Analyst Insight by Wee Teck Loo - Head of Consumer Electronics
Amazon announced its Fire Phone hoping to replicate the success it had in tablets. Amazon proved to be a formidable competitor in the US tablet market with a 25% share in 2013, surpassing established global brands Samsung (15%).
The phone boasts innovative camera capabilities, a dynamic perspective interface (3D viewing via positive parallax), and critically a deep integration of Amazon’s online products and services. In its quest to stand out from its competitors, Amazon forgot the most important success factor that made the online giant’s products popular in the US: competitive pricing. The Fire Phone pricings as indicated at the launch event is on par with flagship models from Samsung and Apple.
Consumers use tablets for media consumption which explains the success of Amazon’s Kindle Fire, but smartphones are still primarily communication devices with media-consumption functionality. Not a lot of consumers will want to pay premium prices for a highly customised smartphone that locks them into a restrictive and limited ecosystem (as compared to Android’s market place and iOS’s app store) without significant savings.
Continue reading "Amazon’s Fire Phone Won’t Set the Smartphone Market Ablaze" »
Apple recently acquired Beats by Dre for US$ 3 Billion, the company’s first major move since the release of the iPad. Both Apple and Beats have very similar marketing strategies and their product lines are sleek and modern, making the move a good fit for both companies. The important acquisition for Apple however is Beats Music, a streaming audio service. Apple had no previous foray into streaming music services so Beats Music can help Apple compete with Spotify, Pandora and Amazon’s recently announced streaming music service.
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Analyst Insight by Loo Wee Tek - Head of Consumer Electronics
Apple Inc (Apple) officially announced an agreement to acquire Beats Music and Beats Electronics for a total of US$3 billion. Beat Music is the company that offers subscription-based streaming music service much like a smaller Spotify whereas Beats Electronics sells the wildly popular Beats headphones and other accessories.
Source: Beats Electronics
Continue reading "Apple’s US$3 Billion Bet on Headphones and Music Streaming" »
Analyst Insight by Jeremy Cunnington - Senior Alcoholic Drinks Analyst
Following much speculation around bids for all or part of Treasury Wine Estates, it is of little surprise that the only concrete offer for the company has come from the private equity house KKR rather than a wine company. KKR is looking to take advantage of Treasury’s weakened position following its US debacle to gain the company at a good price and look to make money through rationalisation and reform, such as CHAMP did with its acquisition of what is now Accolade Wines.
As laid out as far back as three years ago in a briefing How Wine Companies Can Become Global, the key focus for wine companies has switched from growth through acquisition to a more organic approach. Indeed many companies since the turn of the decade have been looking to rationalise their brand portfolios, such as Constellation Brands’ divestment of its UK and Australian operations, to private equity house CHAMP or Pernod divesting various brands such as Lindauer.
Continue reading "No Surprise that it is Private Equity that Bids for Treasury Wine" »