We had a chuckle this morning at the idea of Sony being taken over by Apple Computer, an idea that has been flying around the US stock markets, supposedly as a reason for Sony’s share price to rise a miniscule few percent. If the idea had any legs, Sony would have shot up. Apple sits on $46bn in cash and short term securities, …
Better retail coverage in China.
The Chinese have a plethora of fruit-like products to buy, all at fractional prices compared to the American competition.
Chinese disposable income is barely comparable to that of the US.
I frequently pop up to NanNing and GwangZhou to buy things and I am amazed what nice, clean consumer technology $10-50 can buy you, definitely the type of product Chinese consumers appreciate at prices suited to their budgets.
I just finished doing my Christmas shopping in China
And no doubt my nephews and nieces will be impressed with the top-end fruit lookalike players and viewers, Even picked a couple of V4 phones that work better than the originals,
Apple will buy American Express
To revolutionise payments, billing with iTunes simplicity.
Re: Apple will buy American Express
So that'd make at least one place that actually *takes* Amex then ...
I know that was probably intended as a joke, but
It actually makes more sense than Sony.
Both American Express, and Apple provide a status product. You get something from them you can actually get somewhere else (albeit perhaps with a drop in quality, you decide) but pay a premium because you like the brand, or what they do with the product to differenciate it.
They fill the same roles in their markets, and thus seem to have a good fit.
Available now from American Express, the iBuy Card - Only available in Black for now, white card coming soon, we promise!
nice to see someone writing an article on this with a sensible view rather than the attempts to move the market that were happening during the week by idiot analysts who haven't a clue how the real world works
In search of things to fix with money
One of the weak points in apple's "desktop experience" is enterprise management. Though some management software does indeed exist (the stuff that makes the "big mac" super go), the rollout and support work is rather poor. Fix that and he could make a serious dent in micros~1's enterprise "seat" hegemony. I don't think he would want to. Too much work, not much fame to be had. That in turn is a bit of a weak point in what apple itself is, though.
I was going to say something about networks as the only thing they're offering there is access points, but given how half-hearted the x-serve is treated already, I don't see why. Worse, networking kit is the network admin's toolbox, so there's nary a thing steve's designer touch can beautify by taking away things you otherwise might do with it. Might as well try and revolutionize the desktop lamp experience.
But given that el grande manzana himself likes his hoard just like it is, he's probably expecting a fight in the next few years. I wouldn't know what it would be about, but as war chests go, well, he's coming prepared.
No response necessary: just read the quote and look at the icon
"He might buy out TiVo, and own the time-warp patents, but then again Jobs thinks little of patents and always tries to work around them or ignore them."
Sony is a manufacturing company that does some design where Apple is a design house that also does software and outsources most it's manufacturing. The net result is you have two companies with vastly different staffing requirements and it shows. Apple has only 34,300 employees while Sony has a bit over 5 times that with 171,900 according to google finance.
It is actually very interesting to compare these two as they are so similar in market sector and yet couldn't really be more different in how they go about doing it. Does Apple want to tie itself down by internalizing its manufacturing? I don't think so and there are probably cheaper plays than buying Sony if it did.
Internalising its manufacturing?
Apple to make offer for China in leveraged buyout. You heard it here first!
Maybe parts of Sony, though
I agree with the major point here: Sony as a consumer electronics company has nothing Apple wants. It's a once-great giant that is now stumbling badly--a liability rather than an asset.
However, as a media company, Sony might have some allure. I'm thinking that it would do Apple no harm to own Sony Pictures, for example. That would give Apple access to a huge library of Columbia/Tristar films. Likewise, Sony has some assets in the music business that might be worthwhile.
Would Sony sell off these divisions? Who knows? I'm just suggesting that while it would make no sense for Apple to buy Sony as a whole, Jobs might see value in Sony's media assets, if they became available at the right price.
Sony has nothing Apple needs or wants
Would you buy a company now best known for rootkits?
...with the increasing amount of "control freakery" that Mr Jobs has exhibited over the past few years that would make Apple and Sony well suited to each other!!
I absolutely hate Sony and i despise the business practices of apple.
I hope they do merge so that i can hate just the one monstrosity
In a previous article, the idea was mooted...
Be a better bet than Sony. But then they have the SonyEricsson millstone around their necks, as also Nokia has NokiaSiemensNetworks as their Dun Cow* to slay. ("2½ yearsuntil they can kill that beast...NOT Beresford-Wylie's finest hour...)
Only problem is, I think the Finnish Gov. holds the "Golden Share". Otherwise, with the branding of Nokia vs. the branding of Sony, I'd bet Nokia.
Some sense at last
It's good to read a balanced opinion at last from el Reg.
Steve Jobs actually said it all a couple of years ago when he described Sony as "a dead fish washed up on the beach".
And it wasn't long before that relationships between himself and the head of the playstation division became so bad that it scuppered the collaboration negotiations entirely due to differences of personalities.
Apple do not need anybody and they are smart enough to know it.
Does not make sense
A Apple acquisition of Sony makes no sense at all. We are talking about two entirely different
businesses and cultures. A monolithic culture like Apple would be a disaster for Sony. Apple has no experience running a conglomerate like Sony with multiple divisions. The only thing that makes sense is for Apple to purchase Sony's film library. I see very little chance that Sony would be willing to see their film library.
