Buffett says Apple content plan hard to predict, touts airline safety

Datalogic SpA

28/03/2019 19:21

By Jonathan Stempel
    March 28 (Reuters) - Warren Buffett on Thursday said he
could not predict the success of Apple Inc's  AAPL.O  new suite
of services but was confident the public would benefit as
content providers vie for their wallets.
    The billionaire chairman of Berkshire Hathaway Inc  BRKa.N ,
which owns big stakes in the four largest U.S. airlines, also
said that industry would weather fears about safety even after
Boeing Co's  BA.N  737 MAX planes were pulled from service.
    He also said the pace of growth in the U.S. economy, which
expanded at a 2.2 percent annualized rate in last year's fourth
quarter,  urn:newsml:reuters.com:*:nL1N21E0NN appeared to have slowed down, but "that
doesn't change anything we do" at Berkshire.
    "You really want to bet on America," said Buffett, who was
speaking in Grapevine, Texas at an event broadcast by CNBC.
    Apple on Monday announced an ambitious plan to reorient
itself as an entertainment and financial services company,
including a plunge into video streaming and the launch of a
Goldman Sachs-branded  GS.N  credit card.
    Buffett, whose company owned $40.3 billion of Apple stock at
year end, said the iPhone maker "can afford a mistake or two" as
companies such as Amazon.com Inc  AMZN.O , Netflix Inc  NFLX.O 
and Walt Disney Co  DIS.N  compete for customer attention.
    "Eyeballs aren't going to double," he said. "That's not an
easy game to predict, because you have very smart people with
lots of resources trying to figure out how to grab another half
hour of your time."
    But he said a decade from now, as the delivery of
entertainment content improves, "the public will be the winner."
    Buffett also defended Berkshire's roughly one-tenth stakes
in American Airlines Group Inc  AAL.O , Delta Air Lines Inc
 DAL.N , Southwest Airlines Co  LUV.N  and United Continental
Holdings Inc  UAL.O , despite problems with the 737 MAX.
    Berkshire began amassing those stakes in 2016, surprising
many investors because Buffett had viewed the sector as too
competitive and capital-intensive after making an investment in
USAir Group he later regretted.
    "I don't think it's a suicidal business any more," he said
on Thursday.
    Buffett added that Boeing, which has not been a Berkshire
investment, "has a lot of work to do very promptly," but that
"the airline industry has been so safe."
    Buffett also showed his usual humor, prompting audience
laughter as he removed a flip phone from his pocket during the
Apple discussion.
    "Alexander Graham Bell lent it to me and I forgot to return
it," said Buffett, 88, who was born eight years after the
telephone inventor died.

 (Reporting by Jonathan Stempel in New York
Editing by James Dalgleish)
 ((jon.stempel@thomsonreuters.com; +1 646 223 6317; Reuters
Messaging: jon.stempel.thomsonreuters.com@reuters.net))