Wall Street: Software More Valuable Than Oil 223
CWmike writes "The tech industry's answer to this week's stock market roller coaster was delivered on Tuesday by the mighty Apple Inc. Apple saw its stock price rise enough — gaining more than 5% — to briefly surpass Exxon Mobil as the most valuable company in the U.S., according to an AP analysis of its market cap. (Exxon Mobile wound up the day slightly ahead of Apple.) Most of the other major tech companies — including Intel, IBM, Dell, Microsoft and Hewlett-Packard — all finished in positive territory yesterday, as markets made up ground lost in the big sell-off on Monday that also hit oil prices and other commodities.Tuesday's rally may be all that's needed to shake away, at least temporarily, some of the economic concerns the IT industry still faces. By closing in on Exxon, Apple effectively affirmed that there are few limits to tech growth. CW blogger Jonny Evans posits that ideas are why Apple beats Exxon on market cap, noting, 'While Exxon drills, hammers and crushes its way to find its billions, Apple's mind-miners explore myriad complexities to develop and understand new technologies.'"
Of course (Score:2)
An iPad will get you through times of no oil better than oil will get you through times of no iPad.
Re: (Score:2)
Re: (Score:3)
depending on job you can work from home without gas (yea for nuclear power),
So yeah it is possible he can understand.
me I am in sales, I can do about a 1/3 of my responsibilities with a laptop, net connection and cell phone.
Re: (Score:2, Funny)
*barf*
Re: (Score:3)
Re: (Score:2)
Erh... I go downstairs and then across the street. Actually, my car is parked further away than the grocery.
Not every place on earth is like the US where you pretty much need a car to collect your mail. In some areas there are actually still small/medium sized shops that don't gauge you, regular, normal grocery shops that exist between the apartments.
Re: (Score:2)
Not every place on earth is like the US where you pretty much need a car to collect your mail.
My car threw a serpentine belt last Thursday. My legs hurt now! But, er, how are they going to truck those groceries to the store across the street form you without fuel? Upload them from their iPods?
Re: (Score:2)
Sorry, I misread the original post. But thanks for the reply, it was a pretty witty one.
Re: (Score:3)
Yea, and what about the other 2/3rds? You think you're boss is going to understand that part not getting done?
You are CLEARLY in sales based on your statements. You think its perfectly acceptable to deliver a product that only does a 1/3rd what you claim it does.
Re: (Score:2)
Depends on whether or not your boss is understanding of you not showing up for work because there's no gas for your car...
Wait. So the presumption we're going on here is that the world ran out of oil for him, but has plenty of oil left for the rest of the employees? OK.
Re: (Score:3)
An iPad will get you through times of no oil better than oil will get you through times of no iPad.
Not if we're talking about baby oil.
Re: (Score:3)
hmmm...
so you're saying get our petrochemical products by liquifying baby humans?
worth a study
Re: (Score:2)
Yeah, you can sell the iPad to buy... dude, that joke sucked. Sorry. Pot will get you through times of no money better than money will get you through times of no pot, but that meme just doesn't work with oil and iPads.
I had an iPad once. The iDoctor made me wear it after my iSurgery.
Yeah, Right (Score:3)
Now, good software may be worth more than oil, but I don't think there's enough of it around to really turn it into a commodity.
Re: (Score:3)
There is. It's use in aerospace and space travel. Ya know, the kind of places where a bluescreen or a burping driver can not only really ruin your day, but the day of many people at once.
Re: (Score:3)
I'll admit that depending on what he had for lunch, a burping driver can be quite unpleasant, but you shouldn't let it ruin your whole day.
Re: (Score:2)
But coders run on Oil.
Umm... (Score:5, Informative)
Now, carry on. It's the "information age" or somesuch...
Re: (Score:2)
Re: (Score:2)
(pro-tip: without oil, the market for shiny consumer goods would skew heavily toward the 'canned' variety...);
Pro-Tip: Without oil, computers are not possible. Too many components of oil are required for manufacturing of pretty much every component, ESPECIALLY the ICs themselves. And of course the massive amount of plastic that goes into any modern computer wouldn't exist without oil. In short, no oil means no PC as well.
Re: (Score:2)
I couldn't resist. The only point I see is that computers and oil are codependent.
