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Apple getting aggressive with competitive new acquisition tactics

post #1 of 51
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Apple has hired its first dedicated mergers and acquisitions expert and has initiated -- in some cases -- a three hour window of opportunity for acquisition targets in its tough new efforts to win deals away from rivals such as Google and avoid publicity that could sour deals.

According to a report by Bloomberg, Google has announced nine acquisitions so far this year. Last fall, Google chief executive Eric Schmidt announced plans to inhale a new startup company every month.

Apple hasn't made a similar announcement, instead preferring to keep its plans secret even as its executives described the company's cash pile as being useful in making strategic purchases as opportunities become available. But after making four iPhone related acquisitions in the last six months, Apple has analysts talking excitedly about a buying frenzy between it and Google.

Bloomberg cited analyst Charlie Wolf with Needham & Co. as saying, "It looks like theres an acquisition frenzy going on between Google and Apple in the sense that theres an increasing urgency on Apples part to stay even if not ahead of Google in the phone space and apps space."

Last year, Apple "hired a Goldman Sachs Group Inc. investment banker, Adrian Perica, to help the company develop deals, people close to the company said earlier this year," Bloomberg stated. "They say they believe Perica is the first dedicated M&A specialist on Jobss staff."

"To avoid publicity and possible rival bids, Apple in some cases has offered a target only a three-hour period in which to accept the terms of a sale, according to one executive with knowledge of the situation," Bloomberg noted.

Apple's cautious, strategic acquisition history

In the last decade, Apple has largely only purchased a series of strategic, small software companies in its efforts to build a development team to create its suites of pro apps and iLife titles.

Between 2000 and 2006, Apple bought Astarte and Spruce (DVD Studio Pro), Nothing Real and Silicon Grail (Shake), Emagic (Logic Pro), Prismo (Motion), Silicon Color (Color) and Proximity (Final Cut Server).

The company also bought PowerSchool for its student information system software it later resold, and Zayante, a FireWire chip and software developer.

Apple's Mobile acquisitions

However, starting in 2005, Apple began buying companies to help it enter the mobile market related to its growing iPod business. It snatched up the assets of FingerWorks, which had developed multitouch technologies later used in the iPhone, followed by PA Semi in 2008. Apple chief executive Steve Jobs said PA Semi would be building chips for iPhone and iPod devices.

As Apple's mobile business has exploded, so has its strategic shift toward mobile-related acquisitions. Last summer, the company appears to have acquired Placebase, suggesting that Apple might build its own mapping service to reduce its dependence upon Google.

Last winter, it made subsequent efforts to buy mobile advertising company AdMob. When Google stepped in with a winning counteroffer, Apple bought the competing Quattro Wireless instead. Apple then bought music streaming service LaLa, which had been in serious talks with Google.

In April, Apple bought Intrinsity, which developed chip technology used in the iPad's new A4 processor, followed by Siri, a mobile search applications developer.

Apple ready to buy

Rather than just trying to keep pace with Google, it appears Apple is trying to prevent Google from buying up key mobile assets; Google appears to be doing the same thing. After Apple lost out to Google in buying AdMob, Jobs complained to his employees at at company event that Google "snatched them up because they didnt want us to have them."

Apple now has around $41.7 billion in investment assets it can "liquidate in a day," according to the report, compared to Google's cash pile of $26.5 billion.

Apple's chief financial officer Peter Oppenheimer recently reiterated that the company's investment strategy continues to prioritize "preservation of capital, which has served us well in the current environment."

That has some investors, including Michael Obuchowski, the managing director at First Empire Asset Management, recommending Apple put its cash to work. I want them to reinvest their cash in the business, Obuchowski said. They are sitting on more than $30 billion in cash that is earning close to nothing.
post #2 of 51
Quote:
They are sitting on more than $30 billion in cash that is earning close to nothing.


Bernie will give you 10% if he likes you.
post #3 of 51
I think that Apple is on to a sound strategy here as long as they can stay focused (unlike Google, which seems to be straying far from its competencies, and is beginning to look a little scattershot). It often makes sense to do "A&D" (as opposed to R&D) in tech, as companies such as Cisco have successfully shown.

