The Wall Street Journal  headlined Monday, “Apple Chief to Take Leave.”  Forbes.com Leadership editor Fred Allen quickly asked what most folks were asking “Where does Steve Jobs Leave Apple Now?” as he led multiple bloggers covering the speculation about how long Mr. Jobs would be absent from Apple, or if he would ever return, in “What They Are Saying About Steve Jobs.”  The stock took a dip as people all over raised the question covered by Steve Caulfield in Forbes’ “Timing of Steve Jobs Return Worries Investors, Fans.”

If you want to make money investing, this is what’s called a “buying opportunity.”  As Forbes’ Eric Savitz reported “Apple is More Than Just Steve Jobs.” Just look at the most recent results, as reported in Ad AgeApple Posts ‘Record Quarter’ on Strong iPhone, Mac, iPad Sales:”

  • Quarterly revenue is up 70% vs. last year to $26.7B (Apple is a $100B company!)
  • Quarterly earnings rose 77% vs last year to $6B
  • 15 million iPads were sold in 2010, with 7.3 million sold in the last quarter
  • Apple has $50B cash on hand to do new product development, acquisitions or pay dividends

ZDNet demonstrated Apple’s market resiliency headlining “Apple’s iPad Represents 90% of All Tablets Shipped.”  While it is true that Droid tablets are now out, and we know some buyers will move to non-Apple tablets, ZDNet predicts the market will grow more than 250% in 2011 to over 44 million units, giving Apple a lot of room to grow even with competitors bringing out new products. 

Apple is a tremendously successful company because it has a very strong sense of where technology is headed and how to apply it to meet user needs.  Apple is creating market shifts, while many other companies are reacting.  By deeply understanding its competitors, being willing to disrupt historical markets and using White Space to expand applications Apple will keep growing for quite a while.  With, or without Steve Jobs.

On the other hand, there’s the stuck-in-the-past management team at Microsoft.  Tied to all those aging, outdated products and distribution plans built on PC technology that is nearing end of life.  But in the midst of the management malaise out of Seattle Kinect suddenly showed up as a bright spot!  SFGate reported that “Microsoft’s Xbox Kinect beond hackers, hobbyists.”  Seems engineers around the globe had started using Kinect in creative ways that were way beyond anything envisioned by Microsoft! Put into a White Space team, it was possible to start imagining Kinect could be powerful enough to resurrect innovation, and success, at the aging monopolist!

But, unfortunately, Microsoft seems far too stuck in its old ways to take advantage of this disruptive opportunity. Joel West at SeekingAlpha.com tells us “Microsoft vs. Open Kinect: How to Miss a Significant Opportunity.”  Microsoft is dedicated to its plan for Kinect to help the company make money in games – and has no idea how to create a White Space team to exploit the opportunity as a platform for myriad uses (like Apple did with its app development approach for the iPhone.)

In the end, ZDNet joined my chorus looking to oust Ballmer (possibly a case study in how to be the most misguided CEO in corporate America) by asking “Ballmer’s 11th Year as Microsoft’s CEO – Is it Time for Him to Go?”  Given Ballmer’s massive shareholding, and thus control of the Board, it’s doubtful he will go anywhere, or change his management approach, or understand how to leverage a breakthrough innovation.  So as the Cloud keeps decreasing demand for traditional PCs and servers, Brett Owens at SeekingAlpha concludes in “A Look at Valuations of Google, Apple, Microsoft and Intel” that Microsoft has nowhere to go but down!  Given the amazingly uninspiring ad program Microsoft is now launching (as described in MediaPost “Microsoft Intros New Corporate Tagline, Strategy“) we can see management has no idea how to find, or sell, innovation.

We often hear advice to buy shares of a company.  Rarely recommendations to sell.  But Apple is the best positioned company to maintain growth for several more years, while Microsoft has almost no hope of moving beyond its Lock-in to old products and markets which are declining.  Simplest trade of 2011 is to sell Microsoft and buy Apple.  Just read the headlines, and don’t get suckered into thinking Apple is nothing more than Steve Jobs.  He’s great, but Apple can remain great in his absence.

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