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IBM Unseats Microsoft As Second Most Valued Tech Company
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."
Does that count on MS's value?
perhaps they will take 3rd place.
Am I bothered? Do I look bothered?
So IBM will be number 1 soon.
Really though. This isn't news for nerds.
Deleted
All they make are fancy consumer oriented things. They don't qualify as a tech company anymore than Nintendo does.
Why doesn't anyone else take their laptops and add an aluminum case and 50% markup?
404: sig not found.
Not Microsoft but Balmer's Microsft has lost the race.
Very soon [B]Microsoft will be 50th in the world as the rate of decline accelerates.
Bye bye M$. Bye bye Seattle Campus. Hello India. Dear Lord its so hot there ... come on ... give us a break. We'll melt.
#$%%%^^^^&DFDF^^^%%^^##EE$%%%^^^5%%%
Apple is the largest tech company followed by IBM and Microsoft, if measured by how much the stock market thinks each company is valued at. It is a completely meaningless metric that does not say anything about either company. The stock market is detached from the real world and how well a company's stock is doing is not proportional to how well that company is doing.
Football Odds
What happened to the last time this happened?
http://news.slashdot.org/story/11/05/22/0232216/ibm-now-officially-worth-more-than-microsoft
MS doesn't have innovative growth plan. Instead what they do is wait and watch which next computing trend is going to get big and they go after it (i.e. Bing, Xbox, smart phone and tablet with multi touch, enterprise services, zune) The problem is once they're way behind it is very hard to get enough market share and a lot of these investments are not giving enough ROI.
I always find this a little absurd. Steve Jobs said it best: "We have to let go of this notion that for Apple to win, Microsoft has to lose." The same basic sentiment goes here. The fact that Apple and IBM are doing better than Microsoft doesn't mean Microsoft is in trouble. They're making more money than ever, despite slashdot predictions of doom and gloom continuing since they made a fraction of what they do now.
That doesn't mean Microsoft isn't in trouble but there's really nothing about "not being the richest in the world" that means "dying".
It's extremely difficult for a major company to sustain its business leadership after its founder leaves. IBM was fortunate they had a son at the helm who was every bit as smart as his father. After the son the company lost its way but then found a new, better path after huge, painful adjustments. That's the exception, though. Apple had a near-death experience losing Steve Jobs, but the founder returned and put Apple back on track. It'll be interesting to see what happens now that Tim Cook is in charge, but we won't know the impact for several years. Likewise, Microsoft has yet to prove it can prosper in its post-founder era, and that experiment has been running a lot longer now. True, Ballmer has been with Microsoft a long time, but he's no Bill Gates, Thomas Watson (Jr. or Sr.), Steve Jobs, or even Lou Gerstner/Sam Palmisano.
Do you really believe that dribble or are you trying to be modded up? You're saying their old products are so good no one is buying their new products? Do you know how much profitable software they sell besides OSs and Office? ERP systems are a huge market for Microsoft and still a small part of what they sell. Poor Microsoft indeed.
"say, i couldnt help but notice you are trying to sell a mobile phone. all sorts of people might want to sue you over that, you know, what with patents and all. why dont you pay us, say, 10% of your income, and we can arrange it sos nobody patent sues you?"
there are 'people in washington' who might not approve of your 'tone'.
Source of Ammonia if nothing else
How can we make leather without any piss?
Microsoft isn't in trouble. And as for hurting sales... Sales haven't ever declined, not a single year -- ever. Go spread your FUD elsewhere, the actual numbers are easy to see if you look.
"Of course, Apple is still the #1 company by far."
Would'nt have expected that in 1999...
Only one of the 3 was around at the time... :/
In the form of "Microsoft either needs to move everything else to India, or O/S, Office, and development tools should be split apart and individually sold off to enhance shareholder value. We can call what is left DEC."
Orwell: "In a Time of Universal Deceit, telling the Truth is a Revolutionary Act"
Numbers I see from www.cnn.com and others show PC sales lagging. Offices have been cutting back on upgrades and using older versions of software. I have not seen a single article stating that sales are actually increasing from MS in a long time. That was true 10 years ago, but not today.
