Posted on 04/26/2015 1:50:56 AM PDT by Swordmaker
Apple can’t grow like this forever. No company can.
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.
But even if Apple still has some room to run, there are some early warning signs. After all, the company has already crossed a significant threshold. In February, it grew to twice the size of the next biggest company in the S.&P. 500, a rare feat of financial dominance, and one that hasn’t happened since Ronald Reagan was president.
(Excerpt) Read more at nytimes.com ...
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I was trying to make this point to one of our longtime Apple trolls. He didn’t seem seem to want any of it.
But stocks [companies] have their day and then fade away. I’ve spent my whole life in the stock market and one sees it firsthand ... stocks go up ,,, and then go down.
That’s for all you trolls out there. Apple won’t last forever.
Have an iPhone 5.
But it will be a cold day since Indiana.
I owned many Apple machines for the first twenty years. Today I find the company and its products a bit cultish.
It may not be forever, it just seems so. :)
Waiting for my watch. Donating ten sawbucks now. God bless FR! And continue to bless Apple. ;^)
“...But stocks [companies] have their day and then fade away. I’ve spent my whole life in the stock market and one sees it firsthand ... stocks go up ,,, and then go down....
...Apple won’t last forever.”
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True ‘dat...but its stock’s “wave cycle” is likely years long. I have a kid just starting out in his work life and I convinced him to open a ROTH IRA. I had him do it by opening a self-directed Scottrade Roth account, max out his first year’s contribution with some money he had been saving and then buy as many Apple shares as he could (odd lots are wonderful) in his account. At Scottrade’s $7 a trade cost and a long hold (initially) strategy, his overhead is minimal.
Actually, IBM is still doing OK, much better than in the Akers years. IBM never really had mass consumer market penetration. Even the IBM PC/XT/AT breakout product was effortlessly fumbled away by IBM, which couldn’t at the time make a good playbook for its hot shot players (PCjr, PS/2 models, anyone?). Apple should be likened more to General Electric or RCA.
Comparing Apple and IBM is a bit ridiculous.
IBM lost its way decades ago.
Last count, a large percentage of IBMers were Indian...and IBM is 1/4 the size it was in the 80's (employee-wise)...
At the same time IBM started its slide I worked for Honeywell. It was a wonderful company and in most ways I have never worked for another company that was as professional and ethical. In 1987 Honeywell was sliding downhill fast and I suspect IBM suffered from the same malady. Honeywell’s top management were all good engineers but you didn’t get into the top slot until you were advanced in your career and in age. The management took into their new roles the extreme and well deserved feeling of competence they’d earned at lower level jobs. But whatever view of the world they had when they entered their top job was frozen in amber at some point in the past. They failed to adapt to changing circumstances. In Honeywell’s case we were desperate for a means of automating the office. The secretarial pool and typing pool worked only for top managers and, yet, the rank and file were forbidden to type their own memos. So memos and letters took weeks to cycle from typing pool and back to the author and then back to typing where yet more errors were introduced. Honeywell bought a tiny division from Boroughs (sp?), which had itself been bought recently for about a billion dollars. Honeywell paid nearly as much for WANG Computers as the other company had paid for all of Boroughs. Wang’s only product was office automation on mainframes. The first Apples (The Apple II if I recall.) were being pirated out of budgets into every department in Honeywell as test equipment or repair parts as we were only allowed to buy Honeywell or IBM computers. The direction of office automation was obvious to us and we were horrified at the Wang purchase as it would be like buying a one horse surrey as your town vehicle in 1925.
Apple managers are more conscious of change but they will eventually suffer a similar fate because highly placed managers suffer from what I call Caesar Syndrome. They make a bad call and everybody knows it but nobody has the stones to correct them or point it out. I understand why as I once tactfully pointed out a huge misapprehension to my boss at another company. He reacted with anger and doubled down on what he was doing which caused exactly the fiasco I had warned about. Rather than saying thanks or promoting me he sidelined me in a pigeonhole to suffer career death. Call that a lesson learned and the reason nobody tells the emperor he has no clothes.
There is truth to this but I don’t think it will hit Apple for a good long while.
A very long while.
Personally, I can’t upgrade my phone til September so that is when I will get the watch.