They have nothing Jobs (or I) want...
All their products are proprietary and DRMed to hell and gone, to the point of uselessness... heyyy, waitaminnut...
If you're the size of Apple and you have $50b cash in the bank, you're not going to spend two thirds of it in one go.
Jobs is clever enough....
... to stay away from areas where competition is tough. He stays away from the PC lower end market, he stays away from the server market, and so on. He only likes areas where he can sell expensive items with very little competition, and thus maximize revenues. Sony is in too many markets, Apple can exists if and only if can select its markets.
Apple wants to translate a bubble valuation into a real asset
Apple's current market cap exceeds that of real megacorps like Wal-Mart, GE, the world's biggest banks, and all but the very largest energy companies.
Apple are very good at what they do but their business is not on this scale. The only way Apple will become a business of that scale is by giving up on what is distinctive and different about them, and in the process giving up on their current P/E ratio. In other words, Apple's market cap will shrink dramatically, and quickly, the moment markets perceive they want to become a true megacorp.
Apple now is like AOL at the height of the Internet bubble. Time Warner buying AOL might have made some sense (not a lot with the benefit of hindsight). AOL buying Time Warner was a joke for everyone but the AOL shareholders. The purchase translated massively overvalued paper into a real long term asset. It was the smartest thing AOL did.
Similarly, Apple stock has a bubble valuation right now, and will inevitably fall. We just don't know when. The smart thing to do is translate the current value into a real long term asset. It doesn't have to be Sony, but Apple could do worse. Maybe Sony's entertainment division, not the rest of the company?
Sony's got quite a bit of cash
And that cash would make a fine down payment on the rest of Sony. Sony has a lot of patents. Sony is currently trading at a serious discount from real value. Apple buying Sony is a bit of a stretch, but it's not completely implausible.
As for the window-sitters, the various unprofitable businesses, well, companies that buy other companies quite often spin off large unwanted portions of them to fend for themselves and keep the bits they wanted. Sometimes they do so keeping what they want and netting more for the spinoffs than they paid entirely.
Apple will be more creative in it's aquisitions
Don't expect a financial analyst's mindset to 'get' apple's acquisition strategy. I think the driver will be disintermediation. Yes, a back-catalog of music and movies looks great on paper, but buying Sony wouldn't bring anything revolutionary to the party. For Apple today, mobile operators represent a significant 'choke' on their potential. Why is Face-Time Wi-Fi only? Doesn't Face-Time represent Apple's toe-in-the-water of being a mobile operator? There are lots of options - including going down the MVNO route. iPhone/iPad/Mac + retail & iTunes + a mobile network of their own .. sounds like a pretty good vertically integrated business model to me.... and what about this multi-network integrated SIM card that being rumored for iPhone. Is this just a cheaper way to manufacture, or a 'trojan horse' in preparation for Apple's own network?
Sounds more like a rumour started by some hedge funds to try and make another billion or two over the weekend...
Apple has a lot of money, but wouldn't want Sony anyway - unless it wanted an instant "in" to the console market.
BTW, Apple Inc hasn't been called Apple Computer for several years.
"but then again Jobs thinks little of patents"
Except when he owns them, then its a different matter.
I thought Jobs was wanting to push into the arena of on demand TV? Besides which i really cant see Jobs blowing all his cash in one swoop.
Sony has a lot Apple wants
Think console market for example. And Sony's media (music + film) market.
Only iTune allowed on PS3 would be so evil that Steve couldn't wait to get hold of.
If I were invested in Apple I think I'd like to start getting some of my money back. If the money just sits in the bank then it may as well sit in the investors banks. Or better yet they can re-invest it themselves.
You only buy another company if you can get more value from combined one than from the parts. Buying Sony, or any other big consumer electonics company is not going to suddenly elevate that brand and let them charge additional margins.
I think hardware-wise Apple can only be expected to buy IP and small, specialised players who fit their overall great plan. Besides, hardware is easily outsourceable once hou have a proper design. Then, I would argue Apple's major investments will go into software and/or content.
Think EA, a major game producer or a similar company. Games have become biger a market than music and iPhone/iPad are the devices used increasingly to play games. If you own a game producer you control for which platform the games are made, or are made FIRST for.
This would decrease the value of Sony (and others, like Microsoft), obviously, making them besieged and prompting them to think hard about their core markets.
Also, owning major gaming assets would be similar to owning major movie assets and would mean a lot of control over the market.
I believe the retail story is off the mark. They want a no hassle reseller arrangements or just do the thing exactly their way, that is build their stores by themselves, organically, I think.
Just because you can afford it...
Is no reason to buy something. Sony is within reach of apples liquid Capitol, but songs profits on that do not have sufficient return to be a wise investment. Sure, Sony has a few pTents apple would love to have, and a lot of manufacturing muscle, but buying Samsung would be smarter if the price was the same. (more relevant technology pool).
Really the money is best spend in smaller acquisitions and buying diisionsmofmcompqnies,not the whole thing. This is a laughable idea, buying Sony.
Funny. Seriously tho, i think Sony's getting too Apple-y in their practices already -- no need to make it worse.
Entry into the Enterprise market
What if he wants a chunk of the Enterprise market.
How about buying SAP, they deperatly need a buyer who know how to do
UI's cos SAP ain't got a clue