In 2000 and earlier people upgraded WIndows and Office every 2-3 years. Now the standard life cycle is well over 5-7 years with people hanging on to Windows XP for life. The cost accountants in these organizations have noticed and they like it. Windows 3.0 did not have anything near 40% of the market when XP came out, likewise 10 years later 40% still have XP etc. Those numbers say a lot and equal lost sales.
Also please do not count the sales of new pcs as proof that Windows Vista is catching on, when corporations wipe them and use their old Windows XP volume license. Even if you include those numbers desktops and notebooks are on a big decline. The Ipad is part of that reason and so are some smart phones.
http://saveie6.com/
Part of that is that neither IBM nor Apple have been under DoJ supervision for the last decade, which tends to put them at a bit of a competitive advantage when it comes to pushing for growth. MS got slapped for going for other markets beyond Windows and Word. Granted they were going at it in an anti-competitive manner, but MS historically has only known how to grow via those sorts of sleazeball tactics.
That being said, Apple did have the good fortune of having a decade where the DoJ didn't believe in antitrust regulation where they were allowed to engage in questionable tactics to grow their business.
I love how you personify companies as people, much like countries do. I ask you to name a single IBM employee that was in the company at the time. I'd actually be somewhat skeptical if there are any active employees that were alive for said event.
Bye!
Apple is the largest tech company followed by IBM and Microsoft, if measured by how much the stock market thinks each company is valued at. It is a completely meaningless metric that does not say anything about either company. The stock market is detached from the real world and how well a company's stock is doing is not proportional to how well that company is doing.
Stock prices are not meaningless, they are simply misunderstood and misused. They are not a measurement of how a company is currently doing, they are an estimate of how a company will be doing in the future. The current state is just one of several variables that goes into that estimate. Regrettably when an estimate reflects a relatively large change in either direction, good or bad, speculators pile on and inflate or deflate that price. Apple is far more vulnerable to such speculation than IBM. As suggested by their respective beta's, 0.7 for IBM and 1.3 for Apple.
... You don't see anything meaningful or reflective of the real world in these numbers?
While far from perfect stock prices are meaningful in a normalized form like the P/E ratio. Apple at a P/E of 15, IBM at 14, Microsoft at 9, HP at 5,
Perhaps I'm old fashioned but for current health I like metrics based upon cash flows. A little more difficult to engineer than EBITDA.
Just out of curiosity, what precisely does that have to do with anything? Are individuals that were involved with the company back then still running it? Is there even a single employee working there that was employed by IBM at the time?
It's about as relevant to IBMs continuing operations as Henry Ford's known support of the Nazis.
"We can call what is left DEC?" Last I heard, Compaq got what was left of DEC. Then HP bought out Compaq.
Microsoft and Apple simply didn't exist at the time, so that is an unfair comparison. Knowing that you want to be a fair person, I ask you this... What countries have Microsoft and Apple refused to do business with because of human rights violations?
There's got to be an internet porn company bigger than IBM? CISCO would have gone under 10 years ago if it wasn't for internet porn.
And the ironic thing is that Microsoft is the chief reason why that happened. They switched to Software Assurance after XP and Office 2003 came out and then, with a steady source of income from people buying in each year, the pressure was off and they took forever to put out Vista and Office 2007. Then of course Vista had horrible performance and there was that whole Vista Ready sticker fiasco. Thus decision makers held off on upgrades, so that by the time Windows 7 came out, companies had already been making do with no changes for half a decade, They had stayed off the upgrade treadmill and the world had not ended.
Laissez lire, et laissez danser; ces deux amusements ne feront jamais de mal au monde. - Voltaire
Not that long ago, Cisco had the highest market cap in the world. Fame is transient in the high-tech world. Screw up one generation of products, and you're history.
It's not about sales. It's about profit (and profit growth). Wal-Mart generates far more revenue than Microsoft, but Microsoft has a market capitalization that's currently about $30 billion higher. Wall Street is concerned about Microsoft's potential for future profit growth, and that's not wrong. For example, Microsoft is going to find it increasingly difficult to collect its high Windows taxes in light of devices such as $199 Amazon Kindle Fires running Android.
