Another day, another pundit with a shopping list for Apple CEO Tim Cook. The latest is from Andrew Ross Sorkin in the New York Times. Anyone who uses all three of his names in the byline has to be a serious writer, no?
There’s just one problem with an Apple watcher coming up with ideas to spend Apple’s hard-earned money. Some of the ideas are pure looney.
In what passes for insightful journalism these days, Sorkin describes Tim Cook’s problem with all that cash.
He could hold onto it. He could increase Apple’s dividend, which he instituted this year for the first time.
Or he could spend it.
And I use my own money to buy a daily copy of the Times.
Apple does spend money on acquisitions. The most recent was the purchase of AuthenTec for $356-million. Or, a few days of Apple’s profits for the year.
How should Apple spend all that money? Sorkin has a list.
- Sprint: Sure, a phone company that’s losing money. That makes sense. Not. How would ATT and Verizon feel about Apple taking away their customers? Yes, we’d all love to see Apple’s famous customer service show up in a phone company you’d be happy to use, but it ain’t gonna happen.
- RIM (BlackBerry): The price is right. Google spent more on Motorola and look what they got in return. Other than a few patents, what does RIM bring to the table? Apple has already destroyed the company’s ability to create and sell products that customers want to buy.
- Twitter: This makes no sense at all, despite the fact that Twitter says they have about 140-million active users. Active? Define active. A few percentage of Twitter users actually tweet (hence, active), but the rest of the Twitter litter just watch the stream go by. And Twitter hasn’t figured out how to make any money to justify the nutty valuation. Move along. Nothing to see here.
- Square: This unique company has an electronic payment system that works through iPad and iPhone. It’s clever and could be integrated well into iOS of the future. The only problem is distribution. Online buying and retail store credit card systems are Balkanized wooly mammoth, not easily entrenched.
- Nuance: Sorkin calls this one a no-brainer and I agree. Whatever the price, Apple wants and needs to control their own technology, and speech is the future. Nuance is the best out there. Buy it already, Tim.
Apple has enough money on hand to buy whatever it wants, but acquisitions to date have been tactical, not strategic.
If content is King, I’d like to see Apple get into the content distribution business. The cable companies are a Balkanized industry, too, with much customer dissatisfaction; they’re ripe for disintermediation and disruption. But how? Despite AppleTV’s modest success, Apple hasn’t cracked TV. Yet.
Apple sits on over $100-billion in cash. It’s more money than they need to control much of the manufacturing process of their products, and more than enough to bulldoze their way into distribution channels.
So, if you were in charge at Apple, how would you spend $117-billion?