Microsoft vs. Apple.

I've had a family emergency that has occupied much of my time over the Thanksgiving holiday and will pull me out of town for the next several days. Posting could be sporadic during this time.

Before Thanksgiving though I had to go out to the Apple Store at the Oakbrook Mall to ask them a question about my Ipad. Those of you who have been around this blog for any more than a few weeks should know that I think the Ipad/Tablet/smart phone universe is a game changer in the way the first lap tops were back in the early 90's. Apparently I'm not the only one who thinks that. The Apple store was filled to capacity and it was impossible to even get close to the Ipad displays. Oh and by the way a representative met me at the door and asked me if he could help. He fixed my problem and sold me a camera adapter for my Ipad for his trouble. The guy did everything possible to make sure my experience at his store was great.

On my way out of the mall I noticed that a Microsoft store had opened probably not more than 200 yards down from where Apple is located in the mall. On impulse I went in. Apart from a father and his two kids looking over Microsoft's well received Kinect device for their X-box, the place was empty of customers. There were at least eight people working in the place. Nobody came up to see if I needed help until at least ten minutes had passed. The sales associate who briefly engaged me really wasn't interested and I think was relieved when I told him I was just looking. He quickly scooted back over to watch the dad and his two kids playing on the Kinect.

Now maybe this is a bad example of a bad day for the Microsoft folks. It was the day before Thanksgiving and the Microsoft store hasn't been open all that long. Perhaps they had much larger traffic flow over the weekend. But the Apple store is CROWDED ALL THE TIME!!! You practically need an appointment to get in the place. It's employees practically beam with excitement. Of course if you're a shareholder of Apple you have to feel the same way. Your stock is up nearly 1,700% since 2005 and up almost 60% in 2010. {Investors of Lumen Capital Management own Apple indirectly through our investments in the Nasdaq Composite-QQQQ where Apple now accounts for something close to 20% of that index.}

Microsoft shares, not up so much. Its stock trades at essentially the same price as it did in 2005 or for that matter at this time in 1998. I understand that is not necessarily a complete comparison as one has to also factor in the issue of special dividends. However, the stock has basically flat lined for a decade as have its products and its innovation. Perhaps that's why their employees are so glum or maybe the ones who worked in the store are just biding their time waiting for a job opening down the street at Apple.

*Long ETFs that hold both Microsoft and Apple Computer in client and personal accounts.  Long ETFs related to the Nasdaq composite in client and personal accounts.  Long Microsoft stock as a legacy position in one client accounts.  Two clients of Lumen Capital Management own shares in Apple Computer as an unsolicited position.