Calculate the effect of the iPhone 5 being banned from europe vs the next Galaxy phone from Samsung. This battle is raging right now. For Apple, this is a major part of their business, it brings in a lion share of their profit.
For Samsung? They got plenty of other ventures, a block will hurt their bottom line but not in any significant way. Samsung is larger then Apple in many ways BUT not that much larger, it is just far more diversified.
It isn't fair to say Apple if a bubble stock because Apple isn't to blame for how much outsiders are willing to pay for its shares but during the bubble companies with promise were valued over companies with results. Had an ordinary factory turning out a steady profit for several centuries and wanted an investment during the internet bubble? NOT INTERESTED, burning through investor capitol like it was bonfire night, that was the ticket to get the investors piling their cash on the fires.
Apple if of course not doing that at all but what is its value based upon? A very narrow product line that depends on an economic climate in which people are willing to splurge.
Now whether this is a successful strategy depends on what you think the economic crisis is having and going to have. SOME seem to think that ALL people will feel the pain but this hasn't been the case. The crisis has hit hard but Apple is doing very well indeed. The real result of the crisis seems to be that the divide between have's and have not's is increasing. The iPhone buying bankiers got their social wellfare benefits and the factory workers have to sell of their house to pay for it. The rich not only kept their money, they got more of it. More to spend on more gadgets while the poor got less but they already didn't have enough to buy them anyway. So, some will steal them, getting the rich to buy even more...
Meanwhile poor Samsung has to actually pay its employees decent wages and run factory after factory with middle class (No republicans, middle class does NOT include people making 250.000 or more per year) workers...
Valuing Apple high makes more and more sense, since the valuing is done by the rich who got their wellfare check over the working man's back.
Apples stock will only crumble once the poor of America realize that the American Dream is the opiate of the masses and rise up. And that won't happen. Apple got EXACTLY the right business model for the USA. Poor Americans.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
Monied might be more appropriate. I doubt that either MicroSoft or IBM are "valued" by anybody. They are simply players.
But it's interesting how companies want to be considered persons, with all the rights thereof (but none of the responsibilities, of course). It cuts both ways.
I guess IBM's slogan should be - as variation of Google's "Don't do evil" - "Automating evil".
Markets are comprised of people. To speak of rational markets as if the market or the whole body of people itself is rational makes no sense. I'll assume you know this(a reasonable assumption, I think) and you mean the actors involved. However, this has some problems.
Suppose everyone was given the 'choice' to either have x% of their income stolen from them or they could put it in the stock market. Now suppose also that CEOs are taxed more based on salary than if they take stock options, bonuses, and all that. Suppose that the stock market grew 20 times in trade volume in just 30 years, where before it was almost perfectly level vs several other economic and population measures. Further suppose that the additional money coming from people avoiding theft are not investors, but speculators who know nothing of the companies they invest in. Additionally, suppose that inflation drives these speculators even more to the stock market to preserve their savings. Lastly, stop supposing because this has happened starting around the 80s.
So, while the actions of the individual to keep their money and avoid theft and devaluation is entirely rational, the market is driven by ignorant and scared people who were herded there by coercion. Knowledgeable investors are drown out by the investment banks who manage the huge tidal waves of money sloshing around from people with 401Ks and the like. They in turn have a deep understanding of the political system that keeps them sustained through their ruinous mistakes.
So while reality ruins systems that are unsustainable in the long run and permits only valid behavior to survive, the long run to avoid the manipulations of intervention would have to be quite far. Markets fail in these current economic conditions precisely because people are choosing the best path open to them.
Apple is a media company, first and foremost.
Microsoft is a software company, first and foremost.
IBM is a services company, first and foremost.
The former master previously dethroned by their apprentice is now the master!
Corporations want to be treated as persons, with all the rights of individuals. Well, with rights come responsibility.
If an individual person had done for the Nazis what IBM did, he would have gotten the death penalty at Nuremberg and hung.
Why is IBM still doing business?
You are welcome on my lawn.
Yours is the only correct response. Yes, we have to evaluate corporations based on what they do and with whom they do business. They cannot be given a pass just because they are profit-driven.
Who knows what MS and Apple would have done in regard to the Nazis. But it is worth remembering that not all corporations decided or sought to do business with them.
