Apple's Future Revenue Driver: FaceTime

If you like tech stocks, and you decided to invest in one of the stocks listed on the tech-laden Nasdaq exchange about a year ago, chances are you would have made some money. The Nasdaq has gone up 25 percent over the last 12 months. If you want to invest in a company with growth potential, but you're an older investor like me who wants to keep your risk to a minimum by investing in one of the larger tech companies, Apple (AAPL) would have been a good choice. Apple's stock has outperformed the Nasdaq by over 41 percent during this period and the company is now the largest tech firm. As the new year approaches, you older investors aren't getting any younger. Apple is still a growth stock and, I believe, the risks are few. Apple is still the number one trendsetter in the tech world. It ascended to the Nasdaq throne on the coattails of the trendsetting iPod, iPhone and iPad. Apple's most important innovation, I believe, is still in its embryonic stages. That would be FaceTime, the video chat technology that could turn out to be Apple's crowning achievement. FaceTime has redefined video chat in much the same way that the iPod changed music players, the iPhone transformed the smartphone and the iPad blazed a new tablet trail. Since its release in early June, Apple has made FaceTime the chief selling point of the popular iPhone 4. At the time, Apple chief executive Steve Jobs set a goal of selling "tens of millions of FaceTime-capable devices" this calendar year. By September, Fortune magazine was predicting that 48 million FaceTime-equipped devices could be sold by the end of the year. With the addition of FaceTime to the iPod Touch and Mac computers, these predictions appear to be coming true. When introducing FaceTime for Mac in October, Jobs said that in the previous four months, 19 million FaceTime-enabled devices had been shipped. Apple's popular video chat feature will be the chief catalyst that drives the company's stock much higher, predicts Benjamin Reitzes of Barclays Capital.

Recent report

A recent report by In-Stat projected mobile video calling revenue of $1 billion by 2015. "The market for mobile video calling is hardly new," notes Frank Dickson of the mobile internet division. "What is new is implementing mobile video calling over IP in a significant way. Apple's launch of the iPhone 4 and FaceTime marks the point at which the competition for mobile video calling dominance began in earnest. Apple's capability to revolutionize the mobile calling market is very real and no one in the ecosystem wants to be left behind."