Why doesn't Apple buy Avid and Silicon Graphics?

[ccuilla]

Before MacWorld Expo there were a number of rumors, some of which even involved possible Apple acquisitions. Palm. Avid. OmniGroup. Even Adobe was mentioned in passing.

My question is this...with Apple's obvious bent toward media, multimedia, creative professionals, etc. Why doesn't Apple seek to round out its technology, product and customer portfolios with acquisitions of both Avid and SGI?

These are both relatively small companies. Both appear to have technologies, customers, experience and footholds in markets closely related to what Apple does on both a professional and a consumer level. I could imagine Apple revamping the professional lines of Avid and SGI and even migrating some of the software and hardware technology to the consumer level over time.

See, the Palm acquisition doesn't make much sense to me at all. It doesn't look like Palm has much of anything to add to what Apple can already do.

Software? Apple has the Newton OS, the Mac OS, OS X, etc. All of which can be brought to bear in a PDA effort if Apple so chose.

Hardware? Apple could easily accomplish everything Palm does and more.

Brand identity? Apple vs. Palm? C'mon!

Customer base? Maybe. But $2-3B (Palm's current market capitalization) is an awful lot of money to pay for those customers.

Avid and SGI are a different story. These guys DO have real, loyal, specific customers that use their products for very specific reasons. Apple would have a hard time starting from scratch in these markets. Additionally, they have hardware and software technology that would likely benefit Apple, which Apple could not quickly, easily and economically re-produce from scratch. Finally, brand identity. Not from a consumer perspective to be sure, but in the professional circles Avid and SGI win hands down. Apple could leverage that, the installed base, the technology, eventually transitioning (if they chose) the SGI and Avid brands to Apple brands.

Thoughts on this?

 

[RacerX]

Apple is trying to enter the professional high end market with a combination of support from SGI (in the form of Maya for Mac OS X) and name recognition (many of the people using SGIs have Macs right next to them, check out some of the offices at ILM as an example). SGI/Alias|Wavefront thought they would make advances into the midrange market using Windows NT (having Maya and a current version of Photoshop, Illustrator and Premiere, which are at 3.0.1, 5.5 and 4.0 respectively on Irix, would increase sales), but people who use Maya currently on SGI's aren't big fans of Windows, and people using other 3D products on Windows aren't willing to pay the high price for Maya. Macs seem like the best solution for everyone involved.

Also, SGI is a very proud company. They were not to happy about having to give up Cray, and they would rather drop than become part of someone else. They have their small market almost all to themselves, and that seems to be enough for them for now.

Also it would not be wise for Apple to spend it's cash safety net (large as it is) on aquiring another company in the current market conditions.

 

[AdmiralAK]

There are two reasons could buy palm.
certainly not for palm's "superior" technology (rotflmao)... but for
1) user base --> there are a lot of palm users that would continue to be loyal to the platform even if apple bought off palm because they like what they use and they tell others that too (just like we mac users do with our platform)

2) BeOS technology. Be inc closed it's doors and sold all intellectual property to palm. What does this mean ?

a) BeIA technology if apple wanted to get further into app serving and Internet Appliance tech
b) BeOS was a media OS, so apple could reap the technologies in BeOS which would further apple's goals in the multimedia sector
c) PalmOS 5, is going to be a strongARM based PDA OS, which will be, to my knowledge, based on BeOS technologies. Now what the "look" of it will be no one knows yet (developers under NDAs will find out soon though), will it be a BeOS PDA OS ? will it be a palm OS look alike PDA OS ? who knows ? -- but the point is that this OS will be (a) backwards compatible with the palmOS keeping current users happy, and (b) much more advanced laying the road for better things from palm. Thus is apple buys palm they can further make PalmOS 5 better, infuse it with OS X and newton technologies and sell their product as apple PDA making money.





Admiral

 

[chemistry_geek]

Apple acquiring SGI would be almost as nonsensical as HP acquiring Compaq. Buying SGI outright would not help Apple in the least bit. SGI is a very specialized company with a market share that is likely (I don't really know) a fraction of a percent of the entire computer market. SGI is good for making cool movies like Jurassic Park and Star Wars. Their computers are used in engineering and science as well, both their mainframes and workstations. Apple would gain nothing (monetarily) from purchasing SGI.

 

[ccuilla]

Originally posted by chemistry_geek
Apple acquiring SGI would be almost as nonsensical as HP acquiring Compaq.

Well, that might a bit extreme.

Buying SGI outright would not help Apple in the least bit.

You don't think that a) Apple could leverage SGI's technology into the consumer market and other professional markets, and b) Apple could infuse something new into SGI's products and technologies? They certainly could make them LOOK better. ;-)

SGI is a very specialized company with a market share that is likely (I don't really know) a fraction of a percent of the entire computer market.

Yes, but I suspect they have a VERY large percentage of the market they play in. High-end graphics. Movies/video. Etc.

SGI is good for making cool movies like Jurassic Park and Star Wars. Their computers are used in engineering and science as well, both their mainframes and workstations.

Exactly.

Apple would gain nothing (monetarily) from purchasing SGI.

Except about $2B in annual sales.

 

[RacerX]

One small question... why did this get moved to THIS area? It seems like it was just fine in the area it was originally post in. It isn't like we started in on a completely non-computer/non-Apple topic in the middle of the thread.
I would like to know how this is NOT a Hot Topics & General Discussion for the Mac Community? OR how this IS a non-technical discussion?

Just wondering.

 

[kilowatt]

Although I hope it never happens, Mac OS X would be cool on SGI

I think it apple acquired SGI, it would be sort of like when CBS acquired Fender Musical Instruments. Apple would overhaul SGI, the die-hard SGI employees would leave and create their own company, and consumers would complain that SGI wasn't the same and would jump ship.

Also, SGI and apple target similar markets.. so this could work against them because apple would be competing against its self.. and who is going to buy a G4 server when they can buy a huge SGI? I suppose price is a factor. P&G seems to be quite capable of marketing against its self to promote its products, but I doubt apple could do that.

 

[fuzz]

If Apple acquired SGI, then SGI could be their high end products. Sure, it could cannabalize into Apple's own products. But the point is that it is okay as long as Apple still makes a profit. Apple would be able to get the value of the brand such as Ford acquiring Jaguar, Volvo, etc; and that value ends up being Apple's. Whatever Apple does, it has to be careful because a bad acquisition is like Compaq after acquiring Digital.

What P&G does is to fill up as much shelf space at your grocer that whatever you may choose, it is still a P&G product. Their product line and depth is great. Similarly with the PC industry, whatever PC system consumers purchase, Microsoft makes money.