You are welcome on my lawn.
This is market cap based. 'Value' is the closest word for that. It doesn't directly indicate cash on hand or how much debt they hold. It doesn't indicate directly how highly viewed among potential clients they are. It indicates the perceived value of IBM by stock market participants. This translates well to their ability to borrow and *usually* indicates a healthy company with positive cash flow/good standing with their customers.
While IBM is doing well enough at creating and selling goods and services, but they get a bit *extra* credit with stockholders by using a large chunk of their income to buy back stock rather than do other things with it.
XML is like violence. If it doesn't solve the problem, use more.
Actually, downturn markets are great for companies like Apple, as their success in the last couple years should demonstrate. You see, in times like this, people cannot afford or feel they cannot afford real luxury items: vacations, expensive cars, bigger houses, pools, early retirement, so on. But people still like to treat themselves to a luxury. Apple is right in the sweetspot for this: pretty much everybody with a job can afford an Apple product or two, and they will sacrifice other things to get one just to feel like they have luxuries.
It is called the lipstick principle. You can read about it here:
http://www.nytimes.com/2008/05/01/fashion/01SKIN.html?pagewanted=all
The last two came with MagSafe power connectors.
Which are a female dog and a half to find replacements for should they break, or to find external batteries for. For a very long time, Apple flat-out refused to license its patented MagSafe connector to a maker of external batteries. In fact, one company bought authentic Apple power supplies just for the authentic MagSafe connectors and soldered them onto its external batteries, and Apple still sued.
is getting away from pure commodity parts. They've been using some of their enormous pile of cash to fund manufacturing processes they like (unibody aluminum) and to fund fab lines in return for first dibs on their output (flash RAM - Apple has a significant fraction of world capacity contracted).
Other manufacturers have had trouble competing on price with Apple lately (which is a switch) because Apple has the best price on parts and processes.
Apple will have its hands full exploiting its current markets for the next year or two, by just making the obvious updates (iPhone with 4G and iPad with retina display, both likely next year), which should buy them enough time to create the next shiny object for our enjoyment.
To a Lisp hacker, XML is S-expressions in drag.
Microsoft is following the arc of DEC. Both companies believed in building the entire technology stack themselves, preferably at one location (or nearby group of sites in DEC's case). They dispatched competitors with brutal intensity, using a combination of engineering and sales/marketing leverage. For awhile that worked well for both of them, until their existing markets matured and they were stuck with bloated organizations that couldn't move fast. Meanwhile, newer markets sprang up with nimble competitors leaving them in the dust, and customers unwilling to trust their business to the old monopolists.
Here's the actual numbers, but I stand corrected, there actually was one year that revenue dipped (2009):
Date / Employees / Revenue
June 30, 2011 90,412 $69.94B
June 30, 2010 88,596 $62.48B
June 30, 2009 92,736 $58.44B
June 30, 2008 91,259 $60.42B
June 30, 2007 78,565 $51.12B
June 30, 2006 71,172 $44.28B
June 30, 2005 61,000 $39.79B
June 30, 2004 57,086 $36.84B
June 30, 2003 54,468 $32.19B
June 30, 2002 50,621 $28.37B
Part of that is that neither IBM nor Apple have been under DoJ supervision for the last decade, which tends to put them at a bit of a competitive advantage when it comes to pushing for growth. MS got slapped for going for other markets beyond Windows and Word. Granted they were going at it in an anti-competitive manner, but MS historically has only known how to grow via those sorts of sleazeball tactics.
That's a BS argument because MS tried to get into a lot of markets after the anti-trust agreement like Xbox, Zune, Bing; and they haven't done very well not because of the supervision but because they sucked at selling directly to consumers.
That being said, Apple did have the good fortune of having a decade where the DoJ didn't believe in antitrust regulation where they were allowed to engage in questionable tactics to grow their business.
Again BS. Apple didn't have DoJ supervision because they weren't convicted of monopoly abuse. Being a monopoly is not what got MS in trouble. Abusing that monopoly was their problem. Apple by all accounts has the highest marketshare of MP3 players. They never got in trouble with the DoU because they didn't strong-arm their partners against their competitors like MS did.
