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Wall Street: Software More Valuable Than Oil
CWmike writes "The tech industry's answer to this week's stock market roller coaster was delivered on Tuesday by the mighty Apple Inc. Apple saw its stock price rise enough — gaining more than 5% — to briefly surpass Exxon Mobil as the most valuable company in the U.S., according to an AP analysis of its market cap. (Exxon Mobile wound up the day slightly ahead of Apple.) Most of the other major tech companies — including Intel, IBM, Dell, Microsoft and Hewlett-Packard — all finished in positive territory yesterday, as markets made up ground lost in the big sell-off on Monday that also hit oil prices and other commodities.Tuesday's rally may be all that's needed to shake away, at least temporarily, some of the economic concerns the IT industry still faces. By closing in on Exxon, Apple effectively affirmed that there are few limits to tech growth. CW blogger Jonny Evans posits that ideas are why Apple beats Exxon on market cap, noting, 'While Exxon drills, hammers and crushes its way to find its billions, Apple's mind-miners explore myriad complexities to develop and understand new technologies.'"
Is that a euphemism for "cult"?
SJW: Someone who has run out of real oppression, and has to fake it.
An iPad will get you through times of no oil better than oil will get you through times of no iPad.
Faster! Faster! Faster would be better!
Those look like companies making their money on hardware to me.
your more likely to find oil in your back yard than write software that will not get you sued into the ground due to some blatantly fraudulent patent
That's like saying Google is a search company. They're both enticements for what they actually do sell (hardware for Apple, ads for Google).
Look, Apple closed above Exxon today but that doesn't make software worth more than oil. Oil is a finite resource and has price fluctuations like many other commodities. There is an endless supply of coders to spew out software.
Now, good software may be worth more than oil, but I don't think there's enough of it around to really turn it into a commodity.
News at 11.
Side note: Apple doesn't sell software or hardware. They sells systems. Just because young people are used to be able to install an operating system on a generic computer for the last two decades doesn't mean it always was (and always will) be this way. Amiga, Atari ST, Macintosh. There once was a world without Microsoft.
Bizarre coinages aside, Wall Street wasn't making a comparative pronouncement on the value of software and oil(pro-tip: without oil, the market for shiny consumer goods would skew heavily toward the 'canned' variety...); but on the relative value of a company with substantial ability to pull margins that its peers cannot, vs. a company with a smaller ability to do that.
Now, carry on. It's the "information age" or somesuch...
This is ridiculous !
Without oil we have no modern civilization. Even if you could somehow replace all the energy produce from oil, you will still need it for: pharmaceuticals, cosmetics, plastics and others various organics chemicals. The modern world depends on oil even more than it dose on software.
Jehovah be praised, Oracle was not selected
Apple is a consumer electronics company, not a software company.
Market essentially washed away what it gained back yesterday, and Apple did end up on top today, FWIW.
"Apple Overtakes Exxon to Become Most Valuable"
Discussion System prefs link: http://slashdot.org/users.pl?op=editcomm
"Apple's mind-miners explore myriad complexities to develop and understand new technologies."
Apple isn't NASA in the 60's, it's a manufacturer of shiny gadgets. They don't even have a research division.
Apple profits because people are vain, and are willing to accrue massive amounts of debt to buy pretty things.
Will it make me high? If not, im not interested.
This just sounds like yet another thin excuse for gas prices to go up.
These are the people who in days gone by would read tea leaves.
Without a high-energy society, there is no Apple. Without plastics, there are many missing parts. Without diesel powered container cargo vessels, you must make your products locally for much more money. Without energy intensive semiconductor fab, there is no product. Without electricity the product is not powered. Most importantly, without high-energy freeing up labor, nobody can afford your device. They would be too busy plowing fields with draft horses.
For all intensive purposes, "whom" is no longer a word. That begs the question, "who cares"?
Apple makes much more than just software. iPhones, iPads and Mac's are not software. I truly hate blanket statements like this. All the happened was the market cap of an information technology firm exceeded the market cap of an oil company. These numbers reflect the value of the companies not the value of the underlying commodities.
