Originally posted by MacGregor
...but it is the service contracts and the long-term business relationships that give that market its best margins and stability.
That is why Apple with it's Xserves or whatever is not going to run IBM, HP or SUn out of business anytime soon.
True, to macheads, nothing compares to Xserves or even inexpensive Linux/Xeon blades, but big contracts or large accounts usually measure up other factors - like service contracts, discounts and long term business relationships.
That is why Apple has much to benefit from the SGI brand and sales & marketing engine, if it wishes to persue the high end market.
And if it does, going it alone won't work.
Apple will spend more than SGI's $250 million price tag to establish customers, business relationships, not to mention establish its BRAND and sales and marketing teams at the high end.
Apple bought PowerSchool for $62 million (IMHO, not worth it).
Roxio will cost twice that at least...but online music business is a new and emerging market. It's up for grabs...if Apple wants to invest in it, it should be on getting a iTunes port out the door ASAP. Alternatively getting another Windows client to work with the iTunes Music Store web service. So Roxio IMHO is another UMG rumor.
SGI (actually depreciated since the last i looked) is now $230 million in market cap. Not even twice that of Roxio and half that of NeXT.
It is obvious that there will be some conflict of interest between IBM and SGI/Apple if Apple were to aquire them. However, IBM will benefit by the extending the market of the Power4 platform once SGI adopts it for Mac OS X workstations and possibly super servers.
Also i imagine that Apple/Steve Jobs will choose to focus SGI (or Silicon Graphics) on the media, graphics and 3D markets again.
That could only be good for IBM.
So perhaps IBM will lose out its (few) media, film and 3D customers to SGI, but will gain the (few) commercial IT, enterprise customers from SGI. That doesn't sound too bad to me.
IMHO there is a strong argument for Apple to aquire and direct SGI.
Although it would expand Apple's hardware business, i think it will be an important move in order to secure Apple's position in the media and 3D markets both at the low end and high end.
(Besides the $230 million price tag includes Alias|Wavefront which alone must be worth $100 million at least?)