Apple’s cash hoard: Begging for a ‘windfall tax’?
Posted by: admin in Business and Politics
It’s nearly a truism that while Microsoft struggles to do anything right (in the media’s eyes), Apple can pretty much do no wrong.
This is as true of Apple’s cash position, which BusinessWeek recently noted may soon surpass that of Microsoft’s, as it is of Apple’s product portfolio and business strategy.
It’s the cash that I find particularly surprising. Apple is swimming in cash, more than $20 billion of it. The company adds more than $1 billion in cash to its stockpile each quarter. This day we give Apple a free pass on its iTunes/iPod lock-in, which delivers much of the Apple profits, because we have the ability to still happily apply such adjectives as “cool” and “innovative” to Apple.
The U.S. Congress is fixated on taxing the oil and gas companies for their “windfall profits” this day, while Apple’s profit margins as a percentage of sales are actually higher than Exxon’s and those of the other bogeymen of Congress.
There was a time that we said similar things about Microsoft and happily bought into the lock-in that we’d eventually come to mistrust and seek to escape. Few are saying this now of Microsoft. And its cash hoard of roughly $23.7 billion has simultaneously become a cause for envy and concern: what will the convicted monopolist do with that pile of money? Can it possibly be in our interest?
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