Apple's Solid Triple Play Will Be Hard to Beat 19 comments
October 20, 2009
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Once again Apple (AAPL) has far exceeded even the most bullish expectations with the release of its fourth quarter results. The stock is trading after hours at $202 as I write this, an all-time high. I first wrote about Apple last January when it was trading around $85, and I've been bullish all the way (I actually bought the bulk of my position back in 2002).
A quick check of the stats on this blog shows that 70% of those who visit are still using Windows XP; 13% use Vista, and 11% use Apple's Mac OS. XP is now an ancient operating system, Vista is widely considered a failure, but Windows 7 is getting good reviews. So I expect that a lot of XP users are going to entertain the thought of upgrading (finally) to a modern operating system. Unfortunately the upgrade path is difficult and painful, requiring users to wipe their hard drive and reinstall all their programs manually. If they don't feel quite that adventuresome, they will likely consider alternatives such as simply buying a Mac instead. I know many people who have made the switch, and the most common observation is something like this: "Gosh, it's so nice to use a computer that just works." Most of those XP users probably need to buy a faster, more capable computer in any event.
So I see lots of room for Apple to gain market share against Microsoft (MSFT) in the OS market, and against other computer manufacturers in the hardware market. Meanwhile, Apple is the acknowledged innovator in its field, and the iPhone is rapidly becoming a major player in the smartphone market, with over 7 million sold in the most recent quarter. That's a winning combination: a small but rapidly rising market share, plus technological leadership and innovation that produces products that are a marvel. I just don't see how anyone can dethrone the Mac OS, Apple hardware, and the iPhone at this point. The competition is getting better every day, to be sure, but this race is Apple's to lose.
XP users: please feel free to comment on your plans. Will you upgrade to Windows 7? Wait for awhile? Try a Mac instead?
Full disclosure: I am long AAPL at the time of this writing.
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That's like the guy who said they should close the Patent office because everything that could ever be invented has already been invented.
We're not talking about cola or laundry detergent here... we are talking about Technology, a very dynamic field. Apple already has a number of ( yes, more or less imposters), but sometimes the imposters eventually do it better.
Oh right, this $100 upgrade is so hard I can't possibly understand how to do it. Therefore I MUST go out and spend ten times as much for a new computer because I am not capable of reinstalling some apps(Which I did fine the first time by the way). Are you kidding me fanboy?
Win7 is just Vista SP3. MS has done a better job marketing Win7 but it is still Windows, with the virus issues, registry and .dll files.
And since the Mac Mini is only about $500, that's not much more than the cost of Windoze Ultimate Super Geek Edition TM.
The Mini will also let you run Windoze and Mac at the same time, or dual boot. Or get a laptop, they are very competitive on price. (I am saying here, if you are upgrading anyway, if you are happy with what you got, then more power to you.)
"Unfortunately the upgrade path is difficult and painful, requiring users to wipe their hard drive and reinstall all their programs manually. ""
On Oct 20 09:04 AM John Galt wrote:
> "I just don't see how anyone can dethrone the Mac OS, Apple hardware,
> and the iPhone at this point. "
>
> That's like the guy who said they should close the Patent office
> because everything that could ever be invented has already been invented.
>
>
> We're not talking about cola or laundry detergent here... we are
> talking about Technology, a very dynamic field. Apple already has
> a number of ( yes, more or less imposters), but sometimes the imposters
> eventually do it better.
Best.
Jeff
Regarding Apple and imitators, this is an interesting point. Normally you would expect an imitator to copy a successful product. To some extent this has happened a lot. When the colored iMacs first came out then suddenly everything came with translucent colored plastic. Some laptops look something like MacBooks, MP3 players ship with white earbuds. This is all superficial. What Apple has done is to create an ecosystem of interrelated products. The same OS runs on the iPhone, the iPod touch, the laptops and desktops. This is a huge barrier to entry. Nothing lasts forever, but with their cash hoard and their desire to stay in front then Apple should be able to stay ahead of the pack for many years to come.
So I will say it again. ( I am going to try caps, so maybe the message will get through )
WINDOWS HAS A WORLDWIDE MARKET SHARE OF 96%. APPLE HAS LESS THEN 4% . MSFT HAS CONTINED TO HOLD MARKET SHARE EVEN WITH IT WORST OS SINCE ME.
Did that help? Did you get it, apple has gained market share only in the USA and a couple of EU countries, the vast vast majority of the world are not buying apple PCs.
Now I know you fan boys hate when I point this out, I know you guys want to just keep telling eachother that everyone is using a MAC, but really it is just not true.
JNJ is not now , not ever , never ever ever going to switch to Macs.
Or perhaps you think corp wants to lock in hardware to a single vendor......
And so what ?
On the mass market ? where 90% of the macs are ?
On the pro Market ? where 75% of the Pcs are ?
So, 20% of the mass market in US are Macs, and 8% in France, 20% in canada, 15% in South Afrika, 10% in England.
That is a big, big, big evolution.
2004: Apple have 1,8% of market share in the entire world.
Today, it's 4%
Apple announce 17% of rising sells
For the Pcs market this is only 3%
So, Apple is gaining market share, and not only in the US...
And Apple is gaining market share faster than before
Yesterday, Dell sold 6 Pcs for one mac
Today, Dell sells 3 Pcs for one mac.
