Apple Inc (AAPL)

[roni]

CSFB: - Rated (AAPL) Outperform, target $200.

Key factors are enabling Mac momentum to defy macro conditions. We believe Mac performance is due to several unique drivers that were not present in prior downturns. We anticipate that Apple will continue to grow at a multiple of the overall market for many years to come. iPhone economics have changed for the better. We provide a comparative analysis of the old, revenue sharing iPhone business model and the new, subsidy-based model. After considering the economic costs of iPhone unlocking, we find that the new business model is likely to be far more profitable for Apple over the long-term. Apple's content strategy adds customer switching costs to the iPhone model. As new users invest in software applications and iTunes content for the iPhone, we contend that Apple is once again building material switching costs into its model.