Michael Mace on the plummeting PC sales:
This is an existential shock for the PC companies. It’s like discovering that your house was built over a vast, crumbling sinkhole.
Great read. Just as much about Microsoft’s future as Dell’s. And he makes a good case for Dell seeing the signs of the PC industry decline (slightly) early and the bid to go private being a direct result of that. It’s easier to transform a ship into a submarine when it’s not already underwater.
Good reminder from Alex Wilhelm of The Next Web about Microsoft’s involvement in Dell’s bid to take itself private (which is now under attack from a few directions):
Microsoft is providing just over 8 percent of the needed funds to take Dell private. Why would it do that, if it will not pick up any control over the massive OEM partner that is ailing? In short, Microsoft is currently incredibly cash-rich. With more than $60 billion in cash and equivalents and short-term investments, the company can afford the loan.
And, the general scuttlebutt is that Microsoft is getting a pretty decent interest rate on the loan itself as well as using non-repatriated funds, allowing its foreign cash to be useful.
Seems like a smart way to use some overseas money.
HP Chief Meg Whitman in a statement about the Dell buyout deal.
But what’s great about the comment is that it just as easily could apply to HP. From October of last year:
Ms. Whitman told a meeting of Wall Street analysts that they should expect sharply lower revenue and profits. She also told them not to expect the company to fully right itself before 2016. “We have much more work to do,” she said.
In other words, the company faces an extended period of uncertainty and transition that will not be good for its customers.
Mary Jo Foley for ZDNet:
It’s a tumultous time to be a Microsoft OEM, no doubt about it. The PC market is in decline, revenue-wise. Microsoft is competing with its own OEMs with its Surface line of products. And now Microsoft is providing $2 billion loan to one of its largest OEMs, Dell. I wonder how many Windows OEMs will still be in existence in a year or two, and how many will be backing Windows as just one of several different platforms to hedge their bets.
Glory days, well they’ll pass you by.
Michael Dell, in a memo to his team about the buyout deal.
So he is “particularly pleased” with Silver Lake’s involvement, but only “glad” about Microsoft’s role. Maybe that’s reading too much into nothing, but…
FOR THE LOVE OF GOD
WHAT ELSE WERE YOU GOING TO DO TODAY? NOTHING, THAT’S WHAT
“Dell recommends Windows.” Consider that $2 billion check cashed.
Ben Worthen and Anupreeta Das for WSJ:
Partly at issue is their commercial relationship. Dell, the world’s third-largest maker of personal computers, is one of the biggest channels for Microsoft’s Windows operating software. The sides are discussing how Microsoft’s investment in Dell would alter that commercial arrangement. Under one scenario being discussed, Dell would agree to use Microsoft’s Windows software to power the vast majority of its devices, one of the people has said.
If you can’t get them to use your software because they want to, pay em. Always a winning strategy.
If Dell is going to go private, the assumption is that it’s so they can completely change their business away from the watchful eye of Wall Street. And completely changing their business would presumably mean moving away from PCs…
So why would Microsoft want to help one of their top partners in the PC business all these years do that? Jean-Louis Gassée has a few interesting theories.
Michael Dell, in 1997, on what he would do if he ran Apple.
Obvious reblog-bait today seeing as Dell is apparently in discussions for a buyout from private equity to take the company private, as Bloomberg reports.
Today, Apple could buy Dell about six times over — in cash.
Tim Cook on why the deep bonds that customers form with Apple products matters — again from his great BloombergBusinessweek interview. You’ll note that Cook worked at Compaq immediately before joining Apple.