Don't confuse 'valuable' with importance. Wine costs more than water, but without water there would be no wine..and no us.
good ole google couldn't tell me but I bet it's a bunch.
How long until Apple becomes the poster child for its own little bubble of inflated value? I'm guessing the bubble pops whenever Jobs dies or steps down.
If I have any AAPL stock, I don't know about it, but the broker is burying me in prospectuses, so maybe I do have some via some mutual fund or whatever.
I wonder, though, where a treatment like this leaves the human immune system.
A vaccine spurs the immune system to generate antibodies, so that when we're actually infected by the virus, the antibodies are available to combat it. Our own immune systems do all the work.
This new type of treatment, however, kills off the cells that have been infected by viruses, so the viruses aren't able to use the cell's materials to replicate. As the cells die, so do the viruses. From the sound of it, the treatment achieves this without any assistance from the immune system.
So to put it bluntly, in a world where everybody pops a few anti-flu pills every time they get a little sniffle, what does the human immune system do all day? I can see two possible outcomes:
Breakfast served all day!
And today apple was down over $10/ share while Exxon was up $.07/ share. And who knows what tomorrow will hold. Perhaps Sharpies will be more valuable than both. ;-)
Isn't it religion that's more valuable than oil, not software? Any time shepherd Jobs of the church of Apple releases another fatwa, the faithful flock follows and that's why the profits rose now above any other prophets.
You can't handle the truth.
Back in 1999 (before the tech bubble burst), Microsoft was the company with the largest market cap. And they made less hardware then (this was pre-Xbox) than Apple does today.
They were over 2x larger than Exxon Mobil in market cap at the end of 1999.
Is ComputerWorld implying that back in 1999 Microsoft had "ideas" that were more valuable than Exxon Mobil?
Source: http://fortboise.org/top100-history.html
Apple makes a majority of their income on iOS devices. They're making income on the combination of hardware and software. Pure "software" sales are a *VERY* small percentage of their income.
Another non-functioning site was "uncertainty.microsoft.com."
The purpose of that site was not known.
Look at this: http://en.wikipedia.org/wiki/List_of_corporations_by_market_capitalization#2011 Now, Apple has moved to the top of that list, and MS has been a mainstay for a few decades now. How many other software companies are there, vs how many oil companies? The news here is not that Apple is the most valuable, it's that Exxon doesn't have the power in the oil markets that it used to have.
I've given up on Slashdot's comment scores.
Apple's mind-miners explore myriad complexities to develop and understand new technologies.
"New" technologies? What exactly has Apple invented here, apart from an OS taken from unix, applications written at no cost to Apple because they were done by others, touch screen technology that's been around on PDA's for almost 15 years, etc. Yeah they put it into a good looking package and built a good brand and marketed the crap out of it, but there's nothing exactly "cutting edge" here except for maybe the gross violation of your rights when they make you sign exclusivity contracts with third party cell phone providers.
Now, guess which company is more important. A company that obtains and produces a (relatively) cheap source of energy, or a company that produces a marginally different but very shiny communications/computing device?
Apple is fantastically over-valued and overbought, as anyone holding $400 Apple stock will tell you. I can just imagine the pain of the people who have been stopped out. Well what did you expect when you were buying the stock? Largest market cap != biggest money maker. Amazing revenue growth rates have to make you wonder how sustainable they are over the medium and long term. The bigger they are, the harder they fall. Me, I will cover my shorts at $280 and re-assess.
Seven puppies were harmed during the making of this post.
Apple's products are hardware-software bundles. Apple sometimes sells updated software to use on hardware you already bought from them. They also are a vendor of content -- none of which they create -- with the goal of making their hardware-software bundles even more appealing.
Stupid exceptions that don't change my argument:
FileMaker (a mostly-ignored Apple subsidiary)
You can use iTunes on Windows to purchase music & video and never put them on an Apple device. This wasn't the goal of the iTunes Music Store, and doesn't make much money for Apple.
The legions of 3rd-party products Apple sells online and at their stores have nothing to do with this.
what countries are we going to invade for software now?
So that makes software more valuable than oil!
