Apple CEO Tim Cook courted controversy today by claiming that rival Dell should be liquidated.
In an interview with TechCrunch, Cook said if he were in charge of the struggling company he would “shut it down and give the money back to shareholders.”
“I just don’t know why they’re still around,” he said. “They make terrible, low-margin PCs, which means they’re the worst player in a declining market.
“They’ve tried to diversify into services, but can’t seem to fully commit to the transition the way IBM did. And they’ve failed in smartphones and tablets. Anyone remember the Dell phone? My god what a piece of s**t.
“They should break up the company, sell all their assets and then pay a special dividend. That’s the only way forward.”
The Ones Who Don’t
Dell and Apple, two pioneers in the personal computer industry, have taken divergent paths in recent years. While Apple has innovated its way into new markets, Dell has remained a perennial laggard stuck in the collapsing PC segment.
Dell’s market capitalization has fallen from a high of $40 in 2005 to around $13 today. The company is currently undergoing a painful, months-long fight with shareholders about taking itself private, a move Cook says will only forestall the inevitable.
“The problem with Dell is that they have no creativity, no capacity for innovation,” he explains. “I mean the traditional private equity model doesn’t work in computing. What are you gonna do? Fire a bunch of people and cut costs to improve your profitability?
“You can’t cut your way to new products. You can’t cut your way into new markets. Dell doesn’t need a change in its capital structure, it needs a change in culture. And as long as Michael Dell is involved, the culture won’t be sufficiently innovative to compete.
“Just shut it down. The assets would be better off in Lenovo or Acer’s hands, and the shareholders would be better off with the cash.”
The founder and CEO of Dell, Michel Dell, once advised Steve Jobs to shut down Apple when the company was undergoing financial turmoil in the 1990s. Steve Jobs declined.