The Macalope Weekly: Truisms

Macalope

There are certain truisms in life. One is that Apple acquisition fantasies always involve the company dumping billions on a big name. Another is that Microsoft always wins. No matter how you have to arrange things in your imagination to have it work out.

Crazy talk

Sometimes it takes a craaaazy idea to shake things up!

But not this time. This is just regular old crazy crazy.

Uncommon Wisdom’s James DiGeorgia says:

“Apple Would be Crazy Not to Buy Tesla for This Reason Alone”

Crazy! Not to! Someone should put Apple in a home! That’s how crazy! They’re a danger to themselves and others! At the very least take their scissors away!

Having actually seen this acquisition suggested other places it’s questionable whether it’s that uncommon. It’s certainly not wisdom.

Apple (AAPL) is an insanely profitable company …

So, let’s see if we can fix that.

My suggestion for Apple: Use some of that spare change to buy electric car manufacturer Tesla Motors (TSLA).

Just do it! Go on! Try not to think about it too much! You’ve been good all year! Treat yourself!

DiGeorgia goes on to describe Tesla’s expertise in battery technology, which is true.

What does this have to do with Apple?

The answer may shock you!

(Ha-ha, battery puns!)

More likely, however, it’ll confuse you and leave you wondering what poor life choices led you to reading this piece. At least that’s what happened to the Macalope.

Simple: Batteries are the single-weakest link in Apple’s mobile devices.

Uh, yeah, that 10-hour battery life on the iPad is really … uh … what?

See, Tesla CEO Elon Musk has a large interest in SolarCity, a solar technology company that uses the Tesla car battery for home power. Now you see the connection?!

Apple could put huge car batteries in the iPhone! It’d be like printing money.

Wait, wait! Apple should buy Bitcoin, too! It doesn’t matter if it’s not technically for sale!

It goes without saying that all of this flies in the face of the kind of acquisitions Apple actually does. You know, sound ones. Presumably in DiGeorgia’s mind there are no other, smaller companies that don’t make cars and aren’t run by eccentric founders but also make batteries that Apple could buy. Nope, you have to buy both Tesla and SolarCity or this fanfiction just doesn’t work.

For $20 billion or less, Apple could buy both Tesla and SolarCity at their current market prices and take control of the solar revolution. Apple could be the world’s first multitrillion-dollar company.

Isn’t that what it’s all about? That and stilted technology industry acquisition porn?

Rob Enderle lite

The good news is that since we last heard from Roger Kay back in 2011, he’s updated his website from the Yahoo Sitebuilder template he had previously been using. Way to move into the 21st century, Roger! The bad news is, he’s still the same Roger Kay. That would be the Roger Kay that only sees upside for Microsoft and only sees downside for Apple.

Possibly because Microsoft is a client of his. That’s a little fact that somehow never seems to get mentioned when Kay gets quoted. Very strange. Usually the tech press is totally on top of that.

Cough.

You see, in addition to being the go-to guy for an anti-Apple quote when Rob Enderle strains a groin muscle, Kay is also the author of the “Apple tax” (regular quotes) “analysis” (jerk quotes) that showed beyond a doubt how owning a Mac will ruin you financially.

And MarketWatch doesn’t think you should let the fact that Microsoft paid Kay for that “analysis” (yep, jerk quotes again—you’re catching on!) deter you from taking it very seriously. Or that you should know about it at all. He’s an analyst and analysts are holy, blameless creatures like unicorns and red pandas.

“Why Apple could lose some tablet market share to Microsoft”

If this seems familiar it’s because it’s an almost verbatim repeat of this piece from 2011:

“New Intel tablets could slow iPad enterprise appeal”

By supporting the Windows 7 OS, Oak Trail tablets will blend more smoothly than the iPad into IT environments relying on Windows.

And here we are two years later and all corporations are using Windows 7 tablets, The End.

Hey, can you guess who’s quoted in both pieces?

Go on. The Macalope knows you know, but he wants to hear you say it. SAY HIS NAME!

Roger. Kay.

2011:

“There’s a security story that plays well in corporate. IT managers will be much friendlier to a Windows tablet than to an iOS one,” said Roger Kay, president at Endpoint Technologies Associates.

