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Citi lists Netflix, Tesla as potential takeover targets for Apple
- tdburn 9y agoNetflix makes the most sense. Apple is pretty weak with content. Would Tesla thrive under apple with Musk as the visionary? Hulu sounds like a terrible idea
- jdfreefly 9y agoI would think Netflix's strong ties to AWS would be a non-starter for Apple.
- mdahlstrand 9y agoHow so? I thought apple uses aws (and google's cloud too) for some of their services.
- ProAm 9y agoPlease no. Apple will ruin Netflix.
- zeveb 9y agoAs a Netflix customer and happy Apple non-customer, I'm scared to death of Apple buying Netflix. So much for openness and competition! So much for cross-platform support! And the worst thing is, the great mass of Apple ecosystem inhabitants wouldn't even see the problem.
- johneth 9y agoYou realise that Apple Music is also available on a competing platform (Android)? Netflix's success is, in large part, because of it's ubiquity in the platforms where it's available. If Apple ever bought Netflix, I doubt they'd remove it from other platforms.
- lowtolerance 9y agoApple Music is available on Android and Windows. It would make absolutely no sense for them to buy Netflix only to cut out the vast majority of Netflix users by making it only available on Apple's own platforms.
- mundoayala 9y agoAlthough it's not the greatest example. When Apple bought Beats and rebranded to Apple Music they still publish to Android via Google Play Store.. so they've shown cross-platform support?
- cat199 9y agoNetflix imho nowadays is trying to be the HBO of cord-cutters - In the primarily mail-dvd days, they were like the awesome video store that has everything; netflix online only has a (admittedly large) handful of titles, with ever more emphasis on the ever increasing quantity of self-produced titles... While I was once very pro-netflix as a consumer, imagning one day that I'd be able to watch anything at all ever produced with a low subscription - I'm more ambivalent now imagining the future when the dvd rentals (and associated vast library) are dropped entirely and never digitized..
- 1123581321 9y agoPhysical DVD rentals don't require the expensive licensing deals with individual publishers that digital rental and streaming do. Netflix would offer every movie available in DVD if allowed.
- heavymark 9y agoIf Apple were to buy Netflix, which I don't think would make any sense from a business perspective. That being said, the only thing that would make even less sense would be for Apple to buy Netflix and then make it no longer available on the web or any device other than Mac. That would make 0 sense. And I'm sure you are aware Apple Music for instance is built and supports both iOS and Android.
- drewg123 9y agoAs a Netflix employee, I echo this sentiment. Netflix is the best place I've ever worked (and I've also worked at Google). I'm sure any takeover would ruin our culture of freedom and responsibility. I can't imagine dealing with siloed secrecy that I've heard about from Apple employees.
- rocgf 9y agoI find this interesting. While Google's culture and perks are fetishized in any sort of online thread, I haven't heard much about Netflix. As an outsider, all I have heard is that there is a lot of pressure to deliver, or otherwise you're out. Genuinely curious, what is better at Netflix vs. Google?
- drewg123 9y agoThe basic difference is that Netflix still feels like a small company, in terms of bureaucracy and management overhead. At my level (Senior SWE, promoted to Staff SWE), Google was a place of secrecy verging on paranoia, endless meetings, and insanely huge amounts of process. You had to really work hard to get things done across organizations. Most people were just a cog in the machine, cranking stuff out. The meetings were huge, because all stakeholders needed to feel represented. Google was my first big company, and I'm sure others are worse. But Google was kind of a shock. At Netflix, most groups develop their own process. If you see a problem, you go fix it. If you see an opportunity for improvement, you just do it. There is a lot more independent work, and a lot more small collaborations, especially across organizations. I think most of this comes down to the Google "fungible SWE" concept vs the Netflix "Freedom and Responsibility" culture. For a concrete example, I had a bigger impact at Netflix in my first few weeks than I did in my entire career at Google. Within my first week at Google, I was still taking "new employee" classes and trying to sort out how to use the several different code repos my org used. Within my first week at Netflix, I'd identified and fixed a small regression in our FreeBSD TCP stack that was costing us 3-5% CPU across our CDN. The one thing that sums up the different cultures is business travel. At Google (at least when I was there), you needed to find airfare and hotel that was at or below the median price paid by other Googlers. If you didn't, you needed to get your VP to sign off on your travel expenses. At Netflix, you book things yourself, looking out for the best interests of the company, and submit your expense report & get reimbursed 48hrs later. The food was much better at Google, though. And I really miss TGIF, eng-misc, and memegen.
