Analysts are not impressed with Apple’s new Power Mac G5 and overall business model.
“At a developer’s conference, Apple touted upcoming new desktop computers as “the world’s fastest.” The boxes will contain the new PowerPC G5 chip manufactured by IBM, which can process twice as many bits of data at a time compared to existing desktop processors. Apple also previewed the new version of its desktop operating system, ‘Panther,’ which will be available by the end of this year. Yet fund managers seem unmoved by speculation about Apple’s pending product rollouts,” reports K.C. Swanson for TheStreet.com.
“‘Apple clearly has great customer loyalty. But they just can’t compete with Microsoft and Intel,” says one fund manager who asked to remain anonymous, calling Apple ‘a classic example’ of a company on the losing end of long-term competitive pressure. ‘It’s been a value stock for a long time. I think we made the decision a long time back on sticking with winners,’ says the manager,” reports Swanson. “Analyst John Park, who covers the stock for Independence Investments, says buysiders are likely to stay on the sidelines until Apple can show progress on profitability and market share.”
“…the G5 chip likely won’t be enough to force a turnaround. After all, prices for the gussied-up computer that incorporates the silicon — the PowerMac G5 — start at $1999. ‘Given how weak the market is, I don’t see the volumes being very exciting, no matter how good the product is,’ says Vincent Colicchio, co-manager of the All-American Equity Fund. I mean, this is a niche company, and where the niche is weak it’s not going to get a lot of interest from the Street,’ he says of Apple. ‘Not to mention that from the competitive standpoint it has higher costs than Wintel,'” reports Swanson.
Swanson reports, “At Merrill Lynch, Michael Hillmeyer has been equally skeptical on the expenses front. ‘Apple’s higher costs force it to charge more for its products than similarly equipped Wintel boxes, thus limiting the company’s ability to retain market share,’ he said in a research note Monday. Hillmeyer has a sell rating on the shares and Merrill has not done recent banking for Apple.”
“As for Apple’s online music venture, analysts are generally taking a wait-and-see approach, though most assume sales won’t offer much of a lift to a total revenue base of nearly $5.8 billion over the past year… The same fund manager who sees Apple as a marginal player says he’s ‘kind of intrigued’ with the potential of a new market, though it’s not enough to make him purchase shares. But Colicchio, another buysider, says it just shows Apple is ‘grasping for growth. The fact that they’re looking in that direction tells me they’re in search of a business model. Which is fine; they should do that — but it tells me there’s a lot of risk,’ he says,” reports Swanson.
Full article here.
what a bunch of morons
Hello in there? Yes the G5 starts a 1999, but there are several lower priced new g4 and g3 Macs that run the same OS and are more reliable and stylish than similarly priced PCs. I am typing this on a $1200 Dell Workstation, wonder is a $1299 iMac would work better? It would take less space, have a larger screen.
I am mildly disappointed in the g5, only that it looks so utilitarian now. It does represent the pricepoint, but pushes it into the workstation/server arena. I cant wait to see the v2 etc.
Why are they so much more expensive? $500 more for the base model? That needs to be $1499 or these puppies arent moving very quickly…. (Then again they only have 40,000 chips at this point…)
Analysts are morons…They want a cheaper models. Maybe Mercedes should come out with some 2-cylinder cars for under $10,000. Weren’t these analysts the same guys who said “buy” to companies that had no business plans during the Internet bubble?
Apple is selling an innovative high-quality high-end product. If they decide to sell cheap PCs, then they become a commodity and have no future. Steve is too smart for that.
Blah blah blah wait til these fsckers start shipping and these ANALysts get to see the sales blow up.
And for those crying about the price: would you please examine the specs of the computer. An absolute technological work of art. Understand what it is you’d be paying for and you’d be more accepting of the price.
And the top end G5 is CHEAPER than the top end G4 tower right now (which has been reduced to dual 1.25s).
This is such crap. Read this: here
I particularly enjoy this piece of shit from the article:
“Whether anyone but graphics pros will need a 64-bit chip and its possible maximum of 8GB of memory remains to be seen.”