The key is discipline, and not getting seduced or sidelined by a potential large, hard-to-digest acquisition.

But that is precisely where putting an investment banker in charge is potentially problematic -- IBs thrive on getting deals done, the more the better. Perhaps this Perica person will be different.
post #4 of 51
Perica reports to Jobs. It will be different.
post #5 of 51
Quote:
Originally Posted by AppleInsider View Post

They are sitting on more than $30 billion in cash that is earning close to nothing.

Apple can now buy an island and declare itself a nation.
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post #6 of 51
Who else is brainstorming on creating their own startup in hopes it will get bought out for way more money than it's worth?
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post #7 of 51
Unlike Google, Apple is actually making smart acquisitions. Google seems to be just be spending money for the hell of it. They acquired Bumptop for what seems to be no apparent reason. Nobody liked using it.
post #8 of 51
Sell conditional Licences for Mac OSX to a few select Desktop OEM suppliers to make high-spec, expandable Dual-Boot machines for enthusiasts. Engage some top Mobo manufacturers to design-in SLI/Crossfire capability...the works! The consumer desktop market is going to continue to falter and disintegrate. Take Mac OS out with a bang.
post #9 of 51
Quote:
Originally Posted by AppleInsider View Post

According to a report by Bloomberg, Google has announced nine acquisitions so far this year. Last fall, Google chief executive Eric Schmidt announced plans to inhale a new startup company every month.

Sounds like a very good business strategy.
Buy a company every month just to buy a company every month.
Don't have any idea of where you want to go or what these companies or why you want to buy them.
post #10 of 51
Quote:
Originally Posted by AppleInsider View Post


inhale a new startup company every month.

eh? What?

I get the feeling that Google is gonna choke on what they're 'inhaling'

Apple's 3 hr window is to keep the surprise-value ahead of GOOG
but what a hell of a decision to make.
Here's $100M, you want it, or not?
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post #11 of 51
A 3-hour time frame to decide if I wanted to sell my company? I'd start shopping my company around as fast as I could before I got back to them.

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #12 of 51
Quote:
Originally Posted by SpamSandwich View Post

A 3-hour time frame to decide if I wanted to sell my company? I'd start shopping my company around as fast as I could before I got back to them.

The purpose of the three-hour window is to prevent that very thing, so they don't get into a bidding war.
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post #13 of 51
Quote:
Originally Posted by anantksundaram View Post

I think that Apple is on to a sound strategy here as long as they can stay focused (unlike Google, which seems to be straying far from its competencies, and is beginning to look a little scattershot). It often makes sense to do "A&D" (as opposed to R&D) in tech, as companies such as Cisco have successfully shown.

The key is discipline, and not getting seduced or sidelined by a potential large, hard-to-digest acquisition.

But that is precisely where putting an investment banker in charge is potentially problematic -- IBs thrive on getting deals done, the more the better. Perhaps this Perica person will be different.

I completely agree.

I'm increasingly confused about what Google do. Clearly search, but so much seems to make almost no sense.
post #14 of 51
If apple actually brought back their shares using the 30 Billion they had when its stock price @ $90 during the Financial Crisis. they would have worth more then any US company by now.

Google, apart from its technology superiority, ( Servers, Back end Softwares ) aren't good at anything else.

Google Docs, while easy to use, doesn't compare to any other online suit.
Picasa is useless piece of Junk. I use it merely because Google Server is much faster the Yahoo Flickr.
Gmail - It wins because of its Junk Filter ( Back End Tech )

As a matter of fact, Google is only good at English / Global English Search. Yahoo is much better at local search.

Personally i think Google is getting very lost.

There are only two kind of people in this world.

Those who dont understand Apple and those who misunderstood Apple.

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There are only two kind of people in this world.

Those who dont understand Apple and those who misunderstood Apple.

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post #15 of 51
Quote:
Originally Posted by ksec View Post

If apple actually brought back their shares using the 30 Billion they had when its stock price @ $90 during the Financial Crisis. they would have worth more then any US company by now.

