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Apple Surpasses Microsoft to Become Largest Tech Company

Gordon Kelly

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Apple Surpasses Microsoft to Become Largest Tech Company

I mentioned Facebook privacy settings is one of the most controversial topics on TrustedReviews, but I suspect it won't be as controversial as this...

Late last night Apple officially passed Microsoft to become the largest tech company in the world after its share price value saw it reach $222bn (£154bn). Microsoft at the end of day's trading was worth $219bn.

What does all this mean? Well something and nothing. These values are taken using 'market capitalisation' which is calculated by multipling a company's total number of shares by the current value of each share. Amusingly Apple surpassed Microsoft despite its shares falling 0.4 per cent yesterday because Microsoft's shares fell four per cent.

Why it means nothing is Microsoft still has significantly higher revenue figures than Apple ($53.4bn vs $42.9bn), almost double the operating income ($20.4bn vs $11.74bn) and significantly larger total assets ($77.9bn vs $47.5bn) - all figures from the 2009 financial year.

Why it means something is Microsoft's figures are on their way down while Apple continues to report record quarter after record quarter and that has the stock market excited. The news is also a powerful reflection of the diversity of the technology sector these days. After all, Windows still holds a circa 90 per cent stranglehold on the world's computer operating systems while Mac OS remains under 10 per cent. And while Microsoft can point to the Xbox, Apple has the more powerful combination of iPhone and iPod.

It is also interesting to note Apple was nearly bankrupt in the early 1990s, which illustrates the monumental turn around at the company since the return of Steve Jobs.

Can Microsoft stop Apple's momentum? Certainly Windows 7 was a good start and its Windows platform will remain dominant for many years to come yet, but Windows Phone 7 has too far to catch up to iPhone OS as does Zune to iPod.

So in 10 years time who do we think will be the biggest tech company in the world? That's easy: Google...

Jayboy

May 27, 2010, 4:59 pm

"And while Microsoft can point to the Xbox, Apple has the more powerful combination of iPhone and iPod."





And iPad ;P

rav

May 27, 2010, 5:01 pm

Much as I dislike Apple's closed down nature, nannying of it's customers and Jobs's apparent megalomania I have to admite they really do know how to make money!

GoldenGuy

May 27, 2010, 5:22 pm

Old rivals teaming up to smash a billionaire supervillain making backdoor deals with the Chinese government. This has mismatched cop buddy movie written all over it.





Ballmer : "You crazy son of a bitch! We're too old for this ****!"


Jobs : "Then wear your helmet grandpa."





Jobs ignoring their roughly equivalent age for script purposes, proceeds to launch his Star-spangled banner-topped motorbike off a conveniently placed ramp, smashing through the top floor of the Googleplex, and into the screaming face of the Chinese President.





(Or they could just sue each other over who first patented 'Thing That Does Stuff'.)

Lord Comben III

May 27, 2010, 5:36 pm

So does that mean the EU competition courts will final level the field and place the same restrictions on them as they did to Microsoft. Seems only fair now they can afford the fines.

xenos

May 27, 2010, 7:04 pm

In terms of taking Microsoft or Apple away, which would screw the world up more?





Enough said.

Hugo

May 27, 2010, 7:22 pm

At the time of writing this comment the tables have turned back, with Microsoft at $228.74 and Apple at $227.85 billion. I cannot get enough of real-time share price watching, it's more addictive than crystal meth!





http://finance.yahoo.com/q?s=M...


http://finance.yahoo.com/q?s=a...

Frazoire

May 27, 2010, 7:53 pm

According to AppleInsider there's a rumour suggesting Steve Balmer could be on stage at Apple's WWDC 2010 (starts June 7th) to demo MSVS 2010 being able to build apps for iPhone, iPad and even OS X, now that would be funny if true but sounds more like an April 1st joke





Or maybe the old boys are teaming up to make sure Google & co don't upset the Apple cart too much !

hankb6d

May 27, 2010, 8:07 pm

I'm more concerned about the working conditions of the people that churn out the shit for these hideous people.

Soliber

May 27, 2010, 8:17 pm

@hank: kindly get off your high horse, your computer equipment is probably made by the very same company (Foxconn); that's because they make almost everything for everyone. Feeling guilty yet?

Castalan

May 27, 2010, 8:26 pm

That is an insane market cap - IBM only has a cap of 160Billion - HP 109Billion





Maybe their shares are made from individually hewn single pieces of aluminium - and are worth the price premium - just like the rest of their products ;)





as the Americans say - "go figure" .... :D

theory28

May 27, 2010, 8:29 pm

@ Frazoire





I doubt S Ballmer would be capable of discussing VS10 in the same way Jobs diverts to another team member for development talks. I would think yhat he might be there to talk about the switch to Bing search and Bing maps etc

smc8788

May 27, 2010, 9:02 pm

@ravmania - Yes, selling products with high prices and insane profit margins is an ingenious idea. Why has no one thought of it before?





I'll answer my own question: no one else was stupid enough to. However, the one thing they didn't account for was the stupidity* of consumers.





*Apple fanboys - you may replace the word "stupidity" with "ability to impulsively follow others and credulously imbibe marketing propaganda" if it makes you feel any better.

