|Apple To Buy Universal Music Group|
|Home Theater News Industry-Trade News|
|Written by Jerry Del Colliano|
|Friday, 18 April 2003|
The Los Angeles Times has reported on speculation that Apple Computer is considering buying music giant Universal Music Group (UMG) from its French parent company Vivendi/Universal. Analysts are buzzing, saying that Apple needs “to pull a rabbit from their hat” and that “Apple is acting out of total frustration.”
Apple’s CEO, Steven Jobs, is historically pretty good at creating content, as proven by the long-term success of Pixar. Music and PCs are forever married, and Apple, with its iPod, iTunes and iDVD software, paired with easy to use iMac and G4 hardware, can deliver music to consumers the way they want it.
Perhaps Jobs isn’t as crazy as he being accused of being. Apple, along with others including a reborn Napster and AOL, will be (or already are currently) selling music by the download, with deals in place with the five major labels and many of the larger indie record labels.
Why should Apple buy UMG? Because the one rule in a digital world is that content is king - and UMG has a hell of a lot of content. Apple should buy UMG because it can. They have both the cash and a complete delivery system that can create the elusive entertainment-related “killer app” that everyone in Silicon Valley muses about.
The golden rule of Wall Street says, buy low and sell high. Despite the much-publicized peril of the music business, people still love music and will always want great songs in their lives. This will never change, but how consumers buy their music has changed forever and Apple might be the best company that could put two and two together for the masses.
Source: Los Angeles Times