Apple Inc (AAPL)

[langostino]

"Maybe Apple plans pissing away its profits ..."


"Maybe Apple plans pissing away its profits re-inventing the wheel already used by competitors, available from OEM vendors in the form of commodity parts."

While I'm willing to withhold judgment until rumor and speculation are replaced with an analyzable reality, I do get a very queasy feeling from the notion of Apple reverting to the company that wanted all the elements of its hardware to be proprietary and unique. It's one of the primary elements that once upon a time made Apple an unprofitable and struggling company.

Doubtless, IF it turns out this rumor is true, Apple will have a rationale that can be boiled down to: the extra cost and risk of divergent development paths is outweighed by the benefit in product differentiation and performance. The question then will be, will Apple's judgment be validated by the marketplace or not.

The great fear, of course, is that it will not. And I believe it's this fear, more than any other, that's been causing AAPL to underperform the past few days, and is weighing on the stock. More than fears of Jobs' health. More than fears of a flagging retail environment dragging on Apple sales.

It looks like we've got at least 6-8 weeks before we'll have anything concrete to analyze.

Personally, I was thrilled by the move to Intel and standardized guts. Unless there's an overwhelming benefit to mucking with that, I'd rather see Apple concentrate on its core business and core pathway to differentiated computing experiences: SOFTWARE.