- LordKano 9y agoI could see Netflix or Hulu, depending on price. But I would hate to see it happen because I think that Apple would ruin Netflix.
- lalaithion 9y agoApple should buy Tesla and make Musk their CEO.
- li4ick 9y ago"They have hired people we've fired," Musk said. "We always jokingly call Apple the 'Tesla Graveyard.' If you don't make it at Tesla, you go work at Apple. I'm not kidding." Yeah, not a chance.
- arcanus 9y agohuh, why not? "If you can't beat 'em, buy 'em!" Only way I can see this getting stopped would be if Musk used his poison pill: threatening to leave if they were acquired.
- ajmurmann 9y agoTotally insane scenario: Apple buys Tesla and Musk runs both. Right now sentiment towards Cook send too positive for this scenario, but as a Apple shareholder I'd like that scenario.
- jjtheblunt 9y agoExcept Tesla is not profitable and is heavily in debt, Musk regularly proclaims nonsense to manipulate sources of funding, while Apple is more honest, by far.
- sidcool 9y agoSource?
- wlfmn 9y agoNot the original poster, but i'm guessing they are referring to Tesla including resale price guarantee in sale revenue numbers [1]. You can check out their SEC submissions as well, it's all public. [2] 1. http://www.investopedia.com/news/will-tesla-make-profit-2017-tsla/ http://www.investopedia.com/news/will-tesla-make-profit-2017... 2. https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001318605&owner=exclude&count=40&hidefilings=0 https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&C...
- viggity 9y agooh fuck. please. no. no. no. Apple locks things down, gives you few choices, few integration points. I love the direction that Microsoft is headed (and they likewise are sitting on a mountain of cash). For developers they're executing extremely well. But their overall ability to execute a unified vision is kinda bad (in practice it is really a conglomerate of a bunch of huge businesses that don't always get along). In short. Please just let these awesome companies continue to be awesome.
- cwyers 9y agoThis is so, so dumb. The cash hoard is going to sit overseas where it has until the tax situation changes. Apple will continue to take over companies that help it control its supply chain, which are mostly companies you haven't heard of, and not do any of these big acquisitions that Wall Street loves to speculate about (a month or so ago it was Disney) but that Apple has never done.
- jozzz 9y ago> Until the tax situation changes Do you mean in the country the cash is sitting in? Because in the article it says: > With over 90 percent of its cash sitting overseas, a one-time 10 percent repatriation tax would give Apple $220 billion for acquisitions or buybacks, Citigroup analyst Jim Suva said in a note to clients. > U.S. President Donald Trump's tax blueprint, which was unveiled last month, proposes allowing multinationals to bring in overseas profits at a tax rate of 10 percent versus 35 percent now.
- Moto7451 9y agoThe US. Until the tax holiday is law it's a "what if."
- arcanus 9y ago> Apple will continue to take over companies that help it control its supply change, which are mostly companies you haven't heard of This. Was surprised to not see any hardware manufacturers on this list.
- sandworm101 9y agoBut many of those companies face limitations on forgien ownership (china). I also think apple enjoys not having low-paid workers directly on its payroll.
- mediaman 9y agoMost of the parts are not made in China. That's where assembly is, but very little of the value added content of an iPhone is from China (<5%).
- richardwhiuk 9y agoVideo game developers? Is there any logic or rationale here? This seems vapid speculation at best.
- freehunter 9y agoGaming on the iPad or iPhone or Apple TV are big money makers.
- chillydawg 9y agoBest thing to do is give it back to the owners of that cash: the shareholders. Let them decide.
- Moto7451 9y agoDoing so would incur a large tax liability when transferring the funds back to the US. The reason Apple has been taking out bonds in the US instead of repatriating the overseas cash reserves is because it's cheaper to do the former to pay a dividend or perform a share buyback.
- Analemma_ 9y agoI don't think he has an accompanying article I can point to, but there was an episode of Exponent where Ben Thompson discussed the possibility of these giant Apple purchases (and did specifically discuss both Netflix and Tesla). He made a point that is often underappreciated given how obviously true it is: that, with rare exceptions, huge cross-sector corporate takeovers/mergers almost never work. They entice the imagination, which is why both analysts and the general public are always speculating about them, but from a business perspective it's almost never a good idea. Apple seems to understand this pretty well: they make small, smart buys (as opposed to, say, Microsoft or even Google, who have a history of big purchases that didn't deliver), so I doubt they'll start considering takeovers like this.