But I did donate for you yesterday. It was five dollars because this is a very bad month for me, but if this challenge is still going on after May 5, I can find another ten for you with pleasure. I really enjoy the Mac ping list.
Could be the $20B was an accounting gimmick bubble. Mark Cuban recently deemed IBM a "financial engineering" company rather than a tech company. Hard to say if IBM's problems are terminal. Another house cleaning of the magnitude visited by Gerstner may be in order. The layers of stifling bureaucracy he excised have crept back in over time.
Apple has defied the critics several times. Looked like its PC market share would languish forever in the single digits. Meanwhile, the PC industry settled on a core set of capabilities that either Apple or Windows could deliver. Fewer people are worried that a new card or I/O device supported only by Windows will matter. Meanwhile, prices have kept coming down. Suddenly, paying 40% more for the ease of use afforded by a closed operating system makes more sense. And the iPhone is an amazing convergence of technologies.
There may, however, be a lot of folks like me who get a phone that does enough (5S in my case) and aren't going to spend $600 every 18 months to chase new features. Many of us aren't dropping similar coin on a watch either.
So Apple may peak and fall back again. There may come a time when their ability to continually introduce revolutionary products may stop. Then they'll switch from "bubble" mode to a long-term sustainable model. Like Microsoft before them.
Wang computers ...
I worked for Digital Equipment. LOL.
Apple has made a wonderful business out of taking less-than-leading-edge technology, packaging it in a snazzy chasis, and selling it at inflated prices to its rediculously loyal (yet very small as a percentage) fanbase.
That can’t continue forexer.
If anything, apple was “cultish”’in its “midlife” and not now or at the beginning. I’ve had apple products for the last 30 years and have seen the people close and upfront, all during that time.
This is what the Free Online a Dictionary had for cultish ... “adj
1. intended to appeal to a small group of fashionable people”
In the beginning, it wasn’t a small group as Apple had the lion’s share of the market. It wasn’t cultish at that time. They were a large group in the market they were in. They were the market at that time.
When that commercial came out in 1984, you might say it was the beginning of the “Think different” mentality, which was a future marketing campaign. But one has to keep in mind that “Think Different” wasn’t just “marketing” ... it was part of the company mentality.
After that time was when the “cultish look and feel” started to take hold, as outside attacks on those users started intensifying. That caused many to “circle the wagons” and push back. The “Think Different” campaign and mentality was evident.
There was definitely a “Think Different” mentality going on, but that, by itself, wasn’t really a problem ... but with outside market pressures to bear, with outside attacks from other groups against users ... then all that combined to give a cultish outward appearance. The “Think Different” mentality, though is good and has served Apple well in the long run, so, that by itself was not the problem.
When Jobs came back to Apple and turned things around, there had been a long-standing “siege mentality” in effect at Apple, by that time ... thanks to the bad management of Apple prior to Jobs returning.
Jobs took control and took Apple very strongly back to “Think Different” in real and substantial ways, and always seemingly CONFOUNDING market analysts in doing so. Apple started breaking out of its siege mentality, and users were no longer very concerned about being attached from the outside (although they still were) and new customers became a larger segment of the company than the older ones. The newer customers didn’t know anything of the prior cultish behavior or the siege mentality, and today only the few who lived through it all know about all that.
Today the new customers far exceed the old-timers, and Apple is no longer under siege in their marketplace, it is no longer a cultish group, formed when conditions were different ... but it is MAINSTREAM now ... and is a company to be emulated and copied ... which a number of others in the same market try to do.
Apple still has the “Think Different” mentality, along with the emphasis towards excellence and quality ... and that is making it WILDLY SUCCESSFUL ... but it’s definitely not cultish, as it is well into the MAINSTREAM now ... :-) ...
Ha! I remember the DEC Rainbow, their attempt at an IBM PC competitor. They didn’t sell the OS with a diskette formatting utility, the idea being you would have to buy pre-formatted diskettes from DEC. Yeah, that attempt at vendor lock-in worked real well for them . . .
Very true!
And Apple went through a lot work and trouble before it finally made it to the top.
But IBM had a looong run. Maybe Apple will, too.
Even a big dog like Google can’t seem to live up to its founding ethos: “Don’t Be Evil.” We’ll see if the core principles that drive Apple will keep it at the top.
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