Apple Inc. (NASDAQ:AAPL) may not be quite as flush with cash after increasing its capital return program to $130 billion, but it had no problem spending $3.2 billion on Beats and has enough cash to keep looking for new acquisition targets. North River Ventures LLC managing director Francis McInerney thinks the tech giant should aim high and buy Disney, combining content creation and delivery in a company that he says would be like Netflix, Inc. (NASDAQ:NLFX) on steroids (Matt McFarland at The Washington Post).

Apple

In a video presentation, McInerney explains that iCloud is really what holds together all of Apple Inc. (NASDAQ:AAPL)’s disparate businesses. The move from PCs and laptops, then to smartphones and tablets, and now to the internet of things makes perfect sense if you imagine all of them as different ways of accessing Apple’s iCloud. The products have to stand on their own of course, but McInerney isn’t the first person to point out that the company’s strength rests partially in creating an entire tech ecosystem to meet consumer needs.

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Apple mostly facilitates third party content, but that could be changing

In effect Apple Inc. (NASDAQ:AAPL) acts as a conduit for third party content (music and apps being two of the biggest). This has proven itself to be fantastic business model, but McInerney thinks it could get even better if Apple gets directly into the content creation side of things. He says that he’s been working on this idea for a couple of years, but the acquisition of Beats drives the point home. The size of the deal came as a surprise to lots of people who thought it overvalued the headphone manufacturer, and one of the theories is that Apple Inc. (NASDAQ:AAPL) is more interested in Beats Music, a streaming service that could become a platform for new artists to launch their careers.

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McInerney’s thesis applies to any content creator

Up to this point McInerney’s thesis makes sense, but then he makes a huge jump. If Apple Inc. (NASDAQ:AAPL) is interested in powering its iCloud with in-house content, he is basically looking for the most ambitious merger possible. Disney has a $145 billion market cap, versus $545 for Apple. Apple Inc. (NASDAQ:AAPL) is still the larger company, but integrating such an enormous operation is no small task and could easily go wrong.

In the comments to his presentation, someone asks if Vimeo (the video site that the presentation is hosted on) could also be seen as a potential purchase, and McInerney says that it could.

“Anything that fits my model shown in this video — and Vimeo certainly does — is, in theory, an Apple acquisition target,” he replies.

Anyone who wants to act on this thesis should bear that reply in mind. It makes sense for Apple Inc. (NASDAQ:AAPL) to buy Disney insofar as it makes sense for them to buy any content provider, and there are plenty of others that it would have an easier time bringing into the fold.

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