News 

Since the stock split at the end of February the price has fallen 10 per cent, from a high of $45.14 to yesterday's close of $40.53.

However the prognosis remains good. Wall Street analyst, Piper Jaffray's Gene Munster, has told clients that he expects Apple to outperform expectations in this financial quarter.

Having surveyed 50 retail stores across the US, Munster said that iMac, PowerBook and Mac mini sales are higher than anticipated while iPod demand remains strong. The only concern for Apple is meeting demand for iPod shuffles. However

ADVERTISEMENT

there are signs that the two-to-three week long waiting list for the 1GB model is being cut. Apple is now quoting five to seven days on its US online store, though European customers still have the longer wait.

Munster's viewpoint is broadly shared by Merrill Lynch analyst Steven Milunovich, who thinks that Apple need not worry too much about competition for the iPod shuffle.

Of the new Sony players he said, 'We believe these are likely to be solid sellers, but they don't support iTunes and do not have the cache of an iPod.'

He also believes that Apple can easily respond to any effect that subscription-based music services, such as Napster, may have on iTunes Music Store sales.

'We don't see a big impact on Apple because (1) we are not big believers in the subscription model where consumers pay indefinitely to listen to their favorite songs, and (2) if we're wrong, Apple can establish a subscription service with few barriers to entry,' he said.

He added that record label executives believe subscription will continue to be a niche market with the majority of consumers preferring to purchase their music.