There’s no bigger, richer company on the planet than Apple.
Apple’s CEO Tim Cook has repeatedly stated this most American of companies will soon garner more of its sales from China than anywhere else.
The company hasn’t really been a ‘pirate’ since the early days of the iPod — a decade ago.
The biggest hires at Apple these past few years have come from the world of high margin fashion.
Apple’s primary innovations the past five years, in my view, stem from technologies the company acquired, not developed: Siri and Touch ID, specifically.
One more thing: the great Woz says that whole “Apple started in a garage” myth? Yeah, not exactly true.
This is a new world. Mobile computing devastates all before it and Apple rules the landscape. The old myths, the myths of the garage, the visionary, the pirates, the small, merry ‘cult’ of users, these no longer apply.
What now?
Can you fly a pirate flag when you have more money than anyone else? And a partnership with IBM?
When you are bigger than even Google or Microsoft or Exxon, can you usher in a new order? Against the established order?
Time for new myths at Apple. Myths help support the brand. Apple’s brand is the most valued in the world.
For the second year in row, Apple has topped Google as the world’s most valuable brand. The two are the only brands to be valued at more than $100 billion, according to the annual Best Global Brands report.
Valued at $118.9 billion, Apple increased its (brand) value by 21% year-on-year, while Google’s brand value of $107.43 billion jumped 15% compared to last year.
The Insanely Great New Myths
New myths are now necessary. These must resonate on a deeply personal level, on a universal level, and must seem borderline eternal.
That is not easy to do.
I suspect this is why Apple has been spending so much lately to develop in-house advertising expertise — to craft the message no one else can legitimately mimic. Apple’s current ads reflect the company’s transition from destroyer of Big Old Order to guidepost for Universal Individual Empowerment. But they do not soar. They are not “only Apple.”
Apple’s current ads focus on thinness, a product feature, or generic personal empowerment, an emotional tug. These are fine as marketing efforts go, but are easily replicable by competitors.
What is or can be an “only Apple” myth?
Let’s consider recent Tim Cook quotes as Apple’s attempts to uncover the new myths, the new rallying cries that drive staff and customers for at least a generation.
We’re very simple people at Apple. We focus on making the world’s best products and enriching people’s lives.
A great statement, though I suspect it’s too expansive. The “best products” that “enrich” our lives could be a mobile computer, a watch — or a car, dishwasher or robot butler. Apple can’t do all such products.
Strike 1.
Companies that get confused, that think their goal is revenue or stock price or something. You have to focus on the things that lead to those.
This is an awesome sentiment, in large part because it’s believable. However, as $AAPL nears a literal $1 trillion in value, shuttling billions around from country to country, state to state, such a view opens itself up to way too much snark.
Strike 2.
Our whole role in life is to give you something you didn’t know you wanted. And then once you get it, you can’t imagine your life without it. And you can count on Apple doing that.
Stand up double.
This last sentiment of Cook’s works. It sets Apple apart, puts the pressure on Apple for achieving a level of greatness others can’t match — and suggests its products are rightly coveted.
Unboxing
Remember, it’s never only about the product. Just ask Coke or Coach.
Myths matter, even in business. From a Salon essay on the subject:
Even stripped of their original religious significance, even when we don’t know their source, myths still strike us as being filled with meaning.
In the 20th century, the psychiatrist Carl Jung formed his theory of archetypes, motifs recurring throughout most cultures. The archetypes, he believed, arise from the collective unconscious, an inherited body of symbols shared by all humanity.
Apple products, logistics, manufacturing acumen, design skill and vision enabled it to rise from near death and become the world’s richest company. These qualities remain. It’s the myths that must now change. The old Apple mythos no longer applies in our new world.
Let’s start with the bad news: The Apple Watch. This beautiful, technological marvel is, in my view, the device our future selves point back to as delineating when Apple changed forever.
Not necessarily for the good.
The company long known for delivering absolutely amazing computing devices, so perfect, so uncannily universal that often times, one device, one product line, one price point is sufficient, is no more. The new Apple Watch starts out with three distinct variations and what appears to be a near-infinite number of eye-catching bands.
This feels wrong.
Tim Cook said the Apple Watch is the company’s most “personal device yet.” Maybe so. At present, my take is thus: The Apple Watch is a pricey talisman, one certain to accelerate the top-line yet with only marginal tangible benefit to Apple’s existing customers.
Have we crossed a line?
The Strange Changes
Yes, change is necessary, often good. I realize this is Tim Cook’s Apple, not Steve Jobs’ Apple. That’s both obvious and expected. What I find so troubling is that I no longer know if this is my Apple. Having defended Apple for years against the silly, baseless charge that “Apple is a marketing company,” I woke up last week to discover that, as John Gruber flatly stated, “Apple is not a tech company.”
I am at a loss to adequately explain why anyone would pay $349 for this device. Indeed, $349 just gets you in the door. Yes, many analysts made similar declarations about the iPhone and the iPad. Fair enough. The Apple Watch may prove transformative. Still, Apple was able to fully, succinctly proclaim exactly how we could and would all benefit from those earlier products. This is much less so with Apple Watch:
It’s the most personal product we’ve ever made, because it’s the first one designed to be worn.
Yes, but what does it do? And why should I buy one?
A device you wear is vastly different from one you keep on a desk or carry in your pocket. It’s more than a tool. It’s a very personal expression.
Yes, but what does it do?
Apple Watch combines a series of remarkable feats of engineering into a singular, entirely new experience. One that blurs the boundaries between the physical object and the software that powers it.
I do not understand.
Apple Watch also presents time in a more meaningful, personal context by sending you notifications and alerts relevant to your life and schedule.
Such as?
Apple Watch is right there on your wrist, so it makes all the ways you’re used to communicating more convenient.
Tell me one!
Don’t Want To Be A Richer Man
Most of the world could never afford Apple products, be they Macs or iDevices. This was, frankly, because the costs of quality, usability, integration and reliability necessitated those high prices. True, Apple margins on iPods, iPhones, iPads and some Macs are sizable. Prices can be lower, in theory. The bargain between Apple and customer, however, is we accept these large margins knowing that year after year after year Apple products will get better, without fail, until a completely new magical device takes flight. That’s money well spent.
Will this be so with Apple Watch?
I think not.
Based purely on the company’s marketing messages, the various Apple Watch(es) appear priced primarily for reasons almost fully extraneous to its technology or functionality. I find this disconcerting, to say the least.
For most users, Apple offers the very best smartphone, tablet, MP3 player and laptop available anywhere. The Apple Watch changes this equation in no way. Still, I can’t help but wonder if my relationship with Apple will change now that this “non-tech” company so proudly offers what we assume will be, per Gruber, gold bands on deluxe watches that retail for an astounding $10,000 or more.
I don’t even go into those stores.
Time May Change Me
Throughout its history, Apple has gifted us with numerous incredible devices. Recall the iMac, the iPod (classic) or the very first iPhone. We never envisioned such a device, then quickly wondered how we ever lived without it. It was as if someone from the future left this marvel behind, perhaps accidentally, perhaps as a test. But always, magic, always liberating.
The Apple Watch feels the opposite of this. Lock-in is not liberating. With Watch, Apple has created a mobile computing device with a small screen which requires another mobile computing device with a small screen, the iPhone, before it can function properly.
I can’t help but think how much better it would be — for us, the users — had Apple taken all that Watch work, all those Watch resources, and made the iPhone, iPad and Mac even better, more magical. This applies to the iPhone, in particular. The fact is, I believe Apple and iPhone are on the cusp of remaking everything and I selfishly do not want Apple to blow this opportunity by getting sidetracked with a watch.
And now the good news.
Change Their Worlds
In his long interview with Charlie Rose last week, Tim Cook stated it’s important to think about long term, big picture ideas. One of these, he said, is what comes after the Internet?
I suspect Apple is not merely thinking about what comes after the Internet, but actually working toward this. What is it? My prediction: The entire Internet done right. That is, a secure, family friendly, screen-optimized web paid for by all of us — with our money not our privacy.
Google should be very concerned.
With iTunes, apps, Apple Pay, Apple TV, iCloud, continuity, inter-app communication — now available across all screen sizes and devices — we can finally have our “web” the way we’ve always wanted, the way we’ve always deserved, before we foolishly allowed it down that horrible path back in the 1990s, funded by pornography, data tracking, unceasing ads and content “aggregation” that bordered on theft.
Apple has developed the tools to make these bad bits all go away. We get what we want, reliably, securely, privately, by paying for it, not by having bits of us taken, not by having our eyes and ears assaulted with unwanted garbage.
This will change everything. It cannot come soon enough.
Oh, and the company is not just remaking the digital web and e-commerce. Apple is helping to re-configure offline retail, making it better, faster, more personal. Consider its currently available toolkit:
Apple Pay (money and credit)
Touch ID (security)
iPad (cash register)
iBeacon and Passbook (for deals and rewards)
AirDrop (peer-to-peer sharing of money and benefits)
No one else has anything like this.
Perhaps I’ve been unfair to the not-yet-released Apple Watch. But, companies can’t do everything. The iPhone is literally helping us to change the world. It is re-making commerce, the web, play, learning, work. I don’t want to lose this opportunity.
I fear the Apple Watch has captured Tim Cook’s focus and consumed the best of the company’s design, hardware and software skills. If so, while Watch may be great for Apple I believe it is detrimental for the rest of us.
People really love to hate Apple. It should be considered a disorder at this point. ~ J. Gobert (@MrGobert)
The Apple Watch may or may not fail, but the analysis of the Watch has already failed. People just cannot wait to pronounce judgment. They. Can. Not. Wait. There’s plenty of thoughtful analysis out there, but mostly we’re hearing the same old discredited theories dredged up and reanimated like some horrible army of undead zombies.
About one-fifth of the people are against everything all the time. ~ Robert F. Kennedy
There is something within human nature that immediately has a knee-jerk negative reaction to the new. If we’re not familiar with it; if we cannot understand it, we condemn it. Instead of saying: “I know little or nothing about this, so I’ll learn more and suspend judgement until I do” we instead say: “I know nothing about this…so it must suck.”
People’s reaction to ideas: Bad ideas: “That’ll never work” Good ideas: “That could work” Great ideas: “That’ll never work”
Not only are we terrible at assessing the new, but we seem compelled to share our uninformed opinions with EVERYBODY.
He who knows little quickly tells it. ~ Italian Proverb
Some say it’s wrong to mock those who make obviously stupid statements. There’s no sport in it.
Making fun of Apple’s critics is like hunting dairy cows with a high powered rifle and scope. ~ NOT P. J. O’Rourke
Others focus on more humanitarian arguments:
Do we really need insults at all? Aren’t insults just the precinct of the desperate or powerless, or simply of people too dim-witted to make cogent and logical arguments? Isn’t the whole phenomenon of insults…a sign of the general coarsening of culture? Such concerns are shared by many people, all of them half-witted, imbecilic cretins. ~ Insults Every Man Should Know
Look. These pundits said what they said. If they don’t like it, they can try to explain it away.
The surest way to make a monkey of a man is to quote him. ~ Robert Benchley
But don’t expect me to cut them any breaks. If they didn’t want to come off looking stupid, they shouldn’t have said stupid things.
I don’t suffer fools, and I like to see fools suffer.~ Florence King
Intelligent debate is welcome and there are many questions surrounding Apple’s newly announced Apple Watch. But patently dumb allegations should not be debated — they should be mocked. So here are a couple (hundred) of my most unfavorite quotes, in all their glory, arranged sorta, kinda alphabetically by topic. Let the mocking begin.
Author’s Note: Some of the quoted material contains (R rated) curse words. I decided to use verbatim quotes in order to accurately convey their original tone and meaning.
From all the rumors and leaks, it now appears that Apple is going to unveil the mythical iWatch at its much-hyped product launch event on Sept. 9. While nothing has been definitely confirmed … I still wouldn’t buy it.
It’s always best to make summary judgments on things you know nothing about. That’s just logic.
Sameer Singh suggests a different approach.
Never dismiss a new product outright. Attempt to understand why it’s needed. Draw conclusions later. ~ Sameer Singh (@sameer_singh17)
Nah, that’s never going to happen. From the Claim Chowder archives:
Apple begins selling its revolutionary iPhone this summer and it will mark the end of the string of hits for the company. ~ Todd Sullivan, Seeking Alpha, 15 May 2007
Fools never learn.
Fools rush in where angels fear to tread. ~ Alexander Pope
Against logic there is no armor like ignorance. ~ Dr. Laurence J. Peter
People will always jump to conclusions and judge things that they don’t understand. You have to ignore all of the ignorant people out there. ~ Steve Jobs
Anecdotal
Showed my mom a tablet. She instantly got it and bought one. Same with Apple TV. If I showed her this watch…nope. ~ J. Gobert (@MrGobert)
Me: Hi mom, I’m back in town. How are you? Mom: I’m watching the Apple event. Me: Finally! Mom: Again! When can I order a watch? Me: !!! ~ Rene Ritchie (@reneritchie)
You’ve got your anecdotes and I’ve got mine. The important thing to remember is that anecdotal evidences is the BEGINNING of inquiry, never the end. Isolated stories can point us toward the truth, but they are not WHOLE truth. In fact, when taken in isolation, anecdotes are more likely to mislead than to lead.
Men are apt to mistake the strength of their feeling for the strength of their argument. ~ Anonymous
It’s bad to bring in a verdict before all the evidence is in. It’s even worse to bring in a verdict before the trial has even begun.
Battery Life
Apple hasn’t solved the basic smartwatch dilemma, which is that smart watches use up far more energy than dumb watches, and that there’s nowhere to store that much energy in something the size of a watch. Indeed, Apple has made the problem worse, by combining a powerful computer with a very bright, ultra-high-resolution, full-color display. Either of those things would require a lot of energy; both together require a very thick watch and a limited battery life. ~ Felix Salmon
My first knee-jerk reaction to the Apple Event was similar to the above. Apple didn’t announce battery life and I took that as a bad sign. Then I reconsidered. The product doesn’t even exist yet. Apple literally COULD NOT have announced the final battery life figures because they don’t know what they are. So I decided to cool my jets and wait until the numbers are announced. There will be more than plenty of time to criticize the battery life figures once we know what they are. Why start now?
Imaginary obstacles are insurmountable. Real ones aren’t. ~ Barbara Sher
And while we’re waiting for those battery life numbers to appear, let’s chow down on some delicious battery life claim chowder from yesteryear. Yum!
Unless Apple has also developed some new type of power source, such as nuclear cells or magical hamsters on tiny spinning wheels for the iPad, don’t expect the claims about battery life to hold true. ~ John Breeden II, Government Computer News, 28 January 2010
We hate the very idea that our own ideas may be mistaken, so we cling dogmatically to our conjectures. ~ Karl Popper
Charging Cable
Ugh, not another charging cable! ~ Joanna Stern (@JoannaStern)
(T)he user will have to take off the device for 1/3 of his life as well as carry an extra cable around with him. ~ Radio Free Mobile
Oh NO! We won’t have our device available to us for a full one-third of our life!
Admittedly, we’ll be asleep during that time, and dead to the world…
But still! One third of our life! And! And! And! And we’ll have to carry an extra cable! Oh, the horror! Oh, the HUMANITY!
Sheesh. I swear, if Apple made a time machine, we’d all be complaining about it having a proprietary power cable. Sigh.
People thought it was scandalous that the iPhone needed to be charged nightly. Not a deal breaker if worth it. ~ Ben Thompson (@monkbent)
Buck up, people. We may not be the Greatest Generation, but I think we can tough it out and suffer through yet another charging cable.
Make it your habit not to be critical about small things. ~ Edward Everett Hale
They that are serious in ridiculous things will be ridiculous in serious affairs. ~ Cato the Elder
Coldplay
A watch playing Coldplay is a bug, not a feature. ~ John Collison (@collision)
Okay, I’ll concede that one.
Dangerous
Wearing a radio directly on the body spooks many people who rationally or irrationally fear the health risks of close electromagnetic radiation. ~ Forrester CEO, George Colony
Oh, for the love of G….
Look, what are you trying to say here? That I’d be more fearful of having all of those “irrationally-perceived-as-dangerous” radio waves at the end of my wrist rather than in my pants pocket right next to my jumbly-wumblies?
Are you freaking kidding me?
