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from the the-tide-goes-in-and-the-tide-goes-out dept.
The New York Times published a story that states the obvious for anyone who has studied economics, that Apple's dominant position today is not permanent. They may be very clever and innovative thanks to the spirit (and curse) of Steve Jobs lingering around 1 Infinite Loop, but all fame is fleeting.
In a few short years, Apple has become the biggest company on the planet by market value—so big that it dwarfs every other one on the stock market. It dominates the Standard & Poor’s 500-stock index as no other company has in 30 years.
Apple’s market capitalization—the value of all of the shares of its stock—is more than $758 billion, greater than any other company’s. Yet the Wall Street consensus is that Apple is still having a growth spurt. In fact, if Apple’s watches, phones, laptops and other gadgets and services keep generating favorable publicity—and if its quarterly earnings report on Monday is as strong as the market expects it to be—there’s a reasonable chance that Apple’s value will keep swelling. Not far down the road, it might even reach the $1 trillion level that some hedge funds predict.
Yet, IBM was once a huge computer company, the one to beat, not unlike what Microsoft became.
IBM thrived for years afterward, but just as [Steve] Jobs had predicted, it turned out to be vulnerable to disruptive change, as all big companies are. For decades now, IBM has engaged in a sometimes painful transition, and as it revealed in its quarterly earnings report last week, it is still hurting: Its revenues have declined and it has endured wrenching business shifts.
My take on this is pretty straightforward. I own IBM stock; I don't own Apple except in the form of an S&P mutual fund. While I use Apple computers and like them, I have little faith in Apple's long-term future, whereas I think IBM will be around and relevant for much longer once they get their business properly reoriented.
(Score: 3, Interesting) by VLM on Monday April 27 2015, @11:50AM
Who was the most important phone company pre-iPhone? Nokia? Where are they now? Pimping MSphone? Oh thats a real winner. I bet the world's two MSphone users are really happy.
Solve this equation (apple - iphone) = ? May as well shut down and give the cash back to the shareholders (there was a semi serious call to do that to apple, pre-iPhone)
My point being phones are a form of fashion/fad, and sadly 2010 stuff like see-thru yoga pants are sadly not going to be around forever. The "cool phone" of 2010 is unlikely to be the cool phone of 2020 just like 2000 or 1990 or 1980.
Ten years from now the general public are going to be all "remember that i-whatever... iphone company... what was that name ... Apple? Whatever happened to them? They were pretty cool back in the day."
Also IBM always was a consulting juggernaut. They just happened to sell some hardware their consultants were good at pushing. Also they've got a patent trove big enough to make almost any company a violator, and enough dough to buy any and all of those startups. Finally they've fired/downsized practically every American in their non-direct-sales workforce so they've internationalized and are no longer an American company in practice. They're a Chinese/Indian company with some sales offices remaining in the USA. Pivot pivot pivot they're really good at it. They sell to businesses so the permanent and growing income inequality doesn't matter, if anything it helps their sales because they sell to the rich guys.
What can Apple possibly pivot into, as a cell phone designer/seller? They could pivot into manufacturing by buying foxconn or whatever. yeah good luck there. Or maybe pivot into network providing to become a telephone utility provider for all those android phones. Look at macroeconomic trends, what will permanent declines in energy and permanent increase in income inequality do very long term to a company that basically harvests cash from upper middle class americans by selling them shiny Chinese made phones? Apple is simply doomed long term, no matter how shiny and cool their designs are.
(Score: 4, Insightful) by Aichon on Monday April 27 2015, @02:47PM
What can Apple possibly pivot into, as a computer designer/seller?
Said the crowd in 2000.
What can Apple possibly pivot into, as a music player designer/seller?
Said the crowd in 2006.
What can Apple possibly pivot into, as a smartphone designer/seller?
Said the crowd today.
What can Apple possibly pivot into, as a fashion designer/seller?
Says the crowd tomorrow.
Suggesting Apple can't pivot into something else is a failure to look back at all the successful pivots they've made in just the last 20 years. They went from being a computer company to now making inroads as a fashion brand. Nokia bet the company on Windows Phone and lost. Apple is betting big on their future being someplace where they aren't now, but even if this current foray doesn't work out, they aren't betting the company on it. They'll have time to readjust and try a different angle. I do agree that they'll eventually become irrelevant, but suggesting it'll be within 10 years strikes me as ludicrously soon.
(Score: 0) by Anonymous Coward on Monday April 27 2015, @08:15PM
but suggesting it'll be within 10 years strikes me as ludicrously soon
Your same timeline shows the decline of the previous behemoth, Microsoft. They went from everyone wants a copy of windows/office to meh.
Pretty much all of those pivots they did was Steve Jobs. It has yet to be seen if the current guy can do the same.
In your time frame if you go back 2 years they were getting loan money from MS to stay alive.
I remember the first time I saw a motorola razr. I said to my current gf at the time "they are going to make a LOT of money". They did then watched it all melt away.
A lot of what Apple did was because Steve Jobs was a massive cunt of a businessman. It remains to be seen if Mr. Cook can do the same.
To put it in perspective. Their current wave is because the Galaxy phone line is getting rather crappy and they put a bigger screen on their product. Thats it. They are 1-2 product moves from a competitor to being #1 to being #5. The next iPhone will be a little better than the last. That is how it will go from now on with the iPhone. The watch may be doing OK. Because the margin must be huge on that. Will it last? Probably not. Because the reason people gave up watches was because they already had a phone that told the time. It will be a toy that people stop messing with in less than a year (with a small group of diehards). Because people gave up their watches organically. You can not un-organic that.