I'm not saying that would have been a bad move, however, technically, in that case they might have a $600 (or something like it share price right now, but that wouldn't put any acquisition money in their pockets per se.

When companies buy back stock, they don't "own" it like shareholders do - it's placed in reserve. In order to benefit from their "investment" in their own shares, they'd have to reissue them in certain size chunks.

If they did that they might raise more capital than they have now, and it would look brilliant in retrospect, but it certainly would have been a higher risk move. They've had, and have brilliantly executed an amazingly solid business plan year after year (a rare feat in corporatedom, especially to keep growing at the rate they have from an already substantial market cap).

However, had anything major gone awry, e.g., a botched launch of the iPhone, the price might have gone down, and there might have been little interest in a reissue of Apple shares, leaving them potentially with less possible capital and no actual rainy day fund.

And after having lived through a near-death experience, I think their actions have been understandably conservative and sound - plus they've likely made more than nearly nothing. I'm sure that money's not all sitting in .07% money market funds.

So maybe a slower ramp-up of acquisitions given the "burnt child fears fire syndrome," than they might have had, but they're adapting to their new status now, and can both buy interesting things and have an enviable reserve which may yet serve them well during a problem period. Nearly all companies have tough stretches eventually.

I also heartily approve their eschewing picking up large acquisitions which would be difficult to mesh with their own corporate cultures. This is what large companies in trouble do - and while they always expect to achieve "efficiencies of scale" more often they end up with two sets of problems and long and painful integration/restructuring problems, witness HP and Compaq.

Picking the cream of the startups makes much more sense as long as they have useful IP and talent to pick from.

The one thing that's a potential bother to me personally is if they start buying companies simply to keep others from getting that IP and talent and then bury them and smother promising technologies. MS has done this on many occasions, especially back in their heyday.

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post #16 of 51
Apple is making key aquisitions to bolster its consumer electronics business. They have so much opportunity in that space that they have all but ignored the enterprise space. Sure the iPhone OS has some enterprise features but I'm talking about server side offerings.

Does Apple even care anymore about their OSX Server offerings or the Xserve? I doubt it. When was the last time Apple made huge strides in the server space? I say it is time Apple licensed OSX Server to OEMs and dropped the Xserve. Let 3rd party server manufacturers progress OSX in the enterprise all the while Apple can pour its R&D into the consumer space for the most part.
post #17 of 51
Quote:
Originally Posted by AppleInsider View Post

"To avoid publicity and possible rival bids, Apple in some cases has offered a target only a three-hour period in which to accept the terms of a sale, according to one executive with knowledge of the situation," Bloomberg noted.

"Hey, we wanna buy you for $XXXX. Wanna be part of super cool Apple? You got 3 hours to make a decision."

That is the craziest thing I've ever heard. This will undoubtedly result in a lot of unmotivated resigning staff members and chaotic short term project management should they accept the terms. I don't think there is ANY way to predict what will happen long term after such an acquisition.
post #18 of 51
Apple is using it's cash and is ramping up a lot investment in infrastructure and more.
post #19 of 51
Quote:
Originally Posted by AppleInsider View Post

Rather than just trying to keep pace with Google, it appears Apple is trying to prevent Google from buying up key mobile assets

Did anyone else find this statement odd? I saw it in the original Bloomberg report, and there seemed to be no basis for it. The article talks about how Apple is buying companies with some focus and apparent purpose. I'm trying to figure what aquisitions Apple purchased just to block Google--did I miss something?
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post #20 of 51
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post #21 of 51
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Originally Posted by solipsism View Post

Who else is brainstorming on creating their own startup in hopes it will get bought out for way more money than it's worth?

Exactly.

Quote:
That has some investors, including Michael Obuchowski, the managing director at First Empire Asset Management, recommending Apple put its cash to work. I want them to reinvest their cash in the business, Obuchowski said. They are sitting on more than $30 billion in cash that is earning close to nothing.

I disagree completely. They are not sitting on them, they have made plenty of strategic acquisitions with a lot of thought and patience, being put into them, intrisity, p.a. semi, and lala have been very wise moves. If they are to weather a crisis, which is eminent in the industry (and actually it's already there with pretty much only apple eschewing it), the capital has to be there, and it has to be available.