Re: (Score:3)
While I see your humor, I have to argue that your point (and, to be honest, the point you were replying to) is a victim of mistaking (or improperly generalize) Nth generation tools as 1st generation tools.
Computer control of equipment is done because computers are available. Use of petroleum products in computers is done because petroleum is available. Substitutes in each case exist, but result in lower efficiency and/or greater costs. Much greater costs, much lower efficiency in many cases.
But you'll re
Re: (Score:2)
And the first things we'd recognize as computers were analog/mechanical devices. ... unless you count abacuses, of course.
Er, the first things we'd recognize as computers were really primitive -- they used vacuum tubes (discounting abacuses, slide rules, and mechanical calculators).
I didn't grow up with computers, computers grew up with me [kuro5hin.org].
If E
Re: (Score:2)
Wrong, oil was found before the modern computer was a glimmer in someones eye. The modern computer however simply CAN NOT be produced without the beneifit of oil processing.
It is POSSIBLE to drill for oil, find it, and process it entirely without computers. You can not make a pentium processor without crude oil, it is simply not currently possible. You can act like we can't live without computers, but the reality of it is that we would simply be less efficient and not accomplish things as fast, but nothi
Re: (Score:2)
It has nothing to do with value. It has to do with investors thinking that "hey, the world economy tanked, they're not gonna need as much oil as we thought they would". Exxon and Apple are probably both good investments, but I'm glad oil tanked. Gasoline will be cheaper next week, and I have to drive.
ridiculous (Score:5, Insightful)
This is ridiculous !
Without oil we have no modern civilization. Even if you could somehow replace all the energy produce from oil, you will still need it for: pharmaceuticals, cosmetics, plastics and others various organics chemicals. The modern world depends on oil even more than it dose on software.
Re: (Score:2)
Yep! We're past the tipping point, but maybe we'll be ok in the long run. Once we terra-form Mars.
Re:ridiculous (Score:4, Interesting)
Actually, if you could replace all the energy you get from oil, you could use that energy to make the items you list out of simpler substances- no one has any problem combining ingredients to create oil and gas, the issue is that it's never efficient to do so compared to getting it out of the ground. But if we were given a magical device with 100x the energy of all our current sources, we could just afford to fabricate oil and whatever the end products are from veggies and such.
Re: (Score:2)
the issue is that it's never efficient to do so compared to getting it out of the ground
no, it is not just less efficient, it isalmost always has a negative energy balance.
But if we were given a magical device with 100x the energy of all our current sources, we could just afford to fabricate oil and whatever the end products are from veggies and such.
True but requires a magical device....
Re: (Score:3)
True but requires a magical device....
To someone from 1911 an iPod would be magical. To someone from 1811 an airplane would be magical. Have you kids no imagination? I'm 59, I live in a science fiction world. Self-opening doors, communicators, flat screen computers, PADDs, almost everything from the original Star Trek of my youth is commonplace today. Hell, stuff today is past what sci-fi writers envisioned when I was young. See this journal [slashdot.org].
Hell, in Star Trek II McCoy gave Kirk a pair of reading glasses,
Re: (Score:2, Insightful)
Re: (Score:2)
What value does Exxon bring that would be lost if they closed tomorrow? Anything?
You would lose a 25% return on capital used company and you would lose about 4.4millions barrels of oil a day. I you lose apple you only lose a company sitting on cash that produce finished product without doing any fundamental R&D.
Re: (Score:2)
Re: (Score:2)
Re:ridiculous (Score:4, Informative)
Exxon doesn't advance anything.
Silly little man.
Things like Autotune exist because of companies like Exxon. You have no fucking clue how much Exxon alone has advanced ground radar and sonography, the amount of science Exxon has contributed is rather impressive. Because of oil companies, we know far more about our own planet than you can possibly imagine. These guys make a living out of generating high resolution maps of what the crust of our planet above AND BELOW the surface of the ocean are made of its not even funny.
They don't do it out of the goodness of their hearts, its about money, but they most certainly do advance science in numerous ways in order to further their own business, to find oil where they couldn't find it before, which directly benefits volcanologists and archeologists for instance. They've created technology that has allowed my county to turn away a potentially extremely profitable chemical processing plant ... because tech the another oil company developed let them see into the ground well enough to predict that any leakage would go directly into our water supply ... not just because of the whole NIMBY side, but because there was actual clear evidence that it would be a problem.