Meanwhile, this broad would be masturbating with unheard of furiousity had her beloved Intel come out with such a chip first.
just make this page a PDF, add the the current stock value of AAPL and mail it to them in about a year from now. I just hope they have an iChat AV turned on when they open this mail to see their faces
To me the highlight of the Keynote movie was when Steve showed a video in which we first saw a Panther and then a Longhorn-cow accompanied with some great music. I think this is some what symbolic for the Apple- and MS crowd, even in the world we have far more cows then panthers!
its true i wanted to kick the cow in the face
Thing is, they’re right. Businesses are conservative and will be unwiling to embrace tehse new Macs for the same reason that they failed to embrace them 10 and twenty years ago when they were also ahead.
So what if they’re spreading the FUD ? So what if Apple stays under 5% of new desktop sales ? They’re not saying that Wintel have a technological lead at all, but that they have an almost unshakeable corporate market lead which means it would not be in their interests to promote Apple.
Simpla as.
I’m a little bothered by the tone of this article by MacDailyNews. It seems to me that they too are trying to get us worked up. Be realistic, MDN, the overwhelming majority of people (both PC and Mac) who saw this keynote yesterday are beyond convinced that the G5 is the real deal. Looks to me like you’re just trying to find ways to suck in users to your site by crafting psudo pot shots at the Mac crowd. Please at least try to be professional, will ya.
What a bunch of morons! Did they even watch the keynote? They said that a wintel box which was configured as closley as possible to the G5, which cost around $4100 as apposed to $1999.. yet they say that macs cost more and “Apple’s higher prices…” these guys dont even do their research…Anyone thats a mac fan should email the autor of this article – her email address:
kcswanson@thestreet.com
Yeah like back to the 70’s when these type of mental midgets proclaimed PC’s as a passing fade that would never rival mini main frames and large main frames for market share. Over payed educated idiots who are seldom right on any thing. They are right in the middle of a major computing revolution and can’t see it because their mouths are in the way. Nuf said.
CNET are a bunch of morons..Do they realize there are some of us who need more juice to get things done faster? For example, I work in a in-house digital photo studio, we shoot 300-400 items a day. Our biggest bottleneck, processing the RAW files after they are shot on a $25,000 digital camera. 64bit processing and 8GB of RAM would greatly aid in this processor intensive task.
Just cos’ little ol’ CNET staffers don’t need all that power doesn’t mean others won’t find creative uses for it.
Lets face it some pc morons will never face up to the truth. Who wants a Skoda when you can have the Mercedes or BMW.
Plz refresh my memory but didn’t Steve Jobs quote the price of the Dell
Xeon machine that he was using for the G5 vs Intel showdown
$1000 more than the G5? Obviously Hillmeyer from ML didn’t see the
keynote address, but he knows best. Ya right.
Considering the long wait for professional software like Quark XPress and Pro Tools, Apple is being very smart to charge a premium for the G5 PowerMacs. All those studios around the world that held off buying a new Mac because their software was not released or because there were rumors of a next generation PowerMac will now have every reason to buy new hardware.
The analysts are entitled to their opinions and if they are skeptical today that may have something to do with Apple’s past. Having said that, I do expect many of the same people to be eating their words should Apple make a killing with G5 sales.
[url=http://www.dell.com]http://www.dell.com[/url]
the customized workstation (i tried to make it equal to the dual-g5) costs
$4,853
[You Save $300]
thats funny
What everyone is failing to realize is what you are getting for your money. Maybe you can get a similar dell computer for a little less, but does it come with a stable, UNIX, OS? iMovie? iChat? iPhoto? Virtually no drivers to setup? I’ll pay more anyday for a MAC because I know it’s less time, and money, to screw with setups, drivers, and blue screens of death. Besides, 9 fans? Who wouldn’t want a machine that needs nine fans because it’s so HOT!
I guess someone forgot to tell this idiot that Apple offers a full range of computers from $999 to the top end currently. What was released yesterday merely upped the ante in performance and dropped the price of higher end systems.