Licensing OS X even partly, is a non option to me. Jobs has been there, done that, and more so, seen others do that, and won't go that route. That's not focusing on core competencies, which has led apple so well, so far. It's taking unwarranted risks and setting up themselves for failure imho.

The current mind frame (remember what job said in the keynote about apple's growth, "I can't even believe it, and we don't view apple like that") is sound. Focus on developing great products, push the company forward with these and based on them, then make additions to the arsenal that can expand these products and services, not merely buying pet projects and start ups, to armour up with a dubious arsenal that might or might not work in the long run, but inform all the buying decisions by what is actually currently or in the near future actually required.

And as long as Steve is on the helm, this is the way things are going.

Google shows its young age, by not taking this strategy. Of course they want to and have to grow, but losing focus and throwing their weight and money behind everything that walks, is going to cost them in the long run. Their dominance was established by being very good in something, and focusing solely on that, a great search engine not a f.cking portal, .com bubble, going down the the way that altavista and excite did. Now they are not showing this patience.

You have to wait and see how things play out and buy accordingly, and at the same time, not lose focus on making great products and then support them with new acquisitions, not the other way round.
post #22 of 51
Quote:
Originally Posted by SpamSandwich View Post

A 3-hour time frame to decide if I wanted to sell my company? I'd start shopping my company around as fast as I could before I got back to them.

Assuming you are allowed out of the room and the use of a phone
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post #23 of 51
Quote:
Originally Posted by Bageljoey View Post

Did anyone else find this statement odd? I saw it in the original Bloomberg report, and there seemed to be no basis for it. The article talks about how Apple is buying companies with some focus and apparent purpose. I'm trying to figure what aquisitions Apple purchased just to block Google--did I miss something?

I'd agree, in fact quite the reverse seems to be the case.
From Apple ][ - to new Mac Pro I've used them all.
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From Apple ][ - to new Mac Pro I've used them all.
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"Google doesn't sell you anything, they just sell you!"
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post #24 of 51
Quote:
Originally Posted by Bloodshotrollin'red View Post

Sell conditional Licences for Mac OSX to a few select Desktop OEM suppliers to make high-spec, expandable Dual-Boot machines for enthusiasts. Engage some top Mobo manufacturers to design-in SLI/Crossfire capability...the works! The consumer desktop market is going to continue to falter and disintegrate. Take Mac OS out with a bang.

Apple is now a mobile device company. I don't expect much of their resources to be devoted to desktops anymore.
post #25 of 51
Quote:
Originally Posted by str1f3 View Post

Unlike Google, Apple is actually making smart acquisitions. Google seems to be just be spending money for the hell of it. They acquired Bumptop for what seems to be no apparent reason. Nobody liked using it.

Goog has lost its charm. If you buy crap, you will integrate crap with crappier, and produce really crappy... umm... ?
post #26 of 51
Quote:
Originally Posted by str1f3 View Post

Unlike Google, Apple is actually making smart acquisitions. Google seems to be just be spending money for the hell of it. They acquired Bumptop for what seems to be no apparent reason. Nobody liked using it.

While it hasn't caught on like wildfire, I'd have to say your comment of "nobody liked using it" to be wrong. There seems to be a lot of online media sources that praise the concept it brings, especially for touch-based devices. Considering this all started as the creator's Master's thesis, that's pretty good.

It would be interesting to see if Google can take the concept and adapt it to mobile devices (merge it with Android somehow?), as it seems like BumpTop was more fitted for touch rather than keyboard/mouse anyway.
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post #27 of 51
SJ's health is the biggest liability of the company. If Tim Cook is really "the guy", I wonder why he's not made more public....The idea's of course could all still be Steve's....but to make the company seem less vulnerable on SJ's health...

In reality of course....the leader is so critical... I was never a huge Microsoft fan to begin with...but you look at the turn they took once Ballmer took over.... Good lord...
post #28 of 51
Quote:
Originally Posted by ilogic View Post

Goog has lost its charm. If you buy crap, you will integrate crap with crappier, and produce really crappy... umm... ?

