Apple Inc. (NASDAQ:AAPL) has been on a tear lately, with AAPL stock rising about 70% in roughly a year thanks to strong iPhone sales and anticipation over its Apple Watch line of premium tech wearables.
Now, with AAPL stock investors starting to wonder whether this momentum can continue for the $735 billion technology giant, Apple has thrown more red meat at the bulls: the hopes of an online TV service.
According to reports, Apple Inc. is talking with television programmers in an effort to offer a small bundle of programming across broadcasters that include ABC, CBS and Fox.
A plan like this isn’t all that new. AAPL stock investors will remember rumors that Apple was in discussions with Comcast Corporation (NASDAQ:CMCSA) last year about a streaming TV platform. But apparently either that deal has come to nothing, or frustrated Apple execs have had enough that they’re willing to start forging their own way.
That may be a disappointment for CMCSA, but it’s great news for AAPL stock investors because it shows that CEO Tim Cook is not willing to wait forever for this clearly in-demand product.
Apple May Be the Best Hope for Broadcast Streaming
Apple has proven many times that it is the king of premium, easy-to-use mobile devices. And over the last few years, it has been trying (with limited success) to use that platform to branch out into other areas. Think of the 2013 launch of iTunes Radio as an effort to take share away from streaming music players like Pandora Media Inc (NYSE:P) or the more recent launch of Apple Pay.
But while other efforts have struggled either because of a lack of wide user demand or the pressure of fierce and established competition, there really is no streaming TV option that allows broadcasters on your mobile device.
Sure, providers like Comcast and Time Warner Cable Inc (NYSE:TWC) have apps if you already pay for conventional cable service, and others like Hulu or Netflix, Inc. (NASDAQ:NFLX) allow a kind of “on demand” streaming. But if you want to watch what’s on TV right now, on your smartphone? Nobody has done that yet.
And Apple could be the first.
To be clear, AAPL stock isn’t alone in its assessment that this area has mammoth potential in the years ahead. Google Inc (NASDAQ:GOOG, NASDAQ:GOOGL) has also been rumored to be working on a similar platform or even a la carte access via paid YouTube channels.
And besides, it’s worth noting that the biggest hurdle here has long been the broadcasters themselves, who are leery of a new mobile world where their revenue streams or viewership could suffer.
But if anyone is likely to get this right, it’s Apple — with its loyal base of customers, its affluent users who aren’t afraid to pay for additional premium add-ons and its ability to use the Apple brand to beat reluctant TV broadcasters into submission.
AAPL stock has had quite a run, and I must admit that I’m leery of a top here. But if Tim Cook and AAPL can continue to innovate and find new ways to grow this dynamic tech stock, all will be well for Apple stock holders.
Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP. As of this writing, he did not hold a position in any of the aforementioned securities.