Oil companies do a lot for you besides get you to where you want to go, don't be so ignorant about the world around you. I'm not telling you that you should love the oil companies because they are trying to save the world, thats simply not true. Saying they do nothing to advance anything however is 100% false in every way.
Re: (Score:2)
Re: (Score:2)
it was sincere, it is just a reification that price != worth.
Re: (Score:2)
"Without oil we have no modern civilization."
Or Apple computers.
Re: (Score:2)
Re: (Score:2)
Apple is a hardware company.
" I don't care what your theories are"
so you have stopped thinking in any way and jumped to a baseless conclusion. Grow the fuck up.
Re: (Score:2)
Heh... You can get "Oil" from other sources- just not as easily as you can pulling them from the ground...
All it takes is exposing organic matter (biomass, coal, etc...) to one of several differing pyrolysis processes and you get "Oil"- sweet crude. At efficiencies typically in the ballpark of 70-85%.
Re: (Score:2)
you get "Oil"- sweet crude
you don't have the nice mix of complex hydrocarbons formed under high pressure that are so valuable to the chemical industry, however you could replace tar sand oil with it.
Re: (Score:2)
Find this, an oil company exec stated that they could shut off gasoline and diesel production, have less regulation, taxes and other red tape and make MORE money selling their products as chemical feed stock. They stated the only reason they had not gone that route was their existing customer base and the fear of political reprisal.
I may have imagined hearing that but dimly recall it was not a big name oil company.
Re: (Score:2)
Without software and computers we don't have a modern world...unless you consider 1850 the modern world.
Re: (Score:2)
no, before the software there always is hardware, I know about relay based logic and this date back to 1920 in academia and 1930s on production line. I am pretty sure that I am not the only one to know about that. Without software the only truly important thing that would be missing is the INTERNET....
Apple also more valuable than air! (Score:3)
This also shows that Apple is more valuable than air. After all, air is free!
Uh, yeah. The idea that price equals value is dangerous ideological mumbo-jumbo. Prices tell what something costs to buy. They do not indicate what it is worth to have. This is why political economists (particularly Marxist ones these days) distinguish between use value and exchange value.
Examples of market prices failing to reflect use values are too numerous to count. Fancy clothes and cars vs basic food, for example, or th
Re: (Score:2)
just to extend your definitions further...
market prices indicate "perceived value".
Re: (Score:2)
Cosmetics? Yeah, that's really necessary! The other things you mention can be achieved by other means; oil is, after all, organic. If all oil disappeared tomorrow we'd still get by; there are substitutes, all organic.
And IMO we'd be better off without cosmetics. And fashion in general.
Re: (Score:2)
This is ridiculous !
Without oil we have no modern civilization. Even if you could somehow replace all the energy produce from oil, you will still need it for: pharmaceuticals, cosmetics, plastics and others various organics chemicals. The modern world depends on oil even more than it dose on software.
Oil has been pretty important, but it's a bit of a stretch to say it's necessary for modern civilization. Automobiles didn't originally depend on it and plastics have been made from things other than petroleum. Many areas of technology would have developed quite differently and probably more slowly without petroleum, but perhaps more long-term sustainable energy sources would be more prevalent today.
Re: (Score:2)
Apple did end up on top today (Score:3)
"Apple Overtakes Exxon to Become Most Valuable" [bloomberg.com]
Re: (Score:2)
Market cap doesn't really mean all that much. Other metrics, including revenue and profits matter much more. And so what if Apple is the "largest" publicly traded company right now? That changes so often that it doesn't really matter. Microsoft used to have that title. Cisco had that title for a few days about 11 years ago. GE had that title in the '80s. Besides, there are even larger corporations out there. Saudi Aramco, for example, would be worth trillions of dollars by market cap if it were a public com
The hyperbole is ridiculous (Score:5, Insightful)
"Apple's mind-miners explore myriad complexities to develop and understand new technologies."
Apple isn't NASA in the 60's, it's a manufacturer of shiny gadgets. They don't even have a research division.
