IBM Unseats Microsoft As Second Most Valued Tech Company 296
First time accepted submitter FlatEric521 writes "The BBC is reporting that for the first time since 1996 IBM's market value has exceeded Microsoft's. The values cap a sustained period in which IBM's share price has moved steadily upward as Microsoft's has generally been in decline. Of course, Apple is still the #1 company by far."
Prospering After Its Founder (Score:5, Interesting)
Re:What about Microsoft owning part of Apple? (Score:3, Interesting)
Re:And apple's market cap is going to collapse (Score:5, Interesting)
Apple's strategy for the last decade has been to ride the cusp of the wave of commoditisation. They identify a market that is about to be overrun by commodity products, enter it at the point when they can get commodity prices from their suppliers but still charge premium prices to their customers, and then move on to a new market while keeping a small share at the expensive end of the newly commoditised market. Home computers, laptops, portable media player, smartphones and tablets have all followed this trend. The problem that Apple now has - and the reason that they're resorting to lawsuits to slow down other tablet makers - is that they don't have the next market identified and they don't have a product ready for it.
This strategy is very profitable, but only as long as they keep moving forward. Apple's market cap is based on the fact that their net income has increased by a huge amount year on year. As soon as it stops increasing, or the rate of increase slows, it will collapse.
It remains to be seen whether post-Jobs Apple can keep this going. Steve Jobs was always good at identifying this kind of market (look at PDO and WebObjects, for example), but it wasn't until he returned to Apple that he was really good at exploiting them, and I suspect that this was largely due to other people on the management team. I'm not sure that Apple still has the expertise to both identify and exploit a new market.