If you spend any amount of time reading technology news and opinion sites, you’ll know how high the percentage of bullshit is. It’s huge. Finding the decent stuff takes forever, and you’ll spend your time tripping over errant nonsense.
It takes a lot to excel in the field of writing bad technology stories, but I think Eric Jackson, writing for Forbes.com, may have beaten us all and written the worst article in tech history.
It is, naturally, about Apple. Apple attracts poor writing like nothing else, probably because posting articles about the company attracts page views like nothing else. Jackson spends hundreds of words chastising it for failing to buy companies. Everyone is doing it: Microsoft, Facebook, Google… just everyone. So why isn’t Apple?
It’s clear almost from the get-go Roberts knows remarkably little about how Apple works and what’s made it richer than Croesus. Take this:
It’s also clear that Apple has lots of weak areas that it should be more aggressive in filling in: cloud services (it would nice for iMessage not to go down), web/app services (hello Ping and MobileMe), adding key mobile apps beyond things like iPhoto and iMovie, and maybe even turning its back on the whole walled garden approach with iCloud and iMessage by acquiring a leading cloud company like DropBox and messaging app to open it beyond Apple users.
Sure, Apple could “turn its back on the whole walled garden approach”. But why? So it could lower its margins? So it could have to support more platforms, increasing its costs and complicating its business? Apple sells hardware, with high margins. Now I know this idea utterly offends blinkered pundits who think there’s only one way to make a profit (repeat after me: “MARKET SHARE”) but that’s the way it is. Everything else it does is to support and enhance the hardware.
Better is to come. Jackson isn’t just a Jeremiah: he has actual positive ideas for how Apple can spend some of its cash:
What’s a quick way Apple could deploy $50 billion in cash? Well, they could pay $400/share to take out Tesla (TSLA) and make an audacious huge play for the Internet-connected car, as well as snagging Musk into the fold in one fell swoop.
Leaving aside, for one second, the value of Elon Musk (not everyone thinks he’s a genius) what would Apple gain by this? Suppose AppleTesla becomes the biggest car company in the world, by force of will, hitting the levels of General Motors. That’s 10% of the market. What happens then? Simple: every other car company, which might all have bought Apple technology for their connected cars, uses someone else’s tech because there’s no way they’re benefitting a serious competitor.
Plus you’re now saddled with a high-revenue, low profit business: General Motors made just $18 billion gross profit for the whole of 2013, on revenues of $155bn. Over the same period, Apple generated $64bn gross profit on revenues of $174bn. Apple’s profit margin is 21%; GM’s profit margin is 3%. If Apple wanted to just put $50bn in an ordinary bank savings account, it could make a better annual return than buying a car company.
Fucking. Dumb. Idea. This is why people like Jackson don’t get to be CEO’s of Fortune 500 companies.