Apple profits because people are vain, and are willing to accrue massive amounts of debt to buy pretty things.
Re: (Score:2)
http://apple.slashdot.org/story/01/10/23/1816257/Apple-releases-iPod [slashdot.org]
"No wireless. Less space than a nomad. Lame."
"Yeah, this should compete favorably with the solid state units, but they've already lost to the CD-MP3 units, IMO."
Re: (Score:2)
There are valid reasons why people choose not to buy Apple - stop confusing people who dislike Apple with people who think Apple shouldn't be as successful as they are.
There's no such thing as a product that suits everyone.
However, with Apple, I think it is actually genius that they have discovered that good design sells. Their marketing is pretty good too. Their hardware is often best-in-class, or at least not far off.
Apple revolutionised the industry by claiming that the look & feel, and the UI are
It's just stock prices (Score:3)
These are the people who in days gone by would read tea leaves.
Re: (Score:2)
hold on there. while stock prices are notoriously volatile, they ARE a measure of public confidence in a company.
So whilst you could claim that it is not representative of how much a company is worth (and rightly so), the stock price IS representative of how much the public (well, shareholders actually) THINK a company WILL be worth.
Apple needs oil (Score:3)
Without a high-energy society, there is no Apple. Without plastics, there are many missing parts. Without diesel powered container cargo vessels, you must make your products locally for much more money. Without energy intensive semiconductor fab, there is no product. Without electricity the product is not powered. Most importantly, without high-energy freeing up labor, nobody can afford your device. They would be too busy plowing fields with draft horses.
Re: (Score:2)
Some argue hat oxen are more patient with clueless geeks on the field than draft horses:
http://www.energybulletin.net/stories/2011-08-09/our-future-our-past [energybulletin.net]
I heard that my grandfather had to use an ox on the field when the Russians took the horses. He wasn't happy about it. Contrary to the author of the above article speed does matter on the field, especially when you are being squeezed by an energy starved society that doesn't wan't to work on the fields.
Yet another stupid headline (Score:2)
Apple makes much more than just software. iPhones, iPads and Mac's are not software. I truly hate blanket statements like this. All the happened was the market cap of an information technology firm exceeded the market cap of an oil company. These numbers reflect the value of the companies not the value of the underlying commodities.
Re: (Score:2)
Apple makes much more than just software. iPhones, iPads and Mac's are not software. I truly hate blanket statements like this. All the happened was the market cap of an information technology firm exceeded the market cap of an oil company. These numbers reflect the value of the companies not the value of the underlying commodities.
Apple does not make any of those devices. A company in China makes them. Apple supposedly designs them, and definitely Apple markets and distributes them.
Exxon does not "make" oil either. They're pretty hot stuff at finding it, and coordinating the work of subcontractors to pump it out, assuming the country owning the land allows them to work instead of using their own nationalized company (petrobras, etc). In a world of declining oil production, I'm not sure how useful Exxon is. Kind of like a middlem
Re: (Score:2)
Apple does not make any of those devices. A company in China makes them. Apple supposedly designs them, and definitely Apple markets and distributes them.
Semantics is a poor argument. Does Ford make cars or just assemble them as the parts are made by non-Ford companies? You know what I meant but decided to be cute.
Exxon does not "make" oil either. They're pretty hot stuff at finding it, and coordinating the work of subcontractors to pump it out, assuming the country owning the land allows them to work instead of using their own nationalized company (petrobras, etc). In a world of declining oil production, I'm not sure how useful Exxon is. Kind of like a middleman. Does transocean really need exxon anymore if all the worlds oil is already found, mostly remains in far away lands where exxon isn't allowed to work, and TO is already pumping it?
It looks like you have it backwards; Transocean is an offshore drilling company and ExxonMobile is the producer. TO doesn't pump oil, they just drill holes to get at it. If all the oil was found it would be Transocean in trouble and not ExxonMobile. By the way, all the oil has not been found. That is why oil companies are spending billions searchin
Re: (Score:2)
It is the software that makes these machines what they are. It is the software that differentiates Apple from other companies.
Sure the design and hardware is good too, but we see plenty of good designs out there, yet it is iOS and OSX that drive people to buy Apple.