Never miss a good chance to shut up. ~ Cowboy wisdom
Everybody
AppleWatch may have a heart rate monitor but so does every serious athlete already. ~ Eric Perlberg (@eric_perlberg)
We never seem to get this right. It’s not the eggs that make the soufflé, it’s the Chef. Saying “every one already has” a feature is like saying that “every restaurant already has” eggs, therefore, every restaurant is of equal quality. Apple is the Master Chef of ecosystems. Others are more akin to the Dirty Spoon.
Expensive
(A)t $349 [Apple Watch] is significantly more expensive than its better looking competitors (Moto360 $249, LG G Watch R $230). ~ Radio Free Mobile
It’s expensive — and not covered by carrier subsidies. It’s $600 for the whole package of a subsidized $200 iPhone and the $400 Watch. ~ Forrester CEO, George Colony
Apple clearly believes that the Apple Watch’s advances in size, speed, function and elegance are worth the $150 price premium, but not everyone feels that way. In an informal poll at the Macworld.com Web site, 40 percent of Mac fans indicated that they would not be buying an Apple Watch, and every single one cited the price.
Oh wait! Did I say “Apple Watch”? That last paragraph was actually a 2001 quote from Macworld concerning the original iPod, not the Apple Watch. Note how the nature of the products change, but the nature of the criticism remains exactly the same.
Presuming all decisions are based on price is the easiest way to mispredict the future. ~ Ben Thompson (@monkbent)
Every time Apple brings out a product, critics cite price as its fatal flaw, even when such criticism makes little or no sense.
“iPads are too expensive which is why most of the buyers are new to iPad” Wait, what? ~ Ben Thompson (@monkbent) 7/24/14
Many of Apple’s critics have never understood the difference between price and value. As we move toward wearable computers, the disconnect is only going to grow greater.
The more personal the computer the more value we will place upon it. ~ Horace Dediu (@asymco)
The most expensive Apple Watch will cost more than the most expensive iPhone which will cost more than most PCs. ~ Horace Dediu (@asymco)
And now that Apple is going high fashion? Look out. Most of us are going to lose our grip on pricing entirely.
(There’s going to be a) nerd meltdown when we all learn what “fashion” items cost. ~ Cabel Sasser (@cabel)
When the prices of the steel and (especially) gold Apple Watches are announced, I expect the tech press to have the biggest collective shit-fit in the history of Apple-versus-the-standard-tech-industry shit-fits. ~ John Gruber
Normally, as the price of an item goes down, demand goes up. However, as Ben Thompson likes to point out, with Veblen goods (named after economist Thorstein Veblen, who popularized understanding of the effect) as the price of the product goes up, the demand rises too. This is because the “job” a Veblen good is “hired to do” is not utility alone — it’s added prestige. Veblen goods are counterintuitive and full of surprises for the unwary.
Asia is by far the biggest market for Swiss watch exports accounting for 55 percent July shipments.” ~ CNBC
What folks don’t understand about Asian luxury market in particular is people buy BECAUSE it’s expensive. ~ Ben Thompson (@monkbent)
If you don’t have a background in engineering, you shouldn’t be commenting on how to construct the space station. And if you don’t have a background in economics, you shouldn’t be commenting on pricing, either.
The Prophets of the Church of Marketshare never understood Apple’s premium business model to begin with, even though there is a premium provider for almost every good and service known to man. Woman too. And now that Apple is moving toward fashion pricing, the explosive growth in the number of tech bloggers who will think they are qualified to comment on economic theory is simply going to boggle the mind.
Tech bears the same relationship to fashion as a multiple-choice test does to an essay exam.
Fad
I have no doubts [Apple Watch] will sell. If I had money to blow I’d buy one out of curiosity. But that’s not a product. It’s a fad. ~ J. Gobert (@MrGobert)
The iPhone was a fad too.
The iPhone is a commodity. That’s really all Apple’s iStuff is — an enormous and very profitable fad. It’s the Pet Rock of the new millennium. ~ Anders Bylund, Motley Fool, 6 Mar 2012
Data Processing was a fad too.
I have traveled the length and breadth of this country and talked with the best people, and I can assure you that data processing is a fad that won’t last out the year. ~ editor of business books, Prentice Hall publishers, 1957
Movies were a fad too.
Movies are a fad. Audiences really want to see live actors on a stage. ~ Charlie Chaplin
Be awfully careful before you summarily label — and then dismiss — something as a “fad”. It’s lazy and, even worse, misleading analysis.
Who is there who can make muddy waters clear? But if allowed to remain still, it will gradually clear itself. ~ Lao-tsu
Gimmicks
(A)t today’s Cupertino, California, event, we — the press, the world at large — were treated to a beautifully designed smartwatch (e.g., those interchangeable straps) laden with an embarrassing slew of useless gimmicks. … Cheap tricks that consumers will tire of after a few weeks. ~ Joseph Volpe
Heres an idea Apple – rather than enter the world of gimmicks and toys, why don’t you spend a little more time sorting out your pathetically expensive line up? Or are you really aiming to become a glorified consumer gimmicks firm?
Oops! So sorry. That last quote was taken from the forums at Macrumors and refers to the introduction of the original iPod in 2001, not the Apple Watch in 2014. My bad.
Hubris is one of the great renewable resources. ~ P. J. O’Rourke
The line between gimmicks and genius is thin, as both Jan Dawson and Benedict Evans remind us:
This stuff Apple is demoing now is classic Apple. Thin line between Samsung’s gimmicks and Apple’s delighters, but fairly clear here. ~ Jan Dawson (@jandawson)
There’s an interesting line between products everyone thinks are crap and products everyone thinks are stupid. The latter change the world. ~ Benedict Evans (@BenedictEvans)
Since the line between gimmick and genius is so thin — and since the consequences of getting it wrong are so great — we should think long and hard before we summarily dismiss something as a mere gimmick. Gimmicks, like art forgeries, abound and they need to be identified and discarded. But let’s not allow our analytical brushes to paint too quickly or with too broad a stroke, lest we conceal the subtle masterpiece.
Some things have to be believed to be seen. ~ Ralph Hodgson
I Don’t Get It
I don’t get it. … Apple did not save wearables, as many thought it would. … Apple unveiled something, at best, lukewarm. At most, it’s prettier than the smartwatches that’ve come before, and that’s likely its greatest innovation. ~ Joseph Volpe, Endgadget
I don’t see it. Exquisite but no values behind it (except for design values). ~ Sean Egan (@Sean_Egn)
Here’s an idea. If you don’t understand something — REMAIN SILENT.
Better to remain silent and be thought a fool than to speak out and remove all doubt. ~ Abraham Lincoln
Good advice, seldom taken.
Worth remembering: the industry thought the iPod was stupid when it first came out. Even as recently as the iPad, people missed the point. ~ Jared Cocken (@engers)
We’ll see. It’s worth remembering that the iPod, iPhone and iPad, in turn, were greeted with initial skepticism. Apple Watch seeks to be the next in that lineage, routing the skeptics and delivering a massive payoff for Apple. ~ Steve Lohr, The New York Times
It’s okay not to get something. But it’s not at all okay for us to take that one step further and assume that because we don’t get it, it can’t be got. It’s like we’re blind, so we assume that everyone else must be blind too. It just ain’t so. If we don’t “get something”, that’s a sure sign that we should be shutting our mouths and opening our minds.
Half of being smart is knowing what you’re dumb at. ~ Solomon Short quotes
I Don’t Wear A Watch
The Apple Watch seems lovely. The problem is I don’t wear a watch, and 75% our office does not wear one either. ~ ariel seidman (@aseidman)
Most people don’t wear watches anymore. ~ J. Gobert (@MrGobert)
There’s a famous quote attributed to Pauline Kael, the movie critic, which is usually paraphrased as “How did Nixon win? I don’t know anyone who voted for him….”
The point was, Nixon had just won the US presidential election — in a landslide — and yet Pauline Kael lived in a world where almost no-one had voted for him.
I fear that the people who spend all day thinking and writing about technology often suffer from the same myopia about the behavior and mentality of the vast majority of everyday users of technology. We are nothing like them in many respects…. ~ Jan Dawson
When I was growing up, everybody wore a watch. Everybody. It’s only been a decade or so since some people stopped wearing watches and they did so because they were carrying mobile phones that also told time. In other words, the behavior of not wearing a watch 1) is recent; 2) is of relatively short duration; and 3) was caused by a shift in technology.
To suggest that no one will buy a wearable because you don’t wear a watch and no one you know wears a watch is the height of myopia — you’re living in a self-centric world where no one voted for Nixon.
The difficulty lies not so much in developing new ideas as in escaping from old ones. ~ John Maynard Keynes
Think about it. Did you carry a phone in your pocket prior to 2007? If you did, you were in the 1%. Now half the U.S. (and growing) carries their phone with them everywhere. Why the change in behavior? Change in technology.
Did you take pictures at public events using a ginormous tablet? Of course not. Who would do that? Well, turns out, lots and lots of people. (And it’s usually the ones seated just in front of you.) Why the change in behavior? Change in technology.
Stop saying you don’t wear a watch. You don’t wear a watch…yet. Tech changes. Behavior changes. Tech changes behavior. If wearing watches went out of style because of changes in technology, then wearing a watch can come back in style because of changes in technology too.
Wisdom consists of the anticipation of consequences. ~ Norman Cousins
Our inability to even contemplate — more less fathom — the possibility that tomorrow may be different from today reminds me of this joke:
One caterpillar to another, as they watch a butterfly: “You’ll never get me up in one of those things.”
I Only Need The Time
The things I miss most about wearing a watch would be fulfilled by wearing a watch and I can do that for $50. ~ The LeeBase (@TheLeeBase)
We used to only need to make phone calls too. And we could do that for $50. Then the iPhone came out in 2007. And now, we need more.
Our vision is more obstructed by what we think we know than by our lack of knowledge. ~ Kristen Stendahl
There is nothing more reactionary than the general public. For most of us, our vision of the near future is actually our recollection of the recent past.
A leader is one who sees more than others see, who sees farther than others see, and who sees before others see. ~ Leroy Eims
Here’s the thing, Trip. It takes years to make an “overnight” success. The folks at Apple haven’t been sitting around on their barcaloungers sipping champagne and eating chocolate bonbons. They didn’t wake up on Monday, September 8th, and say: “Hey, everybody. Let’s innovate!” Then — bada bing, bada boom — out popped the Apple Watch just in time for the September 9th Event.
Hey! Wait just a darn tooting minute. Aren’t you the same Trip Chowdhry who said this:
[Apple has] only have 60 days left to either come up with something or they will disappear. ~ Trip Chowdhry (March 2014)
March, April, May….
Hmm. Maybe I should change the title of this article from “Claim Chowder” to “Claim Chowdhry”.
Never put both feet in your mouth at the same time, because then you won’t have a leg to stand on.
Left-Handed
I guess left-handed folk are supposed to switch wrists. ~ Patrick Igoe (@PatrickIgoe) [9/9/14, 2:07 PM]
I guess some left-handed people have the patience of a gnat.
For you lefties: The Apple Watch crown works OK when the watch is on your right hand. But there’s a southpaw mode which flips the UI around. ~ Harry McCracken (@harrymccracken) [9/9/14, 5:17 PM]
Apple Watch can be inverted for left handers. Hurrah. ~ Matt Warman (@mattwarman) [9/9/14, 6:26 PM]
For you lefties: …there’s a southpaw mode which flips the UI around. ~ Peter Hilleren (@Peter000) [9/9/14, 6:38 PM]
Left-handers: You can just turn Apple Watch upside down (and swap straps around) and it’ll just work. ~ John Gruber (@gruber) [9/9/14, 9:49 PM]
I have more sources, if that’s not enough.
A handful of patience is worth more than a bushel of brains. ~ Dutch proverb
Seriously. Can’t people just ask a question and then wait an hour or two for the answer before they start whining? I mean, honestly. Is it really asking so much?
It is a general rule that when the grain of truth cannot be found, men will swallow great helpings of falsehood. ~ Isaac Bashevis Singer
Look And Feel
It is square and fat. 85% of wristwatches sold in the market are round and in pure looks, I think the Moto 360 and the LG G Watch R are much better. ~ Radio Free Mobile
The form factor has fixed limits — the small screen obviates advertising, electronics fatten the case, big fingers obscure the screen when touching. For many, the form will be seen as simply ugly. ~ Forrester CEO, George Colony
Apple Watch ‘too feminine and looks like it was designed by a student in their first trimester’ (Boss of Tag Heuer, Zenith and Hublot says Apple has made “some fundamental mistakes” with its smart watch) – The Telegraph
It’s not a revolution and it’s not what any of us really expected. It’s lipstick on a smartwatch. It’s an accessory and nothing more. ~ Joseph Volpe, Engadget
All this coming from critics who have never seen nor touched nor worn nor experienced the Apple Watch.
Baffled by strong opinions on the Apple watch hardware from people who’ve not held one. I have held one and am still undecided. ~ Benedict Evans (@BenedictEvans)
With smartwatches, even more than phones, even more than tablets, even more than PCs, any verdict requires actual use in the real world. ~ Harry McCracken (@harrymccracken)
Go back and re-read the above quote by Harry McCracken. Wearables simply cannot be understood until we’ve worn them. And nobody outside of Apple has worn them. Yet.
What you don’t see with your eyes, don’t witness with your mouth. ~ Jewish proverb
Ridicule is the tribute paid to the genius by the mediocrities. ~ Oscar Wilde
Name
The Apple Watch names are strange. Apple Watch, Apple Watch Sport, Apple Watch Edition. Weird that two have third names, and Edition is odd. ~ Farhad Manjoo (@fmanjoo)
I like analyzing product names too, but truth be told, if the product is lousy, the name simply doesn’t matter. And if the product is great, the name simply doesn’t matter either.
Remember how critics mocked the name “iPad”? How’d that turn out?
Talk of product names reminds me of this classic Saturday Night Live skit.
Hmm. Perhaps Apple should name their next product: “Mangled Baby Ducks.”
The $350 watch market is niche at best. ~ J. Gobert (@MrGobert)
Gee. When have I heard this lament before? Oh yeah. Whenever Apple introduces a new product category. The $350 iPod will be niche, the $600 iPhone will be niche, the $500 iPad will be niche, etcetera, etcetera, etcetera. Some Claim Chowder from the archives:
The iconic Apple iPhone will either not exist or occupy a very small niche satisfying the needs of committed Mac fans around five years from now. ~ Eugene Kaspersky, Kaspersky Lab, 27 April 2010
iPad
The tablet market has only succeeded as a niche market over the years and it was hoped Apple would dream up some new paradigm to change all that. From what I’ve seen and heard, this won’t be it. ~ John C. Dvorak, MarketWatch, 29 January 2010
The iPad will remain an expensive, niche device compared to all-purpose netbooks…. (N)etbooks sales will still far outstrip those of the iPad. ~ Preston Gralla, PC World, 30 March 2010
Niche, huh? Let’s see how those niche products panned out:
In Q2, Apple made 68% of mobile device OEMs’ profits (65% in q1, 53% in Q2 13). Samsung – 40% (41% q1, 49% q2 13) Source: Canaccord Genuity ~ Daisuke Wakabayashi (@daiwaka) 8/5/14
Quick Apple Q3 numbers for those who like that sort of thing: $37.4 billion; 7.7b profit; 35.2m iPhones; 13.3m iPads; 4.4m Macs; 2.9m iPods. ~ Macworld (@macworld)
Apple’s iPhone sales alone were larger than the revenues at 474 of the companies in the S&P 500 stock index.
Most CEO’s would cut off their right arms to have “niche” products like those.
To be positive is to be mistaken at the top of one’s voice. ~ Ambrose Bierce
Pocket, Purse, Or Wrist?
Apple failed. They did not make the case to compel me to pay $350+ to reduce the pain of pulling my iPhone out of my pocket. ~ The LeeBase (@TheLeeBase)
For many, two devices on the body are unnecessary. Pulling the iPhone out of a pocket or purse is fine — most will not need another device to access payments or track health. ~ Forrester CEO, George Colony
Ya’ know, human beings are kinda funny (in an odd sort of way). I guess it’s human nature to ignore human nature. Go figure.
The fundamental principle of human action—the law that is to political economy what the law of gravitation is to physics—is that men seek to gratify their desires with the least exertion. ~ Henry George
Do want to call that kind of behavior lazy? Okay, we’re lazy. But mostly, we’re human.
