Tag Archive: David Packard


Five years ago Hewlett-Packard (NYSE: HPE) was kicked off the Dow Jones Industrial Average, replaced by Visa.

Three years ago, AT&T (a.k.a., The Phone Company) was ingloriously removed from the index of 30 share prices, substituted by Apple.

And just last month, General Electric (NYSE: GE) was unceremoniously ushered off the exchange for Walgreen Boots.

Will Itty Bitty Machines (NYSE: IBM) be the next Dinosaur Tech heading for Dow Jones extinction?

Flintstones vs Jetsons

Under legendary CEO Jack Welch, GE was the most valuable (market capitalization) American company in 2000. The company was one of the founding companies of the Dow Jones Industrial Average in 1896. General Electric was a consistent standard on the exchange since 1907, 111 years.

What have you done for us lately, Fred and Wilma Flintstone? GE was replaced on the Dow Jones two weeks ago by a drug store company? How embarrassing.

Almost DailyBrett earlier wrote about companies that are absolutely rocking (i.e.,  Apple, Amazon, Facebook, Netflix, Google, Salesforce.com), metaphorically packing stadiums as opposed to those reduced to playing “greatest hits” at county fairs and desert casinos (i.e., Intel, Cisco, Dell).

These latter companies were/are directly tied to the mature PC market and thus became fairly valued with limited prospects for investor growth unless and until they credibly changed their story with compelling new information (e.g., Apple from Amelio to Jobs2 to Cook) & (e.g., Microsoft from Gates to Ballmer to Nadella).

Apple was on the precipice of bankruptcy in 1997; now the company is the world’s most valuable at $912 billion. The Wunder corporation may be first to ever to achieve a $1 trillion market cap (share price x the number of shares).

Microsoft has cleverly reinvented itself as the market leader in the cloud, even though the PC software company was late to the party. Macht nichts. MSFT has a $762 billion market cap.

Apple, Amazon, Facebook, Google, Netflix and Salesforce.com constitute the 21st Century version of the Jetsons.

Conversely, AT&T, GE, Hewlett-Packard and IBM are the Flintstones.

What Are Their Winning Narratives?

Having worked in corporate Silicon Valley public relations for more than a decade, Almost DailyBrett understands the virtue of championing a winning narrative.

What is your company’s raison d’etre?

How does it make the legal tender?

How is the company positioned in the marketplace against ferocious competitors?

What is its competitive advantage?

What is its legacy of results?

What are the prospects for reasonable and achievable expectations for shareholder joy?

For the record, Almost DailyBrett owns shares of Apple (NASDAQ: AAPL) and Salesforce.com (NYSE: CRM).

Both companies have delivered. Both are leaders in their respective fields. Most of all, your author understands their business strategies – lead in consumer innovation and services; provide selected software via the cloud to business customers).

Investing or Gambling?

When you understand how and why a company makes money then markets are investing, not gambling.

What is the winning narrative for GE? The company is restructuring yet again. Give it up J.C. Penney. Forget it, GE.

Tell me more about the business strategy for AT&T. How will it beat Verizon? Your author doesn’t know either.

Your author loves his Lenovo Ideapad. Who commercialized the PC? IBM in 1981. Reagan was president. “Watson,” can you help?

HPites love the 1937 story of HP founders William Hewlett and David Packard and the Palo Alto garage.

If the two gents could see their creation in the post-Carly Fiorina era, they would most likely would be turning over in their respective graves.

When contemplating these four Dinosaur Techs – AT&T, GE, HP, IBM — in a Jurassic Park era, the hardest questions are also the most basic: How do these companies make money? What product defines their respective businesses?

In stunning contrast, Apple is the #1 company in the world, defined by game changing innovation (e.g., iPhone X) and services (e.g., Apple Music).

Amazon is the #1 digital-retailer in the world with 100 million Prime memberships.

Facebook is the world champion social media company with 2.19 billion subscribers.

Google is the #1 search engine and developed the smart phone Android OS.

Netflix is the #1 digital-streaming-video company (at least for now) with 125 million subscribers.

Salesforce.com pioneered SaaS (Software as a Service) and is a leading-business-software-via-the-cloud provider.

Quick: Can you name a signature product/service directly associated with AT&T, GE, HP or IBM?

Being a jack of all trades, master of none leaves investors will absolutely … nothing.

https://www.cnbc.com/2018/06/19/walgreens-replacing-ge-on-the-dow.html

https://almostdailybrett.wordpress.com/2011/07/21/what-happens-when-the-music-stops/

 

 

“I stand ready to lead us down a different path, where we are lifted up by our desire to succeed, not dragged down by a resentment of success.” Former Massachusetts Governor Mitt Romney

Is Suite H33, Kirkland House at Harvard University the most famous dorm room in the nation?

Or maybe it is located in Dobie House at the University of Texas in Austin?