OSX is further proof of this. The hardware it runs on hardly differs from a standard PC (and you can in fact build a hackintosh from standard pc parts) - yet its value lies in the software.
So while you could say Apple is delivering the whole ex
Where does it leave our immune systems? (Score:2)
I wonder, though, where a treatment like this leaves the human immune system.
A vaccine spurs the immune system to generate antibodies, so that when we're actually infected by the virus, the antibodies are available to combat it. Our own immune systems do all the work.
This new type of treatment, however, kills off the cells that have been infected by viruses, so the viruses aren't able to use the cell's materials to replicate. As the cells die, so do the viruses. From the sound of it, the treatment achieves
Re: (Score:2)
Yikes, sorry about that... wrong thread. Damn tabs!
Re: (Score:2)
yes, it's the tabs fault~
Today (Score:2)
And today apple was down over $10/ share while Exxon was up $.07/ share. And who knows what tomorrow will hold. Perhaps Sharpies will be more valuable than both. ;-)
Re: (Score:2)
Neither of them will ever be more important than happiness.
Though a bit of oil and a mobile computer can contribute. :)
Re: (Score:2)
happiness is only important to people who value happiness.
And yes, money does, in fact, buy happiness.
Why is this news? Look at 1999 market cap... (Score:2)
Back in 1999 (before the tech bubble burst), Microsoft was the company with the largest market cap. And they made less hardware then (this was pre-Xbox) than Apple does today.
They were over 2x larger than Exxon Mobil in market cap at the end of 1999.
Is ComputerWorld implying that back in 1999 Microsoft had "ideas" that were more valuable than Exxon Mobil?
Source: http://fortboise.org/top100-history.html [fortboise.org]
Re: (Score:2)
I don't dispute that software can have more value than hard assets or hardware. But I dispute the implication that market cap is the correct measurement way to declare a winner in any "battle of ideas" between companies (especially companies as different as Apple and Exxon Mobil).
In Dec 1999, MSFT was top market cap at over half a trillion in market capitalization. One year later, they dropped to 5th after losing over $350b in market cap. And only 3 months after that, they jump back to 2nd after gaining nea
*PLATFORM* more valuable. (Score:2)
Apple makes a majority [ipadjailbreak.com] of their income on iOS devices. They're making income on the combination of hardware and software. Pure "software" sales are a *VERY* small percentage of their income.
Re: (Score:2)
how much does the hardware cost?
now how much does the software cost?
you even called them "iOS devices". It is the software that makes them what they are.
Its not about whether Apple is a company that primarily does one or the other, its about what part of Apple is the most VALUABLE. I'd say its the software.
More important than oil (Score:3, Insightful)
Apple's mind-miners explore myriad complexities to develop and understand new technologies.
"New" technologies? What exactly has Apple invented here, apart from an OS taken from unix, applications written at no cost to Apple because they were done by others, touch screen technology that's been around on PDA's for almost 15 years, etc. Yeah they put it into a good looking package and built a good brand and marketed the crap out of it, but there's nothing exactly "cutting edge" here except for maybe the gross violation of your rights when they make you sign exclusivity contracts with third party cell phone providers.
Now, guess which company is more important. A company that obtains and produces a (relatively) cheap source of energy, or a company that produces a marginally different but very shiny communications/computing device?
Apple is fantastically over-valued and overbought, as anyone holding $400 Apple stock will tell you. I can just imagine the pain of the people who have been stopped out. Well what did you expect when you were buying the stock? Largest market cap != biggest money maker. Amazing revenue growth rates have to make you wonder how sustainable they are over the medium and long term. The bigger they are, the harder they fall. Me, I will cover my shorts at $280 and re-assess.
Re: (Score:2)
Re: (Score:2)
Apple isn't a software company (Score:2)
Apple's products are hardware-software bundles. Apple sometimes sells updated software to use on hardware you already bought from them. They also are a vendor of content -- none of which they create -- with the goal of making their hardware-software bundles even more appealing.
Stupid exceptions that don't change my argument:
FileMaker (a mostly-ignored Apple subsidiary)
You can use iTunes on Windows to purchase music & video and never put them on an Apple device. This wasn't the goal of th
This is bad news (Score:5, Funny)
Re: (Score:2)
Canada. We have high quality software developers up here, like EA.