I’ve always felt extremely lazy when I explain my main reason for wanting an Apple Watch. It would eliminate the need for me to reach all the way into my pocket to retrieve my iPhone when it buzzed. I stand by my brazen laziness. And I very much appreciate that the Apple Watch will analyze incoming email to create its own “quick choice” reply. Very smart. ~ Ken Segall
Benedict Evans poses some important questions regarding the tablet and the smartphone, respectively:
How much was it worth not to have to open your laptop? ~ Benedict Evans (@BenedictEvans)
I use my phone even though my tablet is in my bag or my laptop on the table. How much does a watch cannibalise in the same way? ~ Benedict Evans (@BenedictEvans)
We know that a large proportion of smartphone use is done in the home, where a laptop or tablet is within easy reach. Shouldn’t that be telling us something? Persistence matters. Convenience matters. Laziness matters. Human nature matters.
And besides, what else — or should I say who else — are we ignoring here?
For half the population, your phone is not always in your pocket. ~ Benedict Evans (@BenedictEvans)
Oh yeah. The female of the species. Remember them? The one’s who do most of the shopping for (literally) mankind? The ones who wear most of the jewelry? The ones who make up the majority of people living on this planet? The ones who often put their phones in their purses instead of in their pockets?
We should be very, very careful not to substitute our judgment for the judgment of others. Just because we don’t like something; just we’re not enthusiastic about something; does not mean that others will feel the same way. That’s just common sense. Unfortunately, there is nothing so uncommon as common sense.
Replace
I see a world where the watch will eventually replace the phone. ~ AAPL Orchard
The long-term success of the iTime (or whatever it gets called) will be similar. If it can’t replace the iPhone completely it’s a goner. ~ John Dvorak
My stance on the smartwatch as a viable mobile accessory is unambiguous; I’ve argued my case before. As a category, it needs to replace — needs to completely replace our need for a cellphone. ~ Joseph Volpe, Engadget
That’s great and all, except that it’s completely wrong.
“A smartwatch doesn’t replace my smartphone.” “A tablet doesn’t replace my personal computer.” “A motorcycle doesn’t replace my car.” ~ AAPL Tree (@AAPLTree)
A device should not try to be something it’s not. It should be true to itself. Why would we want a smart watch that replaces our smartphones? We already have smartphones that work great. What we want — or what we should want — is for smart watches to do what they do best. No one is quite sure what that is yet, but you can be darned sure that squashing a smartphone down to the size of a watch is not going to work any better than squashing a Personal Computer down to the size of a tablet worked.
Replace the phone with the watch? You’ve got it all wrong. And don’t blame Apple just because your vision is faulty.
The worst kind of arrogance is arrogance from ignorance. ~ Jim Rohn
Yeah, about that. I’m not a big believer in surveys about products that don’t exist. You shouldn’t be either.
iPad:
We’re finding — if you look at the surveys, you can see that large amount of the customers that have purchased touchscreen devices in last two years, they intend to get a device with the QWERTY keyboard on it now. ~ Mike Lazaridis, Co-CEO, Research In Motion, Inc, 16 April 2010
iPhone:
Days before the iPhone debuted, the market research company Universal McCann came out with a blockbuster report proving that practically nobody in the United States would buy the iPhone. “The simple truth,” said Tom Smith, the author of the iPhone-damning report, is that “convergence [an all-in-one device] is a compromise driven by financial limitations, not aspiration. In the markets where multiple devices are affordable, the vast majority would prefer that to one device fits all.” Solid survey research suggested not only that the iPhone would fail, but also that it would fail particularly hard in the United States because our phones and cameras are good enough, already. ~ Derek Thompson, The Atlantic
Today there are lots and lots of people saying they have no interest in an Apple Watch or in the smart watch category altogether. They are telling the truth. They really can’t imagine owning a smart watch. However, their beliefs do not reflect the limits of the smart watch category. Their beliefs reflect the limits of their imagination.
You can’t ask people to decide on a trade-off when they have experience of one side but not the other. ~ Benedict Evans (@BenedictEvans)
Tethered
It requires an iPhone to function making it very clear that this is an accessory rather than a new product category in its own right. ~ Radio Free Mobile
Toni Sacconaghi, Bernstein: While the device is aesthetically attractive, and has a very innovative UI (“digital crown” and differentiated touch), we struggle with the fact that the majority of the Watch’s functionality is dependent on the presence of an iPhone.
This shit better have some major non-tethered functionality. ~ Jason Hirschhorn (@JasonHirschhorn)
Remember when the iPod, the iPhone, the iPad were all tethered to the Mac? No? Neither does anyone else.
Memory may be a terrible librarian, but it’s a great editor. ~ Ralph Keyes
The iPod, the iPhone, the iPad and now the Apple Watch are or were tethered to another device. They offload or offloaded tasks which they could not handle or which they were ill-suited to perform to the better suited device. Tethering is not a fatal flaw. In fact, it can be a chief advantages. Take, for example, the iPod:
One of the biggest insights we have was that we decided not to try to manage your music library on the iPod, but to manage it in iTunes. Other companies tried to do everything on the device itself and made it so complicated that it was useless. ~ Steve Jobs
Unnecessary, Unneeded, Underwhelmed
The very first new post-Steve Jobs product, Apple Watch, is stunningly pretty, is functional — and is utterly unnecessary. ~ Brian S Hall (@brianshall)
Did not expect to be so underwhelmed by implementation. It’s basically Android Wear 2.0, which isn’t saying much. ~ J. Gobert (@MrGobert)
I think Apple Watch will be a flop. ~ The Tech Guy, Episode 1118
Great just what the world needs.
I was so hoping for something more.
The reason why everyone’s disappointed is because we had our hopes up for this incredible device.
Why oh why would they do this?! It’s so wrong! It’s so stupid!
Oh wait! Those last four quotes weren’t about the Apple Watch at all. They were taken from the forums at Macrumors and were referring to the launch of the original iPod.
The more things change, the more they are the same. ~ Alphonse Karr ((The original saying & original author.))
New Apple product X is announced. Pundits & analysts say X will fail. X breaks all previous sales records. Step. Rinse. Repeat. ~ Nick Bilton (@nickbilton)
Three years from now, the same people making fun of this thing today will complain that Apple hasn’t innovated since the Watch. ~ Mitchell Cohen (@mitchchn)
CONCLUSION
Professional critics of new things sound smart, but the logical conclusion of their thinking is a poorer world. ~ Benedict Evans
Always listen to experts. They’ll tell you what can’t be done and why. Then do it. ~ Robert A. Heinlein
I have not exhausted all of my material, nor have I exhausted all of the stupidity…but I have exhausted myself. Enough. No more Claim Chowder.
It’s possible to fight intolerance, stupidity and fanaticism when they come separately. When you get all three together it’s probably wiser to get out, if only to preserve your sanity. ~ P. D. James
I want to make something perfectly clear. I am not advocating for or against the Apple Watch. That will be addressed in a future article. What I am advocating for is clear thinking.
The creators of Apple Claim Chowder used to be arrogant and obnoxious but ever since the introduction of the Apple Watch just the opposite has been true. Now they’re obnoxious and arrogant. After all, the vast majority of the Claim Chowder cited here, and in my previous 7-part series ((Apple Claim Chowder Series:
Conversation would be much improved by the frequent use of three words: I don’t know. ~ André Maurois
The wise man doesn’t give the right answers, he poses the right questions. ~ Claude Levi-Strauss
Never be afraid to sit awhile and think. ~ Lorraine Hansberry
Next
Next time, I’ll look at the design of the Apple Watch and try to pose some of the right questions. Come join me then.
Post Script
If you want to take the chance of having me ridicule you in one of my future articles, be sure to join me on Twitter @johnkirk. I’m looking forward to mocking your acquaintance.
I always like to make my predictions AFTER the fact. Improves accuracy. Yet I’m still bound to get a few things wrong.
You can only predict things after they have happened. ~ Eugene Ionesco
Truth be told, I’m working on some massive articles regarding the Apple Event and they’re just not done. I simply haven’t been able to absorb the information yet and I’d rather do it right than do it now.
I’m finding it impossible to keep up with the research in my field” (said every researcher ever throughout history). ~ David Smith (@drs1969)
So I thought I’d fill this week’s column with my quick takes on last Tuesday’s Apple Event.
iPhones
Surprises? Not So Much.
Lots of leaks. Few surprises.
Sales Projections
Expected sales? AT&T said that iPhone 6 demand was “off the charts” and Apple has confirmed the iPhone 6 and iPhone 6 Plus crushed earlier preorder records. So how many are they going to sell?
My official answer to how many iPhones Apple will sell in the holiday quarter— crap tons. ~ Ben Bajarin (@BenBajarin)
Average Sales Price
Apple is selling its base mode iPhone with 16 gigabytes of storage and its mid-tier iPhone with 64 gigabytes of storage. Further, the iPhone 6 Plus starts $100 higher than all previous iPhone models did before it.
Apple has 10% of handset sales, high-end Android another 10% and the rest of Android a further 40% (& growing). Guess which Apple targeted. ~ Benedict Evans (@BenedictEvans)
A weird thing is about to happen. The Average Sales Price of the iPhone is about to go UP! That’ll put a real dent in the “iPhone” is a commodity theory.
The iPhone Is A Commodity Claim Chowder
With all things tech, fused products and commoditization are inevitable markers of the product cycle. The iPhone 5 will be Apple’s last hurrah as competitors increasingly gain ground. ~ Kofi Bofah, Onyx Investments, 29 August 2012
As the mobile phone market increasingly offers more quality phones at a range of price points, Apple now faces a difficult choice. Does it try to remain a premium product-premium price company, or does it dive into the commoditized lower priced arena? Neither choice is very appealing. ~ Bob Chandler, Motley Fool, 2 May 2013
I’m guessing the choice to go premium wasn’t as tough as old Bob here imagined it to be.
The iPhone as a commodity. That’s really all Apple’s iStuff is — an enormous and very profitable fad. It’s the Pet Rock of the new millennium. ~ Anders Bylund, Motley Fook, 6 Mar 2012
Miscellaneous
Here’s a couple of miscellaneous thoughts for you all to chew upon as you wait for me to finish my research and publish my Magnum Opus on the Apple Event:
It’s still a common mistake to see smartphones (and even phones) as a luxury. In fact, their value is inversely proportionate to income. ~ Benedict Evans (@BenedictEvans) 8/15/14
More people on earth have a mobile phone than a street address. ~ Benedict Evans (@BenedictEvans)
Tablets
There’s been a lot of talk of late about tablets diminishing in importance. I don’t see it that way. To me, phones and tablets are just one big continuum — they’re all tablets. But that’s an article for another day.
Pay
Platform building is one of the hardest things in tech. A payment platform requires simultaneous adoption by 1) Banks; 2) Retailers; and 3) Consumers. It took years and years and years for credit cards to finally gain critical mass and they were mocked all along the way.
How do you stop a charging Rhino? You take away its credit card.
And many digital payment schemes have come and gone without consumers even noticing.
Only here’s the thing. Apple makes platform building — the hardest thing in tech — look easy. Take a gander at some of the ads that appeared on the very day of the Pay announcement:
–
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Some people say Apple is late to the NFC party. But until Apple showed up, NFC was a wake, not a party.
It will take years for this to play out, but I believe Apple has already pushed digital payments past the tipping point. Pay is a done deal. Once we’re using our phones (and watches) to make payments, it will change the way retail looks and works forever.
Never underestimate the impact of the law of unexpected consequences. ~ Harvey B. Mackay
Brand
On his ‘Critical Path’ podcast, Horace Dediu expressed surprise at Apple’s move from i-everything to -everything branding. I am surprised by his surprise.
iNames, RIP. ~ John Gruber (@gruber)
The “i” Brand was misnamed from the start (not that it matters to a brand). It originally stood for “i”nternet in the iMac and now it’s simply a nonsensical way of knowing it is made by Apple. Apple is moving into an era where they need consumers to know the product or service was made by Apple. “iPay” would have been generic. Pay is anything but generic. The branding is both a name and a logo and the will put Apple’s brand in your face — which is right where Apple wants it to be.
Watch
Mea Culpa
I thought the Apple Watch would be more of a wrist band, less of watch. I was very concerned about battery life, so I thought the Apple wearable might have no screen. I was wrong.
Apple went the fashion route. Now, the fact Apple made all those fashion hires should have been telling me something. But I wasn’t able to put 2 + 2 together. It’s not the first time I’ve been wrong about Apple and it most certainly won’t be the last.
Why?
A lot of the post-Apple Event discussion on the Watch has been around whether Apple provided the “why”. “Why should I buy this?” “Why does this product even exist?” My favorite take on this so far is by Ben Thompson at Stretechery: “APPLE WATCH: ASKING WHY AND SAYING NO“.
I agree with most of Ben’s article but I have some serious issues with a couple of the details. I hope to write a too long article about this in the not terribly distant future.
What’s Next
Here’s a rough outline of the series of articles I’m working on:
The Why Of The Watch
Steve Jobs On Category Creation
Category Mistakes We Makes
Knee Jerk Objections
Lessons Unlearned
Watch Use Cases
Watch User Interface
First Generation Issues
Fashion Issues
Price Issues
All topics are subject to change.
Change is inevitable, except from vending machines. ~ Anonymous
I hope to have the articles done before Watch 2.0 comes on the market in 2016.
Hobby
Rest assured, the Watch is no hobby. Tim Cook used the “one more thing” line to announce the Watch. He called it the “Next Chapter” in Apple’s story. And it was announced by Tim Cook himself. If the Watch fails to become a category, it won’t be due to any lack of effort on Apple’s part.
Apple’s Wheelhouse
Keep the following in mind. As things get smaller, design matters more. And as design matters more, Apple’s expertise in design matters more.
I love how people say a big company can just ‘get good’ at design – they’d never say that about search or AI or big data in the same way. ~ Benedict Evans (@BenedictEvans)
Further, as things get more personal, fashion matters more. And fashion is an alien concept to most tech companies (and to most tech observers, like you and me). Apple is way, way ahead of most companies in design. And they seem to have “stolen a march” on most companies when it comes to fashion, too. Apple’s wearable products will never achieve mass adoption. However, Apple seems willing to settle for massive admiration (and massive profits) instead.
The most expensive Apple Watch will cost more than the most expensive iPhone which will cost more than most PCs. ~ Horace Dediu (@asymco)
Claim Chowder, Redux
Finally, I’ll end with some delicious claim chowder. Enjoy!
I was talking recently to someone who knew Apple well, and I asked him if the people now running the company would be able to keep creating new things the way Apple had under Steve Jobs. His answer was simply ‘no.’ I already feared that would be the answer. I asked more to see how he’d qualify it. But he didn’t qualify it at all. No, there will be no more great new stuff beyond whatever’s currently in the pipeline. ~ Paul Graham, March 2012
(W)hy are people losing their faith in the money-making machine that is Apple? Maybe it’s because they’ve done it all. What is there left for Apple to do? ~ ~ Emily Knapp, Wall St Cheat Sheet, 24 May 2011
With an Apple Event fast approaching, I’m reviewing critiques of past Apple events to see how accurate they were. Turns out, not very. Critique is needed and welcome. Repeated errors? Not so much.
Events
A book is a mirror; if an ass peers into it, you cannot expect an apostle to peer out. ~ George Christoph Lichtenberg
An Apple event is a mirror too. If an ass peers into it, you cannot expect an apostle to peer out.
Prophesy is a good line of business, but it is full of risks. ~ Mark Twain
WHAT WOULD JOBS DO?
Ever since Steve Jobs’ death, there has been an unfortunate tendency by some critics to create counterfactuals that compare the Apple of this world to an Apple still run by a living Steve Jobs. There seems to be an inverse relationship at work here. The less likely it was for a critic to understand and predict Steve Jobs’ actions while he was alive, the more likely it is for that same critic to claim they can channel Steve Jobs’ spirit from the beyond. Ironic, no?
Egotism is the anesthetic that dulls the pain of stupidity. ~ Frank Leahy
All this talk of trying to figure out what Steve Jobs would have done reminds me of a true story:
For many years, a Franciscan priest by the name of Andrew Agnellus served as an adviser to the British Broadcasting Company (BBC) on religious affairs. One day, a BBC producer sent a memo to Father Agnellus asking how he might ascertain the official Catholic view of heaven and hell. The witty priest’s return memo said simply:
To those critics who truly wish to know what Steve Jobs is thinking now, I extend the same advice.