Or should we focus instead on a garage, maybe one located in Palo Alto, California?

As we struggle to escape the clutches of an increasingly stubborn economic downturn, perhaps we should be looking for a new kind a “stimulus” in the form of more dreamers, achievers, inventors, innovators and entrepreneurs.

Mark Zuckerberg wrote the algorithms as seen in the film, The Social Network, that would eventually turn into Facebook on a whiteboard in a cluttered Harvard dorm room in 2003. Today, Facebook has more than 800 million subscribers, making this social media community the third largest “country” in the world. More than 3,000 people work for Facebook and a potential second quarter IPO is in the offing. If so, it will be the ultimate ka-ching.

kirkland

Michael Dell started building and selling his own brand of computers for fellow UT classmates for under $1,000 each in 1983. There was no need for a middle man, and thus a business strategy was born. Today, Dell has $61.7 billion in annual revenues, a market cap (share price x number of shares) of $28.5 billion and employs 100,300 worldwide.

Bill Hewlett and David Packard started in 1937 what would eventually become Hewlett Packard in a tiny one car garage at 367 Addison Street in Palo Alto, CA.  To many this little garage is considered to be the birthplace of Silicon Valley. Today, HP is one of the largest technology companies on the planet with $127 billion in revenues, a market cap of $52.5 billion and employing almost 350,000 souls worldwide.

Certainly these are not the only entrepreneurs that have been successful as there are many more, some of them coming to America without the ability to speak English, but they all had the capacity to dream.

For more than a decade, I worked for one of those entrepreneurs, Wilfred J. Corrigan. He is now the fifth most famous person to hail from Liverpool, UK. No one knew him when he came to America with no income, flying his bride from the fjords of her native Norway to the Sonoran Deserts of Arizona. He worked on the assembly line for Motorola in Phoenix. Eventually, Wilf became the CEO of Fairchild; later losing the company in a hostile takeover attempt. He spent a year under a no-compete contract. And then started LSI Logic in 1981.

Wilf Corrigan, CEO of LSI Logic

The company eventually grew to $2.7 billion in revenues with 7,700 employees and made the essential processor for the two generations of the Sony Play Station. It all started with a dream. And as a result of Wilf’s dream, thousands were working directly (employees) or indirectly (e.g. distributors, partners, suppliers) and thousands of B2B customers and their customers were being served (e.g. video game players among others). Wilf succeeded, failed and succeeded again. He is part of the 1 percent that you may have read about.

As we survey the economic landscape looking for answers, there are some who believe the key lies in leveling the playing field, particularly those who achieve. As they say, no good deed goes unpunished.

According to the independent Tax Policy Center, 46 percent or about 76 million will not be liable for federal income taxes in 2011. That’s a whole lot of people for whatever reason, who are not achieving, some of which could be achieving a whole lot more. Granted, the ones who are employed are paying payroll taxes and contributing to Social Security.

What would happen if this 55-45 percent taxpaying to no taxpaying ratio was shifted to a 65-35 percent taxpaying to no taxpaying ratio under existing tax rates? What would happen if for example, 20 million more Americans were liable for federal income taxes without raising or lowering rates? What would be positive net income to the federal Treasury? If these 20 million would earn enough to pay taxes, would they also increase their own economic activity? What impact would that increased activity have on the federal Treasury, but also the account statements for states and municipalities?

After 15 years working in the Silicon Valley, I learned to believe in innovation and entrepreneurship. The net results are good products, good paying direct and indirect jobs. The ideas are out there. There are also risks. As a result, some will succeed and some will fail. That is the tyranny of the marketplace, but it is also the opportunity. We need to start listening to the conversations and ideas germinating from dorm rooms and garages. Who knows, the next Facebook, Dell or Hewlett Packard may be taking form.

And with these new ideas turned into new companies comes more job opportunities for the 46 percent that are not liable for federal income taxes.

Sure beats throwing money at a Bridge to Nowhere.

http://www.youtube.com/watch?v=lB95KLmpLR4

http://www.guardian.co.uk/technology/2010/sep/12/social-network-facebook-mark-zuckerberg

http://www.kirkland.harvard.edu/icb/icb.do

http://content.dell.com/us/en/corp/brand-entrepreneurship

http://www.cs.utexas.edu/news-events/news/2011/michael-dell-speaks-during-return-campus

http://www.biography.com/people/michael-dell-9542199

http://en.wikipedia.org/wiki/HP_Garage

http://money.cnn.com/2011/04/14/pf/taxes/who_pays_income_taxes/index.htm

http://www.huffingtonpost.com/2011/06/28/46-percent-of-americans-e_n_886293.html

http://www.taxpolicycenter.org/

http://www.heritage.org/research/reports/2005/10/the-bridge-to-nowhere-a-national-embarrassment

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