Do you find anything crappy with Google Maps, Google Earth, Google Search or Goog411? I use those almost every day.
post #29 of 51
Quote:
Originally Posted by myapplelove View Post

I disagree completely. They are not sitting on them, they have made plenty of strategic acquisitions with a lot of thought and patience, being put into them, intrisity, p.a. semi, and lala have been very wise moves. If they are to weather a crisis, which is eminent in the industry (and actually it's already there with pretty much only apple eschewing it), the capital has to be there, and it has to be available.

I completely disagree with this. They've made a few strategic acquisitions, but they hardly amount to "plenty" when the actual resources they've got at their disposal are considered. If it adds up to more than 2% of their cash and short term assets over the last couple of years, I'd be surprised. As for the rainy day fund concept, I don't know why this is thought to be a good thing by some, when entire idea should scare the hell out of everybody. What kind of "crisis" requires a $40 billion backstop? Armageddon?
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post #30 of 51
Quote:
Originally Posted by Dr Millmoss View Post

I completely disagree with this. They've made a few strategic acquisitions, but they hardly amount to "plenty" when the actual resources they've got at their disposal are considered. If it adds up to more than 2% of their cash and short term assets over the last couple of years, I'd be surprised. As for the rainy day fund concept, I don't know why this is thought to be a good thing by some, when entire idea should scare the hell out of everybody. What kind of "crisis" requires a $40 billion backstop? Armageddon?

We're forever going to disagree on this but I see no reason Apple should spend all the security it has simply because it's burning a hole in their pockets. It's irresponsible! This industry is volatile and looking at Apple's growth along with the increase of capacity, things like NAND could easily cost them $2B in a single payout in the future.

I am heavily invested in AAPL; I do not want them using all their cash simply because they have it to spend. Who knows when they will fall out favour with the public (it will happen) or when another economic crisis will hit (it will happen). This is money that will allow them to buy more at lower prices and invest in R&D as they see fit. Do you live week-to-week or month-to-month? I did as a young adult, and it sucked. $40B may sound like a lot but when you look at their costs and what investments they may have to make in the future it's not that much.
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post #31 of 51
Quote:
Originally Posted by Dr Millmoss View Post

What kind of "crisis" requires a $40 billion backstop? Armageddon?

What short memories we have. What if GM had had a $40 billion backstop? Apple could assume that the computer industry will forever be immune to catastrophic downturns. But I'd rather they didn't. I doubt Uncle Sam would bail them out the way they did the auto industry.
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post #32 of 51
Quote:
Originally Posted by solipsism View Post

We're forever going to disagree on this but I see no reason Apple should spend all the security it has simply because it's burning a hole in their pockets. It's irresponsible! This industry is volatile and looking at Apple's growth along with the increase of capacity, things like NAND could easily cost them $2B in a single payout in the future.

I am heavily invested in AAPL; I do not want them using all their cash simply because they have it to spend. Who knows when they will fall out favour with the public (it will happen) or when another economic crisis will hit (it will happen). This is money that will allow them to buy more at lower prices and invest in R&D as they see fit. Do you live week-to-week or month-to-month? I did as a young adult, and it sucked. $40B may sound like a lot but when you look at their costs and what investments they may have to make in the future it's not that much.

We agree that they should not spend the money simply because they have it. I've made that argument time and again, which to me opens the question of what all that cash is actually for. There's no danger of Apple living week-to-week or month-to-month, however, since they are socking away about $1 billion more, every month. To reiterate what I've said so many times on this subject, the game is called capitalism. The purpose of capitalism is reinvest profits to generate more capital, and so on. The object is to make money, not collect it.

Quote:
Originally Posted by Robin Huber View Post

What short memories we have. What if GM had had a $40 billion backstop? Apple could assume that the computer industry will forever be immune to catastrophic downturns. But I'd rather they didn't. I doubt Uncle Sam would bail them out the way they did the auto industry.