BTW - its not that cold up here. You'll mostly like the temperature during your invasion.
Re: (Score:2)
EA.. ha. I'd rather go without.
Re: (Score:2)
Already doing it to Western Europe in the form of software patents and ever-increasing length of copyright. But I guess they call it "diplomacy" instead of "war".
Stupid (Score:2)
1) Apple isn't a software company, its a hardware and media company.
2) Apple's stock rebounds quickly, so a large number of investors are trying to game that tendancy as the market drives the price down.
I've made a killing on Apple the last two weeks day trading the swings.
plastic ipad? (Score:2)
Apple products made from plastic. Plastic is a byproduct of refined oil.
Ergo, Apple is dependent on Oil, so, in no way, will Apple, ever be more valuable than oil.
Of course (Score:2)
Having a monopoly worths more than something with a lot of suppliers. Put that monopoly in worldwide basis, and with enough weight put in patenting whatever looks like built in the same planet as the ipad and you have a formula for success.
When the bubble on imaginary things (like patents and money) blows up, probably oil won't worth a lot neither.
Re: (Score:2)
yeah, money is going away any day now. Idiot.
Someone still taking Wall Street serious? (Score:2)
For real? I mean, I know, humanity doesn't learn jack from history, but when I see blunder after blunder after blunder from an entity, not only wasting time but also the money of millions, and I'm not even able to vote the jackasses out of their office, I guess the least I should do is to stop taking them serious.
Mind-miners? (Score:2)
Geez, I think I just threw up a little.
necessary evils? (Score:2)
If we all realize that with all this tech (aka Apple products), people sit in a couch all day long, and move a mouse (or their fingers) around a 2D screen to:
a. navigate through a 3D world/game
b. communicate to people
c. shop
d. work on spreadsheets
e. show presentations and watch TV/videos
f. look at photos
That explains why Apple would be at the top, as we are nothing but couch potatoes. Hand over the Cheetos.
.
Now went we get out of the house and....
a. navigate through a real world
b. talk to people face to fac
Price per pound? By volume? (Score:3)
By any unit of measure, even Windows 1.0 and Clippy are more valuable than gold.
-
Blogger Hubris (Score:2)
Assets - Liabilities (Score:2)
I don't think Apple has quite the amount of assets that Exxon has. That oil and its distribution are extremely valuable, and moreso as it runs out while our energy hunger grows. But Exxon has a vast liability. Apple has practically none. Exxon is extremely hateable, but Apple is cute. The values here are not just the assets, but the assets after the liabilities are deducted.
Re: (Score:2)
Re: (Score:3)
Nah, gas goes up when demand goes up. As the market plunges, oil has actually declined because a US in a recession consumes less oil than a US with a strong, healthy economy. But oil doesn't need excuses - as China and the rest of the world continues to grow, so does non-US demand. And since the population of the US is actually rather small when compared to, say, China, the US economy will become less and less relevant to the price of oil.
Of course in any slide there's always a bounce because those who ar
Re: (Score:2)
Re: (Score:3)
This assumes it's an overinflated bubble now, and there are very few indications that it is. Given that it's P/E ratio isn't particularly out of line with other similar companies, there's not a lot to suggest that its value is heavily over-inflated at present - they make a metric shit-ton of money (and profit) on all those devices, and they've been selling more, and more, and more of them quarter over quarter and year over year.
Now, Steve Jobs stepping down / dying would certainly be a psychological shock,
Re: (Score:2)
Software?
When the trowsers drop, "James Brown" is still "the hardest working man in show business".
That's what she said!
Re: (Score:3)
Yeah, what this economy needs direly is another bubble.
Could we, I dunno, ya know, build stuff, sell that and value companies based on what gets made and sold? I know, a completely outlandish concept, but I'm nuts enough that I really want to see this being tried.
Re: (Score:2)
You write software like apps and game from home. You sell it worldwide. If people want it, they buy it. It used to be like that with the games for the first home computers.
Re: (Score:3, Informative)
And the funny thing is, if you DO find oil in your backyard, you'll find that most urban property owners don't actually have mineral rights to their property.
Re: (Score:2)
Damn, fifteen mod points and I had to comment! Someone please mod him up and me down ("no bonus" buttons don't seem to work).