27 thoughts on “The Big Bad Bite of the Apple”

  1. Finally! This is exactly what I’ve been trying to tell my friends for the past year. Apple is an awesome company. Even if you hate them, you can’t deny how successful they’ve been. Actually, another funny thing about all the companies you mentioned is that even though they mocked Apple, they are still following them in some way or another. I think that is the sweeter irony.

  2. “Which makes me wonder if Microsoft, whose CEO once dismissed an iPhone as a toy will be lapped by Steve Jobs & Co?”

    The question is not if, not even when, but whether it’s this year or next year.

    1. If AAPL keeps innovating and MSFT doesn’t shape up soon, yes Apple will eventually take over in terms of market cap.
      I think it will take a bit longer then 1-2 years though.
      P/E on AAPL is higher then on MSFT. That will flatten out the curve a bit eventually.

      1. I don’t see MSFT growing enough to keep Apple from overtaking soon. P/E on MSFT is low because of the lack of long-term growth prospects due to its faltering dominant position.

    2. Apple will out-grow Microsoft in term of revenue and market cap. It is just a matter of time. They will be the biggest corporation on this planet. They didn’t even have to fight for that. They entered a new territory 10 years ago with the iPod and people didn’t realize what was happening. Everybody laughed. Nobody understood the world had changed. When all the others (including Microsoft) entered the game, it was already played. They only viewed music at that time, but Apple already had phones in its mind! Now the view phones and Apple is talking about iPad. OK, some are building slates but these won’t run on a A4-equivalent processor, these won’t have the apps and these won’t have multi-touch. Apple is way ahead. By the time the others catch up, Apple will be playing another game. That’s the way it goes… and you ain’t see nothing yet! Wait until iPad boom and get everywhere. Wait until they invest their cash in new market (TV, the Cloud, services, etc). Wait until their sales grow even bigger in China (India and Russia to follow)… Apple is taking over the world. Bill Gates had once the biggest fortune of the world, but Steve Jobs will put Apple on the throne!

  3. I thought for google this was an unnecessary war. Google is and was the default search engine on iPhone. By competing with apple, backstabbing motorola and sparring with all other mobile makers, google is dropping their sight from the real threat, which is Facebook , Twitter etc.

    Even without doing android, google had commanding share of the mobile search market. Without doing anything Facebook, Twitter etc have 100% presence on all smart phones. So was android a needed to advance mobile search ? 

    Is the return on investment worth it ? Share holders should be asking mr. Schmidt. It would make an interesting article and would love to hear from you on that. 

  4. Now Apple is planning to buy ARM…. This will be a feather in their hat..

    Let’s see what happens.

    cheers, Nag

      1. I don’t think this is something Apple should pursue. Their money is better spent elsewhere. ARM is one of those companies whose business is to license their technology to others and Apple can easily innovate on top of that in its own labs. Not sure why they need to spend $8 billion on it — to shut down others? That’s not so smart a move if you ask me.

      2. Apple already owns a part of ARM. For ARM chip design they bought Intrinsity and PA Semi. There is no reason to buy ARM. As OM points out, ARM earns money through licensing, so it’s not in the DNA to shut out anyone. And then there is US antitrust and the European Union, neither gauntlet is easy to navigate through. More interesting is the talk with AMD for mobiles and desktops.

    1. I hadn’t heard that. Didn’t Apple sell a lot of their stock in ARM in the mid-late ’90s in order to keep their bottom line positive until the iMac took off?

  5. There’s always some lemmings out there bamboozled by shiny trinkets. Let’s see where Apple’s market capitalization of $235 billion will be when lemmings tire of old Apple shiny trinkets and want new Android shiny trinkets.

    1. tim… you are obviously and idiot.

      apple is not a fanboy driven business… it’s a mass consumer success and the leader at UI on this 3rd planet from mighty Sol. Consumers no longer consume content.. they are really .. unbeknownst to them… consuming UX… which increases content consumption and in turn data consumption.. .look at teh AT& T metrics.

      In fact this apple fanboy talk is old.. that is relegated to the mac pc war only… iphone/ipad is a completely different story… mass consumer… leader in the superphone race… market will eclipse desktop internet by billions of users.. apple wins…. any other questions? apple will not only pass MS but will eclipse it in the next 5 yrs by upwards of 75 billion dollars. All my bets are with apple and so is the shiny new startup.

      Low IQ numbnuts such as yourself should really be castrated and banished to the island to play zork for eternity.

    2. So everyone who buys Apple Inc. kit is a lemming and all they are doing is buying a shiny trinket. You do not seem to understand the fundamentals of the ‘Apple trinket’; they have what I would call ‘content glue’, which includes user experience, content, apps, eco-system, that binds those so called lemmings to the overall Apple Inc. experience.

      My friend, the REAL lemmings are those poor souls that continue to believe that enrichment and freedom is about clinging to the technological history of so called ‘freedom’ companies that product the crap products that provide no user experience or content value, time & time again.

  6. I think this is a testament of the power (and market cap) that can be earned by companies that are able to create customer-centric products that customers really love to use – from the i-Pod to iPad and everything in between!

  7. Hi,

    Apple have this uncanny ability of come up with products which can change the entire industry. They can make products which the competitors can only imagine. Its very interesting to see how Steve Jobs & team make their products very very exclusive. They are not going to make any mass market products. I never heard Apple stating ‘an iPhone/iMac for everyone’. Because that place is already taken. The next best option for Apple was to differentiate themselves from the ‘mass’. People working on PCs’ might think about switching to a Mac, but its very very rare to see a Mac user swithching back to PCs.

    If Apple buys ARM, truly that will leave a huge blank for its competitors

  8. At that share price, their P/E is higher than 25. I don’t think that’s sustainable for long.

    1. Adrian

      The P/E is always what someone is willing to pay. It is all about emotions — I mean for a while people were pretty emotional about Apple and wouldn’t pay much for it. This is the cycle of life in a way 🙂

    2. Actually I should point out that with their blow-away figures on Monday it is actually back down at around 20 going forward. For some unexplained reason, Google Finance have yet to change the figure… Just as they were pretty bad at changing it when the new accounting methods came in last quarter.

  9. The same day Apple reported its incredible $3.06 Billion dollar earnings, Goldman Sachs reported its own earnings. It was $3.46 Billion dollars.

    A bunch of armchair crooks, by playing sophisticated money games, while not making any meaningful contributions to the society, have made more money than the hard working people at Apple, whose brilliant work have genuinely improved the lives of millions of people around the world.

    People who simply shuffle money have made more profit than people who design, develop and produce real great products. Isn’t this absurd?

  10. Basically Apple has been able to avoid the internal rot that afflicts most companies as they grow, where fewer and employees are aligned with the goals of the company at large as they become enmeshed in micro-empires dedicated to self-advancement and protection. This is due in no small part to the “Cult of Steve” and Jobs’ ability to stay relevant and envolved in the companies products.

    Now comes word that Apple may be in talks with ARM about acquiring the company. It’s a brilliant move if it passes antitrust scrutiny, not only from a technology standpoint but for the ammunition it would give Apple in the patent wars.

  11. Who’s to say this trend is permanent? Or that any one of those lapped companies is any less significant or relevant?

    Google, for one, seems to have developed a culture and ethos that is sustainable, decentralized, and revolutionary all the same. Who can admit that Jobs and Co. will survive without the impassioned leader?

    Not to sound like the recent Adobe ad, but I am an Apple fan. This is just no way to judge companies; and the biggest tragedy would be to see Apple think the way the author of this post did.

    We live in an exciting time. History will remember the titans; but the smaller members sometimes leave the most indelible marks.

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