Michael Dell owes Apple an apology; Apple up 176 percent vs. Dell’s 13 percent in past 12 months

“It was no less an expert than Michael Dell who forecast the demise of Apple Computer Inc. In 2001, the chairman and founder of the computer company that bears his name said Apple had sealed its fate by failing to build computers that used Intel Corp. microprocessors and software from Microsoft Corp. In sticking with its own proprietary technologies, Apple could not survive. ‘We know how the movie ends,’ Mr. Dell, now 39, said. ‘It’s just a question of what happens in the middle,'” David Akin writes for The Globe and Mail.

MacDailyNews Take: Oh, so now slapping together cheap components into commodity boxes devoid of imagination, depending wholly upon someone else’s mediocre OS, re-branding Creative’s MP3 players (but not selling many), and negotiating good shipping rates based on volume qualifies someone as an “expert?” Please, don’t get us started on Michael Dell. Uh oh, too late…

“But three years later, it is Apple – not Dell Inc. – that some say is now the best bet for investors interested in backing a computer maker,” Akin writes. “Long an ugly duckling for investors, the Cupertino, Calif., company has been the soaring swan of the market for the past year. Its stock is up 176 per cent in the past 12 months (it closed yesterday at $70.10 U.S.), compared with 13 percent for Dell. Apple already rivals Round Rock, Tex.-based Dell in manufacturing efficiency, and is poised to beat it on profit margins, earnings and revenue growth. On new product innovation, analysts say, Apple is unrivalled.”

MacDailyNews Take: Perhaps Mr. Dull should consider shutting it down and giving the money back to the shareholders? Now where’d we get that crazy idea? God knows, it would probably boost world productivity 30% if people dumped Windows running on box assembler Dell’s hardware and switched to Apple Macs running Mac OS X. And think of the IT staff savings alone!

“The much ballyhooed iPod digital music player has been an important part of Apple’s resurrection story; iPod sales went through the roof during 2004’s final quarter. But the bigger story may be Apple’s resurgence as a computer maker. According to financial results released this week, sales of Macintosh computers jumped 26 per cent compared with the year-earlier quarter – double the growth rate for the rest of the computer business. For the first time in eons, Apple is gaining market share. ‘The company could have begun a market share breakout story that could last for the foreseeable future,’ Steven Fortuna, an analyst at Prudential Equity Group LLC wrote in research note last week.”

Full article here.

MacDailyNews Take: Michael Dell needs a head reduction, literally and figuratively. He’s a commodity Wintel box assembler who figured out how to do it cheaper than everybody else. Wow. Okay, so he got rich doing it – so did Mahlon Haines who got rich selling non-descript shoes. You know, Mahlon Haines? M-A-H… Oh, forget it. How will Dell be regarded by historians? Michael Dell is to Steve Jobs as William Henry Harrison is to George Washington. Michael Dell, if he’s really lucky, is destined to become a footnote in personal computer history.

45 Comments

  1. I second that!!! As a matter of fact, I third and forth that. Dell owes Jobs many apologies, BIG Time!!! Dell keeps making sarcastic remarks on Apple but at the same time copies Apple’s design, products, and even business strategy. Did you know Dell is trying to have ”retail strategy ” at shopping mall now? That’s SO many years behind Apple. Just remember, Dell is a mail order PC box pusher. He does not have any insight, foresight, vision, leadership and charisma in the very technology field he is in. All he does is to push boxes and counts beans. He has money BUT NO Class!!!!

  2. I too like iSteve’s point. As much as it pains us to be less exclusive, less of an “in crowd” (I read comments to this effect here and elsewhere since the Mac mini debued), the advantages of market share greatly out way them.

    If being the Mac faithful is about getting people to switch, and the mini is the cure to the misery around us, then its time to take the high road and do what doctors do, work to put ourselves out of business. ” width=”19″ height=”19″ alt=”wink” style=”border:0;” />

  3. The guy who founded Ronco (remember those Christmas gift gadgets?) also got rich, but no one is calling him an expert. No one remembers him either.
    We do know how that movie ends!

  4. “the question is, was he right about AAPL..”

    No, of course he wasn’t. Dell has never been an expert in innovation, much as he’d like to think so, but he is absolutely an expert in manufacturing economics. My post was in reply to MDN’s take that Dell would be nothing but a historical footnote. As to apologizing to Steve Jobs, why should he? Common human decency suggests that he should, but since when was that a requirement for a CEO? Jobs himself is not noted for his caring and sharing personality, and has been described as an “arrogant prick”. And that’s by people who work at Apple. It never ceases to amaze me that Mac lovers get so caught up in worshipping the guy. Don’t get me wrong, I am damned glad that he’s back at Apple, and that his vision drives both Apple and Pixar to deliver wonderful, wonderful stuff, but that doesn’t mean I’d invite him to dinner.

    Conversely, as odd as it may seem, Bill Gates has been described to me by several people who spent a couple weeks with him, as being charming, funny and outgoing in private (“a sweetheart” in their words), but because of his painful shyness it doesn’t come across in public. They told me that it took several days for him to warm to them, and vice versa, but once he did, they all had a great time with him, probably because they never once talked about business. What I’m trying to say here, is that it’s non-productive to get caught up in personality, or to ascribe qualities that may or may not exist to people because you like or dislike what they do. I love what Apple and Pixar do, that doesn’t mean that I like Jobs or that he’s necessarily a nice person, though I certainly have the deepest admiration and respect for him. I despise Microsoft’s business practices, and I think their products, with the exception of Excel, are junk, but as has been described to me, Gates is actually a very nice man. Dell is a clich�d Texan, big mouth and big ego, but he is an important figure in the history of personal computing. It’s important to separate the personalities from their achievements.

  5. My favorite paragraph from the article:


    But investors can take heart from the company’s balance sheet. Apple’s cash increased by $1.5-billion in its most recent quarter and now stands at $6.5-billion or a whopping $15.40 per share � all with no debt. Moreover, the ability to control costs adds to the cash coffers. In the last quarter, revenue rose 74 per cent, year over year, while expenses increased by just 28 per cent.

    $6.5 billion in the bank with no debt is not beleaguered to me. I think the word folks really want to use when describing Apple is enviable.

  6. JadisOne,

    Well said. Apple’s current (and hopefully, continued) success is the best revenge they could have on the doom-sayers. Doesn’t seem to have shut up Enderle though; the guy has been so consistently wrong about Apple that he’s long since lost any semblance of journalistic credibility, yet he just keeps blathering on. When will it sink in with his readership that he doesn’t know what the hell he’s talking about?

  7. $6.5 million in the bank sounds like a company that either needs to pay investors a dividend or increase R&D (maybe by share some development costs with IBM on those G5s or nVidia on those video cards).

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