Apple could nearly buy the mobile phone industry

[Pliablemoose]

http://www.asymco.com/2011/06/17/apple-could-buy-the-mobile-phone-industry/

Holy crap.... That's a lot of cash...

 

[poofyhairguy]

 

[alent1234]

About what Microsoft had 10 years ago

 

[YoungGun21]

That's the goal isn't it?

 

[Anubis]

they will need that cash on hand when they lose all their BS patent lawsuits

 

[MagickMan]

Damn, they could easily borrow the money to do it. That's kinda crazy.

 

[gsaldivar]

they will need that cash on hand when they lose all their BS patent lawsuits

:biggrin:

 

[Bateluer]

they will need that cash on hand when they lose all their BS patent lawsuits

There's also no way they'd have the money to bribe the bulk of Congress and the FCC too.

 

[mammador]

Liquid assets? Is this current assets? If so, that's not necessarily something to crow on about. Too much stock can become dead stock, too much cash means less being spent on operations, and too much credit/debtors means a higher risk of credit not being paid back.

 

[Pliablemoose]

Apple has 0 debit, the 70 billion is cash on hand, not product etc... Cash. They're in an insane position...

 

[akugami]

As Pliablemoose said, it's mostly cash on hand with some other investments that can readily be converted to cash. That's what liquid assets are. Granted a sizable amount is stocks in other companies and other investments. I believe that in terms of actual cash on hand it is about $43 billion. But with just that cash on hand they could buy Nokia and RIM.

 

[Mr.IncrediblyBored]

Liquid assets? Is this current assets? If so, that's not necessarily something to crow on about. Too much stock can become dead stock, too much cash means less being spent on operations, and too much credit/debtors means a higher risk of credit not being paid back.

What's your point? Does any of that apply to Apple? They're swimming in capital and are in a great position in nearly every market.

 

[Tsavo]

But with just that cash on hand they could buy Nokia and RIM.

Or they could wait a year and buy Nokia for $11.53.

Total.

 

[Pliablemoose]

Hard to figure out what makes sense for them to buy, Apple figured out some time ago it makes sense to outsource manufacturing, scoring NorTel's patents would be a good move...

http://www.reuters.com/article/2011/06/18/us-nortel-idUSTRE75H26D20110618

 

[WildW]

Most companies are happy to concentrate on the task of making profit . . . Apple seems to have done that so much that it isn't really important any more.

When you're sitting on a pile of cash that large, a company just becomes a plaything of the people in charge to shape the world in the way they want. And when you start to think about it that way, wanting to dominate the mobile phone industry actually seems rather unambitious.

 

[Mopetar]

Hard to figure out what makes sense for them to buy, Apple figured out some time ago it makes sense to outsource manufacturing, scoring NorTel's patents would be a good move...

http://www.reuters.com/article/2011/06/18/us-nortel-idUSTRE75H26D20110618

Those patents would definitely make it easier to withstand some of the litigation against them, but I don't know how useful they'd before offensive suits since most companies probably already have licensing deals for the patents in question that Apple wouldn't be able to revoke. They may not care to purchase them so much as run up the price for Google.

A year or so back, there was a lot of talk about the use of liquid metal in Apple's products. If that were something they were still interested in, they could use some of the money to invest in the necessary manufacturing capacity to produce an adequate supply of the material. If they wanted to manufacture other custom materials, they might consider building their own plants.

Right now they do their own SoC design, but use third party graphics. They could purchase a small company that does ARM SoC graphics in order to bring their designs completely in house. Imagination Technologies, the company that supplies the graphics for Apple has a market cap slightly higher than a billion dollars, making them a potential acquisition. They may also be interested in putting more phone components onto a single SoC, so other acquisitions may be possible.

If they wait a few more years they might be able to buy Microsoft.

 

[ponyo]

Do you know what rich people fear the most other than sickness? Losing what they have and being broke. Because it's easy to upgrade but downgrading is beyond painful. Steve and Apple flew up the mountain but nearly died falling off. They were saved by an olive branch at the base of the mountain. They have been to Hell and back. Once you have near death experience, you're going to make sure it doesn't happen again. Apple mountain of cash is their safety net in case of accidental fall off the mountain, and I don't see Apple giving that up as long as Steve is around.

 

[Oyeve]

Do you know what rich people fear the most other than sickness? Losing what they have and being broke. Because it's easy to upgrade but downgrading is beyond painful. Steve and Apple flew up the mountain but nearly died falling off. They were saved by an olive branch at the base of the mountain. They have been to Hell and back. Once you have near death experience, you're going to make sure it doesn't happen again. Apple mountain of cash is their safety net in case of accidental fall off the mountain, and I don't see Apple giving that up as long as Steve is around.

This is very true. Apple has nearly died afew times. Wont happen again until steve croaks. Then shit willhit the Apple fan.

 

[Mopetar]

Yes, but they have enough cash to run for at least five years even if all of their sales completely fell off the map. They're incredibly safe with that amount of cash.

They've been using decently large sums (A cool billion here, another there) to invest in component manufacturers and secure supplies for their iDevices, but even with that, they're still adding to the pile faster than they can use it.

One possibility is that they're hoarding cash for the next time their stock takes a crazy nose dive because Steve Jobs coughed funny or someone thinks the world is ending. At that point they could easily buy up outstanding shares and take the company private.