Because iPad are so insecure.

“Windows tablets will likely appeal to commercial customers, who, for compatibility reasons, want to stay with Windows,” Kay said.

Uh-huh. Sure. So, that didn’t happen and presumably a now-chastened Roger Kay is back to point out that Windows-based tablets are really going to have a hard time hahaha noooooo …

“I think the legacy base will carry them, at least part of way, toward that IDC number,” Kay added.

IDC’s current meaningless “prediction” (just give me a break quotes) only gives Windows tablets a 10-percent share in 2017, but they believe most of it will come from the iPad because the enterprise market will eventually warm up to Windows tablets because [mumble mumble] JUST BECAUSE, OK? [IDC is owned by IDG, which is also Macworld’s parent company.]

The Macalope doesn’t know what the market share numbers will be in 2017. But if history is any lesson then neither does IDC. Even Kay doesn’t want to commit to the  research firm’s number.

“I don’t think the forecast is terribly unreasonable, but I’d be inclined to tweak it down a bit, like 7-8% instead of 10%.”

“Guy paid by Microsoft downgrades Microsoft market share forecast!”

You buried the lede, MarketWatch.

Moar Microsoft Winning

Writing for the Motley Fool, Sam Mattera warns:

“Nokia’s New Phones Will Put Microsoft Ahead of Apple”

This means a lot coming from the guy who said bad Galaxy S4 reviews were bad news for Apple and the iPhone 5c and 5s were flops.

So, no link because there’s only so much of this even a mythical beast can take, but tip o’ the antlers to @JonyIveParody who notes the Macalope’s old axiom, “It’s amazing how future Microsoft products beat current Apple products time and time again, isn’t it?”

While that may have once seemed unlikely, Apple’s slow market-share slide combined with Nokia’s low-cost handsets and new phablets, are exactly what Microsoft needs to take second place.

It’s ironic how the skies over rainy Redmond are always perceived to be blue.

And is the iPhone’s market share in a slow slide? Kantar Worldpanel seems to think its slight downtick is explainable by the fact that this year’s model was an “s” release rather than a full number upgrade.

The Windows Phone platform is seeing some positive signs in more developed economies. Nokia’s recently launched Lumia 1520 was temporarily delayed after demand outstripped supply.

And it’s not like anyone ever had to wait to buy an iPhone.

Nokia’s 6-inch phablet isn’t likely to come close to Apple’s iPhone in sales, but a solid U.S. reception should be seen as encouraging.

In the third quarter, Microsoft’s Windows Phone saw year-over-year shipment growth of 156%, according to IDC. That’s an impressive figure.

Not really! When your base is practically nothing, it’s pretty easy to increase it by a large percentage. Also: “shipments.”

Most of that growth has come in Europe, where Windows Phone is finally starting to take a sizable chunk of the market. Microsoft’s mobile platform still has just 3.6% of the world market, but in Europe’s five biggest economies (Britain, Spain, Italy, France, and Germany), its share is more than 10%.

The iPhone, meanwhile, only took 53 percent of the U.S. market in October and 76 percent of the Japanese market. So, like nothing.

Of course, these analyses only ever note the upside for Microsoft. Apple is presumed to suddenly get more into playing guitar or something, instead of making new deals and new devices.

WWDC 2016: “Hey, check out this new chord!”

But the real opportunity for Windows Phone is in …

Narnia.

… emerging markets, where billions of customers remain unserved.

Ah, you mean the low-margin markets where people don’t buy apps and accessories. That should really give a boost to the floundering Windows Phone ecosystem. Good luck with that.

But with Windows Phone’s rapid growth, and Microsoft and Nokia’s willingness to aggressively target emerging market consumers with budget handsets, I expect Microsoft’s platform to eventually overtake Apple’s iOS when it comes to global market share.

The Macalope supposes it’s possible, if Microsoft takes an Xbox-style approach and decides not to make any money off of Windows Phone. But, more importantly, market share predictions are as ephemeral as butterfly wings, spider webs, and one-ply toiler paper. But no one ever got fired for betting on Microsoft. Alas.

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