And he looked at me with those intense eyes that only he had, and he told me to never do that, to never ask what he would do. Just do what’s right. And so I’m doing that. ~ Tim Cook
Premature Predictions
For some reason, people can’t wait until they actually see and use a product before predicting it will fail. It’s like judging a wine before you’ve tasted it. Why we listen to these pre-predictions, I have no idea. But we do.
It’s generally a bad idea to have a strong opinion of a consumer product you have no experience of. ~ Benedict Evans (@BenedictEvans)
Some past premature predictions:
Apple is slated to come out with a new phone… And it will largely fail…. Sales for the phone will skyrocket initially. However, things will calm down, and the Apple phone will take its place on the shelves with the random video cameras, cell phones, wireless routers and other would-be hits… ~ Michael Kanellos, CNET, 7 December 2006
Apple will launch a mobile phone in January, and it will become available during 2007. … After a year a new version will be launched, but it will lack the innovation of the first and quickly vanish. The only question remaining is if, when the iPod phone fails, it will take the iPod with it. ~ Bill Ray, The Register, 26 December 2006
When Apple introduces its iPhone this month, will it pass the acid test? In my opinion, no. ~ Al Ries, AdAge Blogs, 18 June 2007
In fact, I’ll go far enough to say that, if the iPhone 5 looks like the pictures that have recently appeared, Apple may be screwed. ~ Henry Blodget, Daily Ticker, 30 July 2012
With Apple’s next smartphone still months away, fans have been gobbling up iPhone 6 rumors faster than Pac-Man on a power pill bender. However, even the hottest rumor mill in tech can’t turn this device into a winner. ~ Avram Piltch, LAPTOP Online Editorial Director, 14 March 2014
A handful of patience is worth more than a bushel of brains. ~ Dutch proverb
All great ideas look like bad ideas to people who are losers. It’s always good to test a new idea with known losers to make sure they don’t like it. ~ Scott Adams
Speculation
If you believe everything you read, better not read. ~ Japanese Proverb
Speculation can be fun. Speculation can even be helpful. However, building elaborate arguments on unfounded speculation is like building a castle on shifting sands.
A foolish man, which built his house upon the sand. ~ The Bible, Matthew
When it comes to speculation, a couple of rules of thumb can be helpful:
It is better to debate a question without deciding it than to decide it without debating it. ~ Joseph Joubert
Exceptional claims demand exceptional evidence. ~ Christopher Hitchens
Better to trust the man who is frequently in error than the one who is never in doubt. ~ Eric Sevareid
Taking crazy things seriously is a serious waste of time. – Haruki Murakami
Wrong
We don’t know what’s about to happen but we’ll pretend that we do. Then — when we’re proven wrong — we’ll still pretend we knew it all along.
If futurism is visionary, history is revisionary. ~ Bruce Sterling. ((Excerpt From: Robert Cottrell. “The Browser Book of Quotations.” The Browser, 2012.))
Here, for example, is what we thought the iPhone would look like:
No one remembers how wrong they were about the iPhone and the iPad. All they remember is the parts they got right — or the parts they re-imagined that they got right.
The human mind is a delusion generator, not a window to truth. ~ Scott Adams
Any event, once it has occurred, can be made to appear inevitable by a competent historian. ~ Lee Simonson
Even God cannot alter the past, though historians can. ~ Samuel Butler
Change
Whenever a prediction doesn’t pan out, we’ll simply claim we were absolutely right on the money, but Apple changed their mind at the last minute. What the Onion writes as parody, some Apple critics take as gospel:
CUPERTINO, CA—Claiming that he completely forgot about the much-hyped electronic device until the last minute, a frantic Steve Jobs reportedly stayed up all night Tuesday in a desperate effort to design Apple’s new tablet computer. “Come on, Steve, just think—think, dammit—you’re running out of time,” the exhausted CEO said as he glued nine separate iPhones to the back of a plastic cafeteria tray. “Okay, yeah, this will work. This will definitely work. Just need to write ‘tablet’ on this little strip of masking tape here and I’m golden. Oh, come on, you piece of shit! Just stick already!” Middle-of-the-night sources reported that Jobs then began work on double-spacing his Keynote presentation and increasing the font size to make it appear longer.
Claiming that Apple suddenly changed its collective mind is not enough for some critics. Some will go further and claim that that a spiteful Apple changed its plans IN RESPONSE to a critic’s predictions.
When they discover the center of the universe, a lot of people will be disappointed to discover they are not it. ~ Bernard Bailey
The bottom line is, no matter what shows up on stage at an Apple Event, our predictions are never wrong.
Those who never retract their opinions love themselves more than they love the truth. ~ Joseph Joubert
Delay
Here’s another dodge favored by critics — the old “nonexistent product delayed” trick. You know how it goes. We make an outlandish prediction. Said prediction doesn’t happen. Were we wrong in our prediction? Of course not! The predicted product was simply “delayed” almost certainly due to production issues on Apple’s part. The beauty of this claim is two-fold. We weren’t wrong. Apple is incompetent.
Some recent examples of this line of argument:
A fresh report from China’s Economic Daily News believes that Apple has indeed delayed the Retina iPad Mini’s launch until early 2014 because of the troubles it’s having. Apple can’t afford to wait that long. ~ Evan Niu, Motley Fool, 13 July 2013
Continued production issues may force Apple to delay ‘iWatch’ until 2015 ~ @appleinsider
When we risk no contradiction, It prompts the tongue to deal in fiction. ~ John Gay
Lessons Learned And Unlearned
People do not wish to appear foolish; to avoid the appearance of foolishness, they were willing actually to remain fools. ~ Alice Walker
Set aside your predictions and preconceptions. Go into the Event with an open mind. See what is, instead of what is missing, and go from there.
The world is full of people who have never, since childhood, met an open doorway with an open mind. ~ E. B. White
The trouble with having an open mind, of course, is that people will insist on coming along and trying to put things in it. ~ T.Pratchett
Apple has scheduled an Event for Tuesday, September 9, 2014. Apple’s Events attract critics the way a trailer park attracts tornados. Good analysis and insightful critiques are expected and welcome, however many critics merely repeat the same discredited arguments over and over and over again. Some people simply never learn from their mistakes. Which reminds me of a joke:
An Apple critic with two very red ears went to his doctor. The doctor asked him what had happened.
“I was ironing a shirt and the phone rang,” he said. “But instead of picking up the phone, I accidentally picked up the iron and put it to my ear.”
“GEEZ!” the doctor exclaimed in disbelief. “So, what happened to your other ear?”
“Isn’t is obvious?” the critic replied. “I had to call you to schedule this appointment.”
Perhaps the above joke would be more apt if it were we, and not the critics, who had the red ears, for the critics seem to escape their repeated errors unscathed while it is we who end up getting burned year after year.
History is a very good teacher, but (it) has very few students. ~ Wael El-Manzalawy
This is the first in a series of articles that examines past claims and, having found them wanting, expounds upon lessons learned and unlearned. Future articles will group the critics’ claims into topics, but I’ll get things started by simply serving up some of the juiciest claim chowder of all time. Bon appétit.
AUTHOR’S NOTE: Almost all of the linked material comes from the excellent iPhone Death Watch and iPad Death Watch Web sites maintained by AAPL Investors.net. Highly recommended reading.
Apple Claim Chowder
The surest way to make a monkey of a man is to quote him. ~ Robert Benchley
Is there a toaster that also knows how to brew coffee? There is no such combined device, because it would not make anything better than an individual toaster or coffee machine. It works the same way with the iPod, the digital camera or mobile phone: it is important to have specialized devices. ~ Former Apple Vice President, iPod Division, now with Palm, Jon Rubenstein, September 27, 2005
…I am not sure how [the iPhone] will stand against Sprint’s Wimax`(when it successfully launches) and its phones, which I am looking forward much more than over-hyped Apple iPhone. ~ Bhaskar Chitraju, Indews Broadcast, 18 January 2007
The big competitors in the mobile-phone industry such as Nokia Oyj and Motorola Inc. won’t be whispering nervously into their clamshells over a new threat to their business. The iPhone is nothing more than a luxury bauble that will appeal to a few gadget freaks. ~ Matthew Lynn, Bloomberg, 15 January 2007
$500 fully subsidized with a plan! I said that is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard, which makes it not a very good email machine. ~ Steve Ballmer, Microsoft CEO, 17 January 2007
Last year Apple’s iPhone sales alone were larger than the revenues at 474 of the companies in the S&P 500 stock index. ~ Eric Chemi of Bloomberg Businessweek
The iPhone’s willful disregard of the global handset market will come back to haunt Apple. ~ Tero Kuittinen, RealMoney.com, 18 January 2007
I’m more convinced than ever that, after an initial frenzy of publicity and sales to early adopters, iPhone sales will be unspectacular… iPhone may well become Apple’s next Newton. ~ David Haskin, Computerworld, 26 February 2007
Nobody is completely worthless. Some can be used as bad examples. ~ John Tigges
Apple begins selling its revolutionary iPhone this summer and it will mark the end of the string of hits for the company. ~ Todd Sullivan, Seeking Alpha, 15 May 2007
How do you deal with [the iPhone}? How do they deal with us? ~ Ed Zander, Motorola CEO/Chairman 10 May 2007
We lie loudest when we lie to ourselves. ~ Eric Hoffer
What does the iPhone offer that other cell phones do not already offer, or will offer soon? The answer is not very much… ~ Laura Goldman, LSG Capital, 21 May 2007
The forthcoming (June 29) release of the Apple iPhone is going to be a bigger marketing flop than Ishtar and Waterworld combined. ~ David S. Platt, Suckbusters!, 21 June 2007
I may not agree with you, but I’ll defend to the death my right to tell you to shut up. ~ Andy Borowitz
Once the initial fever wears off, however, the bloom will really be off the rose, and sales will be disappointing (at least here in the U.S.). ~ Jim Louderback, PC Magazine. 6 June 2007
You may not be able to change the world, but at least you can embarrass the guilty. ~ Jessica Mitford
The iPhone is a sustaining technology relative to Nokia. In other words, Apple is leaping ahead on the sustaining curve [by building a better phone]. But the prediction of the theory would be that Apple won’t succeed with the iPhone. They’ve launched an innovation that the existing players in the industry are heavily motivated to beat: It’s not [truly] disruptive. History speaks pretty loudly on that, that the probability of success is going to be limited. ~ Clayton Christensen, Author of Innovator’s Dilemma, 28 June 2007
The tablet market has only succeeded as a niche market over the years and it was hoped Apple would dream up some new paradigm to change all that. From what I’ve seen and heard, this won’t be it. ~ John C. Dvorak, MarketWatch, 29 January 2010
If Apple makes a successful tablet, they will have accomplished what no other company before them has ever managed to do, which is why I am not optimistic. If I turn out to be wrong, I’ll gladly eat my words, but I’m pretty sure that I’m not wrong. ~ Alex Cook, Frontier Outlook, 28 January 2010
Unless Apple has also developed some new type of power source, such as nuclear cells or magical hamsters on tiny spinning wheels for the iPad, don’t expect the claims about battery life to hold true. ~ John Breeden II, Government Computer News, 28 January 2010
You might want to tell me the difference between a large phone and a tablet. ~ Eric Schmidt, Google, 10 January 2010
The true way to be deceived is to think oneself more knowing than others. ~ La Rochefoucauld
You know, I’m a big believer in touch and digital reading, but I still think that some mixture of voice, the pen and a real keyboard – in other words a netbook – will be the mainstream on that. So, it’s not like I sit there and feel the same way I did with iPhone where I say, ‘Oh my God, Microsoft didn’t aim high enough.’ It’s a nice reader, but there’s nothing on the iPad I look at and say, ‘Oh, I wish Microsoft had done it. ~ Bill Gates, Microsoft, 10 February 2010
Nothing is more damaging to a new truth than an old error. ~ Johann Wolfgang von Goethe
The only time he opens his mouth is to change feet. —David Feherty
The iPad will remain an expensive, niche device compared to all-purpose netbooks…. (N)etbooks sales will still far outstrip those of the iPad. ~ Preston Gralla, PC World, 30 March 2010
I admit, sales of the iPad beat my expectations. I didn’t think that this device would do that well, and I still think it’s an oversized iPod Touch. ~ Alex Cook, Seeking Alpha, 1 June 2010
Never miss a good chance to shut up. ~ Cowboy wisdom
If a user wants to walk from the kitchen to the dining room in her house, she simply walks through. It does not work like that in mobile–you have to go through the front door to get to the kitchen. iPhone has a home button which works like a go-back-to-front-door button. This is not a model that human beings are used to. People are spatial. ~ Peter Skillman, VP Meego User Experience and Services Design, Nokia, 20 September 2010
There could literally be millions of first-generation iPads gathering dust in people’s home offices already. This product is the tech industry’s biggest MacGuffin yet. ~ Paul Thurrott, Windows IT Pro, 23 October 2010
What you don’t know would make a great book. ~ Sydney Smith
As more developers reach consumers through platform-independent technologies such as HTML5, Apple’s app store could be cut out of the loop as customers gain freedom to transfer their chosen applications from one device to another. ~ Michael Holt, CFA, Morningstar, 28 Dec 2011
Apple’s iOS 7 launch is fast becoming its most troubled mobile operating system update, increasing concern that the technology giant has lost some of its magic touch since co-founder Steve Jobs passed away two years ago. ~ Scott Martin and Alistair Barr, USA Today, 17 October 2013
iPhone accounts for 41.9% of US smartphone subscriber base, up from 31.3% a year ago – Apple CFO Luca Maestri, via @macjournals
I know there’s a lot of noise because Apple did [64-bit] on their A7. I think they are doing a marketing gimmick. There’s zero benefit a consumer gets from that. ~ Anand Chandrasekher, SVP and Chief Marketing Officer, Qualcomm, 1 October 2013
Anand Chandrasekher has been quietly reassigned — and removed from the company leadership page on its website as of 25 Oct 2013.
My prayer to God is a very short one: “Oh God, please make my enemies ridiculous.” God has granted my wish. ~ Voltaire
Lessons Learned And Unlearned
True wisdom is less presuming than folly. The wise man doubteth often, and changeth his mind; the fool is obstinate, and doubteth not; he knoweth all things but his own ignorance. ~ Akhenaton
The lesson here is to not take things on faith. Question everything. Facts should underlie every argument and logic should support that argument’s structure.
A man is getting along on the road to wisdom when he begins to realize that his opinion is just an opinion.
Beware the opinions of critics who are too sure of themselves, for it is most likely that they are also too full of themselves.
Doubt is often the beginning of wisdom. ~ M Scott Peck
Further, while it is always wise to question every opinion, it is not always wise to have an opinion on every question. Some things can only be answered in time.
Who is there who can make muddy waters clear? But if allowed to remain still, it will gradually clear itself. ~ Lao-tsu
This new series A Bird’s Eye View will feature short stories by Tim Bajarin, a 33 year industry veteran of the technology industry. These stories and anecdotes are ones Tim has collected through his 30-plus years as an analyst and will provide a behind the scenes look at many of the industries historical moments.
In 1981, when I joined Creative Strategies as an analyst, I was asked to cover Apple in my spare time. In those days, mini-computers were the rage and as one of only a few mini-computer analysts, I was asked to start looking at the Apple II since it had the term “computer” in it. The Apple II had started getting attention because a piece of software named Visicalc, the first spreadsheet, starting showing up on the Apple II and for the first time some people saw it as an actually useful tool for business. By that time, Apple was an established company but still very small and was thought of as a company that just created a computer for hobbyists.
In 1981, Steve Jobs had already become a legend in the Valley. He and Woz were heroes to the geeks of that era and often attended the Homebrew Computer Club meetings were they were treated as royals. However, they were mainly lauded for providing the group an affordable PC for them to tinker on. Jobs was not looked at as the business tycoon he would become years later. Although I had seen Jobs around various computer events, I did not meet him in my official capacity as a PC analyst until later that year. It was at this time I encountered the rude and egotistical Steve Jobs who, even back then had no use for the media, let alone us fledgling analysts.
Over the next two years I bumped into him at various events and heard him speak a few times. He even graced us with his presence once or twice to tell us about some new product or idea he had. However, I got to see the highly temperamental and explosive Steve Jobs right after Jobs and Apple’s board had hired John Sculley to become its new CEO. Sculley had been on the job two months and I was invited to come to Apple and meet with Steve and Sculley to discuss some new changes to Apple’s business focus and to get my feedback on a product idea they were thinking about. About half way through the meeting, a guy knocked on the door and interrupted us to tell Steve about a problem the guy deemed urgent. After this person explains the problem, Jobs goes ballistic. Calls him an idiot, says he does not know what he is talking about and just undercuts him in nasty ways. John and I both put our heads down in embarrassment and the look on Sculley’s face suggested he was possibly thinking, “What have I got myself into?”
