“Well… another one of those once-indomitable foes has bitten the dust. Gateway has been sold to Acer for a paltry $710 million (that’s how low Gateway had sunk; that price was actually seen as a huge premium by shareholders, who raised the stock 50% today. Apple, by the way, has a market cap of $115 billion). Despite throwing every strategy he could think of to fix Gateway’s problems–including selling the company to eMachines–PC industry pioneer Ted Waitt couldn’t figure out the conundrum of selling a highly-complex product that carries the margins of a banana,” Peter Burrows blogs for BusinessWeek.
“To me, it’s a powerful reminder of the wisdom of Jobs’ approach to business–which values profits over growth, and which values market share mostly as a trailing indicator of success rather than a primary peg of a strategy,” Burrows writes. “Gateway is far from the only proof point that Jobs was right. Back in the day, Apple’s main tormentors also included IBM, Dell, Packard-Bell, HP and Compaq. Now look. IBM is out of the business. Dell is struggling mightily. Gateway announced, in conjunction with the Acer deal, that it would buy Packard-Bell. Compaq was bought by HP…””
Burrows writes, “While it’s hard to argue with Apple’s success, that old obsession with market share dies hard. While Lenovo clearly has the most to lose from Acer’s move, many articles mentioned that the Gateway acquisition would vault Acer well ahead of Apple, as well. Who knows, maybe that contributed to the 2.25% drop in Apple shares [yesterday]. If so, it’s a buying opportunity.”
Full article here.
With Peter Burrows, the truth raises it’s ugly head……
History will show that M$ as the mother ship was a slow trickle of doom for those magnets attached to her refrigerator iceberg Titanic emulating sails.
Slow and steady growth, Apple…what a beautiful sunset awaits you later.
Market share is an important statistic, but not always for the more obvious reasons. If you can’t get some sales because your market share is too slight, you lose those sales. If you can’t get third party support because your market share is too slight, you lose sales that depend on that support. That said, yearly profit – not market cap – is a truer indicator of how well a company is doing. Apple is doing quite well, thank you very much. Gateway, Acer and Packard-Bell are not. Despite market shares.
DLMeyer – the Voice of <a href=”http://glhorton.podomatic.com”> G.L.Horton’s Stage Page/a> pod cast
Hey, let’s look at the bright side…M$ now only has 5 companies in their database to mail Vista to to preinstall…HP, Dell, Lenovo, Acer, and yes, now Apple.
Soon, Apple will be their best customer.
Need a better spell checker here – and/or the ability to edit our posts. Or … maybe I shouldn’t be using my wife’s glossy iMac instead of my own matte G5 with Cinema display. But … it’s so pretty! Sorry … off-topic, here.
Dave
Apple’s motto of “Think Different” was way before its time!
…and it has served Apple well.
Acer and Gateway have excelled at making low quality, cheap units for those people that don’t want to spend the money for quality.
Usually when a component in one of these machines goes out the customer usually gets another $400 to $600 or so computer.
These units are disposable.
It’s like buying a $2 hammer—sure it’s a new hammer and it’s new, but it will always be a $2 hammer.
There are more Windows boxes out there than MAC toys. The simple reason is Windows machines are REAL computers for the REAL world and everyone knows it.
Anyone who says market share doesn’t matter just doesn’t get it. More is always better. Microsoft won, Apple lost. It’s as plain as that.
Your potential. Our passion.™
P.S. Congratulations Acer! The Gateway acquisition really helps complete the full line of fabulous Microsoft Windows Vista based computers in your product mix. I speak for everyone when I say I can’t wait to see what you come up with next. Good job!
I haven’t met a Mac user I felt sorrow for yet.
I haven’t met a Windows user I didn’t feel sorry for yet.
Market share means bugger all to anyone unless it’s falling because the products aren’t being bought and aren’t well regarded.
MDN admin, please do us a favour and do something about this twat Zune Tang. If I glance at another of his posts I’ll go mad because he he is so unfunny.
couldn’t figure out the conundrum of selling a highly-complex product that carries the margins of a banana
I love that line. Priceless.