Tablets before were netbooks (which still are failures). Almost all the cost of a laptop with fewer features. The iPad is an iPhone with a masive screen and more power. That's better than what it was derived from, unlike previous tablets. The iPad is successful because it's an improvement on an already successful product, rather than a downgrade from a failed product, like so many tablets before. If th iPad were out before the iPhone, it would have been a failure as well. But they took the iPhone and improved it, selling a new product based on the success of the others. That's not nearly as bizarre as taking a netbook that isn't selling, removing features, and then hoping that people will by it by the millions, as everyone else had done to that point.
Learn to love Alaska
1) Apple isn't a software company, its a hardware and media company.
2) Apple's stock rebounds quickly, so a large number of investors are trying to game that tendancy as the market drives the price down.
I've made a killing on Apple the last two weeks day trading the swings.
although "Apple's mind-miners explore myriad complexities to develop and understand new technologies." ( should
read "Apple puts out more branded crap about which fanboyz and fangirlz uncritically buy" ),
will it BLEND?
Yours In Akademgorodok,
Kilgore Trout
Since when is Apple just a software company? I'm quite sure they make far more off their consumer products than they do off of their software or service offerings.....
Apple products made from plastic. Plastic is a byproduct of refined oil.
Ergo, Apple is dependent on Oil, so, in no way, will Apple, ever be more valuable than oil.
Hi, I Boris. Hear fix bear, yes?
Considering the fact that the majority of our computers, IDE's and compilers are powered by oil (or another related hydrocarbon product such as gas or coal whose prices are loosely linked), if the software you developed ain't worth the oil it took to write it, what was the point...
...in bed
Having a monopoly worths more than something with a lot of suppliers. Put that monopoly in worldwide basis, and with enough weight put in patenting whatever looks like built in the same planet as the ipad and you have a formula for success.
When the bubble on imaginary things (like patents and money) blows up, probably oil won't worth a lot neither.
For real? I mean, I know, humanity doesn't learn jack from history, but when I see blunder after blunder after blunder from an entity, not only wasting time but also the money of millions, and I'm not even able to vote the jackasses out of their office, I guess the least I should do is to stop taking them serious.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
Apple sells the Apple Experience. Everything else is just a delivery mechanism.
Help stamp out iliturcy.
Geez, I think I just threw up a little.
...to their knitting.
This is the most asinine comparison ever. Now people are taking this way too far in saying that Apple is a better company, or such a huge success story, for surpassing some arbitrary measurement that really has no relative comparative value.
For example, in the last 3 years Exxon has repurchased or dividended out more than $91bn in cash. Apple doesn't pay a dividend and hasn't repurchased any shares. Further, Apple is effectively levered 50% more current earnings than XOM through the P/E ratio. If Apple even misses earnings once that will get crushed.
XOM has a commodity that, while finite, will only get more valuable over time as it gets more scarce. While this happens, economics for luxury goods such as ipads will get compressed through less disposable income.
In summary, making ridiculous extrapolations of how Apple has done so well because it's now the "biggest company", only makes one look like a doof. What's sad is that it's now being perpetuated all over the web as tech pundits extoll the virtues of Apple because of this "achievement".
If software is more valuable than oil, does that mean the government is going to lie about WMD to get more warez?
This also shows that Apple is more valuable than air. After all, air is free!
Uh, yeah. The idea that price equals value is dangerous ideological mumbo-jumbo. Prices tell what something costs to buy. They do not indicate what it is worth to have. This is why political economists (particularly Marxist ones these days) distinguish between use value and exchange value.
Examples of market prices failing to reflect use values are too numerous to count. Fancy clothes and cars vs basic food, for example, or the most valuable things in life - such as love, meaning in life, and human kindness - that are only available for free.
If we all realize that with all this tech (aka Apple products), people sit in a couch all day long, and move a mouse (or their fingers) around a 2D screen to:
a. navigate through a 3D world/game
b. communicate to people
c. shop
d. work on spreadsheets
e. show presentations and watch TV/videos
f. look at photos
That explains why Apple would be at the top, as we are nothing but couch potatoes. Hand over the Cheetos.