It was because of these types of outbursts and lack of managing skills that Apple’s board and John Sculley decided to fire Jobs at the end of that year. As you know, Jobs was very angry with this and decided to start NeXT, which in his mind was the next major evolution in PCs. He became determined to show Sculley and the world he was the only one who could deliver the future of personal computing. Of course, that venture pretty much failed and this period of Steve’s life proved to be kind of a wilderness experience for him. While he was at NeXT he had no contact with analysts and had minimal contact with the media. So most of us did not have a real sense of what Jobs was thinking during that time, although we did know he had bought Pixar and was looking at being the next Cecil B. DeMille.
Steve Jobs 2.0
But the next time I met Steve Jobs professionally was the second day he was on the job after he rejoined Apple in 1997. To my surprise, this Steve Jobs was relatively humble, seemed chastened from some of his past incidents and I thought he had actually matured quite a bit thanks to his experiences at NeXT. The fact he had married during this time and had two kids probably had an influence on his demeanour too. This meeting came about because Apple’s PR team at the time thought it would be good for him to meet with some hand picked analysts and media to share his thoughts about Apple and what he was going to do to help them. At the time he took over, Apple was $1 billion in the red and we know they were six weeks from filing for bankruptcy. When I asked him how he would save Apple, he gave me one response I expected and another I did not see coming at all. The first thing he told me was Apple seemed to have lost its way over the years and he was going to go back and focus on the needs of his core customers. He explained it was the graphics professionals, engineers, desktop publishing and creative professionals that put the Mac on the map and Apple had dropped the ball on meeting their needs. He said he would first focus on delivering to them the best Mac possible to meet their needs and use this as a starting point to stabilize the company.
But the second thing he said he was going to do was to pay more attention to industrial design. He had been furious that a past CEO, Michael Spindler, had made the Mac look like a standard PC and was determined to set the Mac apart from PC competitors as soon as possible. I remember at the time thinking he was crazy. Here Apple was in serious financial hot water and he thought making the Mac look more unique would save Apple? Apparently he was already thinking of the original iMac’s design at the time and sure enough, when the candy colored iMacs hit the market 18 months later, these new Mac’s reignited interest in Apple products and helped give Apple a more solid financial footing for him to start rebuilding Apple.
As I look back at that meeting, I realize now his comments on industrial design were really at the heart of his ultimate vision for the company and reemphasized to me the amazing attention to detail he would bring back to Apple this second time around. While he was cautious about which markets he would enter with new products in the future, his goal seems to have been to see what products got serious potential from the market and then reinvent them with an eye on industrial design. While he did not invent the MP3 player, he reinvented it and made design a key element of the iPod’s success. The same goes for the iPhone. While he did not invent smartphones, his powerful industrial design eye when applied to the iPhone revolutionized the market for these products. Tablets have been around since 1989, yet it took Jobs’ sleek, rich design of the iPad to legitimize this market and make it the major disruptor to the PC business it has become.
At that meeting with Steve Jobs the second day he came back to Apple, I had no idea a simple statement about industrial design would become one of the most powerful reasons why Apple is the Apple of today. Not content with “me too” products, from the beginning of his second tenure as Apple’s CEO, Steve Jobs clearly knew what he was doing and as he has said in public many times, “I create products I want to use”. For Steve, that meant sleek and beautifully designed technology that makes Apple stand out amongst the sea of sameness that permeates the tech world today.
On June 13, 2014, John Gruber posted his epic, “Only Apple.” In part of his article, Gruber focused specifically on the changes occurring at Apple under new CEO, Tim Cook.
Jobs was a great CEO for leading Apple to become big. But Cook is a great CEO for leading Apple now that it is big, to allow the company to take advantage of its size and success. Matt Drance said it, and so will I: What we saw last week at WWDC 2014 would not have happened under Steve Jobs.
New Apple didn’t need a reset. New Apple needed to grow up. To stop behaving like an insular underdog on the margins and start acting like the industry leader and cultural force it so clearly has become. ~ John Gruber
These words were received with near unanimous approval by the Apple community. But is Gruber’s sentiment accurate? Does Apple really need to “grow up” and become more mature? Whatever happened to Steve Jobs’s famous admonition that one should:
“Stay hungry, stay foolish”? ((Stewart [Brand] and his team put out several issues of the Whole Earth Catalog, and then when it had run its course, they put out a final issue. . . . On the back cover of their final issue was a photograph of an early morning country road, the kind you might find yourself hitchhiking on if you were so adventurous. Beneath were the words, “Stay hungry, stay foolish.” It was their farewell message as they signed off. “Stay hungry, stay foolish.” ~ Steve Jobs))
Is Tim Cook The Better CEO?
When Cook succeeded Jobs, the question we all asked was more or less binary: Would Apple decline without Steve Jobs? What seems to have gone largely unconsidered is whether Apple would thrive with Cook at the helm, achieving things the company wasn’t able to do under the leadership of the autocratic and mercurial Jobs.” ~ John Gruber
There’s not a doubt in my mind that Tim Cook is a better CEO than Steve Jobs ever was. I thought so from day one. But is that the right question? Shouldn’t we be asking ourselves instead whether or not Tim Cook is a leader and whether he can lead Apple forward without Apple losing that rare mixture of genius and madness that made Apple so very unique?
The Price Of Efficiency
It has long been axiomatic that Apple is not the sort of company that could walk and chew gum at the same time. In 2007, they issued a (very Steve Jobs-sounding) press release that stated Mac OS X Leopard would be delayed five months because the iPhone consumed too many resources:
However, iPhone contains the most sophisticated software ever shipped on a mobile device, and finishing it on time has not come without a price — we had to borrow some key software engineering and QA resources from our Mac OS X team, and as a result we will not be able to release Leopard at our Worldwide Developers Conference in early June as planned.
Or consider the October 2010 “Back to the Mac” event, the entire point of which was to announce features and apps for the Mac that had started life on iOS years earlier. ~ John Gruber
Apple has always generated stories like this. It’s long been a given that Apple is understaffed — that Apple had only one guy doing project X and when he got pulled to work on project Y, project X foundered and ground to a halt. Such delays drove us all crazy as understaffed Apple let things — important things — linger, sometimes near death.
But did you ever ask yourself why this was? It’s not like Apple was under resourced. They’ve got more money than god. And it’s not like Steve Jobs was a head-in-the-clouds CEO who didn’t recognize the need to acquire additional talent. So why? Why?
Throughout the years in business, I found something. I always ask why you do things. The answers you invariably get is, “That’s just the way it’s done.” Nobody knows why they do what they do. Nobody thinks about things very deeply in business, that’s what I found. ~ Steve Jobs
Being inefficient was one of the many prices Apple paid for having Steve Jobs as its CEO. Jobs notoriously didn’t tolerate “B” players on his team. He felt they infected the company and soon led to the proliferation of “C” players as well. Jobs wanted only “A” players and he was willing to have Apple be understaffed rather than to fill vacancies with anything less that what he deemed to be the best.
[pullquote]Some enjoy comforting the the afflicted. Steve Jobs enjoyed afflicting the comfortable.[/pullquote]
So you put the B team on this one, did you? ~ Steve Jobs
The result? Superb products that were always running on the edge, always running late; always in danger of not coming out in a timely fashion or in any fashion at all.
This is a very uncomfortable way to run a company. It’s a very inefficient way to run a company. But it also proved to be a very effective way to run a company.
Is Apple running smoother now? Undoubtably. But is that necessarily the good thing everyone seems to think it is? Perhaps not.
Apple Wants To Be The Developer’s Friend
John Gruber writes:
(Apple has) begun to act more magnanimously. They’ve given third-party developers more of what we have been asking for than ever before, including things we never thought they’d do. Panic’s Cabel Sasser tweeted:
My 2¢: for the past few years it’s felt like Apple’s only goal was to put us in our place. Now it feels like they might want to be friends.
It’s ironic (to me, at least) that John Gruber used the above tweet as an example of how well Apple is doing when, in my article entitled “Whither Apple or Wither Apple?“, I used that very same tweet as a cautionary tale. My take from that article:
You know who needs a friend, Cabel? End users, that’s who. Because when developers become more important than end users you get — Microsoft. Putting developers “in their place” — which is, to say, placed behind end users — is exactly what Apple should be doing.
Does the above mean that I want Apple to not have a good relationship with their developers? Not at all. I just don’t want that increased friendliness come at the cost of losing focus on the end user. Because if that focus is lost, Apple is lost as well.
Efficiency vs. Effectiveness
Undoubtably, Tim Cook is making the machine that is Apple run more efficiently. But efficiency is getting the trains to run on time. Effectiveness is getting the trains to the right stations. It doesn’t matter how fast you’re going, unless you’re going in the right direction.
My philosophy is that everything starts with a great product. ~ Steve Jobs
Sure, what we do has to make commercial sense, but it’s never the starting point. We start with the product and the user experience. ~ Steve Jobs
Steve Jobs’s “North Star” was making a great product that provided the end user with a great experience. But what is Tim Cook’s guiding principle?
What is Apple’s mission? To make the very best products in the world that really deeply enrich people’s lives. ~ Tim Cook
Identical in word. That’s good. But identical in deed? That’s the hard part.
Creativity Is Fragile
I’ve found that the most creative people are confident about one thing: their doubts in themselves. ~ johnmaeda (@johnmaeda)
At the memorial service given on the Apple campus following Steve Jobs’ death, Jony Ive had this to say:
[pullquote]Creativity comes from spontaneous meetings, from random discussions. You run into someone, you ask what they’re doing, you say “wow,” and soon you’re cooking up all sorts of ideas. ~ Steve Jobs[/pullquote]
Steve used to say to me (and he used to say this a lot), “Hey Jony, here’s a dopey idea.” And sometimes they were — really dopey. Sometimes they were truly dreadful.
But sometimes they took the air from the room, and they left us both completely silent. Bold, crazy, magnificent ideas. Or quiet, simple ones which, in their subtlety, their detail, they were utterly profound.
As I re-watched the video and re-read the transcript of Ive’s speech, I was re-reminded of the fact that creativity lives on the edge.
[pullquote]This is the thing about creativity that is rarely acknowledged: Most people don’t actually like it. ~ @jessicaolien[/pullquote]
Creativity is the power to connect the seemingly unconnected. ~ William Plomer
Creativity is dopey thinking — right up until the moment when it suddenly becomes brilliant. It’s unimaginable thinking — right up until the moment that it suddenly becomes the only solution imaginable. It’s uncomfortable thinking, it’s dangerous thinking, it’s lonely, isolated thinking — right up until the moment when it’s embraced by all.
Artists often work within the uncomfortable space that precedes “Aha!” or “Oh, I get it!” ~ johnmaeda (@johnmaeda)
People listened to to the crazy, creative ideas of Steve Jobs because Steve Jobs was Steve Jobs and Steve Jobs was the CEO. And sometimes even that wasn’t enough. Sometimes, they STILL didn’t listen to Steve Jobs and they fired Steve Jobs, even from the company he had helped to found.
Human salvation lies in the hands of the creatively maladjusted. ~ Dr. Martin Luther King, Jr.
Genius is more often found in a cracked pot than in a whole one. ~ E. B. White
Now that Steve Jobs is gone, who is there at Apple to promulgate, and to promote and — most of all — to protect fragile new ideas?
The best CEOs try to make their companies a safe place for those with wild ideas, and a wild place for those with safe ideas. ~ Dr. Mardy
Conclusion
Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally. ~ John Maynard Keynes
The thing that bound us together at Apple was the ability to make things that were going to change the world. ~ Steve Jobs
[pullquote]The art of progress is to preserve order amid change and to preserve change amid order. ~ Alfred North Whitehead[/pullquote]
Despite all my questioning and kvetching, I do believe that Tim Cook is — as Steve Jobs was — bound to Apple by his desire to make things that are going to change the world. And I believe that Tim Cook is just crazy enough to give the crazy people the run of the company. ((Updated language courtesy of Michael Glotzer @Mglo))
But I don’t know that for sure. It’s far, far too early to make that call.
Now don’t get me wrong. Based on all the available evidence, the verdict is clear — Cook and Apple are on the right track.
But that’s exactly the problem. There’s mounds of evidence in existence that we are not privy to. And there will be mountains more evidence produced over the next couple of years. So any verdict reached today will be terribly, terribly premature.
[pullquote]Do not seek to follow in the footsteps of the wise. Seek what they sought. ~ Matsuo Basho[/pullquote]
You can’t connect the dots looking forward you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something: your gut, destiny, life, karma, whatever. Because believing that the dots will connect down the road will give you the confidence to follow your heart, even when it leads you off the well-worn path. ~ Steve Jobs
It’s as if Steve Jobs was speaking to us — and particularly to Tim Cook — from beyond the grave. Tim Cook has to be his own man and do his own thing. We know he’s got the know-how to do the job. We’ll have to wait and see if he, and Apple, still retain the know-why.
I have crazy-high expectations for Apple’s worldwide developer conference. I expect, at minimum:
An iPhone phablet
iPad split-screen multi-tasking, necessary for the enterprise, awesome for gaming
Touch ID APIs to support mobile payments
Seamless inter-app communications
Apps that can actually push data onto the home screen — because we are adults and this is the 21st century
25GB free iCloud storage per device
That’s just for starters.
What I mostly expect from WWDC is neither new products nor long-overdue enhancements but rather, affirmation. Too often of late it appears that:
Ecosystem trumps product
Brand usurps technology
Growth precedes usability
Margin before accessibility
Does anyone else feel this way?
The creeping doubts refuse to leave — even as I happily work on my MacBook, play on my iPad and yearn for that large screen iPhone.
WWDC Pilgrimage
Today, we mark our annual pilgrimage to WWDC. We learn of the many new products, the updates to Apple’s operating systems, extensions to the platform, the new and better paths to monetize content and services. Everything, no doubt, will be better than before, better than what can be had anywhere else.
That should be enough. Why is it not?
Because we long time users — the Apple faithful — have always held Apple to a higher, more personal standard. Apple is more than a business, even as it has become the world’s biggest business. Why else would we care so much about a developer’s conference?
Apple will never again be run by Steve Jobs. Pirate Apple has become Corporate Apple. Understood. Nonetheless, we want Apple, more so than any other company, and no matter how big, how global, how rich it becomes, to stay motivated not by profits but by an absolute and unwavering:
commitment to innovation
Even as iPhone implants itself at the center of our computing life, we expect Apple to:
disrupt everything
Is this true of today’s Apple? WWDC will affirm our faith, or dash it.
Clearly, we hold Apple to an impossible standard, not merely a higher one. If Elon Musk can build a reusable space capsule capable of ferrying astronauts and supplies to the International Space Station, why can’t Apple? Why must Apple spend the equivalent of 150 Dragon V2 spacecraft on a single headphone company?
These are the wrong questions.
Apple cannot do everything, cannot be everything. It’s simply unfair and unproductive to make Apple our litmus test upon which to judge all technological advancement and innovation. They make computing products and services. Nonetheless, we can’t help but demand Apple, especially Apple, relentlessly innovate, incite countless new revolutions, lift humanity to ever greater heights, with little more than screens that connect us to the world and connect us to our talents, the parts known and the parts yet-to-be discovered.
Believe Different
Belief sustained the Apple faithful through the dark times. It is this same belief that is now called into question. We want badly to believe in today’s Apple, and not merely admire its many products.
We want to believe blocking our messages was a bug, not hubris.
We want to believe China is not just about more billions, but about bringing the best of American technology to the world.
We want to believe CarPlay and “HomePlay” and “HealthBook” and Passbook are about making our lives simpler, better, not merely add-ons to enrich the ecosystem.
We want to believe that positioning the iPhone at the center of our digital life is empowering, not lock-in.
We come to WWDC to be inspired.
One Of A Trillion
As Apple continues along its inexorable path toward a $1,000,000,000,000 valuation, we hope the company remains personally connected with each of us, somehow.
In a world of big data and globe-hopping algorithms, driverless cars and autonomous bots, we expect Apple, more than any other organization, to power personal connections and accelerate human ingenuity throughout the world. We want it all to just work, exactly as we desire, even as the company extends across a billion customers.
