Apple
Dell should sell the company and give money to the shareholders
By Jim DalrympleOctober 8, 2009, 8:10 am PT
I’ll never forget Michael Dell’s comments at a 1997 technology conference when asked what he would do to fix Apple.
“What would I do?” said Dell. “I’d shut it down and give the money back to the shareholders.”
Well, it seems like the shoe is on the other foot now. Perhaps it’s time that Dell think about turning out the lights, selling the company and giving the money back to the shareholders.
I was amazed yesterday when news hit that Dell would enter the U.S. smartphone market, taking on Apple with a touchscreen device. That proves that Dell has learned nothing over the years.
Instead of launching yet another product doomed to failure and aimed at knocking Apple off its pedestal, why not focus on fixing the problems you have now.
It’s not like Dell hasn’t tried this strategy before. Do you remember the name of Dell’s MP3 player — the one that would overtake the iPod? Me neither, but I looked it up.
It was called the Dell DJ. If you go to the Dell DJ Web page now, they are selling all kinds of MP3 players — everything except the Dell DJ and the iPod.
It’s completely unfair to compare quarterly earnings for Apple and Dell, because fiscal quarters are different for each company — they are not based on the calendar year.
What I will look at is the market capitalization. Apple’s market capitalization is $143.3 billion, more than five times Dell’s $27.3 billion. In fact, Apple’s market capitalization is now bigger than Dell’s and HP’s combined.
Dell sells cheap computers, but Apple’s sales continue to rise. Dell sold a cheap MP3 player, but Apple dominates the market. Now, Dell is going to sell a cheap smartphone, hoping to take the wind out of Apple’s sails.
It’s not going to work.
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Dell should sell the company and give money to the shareholders
By Jim DalrympleOctober 8, 2009, 8:10 am PT
I’ll never forget Michael Dell’s comments at a 1997 technology conference when asked what he would do to fix Apple.
“What would I do?” said Dell. “I’d shut it down and give the money back to the shareholders.”
Well, it seems like the shoe is on the other foot now. Perhaps it’s time that Dell think about turning out the lights, selling the company and giving the money back to the shareholders.
I was amazed yesterday when news hit that Dell would enter the U.S. smartphone market, taking on Apple with a touchscreen device. That proves that Dell has learned nothing over the years.
Instead of launching yet another product doomed to failure and aimed at knocking Apple off its pedestal, why not focus on fixing the problems you have now.
It’s not like Dell hasn’t tried this strategy before. Do you remember the name of Dell’s MP3 player — the one that would overtake the iPod? Me neither, but I looked it up.
It was called the Dell DJ. If you go to the Dell DJ Web page now, they are selling all kinds of MP3 players — everything except the Dell DJ and the iPod.
It’s completely unfair to compare quarterly earnings for Apple and Dell, because fiscal quarters are different for each company — they are not based on the calendar year.
What I will look at is the market capitalization. Apple’s market capitalization is $143.3 billion, more than five times Dell’s $27.3 billion. In fact, Apple’s market capitalization is now bigger than Dell’s and HP’s combined.
Dell sells cheap computers, but Apple’s sales continue to rise. Dell sold a cheap MP3 player, but Apple dominates the market. Now, Dell is going to sell a cheap smartphone, hoping to take the wind out of Apple’s sails.
It’s not going to work.
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Discussion 9 comments so far
9 Responses to “Dell should sell the company and give money to the shareholders”
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As of this morning, Apple’s market cap is $171.3 G USD.
Dell is $30.7 G and HP is $111 G.
Now if only we could convince larger organizations that even though a Mac may cost much more up front, your support costs will be far lower, there will be a much longer period of time before needing to upgrade, and your users will be much happier. Every company I’ve worked for as a Windows admin has had people requesting macs, yet the companies have refused because they have a choice between a $2000 Mac or a $500 PC clone. Of course the PC dies after a year or after 6 months becomes so painfully slow that it either has to be rebuilt or upgraded.
The problem isn’t the hardware, my friend. It’s the software. These companies have thousands and thousands of $$$ tied-up in software for Windows – MANY of which won’t run on the Mac to begin with. Emulators are not an option either. If you need an emulator to run the app, then there’s no reason to switch to begin with.
The cost of the computer goes away relatively quickly. But the cost of the software & upgrades continues on every year, regardless.
Penny wise pound foolish
Most of the executives in large companies who make these decisions don’t last long enough to understand Total Cost of Ownership. They don’t have any interest in the welfare of the company since their Golden Parachutes in their contracts don’t have any penalties for doing a lousy job and running the company into the ground.
You forgot to mention Apple could buy 100% of Dell with their cash on hand.
All computer makers should get into the cellphone business. They figure if Apple can do it, any company can. Just build a cheap device with as many features as possible and stick an OS on it and you’ve got the war half won. The cheaper the better. Nobody can resist a bargain. When Dell brings it’s smartphone to China they’ll be able to deeply undercut the iPhone in price and since the Chinese only want cheap, Dell figures their smartphone will hinder iPhone sales very early on. I gather this is true because everyone claims the iPhone will be a huge failure in China because it costs too much.
Quote: “Dell figures their smartphone will hinder iPhone sales very early on. I gather this is true because everyone claims the iPhone will be a huge failure in China because it costs too much.” End Quote
Right, which is why the iPhone is a miserable failure now! What they’ve sold like what 200 or so?
I figured I’d chime in on the absurdity.
Jim
I’m not sure which one is the bigger loud-mouthed (and often wrong) clown: Michael Dell or Steve Ballmer. Full of false predictions about Apple.
I am sorry if I insulted any of the REAL circus clowns of the world. I did not mean to offend.