Dell Doesn’t See Apple as Competition

July 23rd, 2006 at 3:00 PM - News by Jeff Gamet

Michael Dell, Dell CEO, said during a shareholder meeting that he doesnit see Apple as a competitor in the PC marketplace. According to CRN, he said "In terms of competition with Apple (in PCs), our share numbers speak for themselves. Apple is growing, but is still not in the top five in share for computers."

Mr. Dellis comments come on the heels of an announcement that the companyis quarterly earnings will be significantly lower that originally thought, and on news that its stock value is down 50 percent compared to this time last year.

The comments are correct when you look at world-wide statistics. In the United Sates, however, Apple is ranked number 4 based on statistics from Gartner. Apple has also shown 15.4 percent growth year-over-year, compared to Dellis 6.3 percent.

Mr. Dell was also shared his views on the iPod and iTunes Music Store. He said "Apple certainly has done a very nice job with their products. I think youire going to see a number of new, competitive dynamics in that market ...music services. Weive been working with MTV, which has a new service called Urge. Thatis an exciting space that Apple has done well in, but I would be surprised if they are able to maintain the share they have today over the next ten or 20 years."

Unfortunately for Dell, Microsoft is now entering the music player and download market, which creates a new competitor for the Urge service. Ironically, Urge is service that Microsoft co-developed with MTV.

Mr. Dellis comments didnit seem to appease shareholders at the meeting. Shareholder Linda Bush confronted the board of directors with "The stock has gone down more than 50 percent since last yearis stock holderis meeting. What is wrong? An internal thing thatis not working? Perhaps a general housecleaning should be in order like a rival competitor [Hewlett-Packard did in 2004."

Dell discontinued its iPod competitor, the Dell DJ, in February. Itis DJ Ditty is still available, although the company has discounted the price from US$79 to $39.