That Apple will introduce more and better devices and services at WWDC is a given. Success is assured. The iOS moat is already so wide, so deep, as to make the company practically unassailable. The company’s shimmering glass headquarters will soon rise over Cupertino, its future set for decades to comes.
It’s not enough. Not for me, not for many of us, I suspect.
Fair? Of course not. But past performance influences present expectations. Which is why I say: Be a crazy one once again, Apple. Show us you are fully prepared to disrupt yourself just as you gleefully disrupt the world. Make us believe that you do now and always will think different.
WWDC has begun. The floor is yours, Apple. No pressure.
Technology is supposed to make our lives better. Shouldn’t we demand the same from business models? Sadly, it seems as if today’s bleeding edge innovations in business and retail are in — pricing. Yes, pricing. The chief goal, apparently, is to turn everything we buy or might ever buy into a subscription.
No, thanks.
While social media titans offer brands the allure of connecting with each of us — on a human level, of course — I confess I am not at all interested in a Facebook or Twitter relationship with whomever provides my toilet paper, vitamins, cloud storage, dog food, or even the books I read.
Yet, that’s how subscriptions are marketed — as a relationship. One designed to benefit us, the consumer, as much as the seller.
I have my doubts. After pulling together a few stolen moments to review my monthly spending, I discovered I had signed up — subscribed — for all manner of products.
Oyster (books)
Netflix (television)
Pandora (music)
New York Times (website)
OneDrive (cloud storage)
Anchovy oil (via Amazon, for the dogs)
NHL Center Ice
MLB At Bat
Evernote
Razor blades
Zyflamend (via Amazon, a multi-vitamin I decided to try and which apparently I subscribed to so as to save a penny per softgel)
Craft coffee
This does not include the makeup my wife subscribes to and somehow thinks I don’t know about. Nor does it include — as we are still “discussing” this — our basic monthly cable service, nor our monthly iPhone and Internet bills.
But, baby steps. Wherever I can, I am canceling all subscriptions, permanently.
Instead of making my life easier, making it so I never ever have to worry about running out of milk or daily vitamins, the subscription economy has become just another needless pressing burden. While analysts and market makers may cheer the subscription economy, I shall take my leave, despite the Sisyphean effort most retailers require to break these relationships.
Burning Their Money In Wastebaskets
Do you believe the sudden, expansive ramp-up in subscription everything is designed for your benefit? Really? Me, neither.
Are retailers so desperate to take more of what money we have they now must actively promote never ending subscriptions even for the most garden variety products?
I do most of my online shopping through Amazon. It seems like every item I search for anymore, the retail giant offers an enticement if I subscribe instead of just buying the product outright.
I am dubious of any savings or convenience.
Amazon states, non-ironically, “the more you subscribe the more you save.” They claim buyers can save 15% more when they “receive 5 or more subscriptions” per month.
15% savings? On top of Amazon’s already low prices? For a retailer notorious for reducing margins to zero, that’s a rather significant amount to be giving up.
I suspect they can offer this because you will soon discover you have agreed to purchase far more than you really need. Win for them, less so for you. Plus, if you are subscribing to Amazon — for anything — you can’t spend that dollar anywhere else. Share of wallet and all that.
To be fair, Amazon is one of the few retailers that actually makes it reasonably easy to quit. Try that with every other subscription service. Go on, I dare you. Just try. Start with the New York Times or Wall Street Journal. They will insist upon a phone call — in the year 2014! You know exactly why.
Canceling that subscription, which was supposed to benefit you, is made just hard enough, just time consuming enough to make it not worth your effort. You remain locked in. A dollar here, a dollar there, pretty soon it all adds up.
This is not what technology should do — ever. Technology should be liberating, empowering, not a time-suck and not a money pit.
The Best Minds of My Generation
Why must our greatest minds be employed by our greatest companies then tasked with nothing more than making it so we mere mortals can not ever glean the actual price for an actual product?
I suspect you are all familiar with the following scenarios:
I’d like to cancel my subscription.
But, sir, we can reduce the price by 25% if you extend your trial rate for 17 more weeks!
I want ESPN. How much does that cost?
If you subscribe to our Gold bundle, Mr. Hall, you get Bravo, A&E, ESPN and…
You promise me the best prices on the web. So why are you forcing me to join some Prime membership or demanding I buy this same item from you month after month, forever?
(Trick question. There is no human for you to ask this.)
You track me on the web. You track my movements on through my smartphone apps. How much is my data worth?
We can’t tell you that, sir.
But it’s my data!
No, sir. Not really.
I imagine the great minds of Silicon Valley will not stop at having my refrigerator text me that I am low on eggs. Rather, Big Tech will team up with Big Grocer and place me on a weekly egg subscription — one that is impossible to cancel but which no doubt promises 10 cents off, per egg, should I buy two boxes of Cheerios every month for the next year.
Time to disrupt these data disruptors. If we fail to take action soon, we could find ourselves trapped in a web of subscriptions from which there is no escape.
Trembling Before the Machinery
I cover the technology industry because it empowers people and makes the world more accessible. I analyze business trends because most of the innovation of the world, in my view, happens within the walls of for-profit enterprises.
But if you, the retailer, are incentivized to offer me something — anything — other than what I want right now and for which I am willing to pay, right now, then I immediately lose trust in you.
Life is much too short for double-talk, bundles and One-A-Day subscriptions.
Regrettably, my howls are likely to fall upon deaf ears. Nearly 15 million companies in the US and Europe are implementing the subscription model. FastCompany recently profiled Zuora, which has received a “whopping” $128 million in venture capital. Zuora’s mission? To “help us shift from owners to subscribers.”
Us?
Zuora needs all that money not just to scale, but to execute.
“(Subscription’s) a task more complex than you might think. How exactly should you price your product? How do you build a payment infrastructure to allow for price changes? How do you process payments internationally? How do you manage the legal issues that surround storing credit cards?”
Honestly, I am not even remotely impressed by the computational complexity and Big Data algorithms crafted by those leading the subscription charge.
Reminder: 45 years ago, before the majority of the people on this planet were alive, America sent three men to the moon. Two of them walked about. All three were returned safely to Earth.
That’s impressive.
I do not wish to be unfair to Zuora. That they have massive backing from multiple VCs in Silicon Valley suggests their skill set is to be lauded. That said, I simply do not believe their “nine keys to subscription success” are for my benefit or yours.
The Incomprehensible Prison
I am fully aware that far greater minds than mine will spend far more time than I ever can crafting clever appeals with the sole intent of enticing me to subscribe. To anything. I may succumb, despite my declaration.
I need your help.
Recently, after a Paypal executive went on a rather bizarre Twitter rant, I created the notion of a “Twitter buddy.” A Twitter buddy is the person who rips the phone from your hands the moment you begin tweeting inappropriately.
We also should have a subscription buddy.
If I ever decide to subscribe to a new service, subscribe to some product, grab my credit card and throw it in the shredder. That’s what a true friend would do. That’s a relationship worth keeping.
[UPDATE 27 May 2014: Zuora posted a response to this column on their website. It’s a strong rebuttal and I recommend you read it. — Brian]
“Some have argued that Apple’s era of greatness is over, that with CEO Tim Cook sitting in Mr. Jobs’s chair, the magic is gone, and Apple is now, at best, just an ordinary company. Others have countered that, financially, Apple is still doing quite well, and that there’s no evidence that it’s out of ideas.” ~ Walt Mossberg
Let’s make one thing crystal clear from the start. This is not a new debate. The debate over whether Apple’s “magic” is gone didn’t start with Steve Jobs’ death, it started with Apple’s birth. The only difference between the Apple doomsayers of today and the Apple doomsayers of yesteryear is pundits used to say Apple was doomed BECAUSE of Steve Jobs. Today pundits say Apple is doomed because of the ABSENCE of Steve Jobs. The doomsayers have altered their lyrics, but they haven’t changed their tune.
Where Is This Parade Of Which You Speak?
“Steve Jobs has been dead for about two and a half years now, and it’s hard not to notice that the regular parade of game-changing Apple products for which he was famous seems to have disappeared with him.” ~ Walt Mossberg
Seriously?
The founding premise, upon which Mr. Mossberg’s entire article is built, simply doesn’t exist. There never was and there never will be a “regular parade of game-changing (tech) products” under Steve Jobs or anyone else. True game-changers are few and far between. And they appear sporadically and at anything but regular intervals.
Expecting Steve Jobs’ successor or Steve Jobs himself or anyone for that matter, to produce disruptive, game-changing, category busting products every couple of years simply ignores reality. Tech game-changers are to tech iteration as diamonds are to coal: rare, extremely hard to discover and precious.
Is Apple Like A Movie Studio?
“…I think the most useful way of thinking about Apple is to see it as a movie studio. Studios release blockbuster franchise movies every few years, and then try to live off a series of sequels until the next big, successful franchise.” ~ Walt Mossberg
With all due respect, you simply cannot compare the creation of a movie franchise to the creation of a disruptive, game-changing, category creating product. They’re at different orders of magnitude.
A movie franchise emerges once every few years.
A game-changing product emerges once every few decades.
A movie franchise alters the course a company.
A game-changing technology product alters the course of an industry.
Take, as a single example, the notebook computer.
The notebook computer was basically re-invented when the PowerBook was introduced in 1991.
(T)he first PowerBook would set the standard for basic laptop design for the next twenty years, a fact that still surprises everyone. “We hit a homerun with the PowerBook,” Brunner said. “It surprised me to death. There were so many flaws with that machine and that design. I thought it was going to be a huge failure. But looking back today, basically all laptops are that design—a recessed keyboard, palm rests, a central pointing device.” ~ Excerpt From: Leander Kahney. “Jony Ive.”
The basic design for the notebook wasn’t changed again until the introduction of the tablet in 2010 — some nineteen years later.
Demanding Apple “re-invent” computing again — only 4 years after the release of the iPad — is akin to demanding the movie industry evolve from live stage performances, to silent films, to talkies, to digital special effects, every few years. It’s simply unreasonable.
Is It Now Or Never For The Sequel To The iPad?
(S)equel time is almost up. It’s time for a new franchise. And it had better be desirable, logical and elegant. ~ Walt Mossberg
Are you kidding me?
You say: “time is almost up.” Why is that?
Wasn’t there time enough for the iPod to disrupt the MP3 market? Wasn’t there time enough for the iPhone to disrupt the smartphone market? Wasn’t there time enough for the iPad to disrupt the tablet market?
History’s Answer: “Yes, yes, and oh hell yes.”
You say Apple’s offering “had better be desirable, logical and elegant.” Why is that?
It’s not as if Apple’s tech competitor’s have gotten any traction in the marketplace with the “next great thing” in tech. In fact, when it comes to products like wearables, tech companies clearly don’t have a clue what they should be offering. They keep throwing every conceivable sort of device at the consumer in the hope something sticks and the consumer, in their turn, keeps chucking everything right back at them.
Why The Double Standard?
Why does Apple and Apple alone have to release a new “franchise” every couple of years? Why are there no calls for semi-annual new “franchises” from other tech companies?
Some of the “rules of thumb” regarding success are nothing succeeds like success; success breeds success; past success is a predictor of future success. However, when it comes to Apple — and only Apple — pundits instead apply a “rule of dumb”: Apple succeeded through sheer dumb luck and the odds are bound to catch up with them sooner rather than later; Apple is a one-hit wonder with, admittedly, a string of hits, which only makes it all the more certain their next offering will be a flop; while everyone else is taking target practice, Apple is playing Russian Roulette — each and every time Apple successfully pulls the trigger on another category, it also adds another bullet to the chamber, another nail in the coffin that has been patiently waiting for them these many years.
Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally. ~ John Maynard Keynes
Does Apple Want To Be Pixar?
Apple is not like a movie studio. Pixar is like a movie studio. Pixar had only one innovation but it was a beaut– a process for creating hit animated films. Since then, Pixar has only iterated and iterated and iterated. And not only is that good enough, it’s great. It’s turned Pixar into a movie making hit machine.
Why would Apple want to become Pixar? Think about it. Apple has done everything that Pixar has done, and more. It is Pixar, that might aspire to become Apple. And to do so, they would have to create a new process — a process that would not only revolutionize the way Pixar made movies, but a process that revolutionized the way everyone made movies.
Then they would have to do it again.
And again and again.
Every once in a while a revolutionary product comes along that changes everything. It’s very fortunate if you can work on just one of these in your career. Apple’s been very fortunate in that it’s introduced a few of these. ~ Steve Jobs
Will Apple Ever Be Disruptive Again?
Apple is a hit machine, like Pixar, but they’re also serial disruptors — like no one else I’ve ever seen. The hits come out year after year after year. The disruptions (Apple II, Macintosh, iPod, iPhone and iPad) arrive not so regularly and not so much.
Don’t cry because it’s over. Smile because it happened. ~ Dr. Seuss
I honestly don’t know if Apple will ever create another disruptive product. Truth be told, we should be amazed Apple has created as many game-changers as they have. When you look at the careers of geniuses, almost all of them had their breakthroughs before they were thirty. Steve Jobs had breakthroughs before the age of thirty but as the days of his life dwindled, the speed and size of his disruptive innovations grew. And despite his premature death, his biggest disruption may be still to come.
I discovered that the best innovation is sometimes the company, the way you organize a company. The whole notion of how you build a company is fascinating. ~ Steve Jobs
Pixar has created a process that routinely churns out mega-successful movie hits. Did Steve Jobs create a process that would allow Apple to remain a serial disruptor? Only time will tell…
…but time knows how to keep a secret and it probably won’t be telling us any time too soon.
Steve Jobs fully understood the value in surprise, the wonder of magic, and the awe a beautiful, functional, highly personal computing device can evoke when unwrapped for the very first time. Rumors, particularly a stream of unceasing rumors of all kinds, tend to sully this ideal.
Not much can be done about it, unfortunately. Not only because Jobs is now gone but because Apple is far, far bigger than it has ever been. The company now comprises ten of thousands of employees, a massive retail chain, strategic partnerships with nearly every big name in media, relationships with automakers and contractors by the score. The Apple ecosystems spans nearly half a billion active users, a global supply chain that touches 4 million workers, hundreds of suppliers, and 18 worldwide final assembly plants. Leaks and rumors are inevitable.
In addition to leaks, there may be story plants, trial balloons, media spin, hurt feelings from those let go, false leads from those gunning for a promotion, snapshots from an anonymous line worker in China, misdirections from a savvy executive and slip ups by trusted employees. Given the scope of today’s Apple, shutting down the rumor-media industrial complex is simply not possible.
The end result of all of this?
We don’t know what we don’t know and we aren’t always sure what we do know. To be sure, all the rumors and all the talk may help whet our appetite for the next great Apple product. It can also lead to far too many brain cells preoccupied with even the most ridiculous Apple tales.
For example…iRing. Yes, leading Apple sites have written about and thoroughly dissected the very real possibility of a computerized ring, forged by Apple, which could be, it is presumed, a means to support digital payments, possibly serve as a remote control for the wearer’s music collection, and all manner of other nonsensical functions.
This will not happen. There will be no iRing. None. If for no other reason than should Apple even dare release such a product, every sneer, every cutting remark made by any and every Apple hater everywhere since the beginning of time would instantly be made whole. I can barely write the word ‘iRing’ without laughing.
I am certain, however, that talk of an iRing will persist.
The Apple Rumor Prism
Like it or not, expect no end to the Apple rumors and tall tales that emerge from the amorphous flotsam the media periodically feasts upon. This is all exacerbated by the fact Apple PR, whom I have been in contact with on many occasions, nearly always refuses to comment on any rumor. Realistically, they have little other choice.
Which begs the question: Is there a way to pre-determine the veracity of a Apple rumor?
(Wait for it…)
No.
The best we have so far are a few very well connected Apple writers, such as Jim Dalrymple, who can deliver a yay or nay but only at certain times and only for certain rumors. With Apple, rumors are like weeds, and no one person can stomp down all of them.
For example, thanks to the ongoing court battles with Samsung, we recently learned Apple has been rather concerned over the sales growth of large display smartphones, which it does not yet offer.
Surprise! Days later, we are treated to pictures of new iPhone molds suggesting a larger iPhone! Is this a plant from Apple? A false lead? Or some kid in Taiwan not very good with Photoshop? We don’t know. Worse, we tend to latch onto any data point, such as it is, that confirms our biases or affirms our hopes.
