| | July 18, 1999: Michael Dell predicts the imminent demise of one of the top five computer manufacturers even as Steve Jobs patiently plots his revenge. Meanwhile, is a Disney-Apple deal involving MyApple.com slated for a Macworld appearance? And Microsoft mostly wins its antitrust case... (No, not that antitrust case-- the other one.) | | |
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Call Me Ishmael. (7/18/99)
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It's no secret that Steve Jobs has what some might call a vengeful streak. Witness, for example, how completely he obliterated the entire Newton project (despite his voiced attraction to the eMate)-- is there much doubt that the primary motive behind the axing was the Newton's association with former CEO and Jobs-firer Sculley? Oh, sure, you can argue that the Newton was unprofitable, that it was a money pit, that it lost the handheld wars-- but deep down, don't you believe that Steve was really flushing one of the remaining Sculley legacies? Because the Newton could have been turned into a wild success if Jobs had worked his inimitable magic on it, but we think he was happier to see the thing fail. And so it was goodbye Newton, hello Palm...
Now, if you take Steve's attitude towards the Newton, magnify it a hundredfold, and focus it on an external company, you have Steve's white whale: Dell. Ever since Michael Dell publicly said that if he were running Apple he'd "shut it down and give the money back to the stockholders," Steve's had his sights set on Dell-- which is pretty ambitious, given the vast differential between the two companies' revenues. Still, it's nice to aim high, right? Anyway, Steve took a shot back at Dell a couple of years ago when he unveiled Apple's new line of G3 Power Macs and the Dellesque online build-to-order Apple Store. In fact, he even had a "Think Different" commercial that was targeted at Dell-- though at some point he apparently decided that publicly chasing Moby Dell may not have been a good idea at the time, and the ad never aired. But what Steve has done is publicly note for the last several quarters how Apple is beating Dell's previously-industry-leading inventory numbers. Consider it a baby step.
Anyway, our point is this: if Apple really expects to tangle with Dell, it'll be a long battle, and one of the big weapons will be efficiency. Mike Dell himself is publicly predicting that one of the top five computer manufacturers will be forced out of the market within the next few years, according to a CNET article. Since he's talking about a company being dragged down by inefficiency, he's obviously not referring to Apple; he seems to be talking about Compaq, currently the largest PC maker in the game, whose cost structure is "about double" that of Dell's. What's interesting is that Compaq boxes are the ones that typically beat out the iMac at retail; if Compaq were really to drop out of the race, Apple might be on much better footing to snag even more consumer market share. And who knows? If Apple's actually decided to leap into enterprise sales by then, maybe Dell won't be such a huge target after all-- and maybe Steve will finally bag his whale (in the metaphorical, vegan-friendly sense, of course).
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Last-Minute Guesses (7/18/99)
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Hey, it's Expo week-- you have to expect some final speculation about the Jobs keynote. We realize you're probably sick to death of the whole rumor mill by now, given how much overtime it's been putting in lately, but we promise we'll leave the seriously overdone subject-- the P1-- alone for now. It's (probably) coming, and why speculate when we'll know the real, honest-to-goodness, true-to-life official specs in a few days (we hope)? And we're done wondering about a possible Palm announcement, too; if one is made, than hooray, and if not, then we'll go back to wondering what funky designs and improved technologies an Apple-branded Palm device might bring to the table.
So what's left? Well, there's the whole "Apple ISP" thing, for one; this whole buzz about how Apple's planning to shake the dust of the long-dead eWorld off its shoulders and leap back into the online service fray. It's not all that unlikely, when you see the trend forming in the computer industry whereby customers get vastly-discounted PCs when they sign up for a chunk of Internet service at purchase time. Gateway gives its customers a year's worth of Gateway.net access, we believe. Dell is planning on starting up its own ISP to leverage a similar kind of offer. Micron has the gall to offer a "free PC" that actually costs over a thousand bucks up front; part of the cost is three years' worth of Internet service via Earthlink, according to a CNET article. So it's not crazy to expect Apple to jump on the bandwagon; with iMacs still priced at $1199, tossing in a free year of Internet service might be a great way to sweeten the deal.
Probably the king of speculation on this issue is Robert Morgan. On Friday he posted one MacWEEK article which not only supposed that Apple and Disney might be snuggling up together for the debut of "MyApple.com," but also suggested that the monumental announcement might well come during this Wednesday's keynote. Unfortunately, only a couple of days later he posted a second article downplaying that possibility in light of new information he had received. Oh, well. Whether MyApple.com surfaces or not, at least we'll have the P1 to kick around. Maybe.
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Mini-Redmond Justice (7/18/99)
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Still going through "Redmond Justice" withdrawal? Hey, who can blame you? After all, the day-to-day drama of the courtroom testimony was simply enthralling; the verbal thrust and parry, the mind games, the tearful confessions, the on-the-stand suicide attempts-- well, you get the point. So yeah, we miss the daily antitrust battle between Microsoft and the government, too, and we admit that it's going to be tough waiting out the weeks before the next installment. In the meantime, though, modern technology has provided us with a minor miracle. It's Mini-Redmond Justice-- identical to the real show in every way, but one-eighth the size.
If, like us, you were too wrapped up in the government's case to notice Microsoft's other antitrust suit filed by a tiny company named Bristol Technologies, hey, don't beat yourself up about it; no one can watch everything on TV. (Believe us, we've tried.) So here's the skinny: Bristol apparently makes software that lets people run Windows software on the Unix platform. To make this product, they licensed the Windows source code from Microsoft. Then, once Microsoft managed to carve out a decent and growing market for the Unix-challenging Windows NT, they allegedly denied Bristol access to NT source code in an attempt to kill Wind/U and encourage migration from Unix to NT. At least, that's what Bristol says. Microsoft apparently didn't "deny" Bristol access to the software, though they did raise their licensing price significantly. However, other companies reportedly pay the higher license fee and consider it a fair price...
Regardless, we're coming in at the end. The trial's over, and after two days of deliberation, the jury found that "Microsoft did not commit antitrust violations," according to a CNET article. Bristol was looking to get $263 million, but instead they got a whopping $1. (See, the jury did side with Bristol on one count, and found that Microsoft had violated a Connecticut unfair trade law.) Microsoft's pretty happy, of course, but the buzz is that the outcome of this case should have no bearing on the outcome of the real "Redmond Justice," so don't start changing your bets just yet. Especially given how many points the government managed to score off Microsoft's legal team throughout the trial... Guess we'll know next year sometime, provided the sides don't settle first.
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