Conceivably, they might also reach the point where they could buy a country. Apple already generates several times the GDP of some smaller countries during each financial quarter.

 

[mammador]

What's your point? Does any of that apply to Apple? They're swimming in capital and are in a great position in nearly every market.

That cash is simply sitting in the bank, doing nothing. It applies to any business concern, it's basic accounting. Jobs either needs to invest in more fixed assets or buy a company. Having literally billions of dollars in cash, which is not being used, cannot be healthy.

 

[foghorn67]

Most companies are happy to concentrate on the task of making profit . . . Apple seems to have done that so much that it isn't really important any more.

When you're sitting on a pile of cash that large, a company just becomes a plaything of the people in charge to shape the world in the way they want. And when you start to think about it that way, wanting to dominate the mobile phone industry actually seems rather unambitious.

This. They reinvented the mobile market, they want the next big thing. Even if they have to invent it themselves.

 

[akugami]

That cash is simply sitting in the bank, doing nothing. It applies to any business concern, it's basic accounting. Jobs either needs to invest in more fixed assets or buy a company. Having literally billions of dollars in cash, which is not being used, cannot be healthy.

They've been making a few strategic investments/purchases here and there. Some of them actually make a lot of sense with where Apple is heading. One high profile purchase they want to make is for the Nortel patents. Google offered $900 million for those patents. Apple is going to have to bid about $930 million to top it. Likely whoever wins is going to be paying over $1 billion. This is IMHO a critical purchase for Apple. One of the reasons why Apple is being sued so much for infringement cases relating to their iPhones is because they are a relatively new player and don't have a huge patent portfolio relating to wireless telecommunications. Purchase the Nortel patents (overpay if you have to) and watch companies be very careful if they initiate a suit against Apple.

They've also used some of the money to get sweetheart deals or corner the market for components that they use. Example being when they killed the available supply of micro sized HD's early in the iPod's life or when they did the same by practically buying up all available NAND memory for use in devices. Supposedly Apple purchased about 60% of the available LCD's of that size for use in their iPad 2's.

 

[zerocool84]

They've been making a few strategic investments/purchases here and there. Some of them actually make a lot of sense with where Apple is heading. One high profile purchase they want to make is for the Nortel patents. Google offered $900 million for those patents. Apple is going to have to bid about $930 million to top it. Likely whoever wins is going to be paying over $1 billion. This is IMHO a critical purchase for Apple. One of the reasons why Apple is being sued so much for infringement cases relating to their iPhones is because they are a relatively new player and don't have a huge patent portfolio relating to wireless telecommunications. Purchase the Nortel patents (overpay if you have to) and watch companies be very careful if they initiate a suit against Apple.

They've also used some of the money to get sweetheart deals or corner the market for components that they use. Example being when they killed the available supply of micro sized HD's early in the iPod's life or when they did the same by practically buying up all available NAND memory for use in devices. Supposedly Apple purchased about 60% of the available LCD's of that size for use in their iPad 2's.

Umm Apple has TONS of patents compared to Google in the mobile sector. Apple sues tons of people, they're definitely not the victim at all. Apple is as sue happy as everyone else in the mobile sector. Google is actually really using that argument that since they have a relatively small mobile patent portfolio compared to others, they're hoping to acquire it to protect themselves from getting sued.

http://www.engadget.com/2011/04/04/google-bids-900-million-for-nortel-patent-portfolio-will-use-i/

Also you would think with all that money they'd be giving a lot more to charity but Steve Jobs doesn't care about anyone but himself.

 

[Bryf50]

Wait I'm confused. Why are they comparing just the phone making arms of companies vs all of Apple? They make more then just phones also. Samsung is a behemoth of a company even compared to Apple.

 

[akugami]

Umm Apple has TONS of patents compared to Google in the mobile sector. Apple sues tons of people, they're definitely not the victim at all. Apple is as sue happy as everyone else in the mobile sector. Google is actually really using that argument that since they have a relatively small mobile patent portfolio compared to others, they're hoping to acquire it to protect themselves from getting sued.

http://www.engadget.com/2011/04/04/google-bids-900-million-for-nortel-patent-portfolio-will-use-i/

Also you would think with all that money they'd be giving a lot more to charity but Steve Jobs doesn't care about anyone but himself.

Nokia recently settled with Apple so that's out of the picture. Doesn't change the fact that Nokia sued Apple first. And that Apple's suit filed against Nokia was a defensive one. This was always going to end with Nokia getting money from Apple. It was just a question of how much and the lawsuit was a way for Nokia to put pressure on Apple to finish the negotiations faster.

Apple sued HTC and in this case, some of the patents seem overly broad. most of them aren't even mobile patents but GUI patents. This is the only case of Apple using its patents to bludgeon someone in the mobile industry.

Apple is also suing Samsung but in this case this is more about trade dress. Samsung made a phone that had a user similar to Apple's iconic iPhone and was packaged similarly. It wasn't one thing but a series of things and arguably Apple has a legit case here if you get past the Apple hate.


And love Steve Jobs or hate him, he makes $1 per year. It's not like he's greedily amassing more money than he has. Yes he doesn't give jack to charity (at least not publicly) but that's his right. And it's not like he's amassing a huge fortune going forward like other CEO's. Granted some of his stocks in Disney and Apple have gained a lot in recent years. He's basically sitting on what he has. Apple the corporation does have charitable programs. They're just not well publicized.