.
Now went we get out of the house and....
a. navigate through a real world
b. talk to people face to face, shake hands
c. shop while physically touching the products
d. use cash
e. watch a live play or ok, a movie in a theater...
f. look at real art in person....
that's when oil will rise again. If Apple is more important, people stay in their homes and live a virtual life. If oil is more important, people leave their homes and live a real life. Funny how we all are supposed to "hate oil".
How ironic.
Their software is great, but I'm pretty sure it's the *hardware* that makes the Apple experience what it is. Hardware that is jam packed with components which could not exist, or would cost thousands of times more to produce and ship, were it not for oil. The OP makes a very facile argument.
By any unit of measure, even Windows 1.0 and Clippy are more valuable than gold.
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- - You can't take something off the Internet! That's like trying to take pee out of a swimming pool.
The quote from the author about "mind mining" might be true of all intellectual property combined, as a ratio of all finite resource property value. I officially dunno. But stating that a day's stock valuation is evidence of that? Gee, how did Exxon compare to Blockbuster Video ten years ago? How did Exxon compare to TWA thirty years ago? How does De Beers compare to Borders Bookstores? Stock market prices are a snapshot. If Steve Jobs has a heart attack and the stock value plummets, what grand conclusions can we draw about Exxon's future value? Sandcastle stock, selling at low tide.
Gently reply
I don't think Apple has quite the amount of assets that Exxon has. That oil and its distribution are extremely valuable, and moreso as it runs out while our energy hunger grows. But Exxon has a vast liability. Apple has practically none. Exxon is extremely hateable, but Apple is cute. The values here are not just the assets, but the assets after the liabilities are deducted.
--
make install -not war
If there was any doubt that a new IT stock bubble is about to burst, this should clear it.
Apple is one of the least important IT companies in the world; they make mostly fashion accessories and toys. If you deleted every Apple product from existence, at most some people wouldn't be able to listen to music while jogging tomorrow morning. If you did the same with Intel, AMD, Microsoft, Oracle or Cisco products (or many others), the word economy would simply grind to a halt.
And that's without going into raw and semi-raw materials like oil, fuels, chemicals, steel, etc..
The world economy (and the US economy in particular) is completely artificial, and the rise of Apple is the perfect metaphor for it.
was to develop a way construct an EMP that could continuously emit stealth blasts that effect the whole globe for a thousand years as a blueprint in a piece of software. That would force people to change their ways.
Their stuff sells because it is aesthetically pleasing, which has nothing to do with the quality of their software.
This is a huge milestone. A consumer electronics company is now the most valuable (by $$$) company in the world! And it's one that had been written off for dead little more than a decade ago (some people like yourself would still like us to believe it is not doing well).
The stock price is not overvalued by any reasonable measure at this time. They doubled their profits in the last year, and if they do it again (and all indications are that they actually will, since they have no clear competitor) they will be earning more profits than Exxon. The price is due to speculators betting (intelligently) that will happen. But even if it doesn't, the P/E is well line with the rest of the technology sector.
Apple profit: $5.5 billion
Exxon profit: $US5.5bn in the second quarter.
From TFS:
"While Exxon drills, hammers and crushes its way to find its billions, Apple's mind-miners explore myriad complexities to develop and understand new technologies"
To have a right to do a thing is not at all the same as to be right in doing it
With inflated prices, Apple is #1. But Apple does not have renewable resources and neither does Exon. So, the real winners will be the energy producers who have water dams, wind farms to generate electricity or for electricity, have other renewable resources.
Leslie Satenstein Montreal Quebec Canada
this.
Knowledge in the form of an informational commodity indispensable to productive power is already, and will continue to be, a major – perhaps the major – stake in the worldwide competition for power. It is conceivable that the nation-states will one day fight for control of information, just as they battled in the past for control over territory, and afterwards for control of access to and exploitation of raw materials and cheap labor. A new field is opened for industrial and commercial strategies on the one hand, and political and military strategies on the other. --Lyotard, the Postmodern Condition, 1979
Not until you can take a barrel of oil and make a million pirated copies of it, at negligible cost.