Get your head out of your Wintel laptop and sniff the new breed biaaaatch! You’ve been sniffin’ too much cow dung!!
This came from thestreet.com? No wonder. They’ve been idiots over there for years now.
“…Merrill has not done any recent banking for Apple.” Technically correct, but projecting only what the author wants us to read. Now read this from CBS MarketWatch:
“NEW YORK (CBS.MW) – Merrill Lynch upgraded the shares of Apple Computer (AAPL) to a “neutral” from a “sell” following Monday’s launch of G5 PowerMacs, which the brokerage feels will lead to a replacement cycle in the segment. Merrill feels that increased sales of PowerMacs should positively impact Apple’s bottom line over the next several quarters, particularly in September and December.”
Duh.
Remember folks, these are the same people who were pushing Enron et al. They don’t know jack. All they want is to mooch off your hard earned dollar through (imo, unjustified) commission. They don’t care if you make money or not as long as you keep on trading. Want a good investment? Buy a G5 and you will be set for a long time. Buy any PC now, expect it go extinct when Longhorn comes out… 2006? Laughable.
I don’t need to repeat much of what has already been said, because we know that this is the same breed that missed the WorldCom, Arthur Andersen, Enron, & Global Crossing debacles. They also hailed the AOL-Time Warner meger as a great deal. Take a $60-70 stock and a $100+ stock and merge them to get a $14-16 stock in a company with $25-30 BILLION in debt. This same company is now selling off profitable assets in order to serve it’s crushing debt. Ted Turner’s personal wealth has dropped because of this “great” deal from approx $7 Billion to less than $1 Billion. Ask him what he thinks of the “experts” on Wall St.
What it does show is how BIG a job Apple has in re-educating the great unwashed as to what’s available. A 970 single-processor iMac in the $1499 range would not hurt either.
education is really the biggest issue for Apple! The g5 looks great!
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Dual 2GHz, 1GB Ram, 2*80GB HD, better video card
Dell Precision�Workstation 650n Minitower
Intel� Xeon� Processor, 2.00GHz, 512K Cache
Qty: 1
Price: $2,757.00
Date: Tuesday, June 24, 2003 1:28:33 PM CDT
Catalog Number: 5 555
Dell Precision�Workstation 650n Minitower: Intel� Xeon� Processor, 2.00GHz, 512K Cache 65T20N [221-1841]
2nd Processor (Must match speed selection above): Intel� Xeon� Processor, 2.00GHz, 512K Cache PR20 [311-2342]
Memory: 1GB,DDR266 SDRAM Memory,NECC (4 DIMMS) 1GN4 [311-2294]
Keyboard: Enhanced Performance, USB (8 Hot Keys) U8 [310-2701]
Monitor: No Monitor Option N [320-3316]
Graphics Cards: nVidia, QuadroFX 500, 128MB, dual monitor VGA or DVI/VGA capable QFX500 [320-0720]
First Drive: 80GB ATA-100 IDE, 1 inch (7200 rpm) 80I72 [340-7591]
Floppy Drive: 3.5 inch 1.44MB Floppy Drive 3 [340-3736]
Operating System(s): Official Red Hat Linux 8.0, with extended Red Hat Support LIN80R [420-1917]
Mouse: PS/2,Dell, 2 button w/no scroll WS [310-8300]
CD-ROM, DVD, and Read-Write Devices: 48X CD-ROM AND 48X CDRW with Roxio� Easy CD Creator ROMRW48 [313-2898]
Speakers: Internal Chassis Speaker,Dell INTSPK [313-1469]
2nd Hard Drive: 80GB ATA-100 IDE,1 inch (7200 rpm) 80I72A [340-7599]
Hardware Support Services: 3Yr Parts + Onsite Labor (Next Business Day) U3YOS [900-8710] [900-8712]
Installation Services: No Installation NOINSTL [900-9987]
Mouse Pad: Mouse Pad MPAD [310-0007]
Intel Hyper-Threading: Hyper-Threading feature preset to “ON.” Can be disabled/enabled in BIOS. HYPER [460-7163]