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The Problems of Being Dell

First, let's start with this from slashdot, that pillar of incisive technological journalism:
Nine years after Michael Dell said he'd shut down Apple and give the money to the shareholders, Apple has passed Dell in market value, at $72,132,428,843 compared to Dell's $71,970,702,760. Analysts expect Apple to continue to outperform competitors, citing 2006 as 'poised to be the year of both iPod growth and, more importantly, Mac market share gains,' with earnings growing more than 35%.
And then there's quite strong Dell opinions from AMDZone. In the process of boosting his favorite brand of microprocessors, Chris Tom also takes quite a few swings at all things Dull (Dell) and Intel (including, now, Apple). For example:
Forbes reports on Mac sales dropping. It seems AMD is now perhaps not helping them in that regard. Also I have been quiet about this largely due to how obvious it is, but Steve Jobs is the biggest liar in the computer world on the face of the planet. Now Intel is faster than the IBM G5. Ok. Anyone that believes a thing that comes out of his mouth, including business partners, needs some serious counseling. He has so far surpassed the complete bull we hear out of Dull brass that it is almost unfathomable.

Advanced Micro Devices ... may also prove to be a tough competitor, Stahlman added. "As impressive as the computer-intensive benchmarks offered by Apple might be, there is no way to avoid the fact that Intel's Core Duo processor (aka 'Yonah') is a 32-bit engine that is fundamentally obsolete in a 64-bit x86 world. As AMD ramps to ship its dual-core 64-bit notebook CPU's ... we believe Apple may lose some of its premium luster," the research analyst said.

It should be noted that Chris Tom is a former Dell employee. The details of his former employment and the situation that led to his leaving Dell are best found on his site. But Chris is no neutral bystander to all of this. Far from it. It just incentivises him to go after the facts. Like a pit bull after a lamb.

So is Dell about to become Apple's roadkill? Are we on the cusp of seeing Apple ascendent over all? I don't think so.

First, I have to agree in principal with Chris' comment that Steve is less than truthful. I've dealt with Apple since the Apple ][ days on through the early Macintosh days. I stopped buying Apple in the mid-80's precisely because of Steve Job's antics and until very recently (because of the hassles of Windows security and Linux installs) haven't considered buying Apple.

When I switched to PCs I first purchased IBM, then started to buy white-box systems, then slipped over to DIY. I went the white-box and DIY route because that was all I could afford at the time. When I thought about buying 'whole' PCs, especially in the late 80's and early 90's, I thought of Compaq or HP, never Dell.

The reason was Dell was spotty in its quality through the 80's. Some models were excellent, while others were just junk. And Dell was always working on the trailing technology edge. Yes, Dell was cheaper, but you got what you paid for. Then in the 90's Dell started to work on its image and make a very big push into corporate accounts. I started to run into Dell systems everywhere in 1995. They were always big, white, boxy things with never quite enough memory or disk space to scale into real work. But they sold like hotcakes to the bean counters in the company because they were "value" systems, and at the time Dell went out of its way to provide admittedly good customer service and support.

But as the years rolled along Dell, to increase profitability, off-shored customer server to the point where it's now mediocre at best (especially if you're not a corporate customer), and the systems they move are crippled simply by being exclusively Intel inside. Yes, Dell will decline in front of Apple's onslaught not because Apple is truly superior but because Dell has become that bad. It is Dell's game to loose, not Apple's to win.

I mentioned earlier I looked at Apple, primarily because of OSX. After having looked at the Macinteltosh MacBook Pro, I have to say that it's underwhelming in the face of what you can get from other manufacturers, such as Gateway, for the same amount of money. The Gateway M685 will come with a faster processor, a better graphics system, a better DVD burner... you get the idea.

And what about those lovely Apple iPods? Again, let me speak from personal experience. Both of my daughters don't want iPods because they don't want Apple. They grew tired of Apple in school, and they've watched how their friends are limited by their iPods. My oldest doesn't care, having decided a long time ago she could mix and match tracks on CDROMs and create her own CD collections from CDs she purchased from the store. My youngest and I use a Memorex MMP8570. Its key features for us were 512MB of built-in flash, expandable via SD cards, its ability to look like a USB drive so that you could drag-and-drop tracks to it under Windows (or Linux), and for me, it has a built-in FM radio for listening to the news and weather when the hurricanes come roaring ashore. We rip tracks from CDs we own and just drop them on the Memorex and we're good to go. In short, we don't have a need to prove we're "super L337" consumers by buying Apple (or anything else, for that matter).

Update
How Apple Could Mess Up, Again
These days it's hard to find a pundit willing to question Apple Computer's (AAPL) long-term prospects or the calls of its famous CEO, Steve Jobs. After all, Apple's fortunes have been on the rise for nearly a half-decade now, and they seem to be only gaining steam.

That has caused even some of the most devoted skeptics of years past to stop fretting over Apple's future. For years, many felt that Apple's past mistakes were bound to come back to haunt the Cupertino (Calif.) company -- the refusal to license the Mac OS in the 1980s; the stale products, bloated expenses, and management turmoil that hobbled it in the mid-1990s; the software availability and falling market share that plagued it right into the 21st century. These days, with Apple's stock price the talk of Wall St. and its products once again defining techno-chic, all that's a distant memory.

That is, unless you're Clayton M. Christensen, the Harvard professor and author of the seminal 1997 book The Innovator's Dilemma. Christensen, who more recently wrote Seeing What's Next: Using Theories of Innovation to Predict Industry Change, isn't willing to jump on the Apple bandwagon just yet. As well as Jobs & Co. is performing now, Christensen fears that success is built on a strategy that won't stand the test of time.

When you finish the article, make sure to read the pithy comments to the author from the Apple fanboys and -girls at the bottom. And I thought Linux fanboys were virulent.

Comments

  1. You posted about you using the Memorex MMP8570. I wanted to email you privately about how to use it. I've had it for over 2 mths & I'm about to trash it. You made it sound "great" so I've decided to give it a try.

    irbailey@bellsouth.net

    Thanks...

    ReplyDelete

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