So, you think Apple could at any time become an unprofitable and grossly mismanaged business in a low margin industry. Thanks for the comforting thoughts.
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post #33 of 51
When Apple was a small company worried about it's next year, it makes perfect sense to cut costs, outsource and stockpile some savings.

Apple is not that company anymore - it is now one of the biggest companies in the US which takes a lot of our hard earned money, stockpiles it and sends it overseas via manufacturing and component outsourcing.

There is a certain point in a rich company's life, in which there is this thing called corporate responsibility to invest in the place where you have made your killing - e.g. "Apple Gives Back".

Apple needs to start buying domestic hard drives (why aren't the intel SSDs in macbooks? - The chips are made in Utah!). The same with RAM and flash and as many components as possible. Why can't apple build a robotic assembly factory for iphones here - the technology is here and it would be a few billion tops. I know it would swing my vote to buy one. If there isn't enough US capacity - go into a joint venture and fund a new chip factory. God forbid if it cost Apple a billion dollars to create thousands of domestic jobs which would plug millions back into the pockets of those who are the majority of those buying expensive apple products. We need to start a movement to hold companies responsible to reinvest.

(P.S. Google is even worse - it is giving away Software, using it search monopoly to subsidize it's software undercutting any legitimate software shop here - look at Palm - it is a clear causality of Goggle's unethical practices, When you buy an HTC phone with free Google software all of the profits go overseas - it helps the American economy almost zero - it is almost a criminal business model - the Feds need to knock at Goggle's door)
post #34 of 51
Quote:
Originally Posted by 21yr_mac_user View Post

Apple is not that company anymore - it is now one of the biggest companies in the US which takes a lot of our hard earned money, stockpiles it and sends it overseas via manufacturing and component outsourcing.


Good points.
post #35 of 51
Quote:
Originally Posted by 21yr_mac_user View Post

When Apple was a small company worried about it's next year, it makes perfect sense to cut costs, outsource and stockpile some savings.

Apple is not that company anymore - it is now one of the biggest companies in the US which takes a lot of our hard earned money, stockpiles it and sends it overseas via manufacturing and component outsourcing.

There is a certain point in a rich company's life, in which there is this thing called corporate responsibility to invest in the place where you have made your killing - e.g. "Apple Gives Back".

Apple needs to start buying domestic hard drives (why aren't the intel SSDs in macbooks? - The chips are made in Utah!). The same with RAM and flash and as many components as possible. Why can't apple build a robotic assembly factory for iphones here - the technology is here and it would be a few billion tops. I know it would swing my vote to buy one. If there isn't enough US capacity - go into a joint venture and fund a new chip factory. God forbid if it cost Apple a billion dollars to create thousands of domestic jobs which would plug millions back into the pockets of those who are the majority of those buying expensive apple products. We need to start a movement to hold companies responsible to reinvest.

(P.S. Google is even worse - it is giving away Software, using it search monopoly to subsidize it's software undercutting any legitimate software shop here - look at Palm - it is a clear causality of Goggle's unethical practices, When you buy an HTC phone with free Google software all of the profits go overseas - it helps the American economy almost zero - it is almost a criminal business model - the Feds need to knock at Goggle's door)

That's one of the things I admire about RIM. While they have moved a lot of their manufacturing overseas, they still do much of here at home (Canada). On the same street they do their R&D, they also have a manufacturing facility and many call centre buildings.

But that is only looking at the hardware manufacturing side of things. The much higher paying jobs in research and development for Apple and Google are in the US. Outside of R&D they employee thousands of people in general office and operations jobs.

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post #36 of 51
Quote:
Originally Posted by Tulkas View Post

That's one of the things I admire about RIM. While they have moved a lot of their manufacturing overseas, they still do much of here at home (Canada). On the same street they do their R&D, they also have a manufacturing facility and many call centre buildings.

But that is only looking at the hardware manufacturing side of things. The much higher paying jobs in research and development for Apple and Google are in the US. Outside of R&D they employee thousands of people in general office and operations jobs.

Apple is an American company, and it is good for us to support American companies. I try to Buy American if I can. When I bought my new laptop, the only companies I considered were Dell, HP and Apple.
post #37 of 51
Quote:
Originally Posted by 21yr_mac_user View Post

When Apple was a small company worried about it's next year, it makes perfect sense to cut costs, outsource and stockpile some savings.