Well, there's spam egg sausage and spam, that's not got much spam in it.
The concern with MS for many shareholders is their stock is stagnant and they don't seem to have a plan for the future. IBM is growing and they do have a long-term strategy. Part of that strategy was getting rid of their PC business 5 years ago. Some people didn't like that but in retrospect, it was clear that while generating a lot of revenue, it wasn't going to be very profitable. With MS, they seem to be rushing in late to every buzzword that comes up and throwing lots of money at ventures that don't bring in much money.
Well, there's spam egg sausage and spam, that's not got much spam in it.
No what he's saying is that for most businesses, they don't need the latest Office and their current Office may work for the vast, vast majority of their workers. As for Windows, Vista really hurt their image but Win 7 is good upgrade from XP. But they lost revenue in the meantime as companies skipped one OS upgrade. As for ERP, my understanding is they are still dwarfed by SAP and Oracle and Infor. As of 2010, they lost market share in ERP but gained in CRM. However they are at 3% and 7% respectively. MS only does well in the small business market. The middle and large enterprise are owned by others.
Well, there's spam egg sausage and spam, that's not got much spam in it.
Also as the prices of computer hardware goes down and Windows prices go up, it's harder for someone to pay $100 retail for Windows if they build a computer for $400. OEMs also will have issues because they are being squeezed on margins as it is.
Well, there's spam egg sausage and spam, that's not got much spam in it.
Yes, many companies felt they got burned by SA. I don't know if any companies complained or got discounts on Win 7 but I'm sure that the SA contract had an escape clause that gave them an out when Vista wasn't ready.
Well, there's spam egg sausage and spam, that's not got much spam in it.
MS still makes lots of money and profit. But that's not the concern. The concern is they don't seem to have much of a long-term strategy. They have had major stumbles. Their stock is stagnant. IBM has surpassed them in cap because investors think that IBM has a plan for the future.
Well, there's spam egg sausage and spam, that's not got much spam in it.
I'm surprised I hadn't seen a comment similar to "Don't worry, Microsoft, you still smell like #2 to us!"
You're exactly right. Market cap changes rapidly over the years and says mostly something about how "hot" or fashionable a company is a certain time, not about how profitable or anything else really. Ars Technica had a nice article about this a while back and mainly says you can't measure a company by its market cap at all.
But still... think a few years back. If someone would have said to me "In about 10 years IBM will be worth more than Microsoft, but Apple will be worth more than both of them" in 2001, I would have laughed at that person.
Pretty good is actually pretty bad.
I'm sorry, this reply wasn't supposed to be attached to this post. It was actually meant as a reply to this.
Pretty good is actually pretty bad.
Maybe in the PowerPC days, but now a Mac laptop (to use the OPs example) is nothing more than a PC laptop with an aluminum case and a markup (I won't claim 50%, as it varies depending on the model and the PC maker. Let's look at what a modern Mac has
x86 CPU? check A complement of ports? check, though usually the Mac is missing those commonly found on PCs like SD cards, CF, Dock expanders, expresscard etc. ATI or nvidia graphics card? check LCD? check Trackpad and keyboard? check LiIon battery? check Optical drive? check, though Macs still don't have Blu Ray. Runs Windows and Linux? Check
In fact, no matter how it's spun, there is *no* difference between a Mac and a PC laptop of equivalent specs (talking logic and features, not design), except the Mac will be several hundred dollars more expensive. What's the difference?
An aluminum case. Nothing more, and even that differentiation is disappearing as PC manufacturers make laptops with the same case and no markup, meaning you pay for a glowing plastic logo.
In that case, why can't one buy a normal PC, and simply install OS-X Lion on it? Why does Apple support people installing Windows on their 'Macs', but not people installing Lion on PCs they don't make?