Macaday,
Zune Tang is being SARCASTIC! MDN Admin, please before every Zune Tang post put the word SARCASM, that way people who do not have ‘SAR-DAR’ will instantly recognize his posts for what they are.
Turano
It’s simple. Would you rather sell 250 items of something and make $10 profit on each of them, or 100 items of something and make $100 profit on each of them. It’s easy to see which of those two methods will make the company the most profit, market share be damned…
Beautiful Zune Tang!
I love the ” I speak for everyone when I say I can’t wait to see what you come up with next. Good job!”
I’m sill laughing.
You come up with great stuff!
Don’t know if MDN will do anything about Zune Tang, freedom of speech etc.
Anyhow Zune Tang is obviously delusional as his or indeed hers posts clearly indicate that.
@Macaday:
I wouldn’t stress yourself about Zune Tang’s comments. Every village has an idiot and this idiot Zune Tang always sounds so ridiculous he makes any sane MDN reader laugh at the absurdity of his drivel.
Basically if you take the truth and then change it into the complete opposite. (The sky is green and grass is blue etc) you get a typical Zune Tang style comment.
He is either one of four types of people:
1) A Mac user that is just doing it to get a rise out of the Mac faithful for kicks.
2) A Windows faithful “Cognitive Dissonance” suffering fool who feels threatened because Apple is doing far far better than any one PC manufacturer and is slowly taking ground.
3) A complete idiot.
4) Steve Ballmer, desperately trying to get some credibility back for his flagship product.
Take your pick mate.
MDN word “feed”
as in “Don’t feed the trolls!”
“. . . a highly-complex product that carries the margins of a banana . . .”
So, the whole bunch got too ripe for the market and lost its appeal? No split for him.
@turano …. we know it is sarcasm … it still is not funny … Zune Tang has become old and stale …
The PC makers are stuck with their current business model. They cannot innovate because they are tied to Windows and they have to maintain the margins by minimizing R&D in their new machines. The best they can do is take the newest components and put them together.
For them it is Catch 22. HP are doing well. In a few years, just like Dell they will be on the decline and another vendor (probably Lenovo) will be in the ascendancy.
As we all know, Apple’s business model is completely different. They have the flexibility to innovate. Sometimes they get it wrong but most of the time it is exactly what the customer wants.
MW “leaders” – now that’s cool
@turano
whether ZT is being sarcastic or not, he is not funny or entertaining in any way, and I like Macaday, grow weary of him. If he is indeed a Mac user in wolf’s clothing as some propose, he is still a troll because he attempts to incite a heated response from readers here. If he continues his campaign here I will take my Mac News reading elsewhere entirely.
“<a href=”http://glhorton.podomatic.com”> G.L.Horton’s Stage Page/a> pod cast… maybe I shouldn’t be using my wife’s glossy iMac ..,”
And it begins…
that is something i hadnt thought of and is a really good point: all the hardware manufactures of micros**t boxes dont really have a say in what goes into the operating system that they have to build around. they cant come up with new innovative products because they have to stick with what they are given. whereas apple can come up with a new idea for the os and go to hardware and say ‘make this happen’ and viseversa. dont have to worry about pleasing the mothership because they are the mothership
are there any ‘dell rumor’ sites? no, because we all know what vista can (read: cant) do, and thats the limit. OOOOOOO NEW LAPTOP COLORS!!??!!! ZOMG!
MW: “end” the end is near for more m$ box makers!
Zune Tang, ‘ol buddy. It was bad enough that Gateway got scooped up after scooping up Packard Bell and Emachine, but the real insult is that they got scooped up for only pocket change…only 710 million??? Apple is worth well over 100 billion. It is really a shame for the moo cow company. At least they had some sort of image.
I hope that what ever they do come up with next is better than what HP has come up with to try to compete with the iMac…that contraption is a plastic disaster with a huge footprint.
Hey ZT, tell me: do you wear a short-sleeve shirt with a tie… you know, Dilbert style?
Another lovely post, by the way.
Zune Tang truly represents the way PC users truly think.
He is the ultimate sheep! We need a daily reminder of just how people are out there.
He never posts more than once because he simply doesn’t have any real argument left to argue. He is fake!