Gordon394

May 27, 2010, 9:34 pm

@Hugo - now MSFT: 228.71B, APPL: 228.12B. I suspect that's just from the headlines generated, but the speed with which Apple has caught Microsoft over the last few years suggests it will start to pull clear in the next few days.

Xamph

May 27, 2010, 9:44 pm

*ExxonMobil and PetroChina looking nervously over shoulders*


Mind you, in this willy-waving contest, even those guys are dwarfed by state-owned companies like Saudi Aramco.

Andy C 1

May 27, 2010, 10:12 pm

@smc8788 - Yawn! someone change the record.





I prefer to applaud success - but maybe that makes me strange.

smc8788

May 27, 2010, 11:40 pm

@AndyC - If you're British, then yes. Yes it does.

Jim Fulton

May 28, 2010, 12:55 am

@smc8788 - you really are a saddo. Like most others on this site, I am a consumer, and to quote someone on TR some time ago, Apple are as much a marketing company as a computer, or hardware company. Their success can't be denied, whatever your own feelings. To call the ten percent of consumers who buy Macs, the large majority of design/print/pro Mac users, the eighty percent or so of personal music device buyers, and a fair proportion of Phone users, collectively "stupid" barely disguises your own prejudices. Its a (relatively) free market, buy what you want and enjoy it, let's hear more about what you are enthusiastic about rather than dissing me, amongst others.

BobaFett

May 28, 2010, 1:01 am

@smc8788: Rather than tarring buyers of the 220 million iPods and 34 million iPhones that have been sold with the "stupid" brush, you might want to consider that perhaps they were waiting for someone to make the product they wanted. Maybe you should be venting your anger on the manufacturers who failed to realise there was a large and willing market for the right products, however deficient or superficial they may be in your own opinion.





No doubt, had the iPod and iPhone been created my Microsoft you would be a happy bunny? Shame the Zune was 4 years too late and Windows Phone isn't even out yet. And Windows Mobile has hardly been a roaring success. Maybe it's not the consumers that are stupid, but companies who think like you and aren't in touch with what consumers actually want.

Pbryanw

May 28, 2010, 2:22 am

@Hugo - WolframAlpha has a nice visual representation of the two company's market values:


http://www.wolframalpha.com/in...





Though not updated as regularly as Yahoo - interesting to see the two values converge this past week.





@smc8788 - I think you underestimate consumers - if Apple's products were in some way inferior or didn't offer value for money even at their high prices, then consumers would soon find them out and vote with their wallets. Marketing only gets you so far. Just look at the AppleTV to see that not every Apple product is a success.

Xiphias

May 28, 2010, 4:13 am

Where is all this coming from? Luxury MP3 players must be a dying market, smartphones are only 5% or so of the phones bought and Apple's PCs have an even smaller share so while Microsoft is understandable with every PC using Windows and every business using Office Apple has no obvious big earners.

smc8788

May 28, 2010, 6:00 am

@Jim/BobaFett - What makes you think that just because I do not agree with Apple's product design and marketing strategies I would like Microsoft's inferiorly marketed, cheaper products? I'm not particularly a fan of either to be quite honest, and as hard as it may be to believe to those who regularly engage in MS vs. Apple debates, people do not necessarily lie on one side of the fence or the other. You may also notice that I never once said a bad thing about Apple or their products in my comment. If Apple products offered what I wanted at a price I considered reasonable, I would buy one in a heartbeat. But they don't, so I won't.





I'm sure there are plenty of people out there who are perfectly happy with their Apple products and have enough money to justify their purchase over cheaper, functionally similar devices. However, I'm sure there are just as many people out there who don't have a clue why they bought it (other than "it's shiny"), what to do with it now they have it, or of other products on the market that are viable alternatives.





I guess, as a technology enthusiast and opponent of technology as fashion statements, I just find it depressing how a company which sells technologically limited devices at a higher price than rival products is able to achieve such success in the market.

ffrankmccaffery

May 28, 2010, 7:22 am

@Soliber: Perhaps you could take off your Apple tinted glasses. This historic share price increase of Apple's is a direct result of it's record iPhone sales. Meeting that high demand has led to the horrendous working conditions suffered by the employees of it's supplier Foxconn, along with the despair that's led to some of them to ending their lives. Foxconn may manufacture computer parts for other companies but it isn't under pressure to supply them at breakneck speed as it is from Apple.


Your post is one of the most distasteful and insensitive defenses that I've read yet from a Machead on here.

Ed

May 28, 2010, 1:44 pm

@ffrankmccaffrey: I actually find your post to be more distasteful and naive than that of Soliber - he has a perfectly valid point. That's not to excuse any mistreating or exploitation of workers but to peg that only on Apple is out of line.

Kaurisol

May 28, 2010, 2:08 pm

It's a matter of horses for courses. My daughter is looking to buy a new phone, so I've told her to wait until after the new iphone comes out - she wants something that "just works" and she already uses itunes. She doesn't need the flexibility etc. of Android (although I've suggested the HTC Desire to her as well). I happen to like my N900, but recognise that it wouldn't suit her.

KB

May 28, 2010, 2:20 pm

Market capitalisation is just one measure and highly misleading. That can double or halve tomorrow and flip back again the next day all on a few rumours. But does that mean the company really grows or shrinks? By turnover its Samsung according to





http://en.wikipedia.org/wiki/L...





Microsoft and Apple are well down the list.

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