Apple is not that company anymore - it is now one of the biggest companies in the US which takes a lot of our hard earned money, stockpiles it and sends it overseas via manufacturing and component outsourcing.

There is a certain point in a rich company's life, in which there is this thing called corporate responsibility to invest in the place where you have made your killing - e.g. "Apple Gives Back".

Apple needs to start buying domestic hard drives (why aren't the intel SSDs in macbooks? - The chips are made in Utah!). The same with RAM and flash and as many components as possible. Why can't apple build a robotic assembly factory for iphones here - the technology is here and it would be a few billion tops. I know it would swing my vote to buy one. If there isn't enough US capacity - go into a joint venture and fund a new chip factory. God forbid if it cost Apple a billion dollars to create thousands of domestic jobs which would plug millions back into the pockets of those who are the majority of those buying expensive apple products. We need to start a movement to hold companies responsible to reinvest.

(P.S. Google is even worse - it is giving away Software, using it search monopoly to subsidize it's software undercutting any legitimate software shop here - look at Palm - it is a clear causality of Goggle's unethical practices, When you buy an HTC phone with free Google software all of the profits go overseas - it helps the American economy almost zero - it is almost a criminal business model - the Feds need to knock at Goggle's door)

I think this point is a really heated topic...

I simply don't see how the US can compete in repetitive, manufacturing-type jobs. I had a girlfriend from Taiwan.....Even in Taiwan, there is this fear of China...that the same kinds of jobs can be done for 1/4 of the cost there...

Say Apple took your advice and moved production to the US... HTC is Taiwan based...Say the iPhone becomes 5 times more expensive than the Nexus One to build....How would Apple make up the difference? They may have large cash reserves but they can't operate at a loss.

EDIT:
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Re-reading your post...So you're talking about robotics manufacturing that would keep costs competitive to overseas costs? Would be interesting to see some examples.... Though either way, it seems the American manufactuaring worker is being replaced... it's either happening from a worker in a developing country or a robot.
post #38 of 51
The problem with this argument is that Apple is not in fact stockpiling money to send overseas. The stockpiled funds are invested in short-term securities most of it probably right here in the US in commercial paper and the like. The fact that they manufacture overseas is not to be confused with where the excess funds go. And before we get too worked up about overseas manufacturing, we might stop and consider how many people Apple employs here, from Cupertino right down to the Apple Stores.
Please don't be insane.
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Please don't be insane.
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post #39 of 51
Quote:
Originally Posted by Dr Millmoss View Post

So, you think Apple could at any time become an unprofitable and grossly mismanaged business in a low margin industry. Thanks for the comforting thoughts.

Okay, so GM was not the best example. But not every company that failed in the crash was unprofitable, grossly mismanaged, etc. My main point was that we never know what form the next downturn will take, and why. To apply a related aphorism, the army is always preparing for the last war. It never hurts to be prudent and flexible enough to face any unexpected turn of events. I, like Solipsism, have a pretty good position in AAPL and am very comforted by their conservation of resources (cash).
A.k.a. AppleHead on other forums.
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A.k.a. AppleHead on other forums.
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post #40 of 51
Quote:
Originally Posted by WilliamG View Post

Apple is an American company, and it is good for us to support American companies. I try to Buy American if I can. When I bought my new laptop, the only companies I considered were Dell, HP and Apple.

Interesting how you define American, suppose you are saying the finished goods, since majority components that make up the computer are certainly not American. I do not even care were the product comes from as long as it is good quality and suits my requirements. I suppose I should support UK, America, India and Jamaica products.


Quote:
Originally Posted by WilliamG View Post

Apple is now a mobile device company. I don't expect much of their resources to be devoted to desktops anymore.

I think just because their profits largely coming from mobile devices, Apple should still not be put into this category. Apple will innovate in any area that it see a potential business strategy to develop and provide customers high quality products within the computing sector. I very much doubt resources will decline with concern to desktop business.
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