more on Could GM, Microsoft End Up in Chinese Hands?

[David Farber <dave () farber net>]

Begin forwarded message:

From: Richard Wiggins <richard.wiggins () gmail com>
Date: June 28, 2005 2:57:10 PM EDT
To: David Farber <dave () farber net>
Cc: eekid () aol com
Subject: Re: [IP] more on Could GM, Microsoft End Up in Chinese Hands?
Reply-To: Richard Wiggins <richard.wiggins () gmail com>


Dave,

In the grand scheme of things, $1.25 billion is a VERY small number
for such an acquisition.  Some perspective:

-- Google's market capitalization is now $85 billion.  See
http://www.nytimes.com/2005/06/28/technology/28google.html

-- General Motors, which actually makes things,  has a market cap of
$18 billion or so.

-- Verizon and Qwest are wrangling over an $8.5 billion deal to buy  
MCI. 

-- IBM's revenues for 1Q 2005  were $22.9 billion.

-- The war in Iraq has cost taxpayers at least $300 billion.

In context, the Lenovo deal to buy IBM's consumer PC business was a
wash -- a non-story.   IBM might as well have just deeded the PC biz
to Lenovo for free.

/rich

On 6/28/05, David Farber <dave () farber net> wrote:

> Begin forwarded message:
>
> From: malin () cs cmu edu
> Date: June 28, 2005 10:02:28 AM EDT
> To: dave () farber net, eekid () aol com
> Subject: Re: [IP] Could GM, Microsoft End Up in Chinese Hands?
>
>
> > Lenovo Group Ltd.'s agreement in December to buy the personal
> > computer business of International Business Machines Corp. for $1.25
> > billion was the first sign China is becoming rapidly more
> > internationally acquisitive.
>
> Maybe this is an indicator of China's rise, but let's be clear. IBM  
> sold
> the personal computing component, not because Lenovo made it a juicy
> offer, but because it was severely dragging down their profit- 
> margin.  As
> IBM has confirmed, they are retooling themselves to be a services  
> company.
>  Thus the purchase of PriceWaterhouse Coopers several years ago...
>
> -brad
>
>
>
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