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Leader: Innovation doesn't always equal financial success
The Apple faithful defend iPod against Dell criticism - but how strong is their argument?

By silicon.com

Published: Tuesday 18 January 2005

The silicon.com mailbag has filled up over the past 24 hours with reader responses to a story we ran yesterday quoting the views of Dell CEO Kevin Rollins on Apple and its soar-away success of the last couple of years, the iPod.

Most have come from the legendary Apple faithful, standing up for their preferred vendor in the face of criticism from the most successful seller of Wintel PCs.

But could it be there are two completely separate issues here?

On the one hand, we have Dell, raking in around $13bn per quarter in sales these days and around $1bn in profit. By its own admission, although the company covers a number of areas now, from PCs for consumers and businesses, to higher-end IT gear, to consumer electronics even, its main areas of innovation are in its supply chains and assembly. It is not a tech pioneer.

Meanwhile, Silicon Valley's Apple remains a tech stalwart. It has had its problems over the past quarter of a century but has truly been an innovator and has had success in recent times with the iPod, a consumer electronics device which may have some knock-on effects with IT buyers considering the brand again. Its share price has rallied of late - much more so than Dell's or most other big vendors' - but its sales were $3.5bn with a net profit of $295m for the quarter that ended on Christmas Day.

When Dell's Rollins seemingly belittles Apple's achievement - with the iPod or anything else - it is from a position of power, both within the industry and in a simple way most people can measure: money.

Maybe using the word "fad" wasn't the best choice but we can see where he's coming from. Michael Dell may not have invented the PC, servers or storage equipment but his company's versions of those products seem a safer bet financially than any one digital music player, even the seductive iPod.

Will any of those things change our lives? Maybe - in ways that won't seem obvious, as tools where we work or for the person that takes our holiday booking or the website that gets those flowers delivered just in time.

An Apple product, however, is tangible, (often) well-designed and generally more personal than the usual personal computer. The company may get credit where it doesn't always deserve it - copying the GUI from the copier company, anyone? - but it has innovated in its products.

As one reader, photographer Christopher Mann, who we may just have pegged as an Apple fan, told us: "Dell and every other company NEED Apple and they need Apple BAD. Apple is their research and development company. Apple innovates. Everyone else merely follows."

But some of our other feedback was way off the mark. Of Rollins' comments, UK-based designer Brett Archibald wrote: "Stupid, ignorant or just in plain denial? You decide."

Meanwhile, 'Shorty' from Germany told us: "LOL! [Rollins] HAS to say that! He knows that the [Mac] Mini is gonna make his sales-life HELL, what do you expect? What a jealous little baby..."

We don't agree with the thinking there, that somehow Dell will come a cropper and the future belongs to design-savvy Apple.

Let's recognise all the good things Apple has done in terms of product innovation. But at the same time let's not pretend that innovation will necessarily make it a rich company on par with a Dell or a Microsoft.