Initial reports stated that Apple had plans to launch a new video-streaming service this year, but analysts from Citi have now suggested that the iPhone maker may just acquire Netflix.
Initial reports stated that Apple had plans to launch a new video-streaming service this year, but analysts from Citi have now suggested that the iPhone maker may just acquire Netflix.
A report by IANS pointed out that there is a 40 percent that Apple might buy the video-streaming service. Under the new taxing rules, the tech giant will be able to repatriate about $220 billion in cash to the US.
Citi analysts Jim Suva and Asiya Merchant were quoted saying, “Historically, Apple has avoided repatriating cash to the US to avoid high taxation. As such, tax reform may allow Apple to put this cash to use. With over 90 percent of its cash sitting overseas, a one-time 10 percent repatriation tax would give Apple $220 billion for mergers and acquisitions (M&A) or buybacks.”
The reason being cited is the corporate tax cut that US President Trump just had passed. The company currently has $252 billion hoarded away. The Trump tax cut will allow Apple to repatriate these holdings while taking a small tax hit. This will allow Apple to make a large purchase for a company like Netflix. Acquiring Netflix will also allow Apple to get a large base of original content.
The report points out that Apple has already hired top Hollywood talent Sony duo Jamie Erlicht and Zack Van Amburg to lead its Hollywood push and is reportedly developing a new TV show that will star Reese Witherspoon and Jennifer Aniston.
Recently, Apple increased the prices of its flagship product iphone as the government has increased the import duty on mobile phones. After the five per cent hike, mobile phones will now be taxed at 15 per cent from earlier's 10 per cent.
The government hiked import duty on smartphones, television sets, microwave, LED lamps and some other electronic items in a bid to protect domestic manufacturers.
Imported smartphones will cost more with customs duty on them being increased to 15% from nil now, the finance ministry said in a notification. The move will impact telecom companies that were sourcing cheap smartphones to offer bundled services to customers in a bid to capture market.
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