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I am in no position to tell Apple how they should spend their money but after reading the articles about Elon Musk today I can't help but imagine how the world

I am in no position to tell Apple how they should spend their money but after reading the articles about Elon Musk today I can't help but imagine how the world could be changed to become a better place with all this money. And I don't mean that Apple should give money away to charities. Why not invest in space exploration , electric cars, self-driving cars, medical devices, green energy,... It is not Apple's core business, but "phones" have not been the business of "Apple Computer" as well. Apple has moved humanity forward with the personal computer and mobile phones. I don't want them to stop with computers, smartphones, tablets or TVs. I want Apple to aim for more than just consumer electronics - but I guess we won't see that happening.

tptacek 15y ago
They can't, unless they believe they'll be profitable doing it. It's not their money. That's a difference between Apple and Musk.
- jcfrei 15y ago
  that's not true. it is their money - the shareholders probably just wouldn't like the move and as a result, apples stock price would plummet (but that doesn't really need to bother them - it's not like somebody's just gonna buy the currently most expensive company in the world). however what would bother me more as an investor would be that apple apparently has no idea what to do with all that money (how about expanding R&D even more, like microsoft? and develop the next gen input devices (after touchscreens))
  - brown9-2 15y ago
    The shareholders of Apple are the owners of Apple. They get the final vote in the end, although it has to be translated through boards of directors and management.
  - lusr 15y ago
    The Apple Board of Directors has a fiduciary duty to investors. If they take action that causes the share price to fall dramatically, thereby losing investor value, you can be pretty sure the Board will not last very long so yes it would matter.
    - jcfrei 15y ago
      that's only true in theory. the largest investors are usually pension funds and in general they approve whatever the board recommends.
      - tptacek 15y ago
        Then Apple can put their space exploration ambitions up to a vote of the shareholders, who are the ones who actually own Apple's money. Hence today's dividend announcement.
  - maukdaddy 15y ago
    but that doesn't really need to bother them Oh yes it better bother them. Cook and the Board have a fiduciary duty to the shareholders. They can't just go spending money however they want without regard to shareholder wishes or stock performance.
  - dereg 15y ago
    Tim Cook said on the conference call that they have well more than enough to make strategic investments and to support growth. Plus, a company's #1 goal is to create shareholder value.
    - wanderful 15y ago
      A company? We're talking about Apple. I doubt Steve Jobs would have been caught dead saying that about Apple, and I hope that culture is continuing with Apple. Apple employees, notably Ives, have said over and over that their #1 goal is to create <magical products>.
- dpcx 15y ago
  Actually, I think that money is theirs. It's not part of their stock, it's cash that they have in reserve.
  - huggyface 15y ago
    I think they're saying that it's the shareholder's money, which is absolutely true. However that doesn't preclude them from doing good with it, even in money-losing investments, beyond perhaps shareholder revolt ousting the board. There's an oft claimed belief that corporations are somehow bound by corporate law to do everything in their abilities to increase profits/returns for their shareholders. That is not and has never been true. Corporations are essentially mini-democracies, albeit where your say is scaled by your ownership: If the shareholders don't like it they have mechanisms to deal with it.
    - tedunangst 15y ago
      Nothing prevents the shareholders from taking the dividend and investing it in cold fusion or flying cars. Then you don't even need to take a vote. You just give people their money and they decide what to do with it.
  - InclinedPlane 15y ago
    The board aren't the owners, they're just the board, the owners are the share holders. The company literally belongs to them, as does this money.
    - __alexs 15y ago
      That is to stretch the definition of ownership quite a lot. Share holders have no rights to or control of any portion of the cash balance of a company that are not granted to them by the board.
      - tptacek 15y ago
        The board represents and has a fiduciary duty to the shareholders. The term "fiduciary duty" is not abstract; it has legal force, hence the frequency in the news of another investing term: "shareholder's lawsuit".
uptown 15y ago
"Why not invest in space exploration , electric cars, self-driving cars, medical devices, green energy" Why should they? Just throwing money at something doesn't guarantee success, and deviating from a company's core competencies can become a distraction that drags down the parts of a company that are succeeding. The dividend puts money back into the hands of investors that can choose to either re-invest back into Apple stock, or invest in companies whose core competency is space exploration, electric cars, or some of the other areas that wouldn't be in Apple's expected domain.
- droz 15y ago
  Used to be that all Ball made was jars. Now they are sending successful probes out into space and helping the advancement of science.
maukdaddy 15y ago