What then, is the best means of determining if a rumor is even merely likely when Apple refuses to say and the best Apple sources can’t (yet) verify? I focus on what I do know with a high degree of certainty and run the latest rumor through that prism. This may lead to some dead ends or errors, but it typically keeps me on the right trail.
I know with a high degree of certainty that…
Tim Cook is firmly in charge of Apple
Jony Ive is firmly in charge of the look and feel of Apple products — all of it, inside and out
Tim Cook has essentially removed Jony Ive from the bowels of the Apple design labs and made him a quite respectable SVP, which almost certainly means Ive won’t be as intimately involved with each and every product, manufacturing process and innovative material going forward
Cook’s big name hires have been in retail and branding, though he’s also hired veterans from the fitness and medical devices industry
Apple works on products and prototypes for years before it believes everything is just right for launch
iPhone margins are massive and counter to the direction of the marketplace
Apple is comfortable with offering seemingly confusing choices for consumers (e.g. iPad Mini RD vs iPad 2 vs iPad 3, I think)
Core Apple products such as the iPhone, iPad and the Mac are typically replaced by users every 1-5 years, and many of these are not junked but rather re-sold by the original customer or a third party
Apple possesses a near religious fealty to the notion of continuous product improvement
Optimizing and innovating all hardware in pursuit of product improvement — and product margins — is hardwired into the company’s DNA
Apple’s relationships with IT decision makers and procurement personnel in government, the enterprise and businesses with more than 20 employees is woefully lacking
Apple is worth more than $450 billion and is sitting on approximately $160 billion in cash and equivalents
These guide me whenever I dare pick apart an Apple rumor or chase down the latest crazy Apple tale.
Caution: these ‘knowns’ are not equal!
The majority of Apple’s revenues come from the iPhone. The addressable market for the iPhone is radically larger than the market for any other extant Apple product. Each fact from above, even if entirely true in isolation, is not inviolable should it ever even potentially bring harm to iPhone sales and iPhone margins.
The Apple Rumor Mill
Running rumors though this iPhone prism serves as my handy guide in understanding if a rumor has legitimacy or not.
For example:
An iWatch should almost certainly integrate with (and be made most useful by) the iPhone. An iWatch will likely demand a keen sense of style, luxury branding and retail sales savvy. Given what I know, iWatch rumors are absolutely within the bounds of certainty.
An Apple television would not be appreciably enhanced by the iPhone. Televisions are kept in use far longer than five years. There’s little to justify this rumor, no matter its persistence.
A line of wearables or ‘smart’ accessories that all tie back to the iPhone? Absolutely. These enhance the iPhone’s value and should extend iPhone sales.
That Apple has to do anything this month, this quarter, this fiscal year to ensure its success? Complete nonsense.
A revolutionary new product that just might “disrupt” the iPhone? No. Repeat after me: No. For Apple to even consider disrupting its golden iPhone goose would not only be foolish but darn close to a dereliction of duty. Buttressing this is another fact: there is nothing on the horizon, nothing at all, even remotely ready to replace the iPhone (or any high end smartphone). Nothing. Not Google Glass. Not Oculus Rift. Nothing. We are in the early days of the smartphone market. Do not make me repeat myself.
Within a week of reading this, probably sooner, you will hear yet another rumor about Apple. Before considering it, pro or con, first make sure you run it through your list of knowns. Most of the time, you will immediately recognize the rumor as utter nonsense. On rare occasions however and no matter the source, you will stumble upon a rumor more true than not.
Such is life for those that follow Apple Inc and the hundreds of millions who love its products. The true story of Apple does not begin or end at product launch. Those are merely two data points in an ongoing and very rewarding chase.
—
1. [Feel free to counter my claim Apple cannot go down market. Remember, however, even the ‘cheap’ iPhone, the iPhone 5c, is one of the most expensive on the market, and note also the major Apple retail hires come from luxury brand companies.]↩
The ghost of Steve Jobs haunts Google and Facebook. Unlike Apple, which has always aligned its interests with its users, both Google and Facebook must serve two masters: users and customers. They are not the same. Indeed, the divergent demands of these two groups has placed both web giants at a long term competitive disadvantage against Apple — one that will cost them billions to correct and will likely never be fully resolved.
Steve Jobs repeatedly veered from conventional Silicon Valley wisdom. His successes were legion. Given Apple’s current size and dominance, it’s easy to forget how so many of the big strategic gambles Jobs made were almost laughable at the time.
Vertical integration
Make both hardware and software
Keep design in-house
Create a global retail chain
Lock down your ecosystem
Make money on the hardware
Focus on fashion
Touchscreens are superior to physical keyboards
Google is, despite occasional shout outs to “openness”, absolutely following the Apple playbook which Jobs crafted decades ago. Facebook will follow as best it can, I suspect.
It’s not going to be enough.
Jobs made an even more profound strategic decision, one neither Google nor Facebook can ever match. It was a decision stunningly obvious in its simplicity, yet even today, despite Apple’s success, is still rejected throughout the Valley. That primal Jobsian strategy?
Your users are your customers and your customers are your users.
Sounds so simple, so obvious, yet think of nearly every start-up success in Silicon Valley this millennium, every hot new business model trend. Is the actual end user the actual paying customer?
In nearly every case, the answer is no.
In this disconnect, there is much weakness.
By linking Apple’s fortunes with the happiness of its actual users, Steve Jobs unleashed a slow-motion revolution that haunts Google and Facebook even now. Others, too. Even once dominant Microsoft, which remains radically dependent upon corporate buyers — not the actual users of their product — is hurting.
Obvious is not always easy.
The High Cost of Serving Two Masters
The divergent interests of users and customers is why Google and Facebook have been on such a massive buying spree recently. I do not expect a slowdown.
The latest acquisitions are not, as so many confounded analysts suggest, a sign Google and Facebook lack Apple’s “focus”. Rather, the fault lines in the Google and Facebook business models demand these acquisitions. That is, to make users happy and to make advertisers happy and to ensure an uneasy peace across both consumes enormous resources. Google and Facebook will always need to keep the checkbook handy. It’s not a lack of focus which explains their acquisitions. Just the opposite, in fact. Their focus is on a two-headed beast.
Before I go any further analyzing Google and Facebook acquisitions, I must acknowledge there are other, less critical factors at play:
Real Control
Fake Money
Google’s and Facebook’s founders have radically disproportionate voting control relative to their total ownership share. They can buy, even on a whim, and almost without explanation. Steve Jobs had no such control, nor does Tim Cook. Essentially, Larry Page and Mark Zuckerberg can buy whatever they wish without a single voice being raised.
In addition, the respective CEO-owners of Google and Facebook are fortunate enough to have inexplicably high PE values. $GOOG is at 31, $FB is 92 — that’s not a misprint. $AAPL on the other hand, trades at a stunningly reasonable 13. Whether you think the market is appropriately valuing these three companies is a separate issue. For now, the market is throwing money at Google and Facebook and money is of no use if it’s not being spent. I suspect if the market pushed Apple’s share price to a PE of 31, that Cook would likewise go on a shopping spree.
These two fortunate, albeit anomalous realities notwithstanding, the primary motivator behind the massive Google and Facebook spending sprees is, in fact, their respective CEO’s keen understanding of what their businesses require to succeed.
Think of a gushing well that nonetheless requires continuous priming.
Encourage. Capture. Present.
To continue earning billions, both Google and Facebook must:
Encourage use — to the point where they pay whatever is necessary to get billions more people online.
Capture our personal data — including where we are, who we are with, what we are doing, even how we are feeling.
Offer screens, tools, services and platforms so their paying customers — advertisers — can effectively present their message.
All their respective acquisitions are to maximize these three building blocks: Encourage. Capture. Present.
Thus, while couched in feel-good language, it’s shrewd business to encourage more people go online.
Last year Facebook and other tech companies launched Internet.org, a global partnership to make the internet available to the two thirds of the world’s population that doesn’t have it.
Thus, cool-sounding “AI” projects are really little more than a means of better extracting maximum value from the captured information of a billion plus users:
By teaching a computer to think, Facebook hopes to better understand how its users do too. So today the company announced that one of the world’s leading deep learning and machine learning scientists, NYU’s Professor Yann LeCun, will lead its new artificial intelligence laboratory.
Thus, a few years from now, when we spend as much time inside ‘virtual reality’ as we now do staring at our smartphones, Facebook will need to have a suitable platform for its advertisers to present their message. Enter: Oculus Rift.
SWOT
Of course, each company has its own unique strengths. As the graph below illustrates, I contend Google does a far better job of capturing user information — via Play, Wallet, Android, search, Maps, etc.
Both Google and Facebook do an equally good job of encouraging use.
Facebook offers advertisers more and better options to present their message — Facebook, Instagram, WhatsApp.
We should therefore expect both companies to acquire other firms, talent and technologies that enable them to further enhance their existing strengths and to shore up their weaknesses. For example, Facebook needs to build or buy tools to more effectively capture critical personal data. Might this lead to buying Foursquare, for example, with all its user-location data?
As we increasingly look to our wearables and smart watches, expect Google to buy or build tools to ensure their advertisers can present their message onto these new screens.
There’s still another consideration for potential acquisitions. The companies currently are split in the type(s) of information they are best at encouraging, capturing and presenting.
Facebook’s superiority is better suited for encouraging us to share how we feel, and its platforms allow users to more fully express themselves. Google by contrast, is far better at capturing what we want and what we are doing.
Given this, I suspect while both Google and Facebook will acquire companies that help them shore up weaknesses across the feeling-doing-wanting-expressing spectrum, the really big money will be spent on ensuring their current leadership is almost impossible to surpass.
Focused Acquisitions
Was $19 billion too much for WhatsApp? Likely. As was $2 billion for Oculus and $3+ billion for Nest. Fair enough. But, these acquisitions do not reveal a lack of focus – just the opposite:
Driverless cars will present ads and content in a captive environment without distraction.
Internet drones, lasers and balloons encourage more of us onto the web and onto the many and varied Google and Facebook platforms.
If any of us spends any appreciable time in the “metaverse”, then Facebook’s Oculus Rift gamble will enable advertisers to present a stream of messages into our eyes and ears, without any of the real world’s messiness.
Google Glass can (soon) present the latest reviews of the newest restaurant as we walk past — or instantly display where we can get a better price on our favorite gear.
Nest will help Google capture our home information.
WhatsApp encourages us to share a great deal of personal information.
Instagram encourages us to express ourselves.
The list goes on.
Therefore, when you read financial analysts, such as Felix Salmon, who insist Facebook’s latest acquisitions aren’t related, they are missing the big picture.
Look at his big purchases — Instagram, WhatsApp, Oculus. None of them are likely to be integrated into the core Facebook product any time soon; none of them really make it better in any visible way. I’m sure he promised something similar to Snapchat, too.
Wrong. It’s not about being “integrated into the core Facebook product.” Rather, it’s about encouraging use, capturing use, and maximizing its value to advertisers — which means enabling those advertisers to present their message to every user at any time, in all places, on all screens.
And it will never end.
Apple must make its customers happy. That’s no easy task. Google and Facebook, however, must make both their customers and their users happy. That’s much harder. The checkbooks will remain at the ready.
Me? I know why and am grateful for the odd, stirring, mostly unplanned path that brought me here.
My father spent over 30 years working inside an auto factory, the first 20 “on the line”. When he heard “computers were the future”, he saved up, found one at a garage sale and proudly brought it home. It was a Commodore 64. I loved it from the start.
Confession: I have never cared much for coding, programming or building my own computer. I was however — and still am — acutely interested in what I could do with a computer. In the case of my 64, I was a kid, so mostly gaming. Lucky for me, dad’s garage sale booty included a “floppy drive”, several games and various “educational” programs.
In short time, I became reasonably expert at H.E.R.O., Fort Apocalypse, and Summer Games. There was a time when I engaged in far more virtual Raid(s) over Moscow than any of today’s most capable generals.
The Commodore 64 cost far more than my parents could reasonably afford. So from the start they made it plain it was very important, not at all a toy (despite how I used it), and repeated this to me like grace before dinner. Computers, they insisted, are the future. Be a part of that.
That’s why I’m here.
Intel Inside. And Maybe Hopes & Dreams.
Of course my native Detroit was far away from Silicon Valley, the fast beating heart of the computing revolution. It didn’t matter. The 64 carried me here. For all the machines that followed, the used Mac, the shiny new Mac LC, the Toshiba laptops and many more, it was that first 64 which shed a light on my future, a future where people and data and machines and ideas and random musings are all connected.
The Commodore 64 lured me down the rabbit hole that was online bulletin boards, which led me to Prodigy, Dialog, Compuserve and others. From there, I discovered Mosaic, then Netscape. By then I had a career in computer tech, almost without planning it; my parents’ intentions realized.
I can’t stop now. I don’t want to stop. It’s not just there’s more to come. More is coming faster, and it’s even more amazing.
Consider the scary-exciting merger of healthcare and computing. Acknowledge the rapid rise of Facebook and global messaging, from nothing to vital in a few short years. Reflect upon the astounding functionality of the iPhone, the utter pervasiveness of Google, how giant Microsoft is morphing before our eyes. We have new media, mobile payments, crypto currencies and experimental forms of retail. Global connectivity has dethroned the sovereigns of time and distance. Yet, both real time and precise location are now more critical to more of what we do and say (and even think, see and feel) than ever before. I did not see that coming.
I am here as well because the visions, proclamations and inspired work of the early computing pioneers really did come true. Their words, their mad tinkerings quickly spread far beyond Silicon Valley, where the shrouded potential of their creations seeped into our computer-less consciousness, found their way into the local news and duly informed my parents who went straight out and acquired for me everything they were told I would need to become a part of the future.
I am pleased to still be part of this long running serial.
Yes, our industry failed at much. The endemic spread of pornography, the utter devaluation of personal privacy, our rather casual silence at how the latest waves of computing technology are displacing good, smart, hardworking people by the millions, leaving them with little to do but hope self-employment, freelancing and the sharing of labor and tools can somehow enable them to get by. There is much to fix.
Random Access
The arrival of that Commodore 64 led to another serendipitous find. We could afford only one television in those days, no cable, and when home, my father religiously watched the local news and all sports. Big-ticket purchases like the 64, however, demanded he work on Saturdays — time and a half made those 8 extra hours of work equal 12 hours of pay, which mattered dearly. Which led to him being gone one particular Saturday. Which led me to gleefully run through all 9 channels. Which is when I stumbled upon The Computer Chronicles.
“the amazing palmtop computer”
The Computer Chronicles documented, almost from the very beginning, the rise, the spread, the incredible innovation of personal computing. It proved to me — because it was on television — a career in computers was viable, no matter where I lived.
I am more excited, more convinced of the transformative power of computing tech and its ability to achieve net good than ever before. This is one reason why I never play favorites. It’s why I can’t suggest you buy Bitcoin, no matter how hyped it has become, or why I cannot recommend the iPhone 5c, no matter how greatly I admire Apple. It’s why my posts cause numerous CEOs and VCs (and several editors) to immediately block me from their Twitter feeds, and limit my access.
All worth it. This stuff matters to me and I fully appreciate how it impacts you.
We are the screen. The screen is the world.
Whatever the reasons you are here, I am glad you are. Now hang on tight.
As Google and Facebook appear to buy up everything that was only yesterday considered cutting edge, as venture capital becomes, somehow, even more of an insider’s game, with not even scraps available to the rest of us, I nonetheless stay positive. I know money, computing power, networking, software, the creeping of technology into all aspects of our life and into every personal and business endeavor, and the random, very human mutations that takes hold inside this swirling glorious mix will continue to create still more and larger revolutions, more big and bigger bangs, more insanely great.
We are rapidly transitioning from the era of personal computing to an era where each person is a computer — with eyewear, wristbands and clothing all capturing who we are, what we do, and how, when and where. Then sending this data floating off, joining up with 7 billion similar nodes.
We are the screen. The screen is the world.
I say this all not because I have a product to sell you or because the larger, more pumped the market, the greater the return on my quickie investments. I say this because it’s true: The computer chronicles have only just started.
Posit: Apple Is The Richest And Most Under-Staffed Company In Tech ~ Benedict Evans (@BenedictEvans)
Anyone who follow Apple closely knows that they are a bundle of paradoxes. One of the most baffling of these is that Apple has literally tens of billions in excess cash but seems always to be chronically short of critical software engineers.
