The Motley Fool: Apple ‘may be the next Dell’
Friday, April 07, 2006 - 10:03 AM EST"How do we value Apple's stock now [that Boot Camp has been released]? To answer, we'll need to dig into Apple's strategy. I've got my own opinions on that, but I'll first give the floor to an old friend of mine, Rich Levin, a former InformationWeek editor and host of a national radio show covering tech topics. We've debated this and that about the Mac for what seems like just short of forever," Tim Beyers writes for The Motley Fool. "This time, however, I think he's spot-on:"
"It's the first EFFECTIVE strike at Dell. It's also a strike at Microsoft, and uses its own OS against them. And it's a dual-edged 'Win' [sic] for Microsoft ... Every Windows user will consider a Mac if Apple prices them competitively, and continues to produce computers that have style, superior engineering, and better quality overall in a world of commodity tin-box PCs ... Flip side: Apple's strike at Dell and Microsoft will not be maximally effective unless users don't encounter limitations. They have to embrace Windows hardware, games, etc."
Beyers writes, "I couldn't agree more... Apple's courtship of Windows users isn't new. Ever since October 2003, when Apple first released the iTunes Music Store for Windows, Apple has been on a mission to woo PC loyalists. And that makes sense. If CEO Steve Jobs really wants a spot on the couch, he's got to have a platform that, at the very least, offers the most and best video games. That's not the Mac today. It's Windows. (After the Xbox, Playstation, and the like, of course.) Think about that for a second, and then think about this: Every PC maker -- Dell especially -- wants to be your coach in the Couch Potato Games. To date, they've had two advantages over Apple: price and Windows. The first was eroded substantially when the Mac mini debuted with PC-like pricing. The second died with the introduction of Boot Camp. That leaves design and brand appeal as differentiators. Do you really believe Apple can't win that battle?"
Beyer's does some calculations and "puts [Apple] stock at more than $137 a share, or at least a double from yesterday's close...Nice, right? Indeed. Just bear in mind that this valuation has several flaws. For one, Apple may already be richly valued. Second, Apple may not convince a substantial number of Windows users to buy Macs. Third, iPod and iTunes may not remain as dominant as they have been. Finally, there remain distinct differences between Apple and Dell, which could corrupt my assumptions... Bottom line: Apple may end up as the next Gateway. Or it may be the next Dell. Personally, I think the latter is much more likely."
Full article here.
MacDailyNews Take: Thankfully, Beyer doesn't mean Apple will be assembling ugly boxes, slapping somebody's upside-down and backwards attempt at copying the Mac OS onto them, and then using bait and switch tactics to sell them to dupes online; he means Apple's going to be selling a lot more Mac hardware now.
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I was wondering when MDN would post this article..