Maybe Apple doesn't feel they can be successful in areas other than consumer electronics. Trying to get into another line of business would be a HUGE distraction for management as well as the employees. As for your green energy comment: I think Apple can do far more to promote green energy by being a customer and driving partners to produce better products than designing their own green business. For example, by buying a shitload of fuel cells for their datacenters, Apple funds Bloom's (or others') R&D efforts. Same with solar panels and other alternatives.
- Apple-Guy 15y ago
  Apple is already buying quite a lot of fuel cells AND solar panels for its datacenters.
dereg 15y ago
Because Apple's duty is not to pursue community goals. Furthermore, they don't have the competence to make those sorts of investments. Apple is not a philanthropic organization, and it would be to everyone's detriment if they were to act like one.
celticninja 15y ago
>Apple has moved humanity forward I would say this is quite a lot of hyperbole. They have refined what others have made but they have not moved humanity forward. The Haber-Bosch process, Norman Borlaug, the space race, the production of a silicon chip etc have al moved humanity forward. Apple in comparison made some trinkets.
- jiggy2011 15y ago
  You could argue that they have moved humanity forward in the sense of setting the bar higher for the sort of experience that people expect with everyday things. Of course they are not primarily a science/research company so they rely on "standing on the shoulders of giants".
adnam 15y ago
>> Apple has moved humanity forward Twaddle.
- astrodust 15y ago
  Why are you so dismissive? Apple is not the only company that has done this. Many companies had MP3 players prior to the iPod, but it was Apple's device that completely up-ended the music industry. Now people have access to entire libraries of music on their phone, and a store where they can buy even more. Can you really say the situation would be better if Apple had blown out in the 1990s and we were at the mercy of Rio and RealPlayer?
  - adnam 15y ago
    Hyperbole. OK, I agree, Apple has move humanity forward. But by mere millimeters compared to Alexander Flemming's mile.
    - Bud 15y ago
      I disagree. But it's interesting that you mention Alexander Fleming (it's one m in his name, btw). Fleming actually has some similarities to Apple's role in technology. Fleming discovered penicillin and its effects, but he abandoned the discovery because he was unable to produce it in quantity, and also did not believe it would last long enough in the human body to cure infections. It took the work of several others, and fifteen more years, to actually produce an effective drug. Similarly, those who made various fundamental discoveries and inventions in computing are certainly significant and worthy of attention, but Apple also deserve much credit for making easy-to-use, refined products out of these discoveries, especially over the last ten years. Giving people better tools makes them more productive in whatever endeavors they pursue. It would be short-sighted to not see Apple's value to society.
InclinedPlane 15y ago
Why not buy Applebee's or invest in ice hotels? At some level it's necessary for a company as tight and as focused as Apple is to maintain a cohesion in its corporate expanse. They could easily spend their money on growing the company in a myriad of ways. They could invest in pharmaceuticals or unicycles, but the farther afield they get from their core competencies the less likely they are to succeed, and the less likely they are to remain a single, cohesive company. At the end of the day the key question remains: what is Apple other than just a big ol' wad of money? If Apple is something other than just an amalgam of various profitable enterprises then they should keep on being that instead of trying to be something they're not.
glenra 15y ago
Apple has been successful so far with a very careful strategy: they focus on just a few markets at a time, only enter new markets if they have a big competitive advantage in those markets and only release new products if those products are a big improvement on the prior status quo. If they were to spread management attention more thinly by starting separate divisions to do the sorts of entirely unrelated things you describe, Apple could easily turn into IBM or Microsoft. At its heart, Apple is a small company. The main way Apple helps all those other industries is by training engineers to think in the Apple way who then go off and found start-ups of their own. And by making lots of millionaires to fund those start-ups. (Apple's also investing in some of those industries as a customer. For instance, they invest in "green energy" by buying solar panels for its new HQ building.)
therandomguy 15y ago
because Opportunity Cost
tomkinstinch 15y ago
I guess we can ask which other sectors they could disrupt. Education seems like a perfect fit. They could start their own publishing house to author first-rate dynamic textbooks for the iPad. The content could be better than it is in current books, and it would sell iPads to boot.
furyofantares 15y ago
> but "phones" have not been the business of "Apple Computer" as well. I don't think of the iPhone as a phone at all. It's a computer I always have with me. Now, the main reason I always have it with me is because, rather than being an additional thing I need to carry in my pocket and always remember, it replaced a thing I need to carry in my pocket and always remember, but the "Phone" feature is the least used feature of my iPhone by far. This is how Apple approached the iPhone, too. It was initially thought of as an iPod that had the sweet feature that it could replace your phone rather than require you to carry an extra device.