Comparisons like that - between companies in entirely different sectors - aren't just invalid, they're retarded.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
Looks like I stand corrected too and retract.I am not a troll, but rather I see bad signs and a less powerful mindshare wise from 10 years ago while clients refusing to upgrade. MS has more and bigger competitors now in many areas. I am surprised actual sales growth is occurring, as Asia is mostly pirated and life cycles are much longer than a decade ago. I wonder where its new revenue is coming from? I know they sell sharepoint and a few other newer things but Id ont know how much they cost.
http://saveie6.com/
That's a BS argument because MS tried to get into a lot of markets after the anti-trust agreement like Xbox, Zune, Bing; and they haven't done very well not because of the supervision but because they sucked at selling directly to consumers.
It's not BS, they did try, but they had to take into account the restrictions and scrutiny that came with being supervised. The Xbox, is a poor argument to make, they did well with that one in large part because it was separated enough from their monopoly that they had room to maneuver.
Again BS. Apple didn't have DoJ supervision because they weren't convicted of monopoly abuse. Being a monopoly is not what got MS in trouble. Abusing that monopoly was their problem. Apple by all accounts has the highest marketshare of MP3 players. They never got in trouble with the DoU because they didn't strong-arm their partners against their competitors like MS did.
Strong-arm their partners? You mean like how Apple refused to license Fairplay to any other hardware manufacturer so that anybody wanting to use the ITMS had to either buy an iPod or had to go through the inconvenience of burning and ripping a disc, hence getting a lesser quality of product.
But, no, it's not like Apple would ever strong arm the competition like that, no siree.
As for the lack of conviction, it's hard to get convicted when you're never put on trial. It might be that Apple engaged in perfectly legal behavior, I doubt it, but it somewhat waters down the point when the DoJ isn't enforcing the law.
Some of the numbers and reports are grossly overblown. For example, there is an estimated 409 million PCs sold in 2011 vs 20 million tablets. If each tablet sold constitutes a lost PC sale (which in the vast majority of cases it doesn't.. It's in addition to a PC, not a PC replacement), it would be hard to notice the impact. You would see PC sales increasing at a measly 10% per year rather than it's normal 14.8%.
It's a trend, and it may have an impact in 3-5 years, perhaps, but that day isn't today. It also shouldn't be ignored, and it appears that Microsoft isn't ignoring it (Window 8 being largely a tablet friendly enhancements). Time will tell.
I find that humorous. They are a largely irrelevant company. Who cares if they disappear. If IBM or MS goes down the world is in a lot of hurt. Apple doesnt matter
Granted they were going at it in an anti-competitive manner
I think that is more of the problem. MS hasn't innovated anything -- they wield their patent portfolio and extort or steal technology and/or revenue. And the biggest selling point they offer in non-windows products is compatibility with Windows which is their monopoly anchor. Other companies, such as google, are innovating and providing better products. Compare bing results to googles, compare Picasa to Windows Live phots, compare gmail to windows live. The MS products seem simple and primitive compared to the google products. So what does MS do instead? They extort patent royalties for patents they are not even willing to disclose.
My 2 cents .. YMMV
Strong-arm their partners? You mean like how Apple refused to license Fairplay to any other hardware manufacturer so that anybody wanting to use the ITMS had to either buy an iPod or had to go through the inconvenience of burning and ripping a disc, hence getting a lesser quality of product.
There is a difference in Apple not licensing a DRM they invented to anyone and MS hinting to Intel that if they developed a Java VM, MS would strongly favor AMD in the next version of Windows and telling OEMs that if they installed Netscape that their Windows prices might rise. The problem with your argument is that Apple did not have partners in their DRM; they did it on their own.
But, no, it's not like Apple would ever strong arm the competition like that, no siree.
Read carefully and process what I said. How is it strong-arm the competition by not licensing or partnering with them? Did Apple ever reach out to third parties? Did Apple ever go to any of their iPod/iPhone case manufacturers and tell them not to make cases for Samsung or HTC or Motorola or their licensing fees would rise? That would be analogous to what MS did.
As for the lack of conviction, it's hard to get convicted when you're never put on trial. It might be that Apple engaged in perfectly legal behavior, I doubt it, but it somewhat waters down the point when the DoJ isn't enforcing the law.
If you have a specific complaint other than their refusal to license their DRM which they have a right to do, I'd like to hear it. Netscape and Sun had specific examples of wrong doing by MS which they presented to the DOJ.
Well, there's spam egg sausage and spam, that's not got much spam in it.