In a piece on The Register, Cormac O’Reilly speculates that the sale of IBM’s PC division opens up the prospect of Big Blue either buying Apple or forming a close partnership with it to sell Macs – possibly with the IBM label.
Technology journalism is littered with the words of nay-sayers who later had to eat large slices of humble pie, but I’m going to stick my neck out and say that an IBM/Apple deal is about as likely as Dell being sold to Microsoft. However, there is one scenario where a deal between IBM and Apple would make sense – although it probably wouldn’t be one that Mac users would like.
There are two key reasons for a buy-out being unlikely. First of all, such a deal would make no sense whatever to Apple, which has both the cash in the bank to fight off a hostile takeover and the desire to remain independent. Although the years when Apple saw IBM as its main competitor are long gone, and the much-vaunted “Apple spirit” isn’t what it once was, few at the company would want to work for IBM. Steve Jobs, thanks to the success of the iPod and his involvement in Pixar, now has the potential to be the first big media mogul of the 21st Century, and would be unlikely to give up that chance. Nor would a sale deliver anything to shareholders, particularly as at the moment the stock price has been doing very nicely and profits have continued to roll in. Apple is neither financially nor culturally ripe for a takeover.
The second main reason is that it would make little sense for IBM. While there is a certain synergy with IBM’s strategies thanks to Mac OS X’s Unix heritage, IBM’s focus for most of its future products and services is Linux, not BSD, and diversifying the “pure” Linux message would only confuse the marketing. Owning the Mac platform would provide IBM with no additional benefits, and a foray into the consumer lifestyle market via the iPod would be far too alien to IBM culture. Who’d buy an IBM iPod?
One minor point that Cormac makes, though, does merit some attention: IBM’s lack of Apple as a signatory to its new PowerPC consortium. However, this is equally likely to mean that Apple’s commitment to PowerPC is less solid than IBM would like than meaning that the two companies are so close they don’t need to sign up. The Mac OS X on Intel project remained live, last time I heard, although it’s not what most people think it is (you won’t be able to run OS X on stock PCs, but instead will buy a Mac with an Intel processor in it). Perhaps, as happened with Motorola, Apple has seen the future road-map of the PowerPC and is less than impressed. Or perhaps Steve Jobs is simply “punishing” IBM for its slowness in getting faster PowerPC 970’s to market. Any of these explanations is more likely than an IBM/Apple buy-out.
There is, however, one possible option for a deal between the companies, and one which makes sense at least for Apple. I have to emphasise that this is complete speculation, and that I have no insider knowledge of this actually being true: but suppose, rather than Apple itself being sold to IBM, the company just sold the Mac to Big Blue? This would give Apple two big benefits: it would free the company to concentrate on the two things that have the most potential for growth, digital media and software (a Windows version of Final Cut Pro would sell faster than Apple could duplicate the discs). It would remove a huge chunk of expenses, in the form of hardware development of a platform that, even at the most optimistic estimates, has only limited potential for growth. And it would give Apple the chance to break free of the need to develop and support an operating system, something which is both expensive and increasingly difficult.
The problem, though, is that such a deal makes sense for IBM only if you believe that Linux is heading into difficult water, and there’s little sign of that. Or is there? Rumours have been floating around for a while that Microsoft is preparing some kind of major attack on Linux through its ownership of intellectual property that the open source operating system may infringe upon. If such an attack were to take place, it would be advantageous for IBM to own a “clean” OS capable of support its systems and platforms – and Mac OS X would be a perfect candidate. OS X is pretty scalable, runs on PowerPC, and there are some very neat technologies wrapped up with it – such as Xgrid – which would be attractive to IBM’s core markets.
It’s worth mentioning again that this is speculation, and that I think it’s unlikely at best. But why not? With perhaps four million iPods being sold this coming quarter, an Apple focussed on digital media makes much more sense than a company trying to sell boxes into a commodity market. Perhaps the time is right to look for a buyer for the Mac.