- throwaway40483 9y agoYeah. Their biggest purchase is Beats at $3B, which is astonishing low for a corporate giant like Apple. I'm not sure whether this is due to prudence or just NIH syndrome.
- FLUX-YOU 9y agoThis is not even an article and no explanation is given as to why Apple would specifically consider these companies other than an analyst having 3/5 stars.
- stupidcar 9y agoDoes it really need spelling out? Buying Netflix or Disney gives them access to large and valuable content libraries and distribution infrastructure. Buying Tesla gets them access to the electric car market that they have tried, and so far failed, to move into.
- antr 9y agoI've just read the report, its +20 pages long, and there is a reasoning by the equity analyst in using the mentioned companies. It does also mentioned other companies not mentioned in the article. This article is just clickbait, and this type of reports are produced every day by dozens of research analysts. FYI, here is a screenshot of the seven target companies mentioned, as well as the impact these will have in Apple's revenue and EPS growth: https://cl.ly/0P1m0E2f043B https://cl.ly/0P1m0E2f043B
- gremlinsinc 9y agoPretty sure you'd have to steal tesla, spacex, etc from Elon's cold dead hands -- he's too attached to the companies at a core emotional level. There's no way he just decides..think I'm gonna sell Tesla today...if the price is right...
- Spooky23 9y agoWhat's Tesla's real endgame? There are literally dozens of car companies, who are figuring out how to make electrics. The Tesla value is largely in the brand.
- cat199 9y agoPinky: What are we going to do tomorrow night? Brain: The same thing we do every night, Pinky - try to take over the world! - Pinky & The Brain
- RKoutnik 9y ago> What's Tesla's real endgame? Batteries. If no one buys Tesla cars but all the car makers buy Tesla batteries, Tesla still wins. Gigafactory 1 at full production will be making about as many batteries as the entire planet produced in 2016. They're already working on Gigafactory 2. This is why they released all their patents - Tesla wins if electric cars win in general. Doesn't need to be Tesla cars. (Disclaimer: I own a moderate amount of TSLA, specifically because I think investors missed this point)
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- MS_Buys_Upvotes 9y ago> Citigroup analyst Jim Suva said in a note to clients. One bozo sends out an e-mail and it's news?
- seeingfurther 9y agoBuy Tesla. Groom Musk for CEO of Apple.
- orcasauce 9y agoI think he's more interested in fixing the world, not just changing it.
- deleted 9y ago[deleted]
- heavymark 9y agoAs much as I'd love them to buy Netflix, people have been saying it for years and still doesn't seem to make sense, since in general Apple get's everything it needs from Netflix through AppleTV. Owning it wouldn't greatly increase their profits vs the cost to get it. More importantly, when its time to renew all the shows, all the major networks could simply increase all there rates knowing Apple can afford it. Yes, Netflix has a lot more original content now, but even that may suffer with a company at the helm. For Tesla, Apple can build their own car if they won't but it sounds like they have decided against that and instead will focus on building the intelligence of the cars and then sell that to all the car manufactures through licensing which is much more lucrative based on the effort involved. Instead Apple will continue to focus on smaller companies to gain more control over their supply chain and the companies that they have to pay licenses to. That is guaranteed savings in the long run vs something like Netflix which could devalue itself with a new owner.
- eip 9y agoI don't care about Tesla but please don't shit on Netflix. http://imgur.com/gallery/NnYOrNd http://imgur.com/gallery/NnYOrNd
- giarc 9y agoThis will sound pretty fan boy, but I think it's pretty obvious Musk isn't in this for the exit money and he believe he can build Tesla up to be a great company. He likely doesn't see much value add by being acquired.
- squozzer 9y agoWhy not a telco/cableco, especially if FCC reverses Net Neutrality? Apple is not really in the service business a la Google, Facebook, Netflix, or Amazon, but they could tap into the rents the last-milers will be seeking -- and probably getting -- from the big boys/girls once NN is history.
- kchoudhu 9y agoIt's also Citi saying this, so you can ignore pretty much anything and everything they say.
- twothamendment 9y agoAn Apple owned Netflix scares me. I like the products I use and Apple tends to be a little more of a closed ecosystem. I'd hate to see how well (or not well) Apple would support the streaming or offline options that currently exist.