tptacek 15y ago

They can't, unless they believe they'll be profitable doing it. It's not their money. That's a difference between Apple and Musk.

jcfrei 15y ago
that's not true. it is their money - the shareholders probably just wouldn't like the move and as a result, apples stock price would plummet (but that doesn't really need to bother them - it's not like somebody's just gonna buy the currently most expensive company in the world). however what would bother me more as an investor would be that apple apparently has no idea what to do with all that money (how about expanding R&D even more, like microsoft? and develop the next gen input devices (after touchscreens))
- brown9-2 15y ago
  The shareholders of Apple are the owners of Apple. They get the final vote in the end, although it has to be translated through boards of directors and management.
- lusr 15y ago
  The Apple Board of Directors has a fiduciary duty to investors. If they take action that causes the share price to fall dramatically, thereby losing investor value, you can be pretty sure the Board will not last very long so yes it would matter.
  - jcfrei 15y ago
    that's only true in theory. the largest investors are usually pension funds and in general they approve whatever the board recommends.
    - tptacek 15y ago
      Then Apple can put their space exploration ambitions up to a vote of the shareholders, who are the ones who actually own Apple's money. Hence today's dividend announcement.
- maukdaddy 15y ago
  but that doesn't really need to bother them Oh yes it better bother them. Cook and the Board have a fiduciary duty to the shareholders. They can't just go spending money however they want without regard to shareholder wishes or stock performance.
- dereg 15y ago
  Tim Cook said on the conference call that they have well more than enough to make strategic investments and to support growth. Plus, a company's #1 goal is to create shareholder value.
  - wanderful 15y ago
    A company? We're talking about Apple. I doubt Steve Jobs would have been caught dead saying that about Apple, and I hope that culture is continuing with Apple. Apple employees, notably Ives, have said over and over that their #1 goal is to create <magical products>.
dpcx 15y ago
Actually, I think that money is theirs. It's not part of their stock, it's cash that they have in reserve.
- huggyface 15y ago
  I think they're saying that it's the shareholder's money, which is absolutely true. However that doesn't preclude them from doing good with it, even in money-losing investments, beyond perhaps shareholder revolt ousting the board. There's an oft claimed belief that corporations are somehow bound by corporate law to do everything in their abilities to increase profits/returns for their shareholders. That is not and has never been true. Corporations are essentially mini-democracies, albeit where your say is scaled by your ownership: If the shareholders don't like it they have mechanisms to deal with it.
  - tedunangst 15y ago
    Nothing prevents the shareholders from taking the dividend and investing it in cold fusion or flying cars. Then you don't even need to take a vote. You just give people their money and they decide what to do with it.
- InclinedPlane 15y ago
  The board aren't the owners, they're just the board, the owners are the share holders. The company literally belongs to them, as does this money.
  - __alexs 15y ago
    That is to stretch the definition of ownership quite a lot. Share holders have no rights to or control of any portion of the cash balance of a company that are not granted to them by the board.
    - tptacek 15y ago
      The board represents and has a fiduciary duty to the shareholders. The term "fiduciary duty" is not abstract; it has legal force, hence the frequency in the news of another investing term: "shareholder's lawsuit".

uptown 15y ago

"Why not invest in space exploration , electric cars, self-driving cars, medical devices, green energy" Why should they? Just throwing money at something doesn't guarantee success, and deviating from a company's core competencies can become a distraction that drags down the parts of a company that are succeeding. The dividend puts money back into the hands of investors that can choose to either re-invest back into Apple stock, or invest in companies whose core competency is space exploration, electric cars, or some of the other areas that wouldn't be in Apple's expected domain.

droz 15y ago
Used to be that all Ball made was jars. Now they are sending successful probes out into space and helping the advancement of science.

maukdaddy 15y ago

Maybe Apple doesn't feel they can be successful in areas other than consumer electronics. Trying to get into another line of business would be a HUGE distraction for management as well as the employees. As for your green energy comment: I think Apple can do far more to promote green energy by being a customer and driving partners to produce better products than designing their own green business. For example, by buying a shitload of fuel cells for their datacenters, Apple funds Bloom's (or others') R&D efforts. Same with solar panels and other alternatives.

