Shares of Apple (AAPL 1.45%) fell 3.6% on Monday. At the same time, Hewlett-Packard (HPQ +0.67%) rose 4.9% and Dell (DELL +0.00%) jumped 13%.
This would have been a perfectly normal day 17 years ago, when basic PC sales were booming and Apple struggled for survival. But more recent history makes this action look kind of perverse. Apple is supposed to be the big winner nowadays while Dell and HP shy away from a barrage of smartphones and tablets.
So why should we party like it's 1996 again?
The reasons are many and varied, and quite different from the catalysts back in the 1990s.
Dell is thinking about going private. That's a double-edged sword where the system builder gets to revamp its operations without worrying about shareholder concerns, while insiders may also see it as a cash-out exit strategy. HP followed Dell's gains, because a restructuring rival would mean lower-hanging fruit for its rivals, but also because the door seems slightly ajar for a spin-out of HP's own PC business. Hardly a show of strength, if you ask me.
Apple's dip comes as Cupertino reduced manufacturing orders for the first quarter. The iPhone 5 may not be the unqualified home run everyone expected it to be, and the company may need to rethink its sales strategy. The smartphone market has matured, and lower-cost Android alternatives have undercut the market for top-shelf iPhones. Moreover, Nokia and Research In Motion have both revamped their entire product portfolios with brand-new software, each hoping to become the next rags-to-riches story in the Apple mold.
In short, it's time for Apple to actually invent something again. The iPhone magic has faded, and it's no longer good enough to just come up with new versions of the existing glass slabs.
All three of Monday's big movers stand at a crossroads. It's do or die for two of them, and Dell is about to throw in the towel.
At the turn of the millennium, Apple had tripled from its early 1996 levels, HP jumped fivefold, and Dell's gains were just ridiculous. But they won't party like it's 1999 over the next four years.