You understand what happens ?
And today windows haven't a market share of 96 %. You are wrong and lost in the nineties.
Oh yeah, I do have an iPOD, we use it for bird watching. (that's done outside too)
Have a great day and hit me with some entertaining barbs!
No need to shout. It's a Mac, not a MAC.
And what does Windows market share give Dell, HP or MSFT for that matter? This will be the third quarter where all three companies will complain about the economy and blame something other than the business model they decided to pursue. This cheap PC mode only has them begging for table scraps when it comes to profits. This isn't 1995 when the average PC was $3000. There are few profits to be made in the Windows PC space. How much money can MSFT make off a $399 PC? It has nothing to do with market share. It has to do with profit margins. Apple wins hands down (36%) compared to Dell and HP. Win7 might be a great OS but it will not bring huge profits to MSFT because the PC is cheap, cheap, cheap. Those ads are coming back to haunt them. Apple has 90% of the market for computers over $1000. So where are all the profits going? Apple.
MSFT is dying and will become like IBM in three years. Glory days are over. WinMo is a failure. Xbox loses billions over the last three years. Bing is already going down against Google. Nobody is willing to spend $300 on Office anymore. It's all about profits, not market share.
With my Mac I can make a .pdf file of anything in an app. And I have access to great software (included) like iPhoto and iTunes and iMovie, which help me with my photography hobby. I use Garage Band for writing music with my keyboard and guitar, also a bundled app with Mac. It's not for everybody, but I know a number of folks who've switched and they're quite happy, as am I with my Mac.
RG
The only stats that put MSFT below the high 90s are silly net based "who is online " stats.
To even get close to apple making 5% you need to exclude 100s of millions of MS severs. And you must pretend the 100s millions of PCx hiding on corp intranets simply dont exist.
So come on lets see some worldwide stats that really show MSFT in real decline and AAPL really taking worldwide share. In any kind of meaningful way.
MSFT has just had its worst OS in its history and still has held up share, Win 7 is set to ensure MSFT rules OS for years to come.
as to apple having 1.8% in 2004, rubbish apple have been running close to 3% + /- since forever.
>
> And so what ?
>
> On the mass market ? where 90% of the macs are ?
> On the pro Market ? where 75% of the Pcs are ?
> So, 20% of the mass market in US are Macs, and 8% in France, 20%
> in canada, 15% in South Afrika, 10% in England.
> That is a big, big, big evolution.
> 2004: Apple have 1,8% of market share in the entire world.
> Today, it's 4%
>
> Apple announce 17% of rising sells
> For the Pcs market this is only 3%
> So, Apple is gaining market share, and not only in the US...
> And Apple is gaining market share faster than before
> Yesterday, Dell sold 6 Pcs for one mac
> Today, Dell sells 3 Pcs for one mac.
> You understand what happens ?
>
> And today windows haven't a market share of 96 %. You are wrong and
> lost in the nineties.
another bit of misleading data.
1 its not 90% of the market , it is 90% of one market the USA.
2 that number is pure retail B&M, which cuts out just about everybody else but Apple.
3 Corp does not even get a look in, most corp laptops are over $1,000 and every single one was not counted.
4 almost every single apple laptop is over a $1,000 so apple gets to include every sale , while everyone else gets the numbers hacked to bits.
On Oct 20 04:14 PM BladRnr wrote:
> @ Jack Dee
>
> No need to shout. It's a Mac, not a MAC.
>
> And what does Windows market share give Dell, HP or MSFT for that
> matter? This will be the third quarter where all three companies
> will complain about the economy and blame something other than the
> business model they decided to pursue. This cheap PC mode only has
> them begging for table scraps when it comes to profits. This isn't
> 1995 when the average PC was $3000. There are few profits to be made
> in the Windows PC space. How much money can MSFT make off a $399
> PC? It has nothing to do with market share. It has to do with profit
> margins. Apple wins hands down (36%) compared to Dell and HP. Win7
> might be a great OS but it will not bring huge profits to MSFT because
> the PC is cheap, cheap, cheap. Those ads are coming back to haunt
> them. Apple has 90% of the market for computers over $1000. So where
> are all the profits going? Apple.
>
> MSFT is dying and will become like IBM in three years. Glory days
> are over. WinMo is a failure. Xbox loses billions over the last three
> years. Bing is already going down against Google. Nobody is willing
> to spend $300 on Office anymore. It's all about profits, not market
> share.
I agree with your point of Apple (not really) having 90% of the >$1000 market. Just remember though, most/many of Apple's computers are also sold online at their own web site not through their BM stores. Would you accept they have a very significant amount of the >$1000 computer market? Even 30-40% would be astounding.
That said, there is no arguing Apple is definitely closing in on Microsoft's annual revenues. Still has a ways to go, but they have made significant headway there and in market cap too....So Market share is not all that when it comes to financials....
There's no arguing Apple will be lucky to top 10% market share with their business model (focusing their efforts almost solely on the consumer end of the market with no real effort spent selling on the corporate end). The good news is (if you are an APPL investor), there is a lot of market share out there.
As an investor I only care Apple has enough market share to remain relevant (and they have proven that 4-5% is enough) and most importantly they are able to make money with that market share, and there is no arguing they can do that even in a shitastic economy.
Argosy