Apple-Guy 15y ago
Apple is already buying quite a lot of fuel cells AND solar panels for its datacenters.

dereg 15y ago

Because Apple's duty is not to pursue community goals. Furthermore, they don't have the competence to make those sorts of investments. Apple is not a philanthropic organization, and it would be to everyone's detriment if they were to act like one.

celticninja 15y ago

>Apple has moved humanity forward I would say this is quite a lot of hyperbole. They have refined what others have made but they have not moved humanity forward. The Haber-Bosch process, Norman Borlaug, the space race, the production of a silicon chip etc have al moved humanity forward. Apple in comparison made some trinkets.

jiggy2011 15y ago
You could argue that they have moved humanity forward in the sense of setting the bar higher for the sort of experience that people expect with everyday things. Of course they are not primarily a science/research company so they rely on "standing on the shoulders of giants".

adnam 15y ago

>> Apple has moved humanity forward Twaddle.

astrodust 15y ago
Why are you so dismissive? Apple is not the only company that has done this. Many companies had MP3 players prior to the iPod, but it was Apple's device that completely up-ended the music industry. Now people have access to entire libraries of music on their phone, and a store where they can buy even more. Can you really say the situation would be better if Apple had blown out in the 1990s and we were at the mercy of Rio and RealPlayer?
- adnam 15y ago
  Hyperbole. OK, I agree, Apple has move humanity forward. But by mere millimeters compared to Alexander Flemming's mile.
  - Bud 15y ago
    I disagree. But it's interesting that you mention Alexander Fleming (it's one m in his name, btw). Fleming actually has some similarities to Apple's role in technology. Fleming discovered penicillin and its effects, but he abandoned the discovery because he was unable to produce it in quantity, and also did not believe it would last long enough in the human body to cure infections. It took the work of several others, and fifteen more years, to actually produce an effective drug. Similarly, those who made various fundamental discoveries and inventions in computing are certainly significant and worthy of attention, but Apple also deserve much credit for making easy-to-use, refined products out of these discoveries, especially over the last ten years. Giving people better tools makes them more productive in whatever endeavors they pursue. It would be short-sighted to not see Apple's value to society.

InclinedPlane 15y ago

Why not buy Applebee's or invest in ice hotels? At some level it's necessary for a company as tight and as focused as Apple is to maintain a cohesion in its corporate expanse. They could easily spend their money on growing the company in a myriad of ways. They could invest in pharmaceuticals or unicycles, but the farther afield they get from their core competencies the less likely they are to succeed, and the less likely they are to remain a single, cohesive company. At the end of the day the key question remains: what is Apple other than just a big ol' wad of money? If Apple is something other than just an amalgam of various profitable enterprises then they should keep on being that instead of trying to be something they're not.

glenra 15y ago

Apple has been successful so far with a very careful strategy: they focus on just a few markets at a time, only enter new markets if they have a big competitive advantage in those markets and only release new products if those products are a big improvement on the prior status quo. If they were to spread management attention more thinly by starting separate divisions to do the sorts of entirely unrelated things you describe, Apple could easily turn into IBM or Microsoft. At its heart, Apple is a small company. The main way Apple helps all those other industries is by training engineers to think in the Apple way who then go off and found start-ups of their own. And by making lots of millionaires to fund those start-ups. (Apple's also investing in some of those industries as a customer. For instance, they invest in "green energy" by buying solar panels for its new HQ building.)

therandomguy 15y ago

because Opportunity Cost

tomkinstinch 15y ago

I guess we can ask which other sectors they could disrupt. Education seems like a perfect fit. They could start their own publishing house to author first-rate dynamic textbooks for the iPad. The content could be better than it is in current books, and it would sell iPads to boot.

furyofantares 15y ago

> but "phones" have not been the business of "Apple Computer" as well. I don't think of the iPhone as a phone at all. It's a computer I always have with me. Now, the main reason I always have it with me is because, rather than being an additional thing I need to carry in my pocket and always remember, it replaced a thing I need to carry in my pocket and always remember, but the "Phone" feature is the least used feature of my iPhone by far. This is how Apple approached the iPhone, too. It was initially thought of as an iPod that had the sweet feature that it could replace your phone rather than require you to carry an extra device.