Benedict Evans, above, wonders aloud “whether” Apple was understaffed. Rene Ritchie, below, wonders “why.”
How much by design and how much by scarcity of resource is interesting to ponder. ~ Rene Ritchie (@reneritchie)
I think I know the answer to that question, but I’ll let you be the judge.
Two Possible Reasons
Quality
Quality is more important than quantity. One home run is much better than two doubles. ~ Steve Jobs
Apple values quality over quantity and quality takes time, regardless of how many software engineers one puts on a project. A reasonable explanation.
Simplicity
When you first start off trying to solve a problem, the first solutions you come up with are very complex, and most people stop there. But if you keep going, and live with the problem and peel more layers of the onion off, you can oftentimes arrive at some very elegant and simple solutions. Most people just don’t put in the time or energy to get there. ~ Steve Jobs
Apple values simplicity and simplicity takes time. Another valid explanation for Apple’s seeming tardiness.
The Real Reason
Here, in my opinion, in the real reason why Apple is always chronically understaffed:
I found that there were these incredibly great people at doing certain things, and that you couldn’t replace one of these people with 50 average people. They could just do things that no number of average people could do. ~ Steve Jobs
Apple tries to hire only exceptional people and refuses to fill in the gaps with average employees.
The following quote is rather long but it is — again, in my opinion — the answer to the question of why cash rich Apple seems to be so continuously understaffed:
[pullquote]It is infinitely better to have a few good men than many indifferent ones. ~ George Washington[/pullquote]
I observed something very early on at Apple, I didn’t know how to explain it then, but I’ve thought about it since. Most things in life, the dynamic range between “average” and the “best” is, at most, two-to-one. If you get into a cab in New York City with the best cab driver, as opposed to the average cab driver, you’re probably going to get to your destination with the best cab driver maybe thirty percent faster… Or a CD player, the difference between the best CD player and the average CD player is what? Twenty percent? So two-to-one is a big dynamic range in most of life. In software — and it used to be the case in hardware too — the difference between the average and the best is 50 to one. Maybe one hundred to one. Very few things in life are like this, but what I’ve been lucky enough to spend my life in is like this. ~ Steve Jobs
Is It Worth It?
[pullquote]Two Eskimos were sitting in a kayak chatting. After a while they got a bit chilly, but when they lit a fire in the craft, it sank . . . I guess this just goes to show that you can’t have your kayak and heat it, too.[/pullquote]
The problem with the above philosophy is that it seems to fly in the face of Jobs’ other mantra that “real artists ship.”
In typical Steve Jobs fashion, I think he expected his people to do the impossible — to be understaffed AND to ship on time too. And in typical Steve Jobs fashion, they sometimes — but not always — did the impossible.
Query: Is the tradeoff worth it? Can Apple continue to operate continuously understaffed? Because I believe that it is no accident but, rather, a very conscious policy and a key component of their business model.
Perhaps only posterity will be able to accurately judge.
Failure is fascinating. Failure highlights our limits, our strengths, our mortality. My ‘explorations in failure’ will this week examine the iPhone 5c. At the very moment Apple was about to slice deep into the Android behemoth, offer the world a glorious low-cost iPhone, it fell flat on its face.
How could this happen?
I don’t have all the answers, of course, but I think there is much to divine by piecing together the iPhone 5c detritus.
The scale of Apple, its global supply chain, massive retail footprint, market valuation, the popularity of its computing devices, these all reveal a company that rarely makes mistakes. Apple’s iPhone 5c has been a striking failure, however, selling far fewer devices than Apple expected, likely dampening overall iPhone sales, and, if well-placed rumors are correct, very soon to be no longer of this world.
It all began, of course, with so much promise. The iPhone 5c — aka the “cheap iPhone” — was, we were convinced, going to be the aggressively priced new iPhone, ready to dismantle Android throughout the developing world, possibly beyond. It would (quickly) add tens of millions, ultimately hundreds of millions of new users into the Apple/iOS ecosystem.
This was not to be. As Tim Cook stated during the company’s most recent earnings call, 5c demand “turned out to be different than we thought.” While Apple sold an astounding 51 million iPhones total in the last quarter, Cook admitted that “our North American business contracted somewhat year over year.” Cook placed the blame squarely on the iPhone 5c by bravely reminding us that Apple “actually sold more iPhone 5s’s than we projected.”
Here’s the bottom-line: not only did iPhone 5c fail to sell in the numbers Cook calculated, the company suffered unnecessary expenses and pinched revenues by wrongly estimating the 5c/5s sales mix.
In a rather harsh assessment to the 5c’s poor showing, USA Today noted that Tim Cook refused to address the device by name. The publication went on to state that:
Sales of Apple’s iPhone 5c have been so disappointing that the consumer technology giant will likely cut the price of the device soon or even scrap the model altogether.
Count me among those that doubt iPhone 5c will reach its first birthday.
After all, the iPhone 5c, as it presently exists, is frankly inexplicable. It’s one of the highest-priced smartphones on the market, nearly as pricey as the 5s, yet with shockingly lesser hardware and camera features. Oh, and it doesn’t have the same look as the iconic iPhone 5s.
Go on – do your best sales job with that.
How did Apple so badly misread the market? In fact, there are several reasons.
Failure 1. Losing the Narrative
The most obvious failing of the iPhone 5c may be in how badly Apple lost control of the narrative. Remember the build-up of buzz before the original iPad? A full touchscreen tablet, built on iOS! The only downside, it was going to cost about $1,000.
The 5c was the reverse of this. For example, as speculated in Daring Fireball: “(Apple’s) three pricing tiers for the next year would be a new iPhone 5S at the high end, today’s iPhone 5 in the mid-range, and the new 5C at the low end.”
Sadly, no. Worse for Apple was that we all believed the rumors. Not simply because of their persistence, no, but from the fact that the market was so obviously ready for that awesome low-end device that we were convinced Apple was capable of delivering.
Perhaps we should not have convinced ourselves. As I have said here many times: it is extremely hard for any company to shift gears and go down-market, or, for that matter, to reverse its low-price strategy and go up-market. Apple is no different. All corporations have unique strengths, unique brands, unique positions within the larger marketplace. With the 5c, we learned this the hard way. Nonetheless, Apple PR must do a better job of controlling the narrative of its upcoming products.
Failure 2. Anti-Apple design
A second failure is that the iPhone 5c altered the familiar design cues of the highly popular iPhone line. The 5c is “unapologetically” plastic and offered in several bold colors. This is the Nokia design template — and they’ve been doing it far longer than Apple. Apple offered up absolutely nothing new.
This is not to suggest the design is bad. I actually prefer the look and feel of the 5c. Not surprisingly, my go-to device is a Lumia 1520, with its bright yellow casing made of sturdy polycarbonate. The iPhone 5s feels much too light, much too fragile for my taste. Whether others feel the same is not the issue, however. Rather, the world knows at a glance what an iPhone is, and the 5c forks from this.
Unless Jony Ive and Apple are set to unleash myriad models of iPhone in numerous shapes, colors and price-points, iPod-like, then the 5c design stands out for all the wrong reasons. If you want the world to know you have an iPhone, the 5c states this with a whisper, if at all.
Failure 3. Devaluing Hardware
The most egregious, most confounding failure of the 5c, and the one I think will haunt Apple, is that the 5c effectively declares to all the world that one or all iPhones are radically overpriced. I am at a loss to understand how Apple allowed this to happen.
There is a measly $100 suggested retail price difference between the iPhone 5c and the iPhone 5s. For that extra $100, the iPhone 5s buyer receives the following additional hardware, services and benefits:
A7
M7
TouchID sensor
Lighter weight
True Tone flash and larger 8 MP sensor
Slo-mo video
Enhanced imaging features
Explain this: A 16gig 5c retails for $549. A 16gig 5s retails for $649. Why?
We know what that extra $100 gets us, and it’s awesome. What are we getting for that first $549? I now have no idea. The very existence of the 5c, priced so high, calls into question the entire pricing scheme for all of iPhone. Either the 5c is priced way too high or the 5s way too low. With the 5c, Apple has brought pricing to the forefront, and in a bad way.
Putting a positive spin on the 5c’s failure, Tim Cook stated that:
“I think the 5s, people are really intrigued with Touch ID. It’s a major feature that has excited people. And I think that associated with the other things that are unique to the 5s, got the 5s to have a significant amount more attention and a higher mix of sales.”
In this case, I think it would have been better had he not spoken.
The 5c was passed over because people want Touch ID? Where are these people? I watch iPhone 5s users on a daily basis and TouchID is of scant importance to them, and certainly not the primary deciding factor between 5c and 5s.
There is simply no justification for either the 5c’s price or the 5s’s price, maybe both. Which is it, Apple? Why even allow this question to be raised?
Failure 4. Peeking behind the iCloud curtain
A final concern, one pointed out to me by reader iDawg, is that Apple may have intended to legitimately price the 5c at the mid- or low-end, but were prevented from doing so, possibly just before launch, because their services — Siri, iCloud, streaming media, data synching, etc. — weren’t yet ready to support a massive influx of new users.
“The real reason Apple doesn’t sell more phones: fear of choking Siri (and online services) to death.”
Thus, as the 5c neared completion, this theory goes, it became apparent that Apple’s various services weren’t ready to effectively meet the anticipated numbers of new users. Raising the price, and thus limiting demand was the only realistic option to prevent every user, not just 5c users, from rage-inducing crashes and failures. This is a bit hard for me to fathom, though if true, ought to place Eddy Cue on the hot seat.
5c We Hardly Knew You
As I wrote a mere fortnight after its release, Steve Jobs would never have approved the 5c. I stand by that assertion. Jobs had a near-religious fealty to focus and function, and the end result was hardware honed to near-perfect clarity. The 5c, on the other hand, is muddied, the result of varied and competing interests. The 5c doesn’t know who it is nor who it is for.
Let’s count the ways the 5c fights with itself and with what Apple is best at:
An alternative design which denotes newness and low-price versus the iPhone design is iconic and beloved
Lots of new Apple customers versus we must provide the best service to all our customers
A low-cost device versus we must protect our margins
We can make a great smartphone at any price versus we focus on the premium market
Is the iPhone 5c Apple’s canary in the coal mine? A telltale sign of near-term headwinds and divergent internal factions? Possibly, though given the company’s track record, I’m inclined to think of this as a minor self-inflicted wound, like how Disney spent far too much on that movie, John Carter.
That said, the failure of iPhone 5c is well-earned. This was not a case of technology before its time. Rather, of botched execution and that rare placement of profits before customers. Apple’s leadership, Tim Cook and Jony Ive, in particular, blew this one. That’s the most troubling aspect of all this. Tim Cook has scaled Apple to once-unimaginable heights. The iPhone 5c, however, reminds us that no company and no CEO has a perfect batting average.
I owe much to the movie Real Genius. I think Silicon Valley also owes this great film its gratitude. Indeed, if you love Silicon Valley, its culture, its vision, its bold, disruptive ethos and hacker creed, its belief in the expansive power of technology, then you likewise should be appreciative of this funny, heart-filled film.
Real Genius premiered in 1985. Yes, ten years before Windows 95. Ten years before Amazon.com. The President was Ronald Reagan. Everyone’s music came on cassette tapes. The Mac was a year old, not 30. CompuServe was bleeding edge. Yet, to this day, Real Genius remains a damn good movie, still able to inspire the next generation of geeks.
Talent, vision, skill, brainpower — and not looks, politics or favoritism — rule in Real Genius. To tackle the big problems, to demand success at a heretofore unimagined scale, those non-meritocratic skills are not only useless, the film teaches us, but actual barriers to success. Silicon Valley has taken these lessons to heart. I honestly do believe that Silicon Valley would be a lesser place, less fun, less daring, less successful, less eager to embrace actual unique personal genius, if not for the movie Real Genius.
Real Genius assures us that we can remain fully ourself, with all our quirks, all our awkwardness, and still be welcome into its egalitarian world. The movie likewise reveals that to love what you do, love what you are good at, love working with others who feel just the same, then it’s not really work at all, its’ more a calling.
The glory, the money, those will come, and when they do, they will remain secondary. This is the creed of today’s tech entrepreneur.
What’s Real Genius about?
Well, this mean teacher recruits all the top physics and engineering students to his school then blackmails them to work on a top secret project to create a “five megawatt laser” that can vaporize a person from the sky, while he secretly uses those earmarked CIA funds to build himself an amazing new house. The smart kids succeed, naturally, only to soon discover what their work is intended for — drone-like assassinations. Now, they must destroy the device, their greatest creation, and make the bad guys pay. Since they’re all living on campus, far from home, there’s also plenty of good-natured hijinks.
But, none of that’s terribly important. What’s important about Real Genius is its message: Give us your very smart, your young, your daring, quirky, your most technically inclined, and we can achieve the impossible. This same message permeates Silicon Valley. Come one, come all — provided you are smart — and we will find a place for you here.
Real Genius taught me, taught us, that it was ok to be smart, even super-smart. It taught us that being a geek, a nerd, a egghead, we could still be cool, we could still do good, we could change the world for the better — provided we thought through the consequences of our clever-brainy actions.
For me, Real Genius is that rarest of movies, like Spaceballs, that I absolutely have to watch whenever I stumble upon it.
Real Genius taught me that if I was super smart — and didn’t try to hide it — companies would come to me. It taught me that that cute, super smart girl was the one I really should spend my time with, give my heart to, and not the girls more commonly displayed across film and television.
Real Genius is like if the kids in The Outsiders all had off-the-charts IQs, reasonably concerned parents, and then went on to create new companies, new technologies, new business models that upend everything, all while making them each fantastically and legally wealthy beyond their dreams.
I imagine Steve Jobs is Chris Knight, expertly played by Val Kilmer. Smart, fearless, too reckless for anyone’s good, a corporate slacker that has no time and less patience for the business world. Bill Gates is the slight, scared and scary-smart Mitch Taylor, played by Gabe Jarrett. You just know both will change the world profoundly — maybe even similarly — despite their differences. They are linked solely by their brains and the rising belief in their unique abilities, and that’s exactly enough.
The young Jordan, who can’t slow down for even a second, is obviously Marissa Mayer.
Lazlo? Probably Tim Berners-Lee.
The geek-and-proud, smart-and-disruptive, ready to take on the world ethos in Real Genius has long since been embraced by Silicon Valley, its hackers, programmers, builders, dreamers.
Heed and herald the Real Genius values:
Being smart makes you a badass
Change the world and have fun doing it
You can beat the system, you can invert the system, and create a world more to your liking
Admittedly, the movie also suggests that the super-smart should congregate mostly amongst themselves, in schools, in bars, away from the other. That is the only real downside to the film’s core message, the consequences of which now reverberate throughout the region.
Perhaps the profound disconnectedness of the world back then heightens my endearment to this small movie, which spoke to me in every scene and through every character. Real Genius taught me, in a way that home, high school and my neighborhood did not, not quite, that it was okay to be brainy, there are more like you out there, and soon you will connect, friend one another, and change the world.
Now that the world no longer has Steve Ballmer to kick around, I think it’s time we direct our focus toward Apple’s Tim Cook. After all, just like Ballmer, Cook had to follow a legendary, visionary founder. Just like Ballmer, Cook is an operations guy, skilled in maximizing profits, growing a company, making sure the trains run on time. Like Ballmer, Cook’s more top-line than techie.
The biggest difference between the two men: Ballmer is worth billions whereas Tim Cook, late to Apple, is worth mere tens of millions.
Is this fair? Probably not, though also scarcely relevant. Regardless of the scope of Steve Ballmer’s fortunes, Tim Cook has enough money to live exceedingly well for the rest of his life. Which begs the question: why does he do it? Why does Tim Cook continue to lead Apple, with all its complexities, all its obligations, when he could retire — and perhaps pursue his other passions, or offer his time to the needy?
I find it fascinating that Cook — and so many others who have so much money — continue to give so much of themselves to a business. Does merely wondering this reveal I am destined to never lead a giant, highly profitable corporation?
Like so much about the murky Mr. Cook, his actual net worth is difficult to determine. The vast majority of his money is, unsurprisingly, linked to Apple stock awards which vest piecemeal over ten years. By the end of 2015, however, and based upon the various sources I reviewed, I will ballpark Cook’s wealth at about $250 million. Imagine you hit the Lotto this week and cleared $250 million. Would you still work? Really?
Break it down:
$50 million for your children
$25 million to charities (10%)
$25 million to your alma mater (you are generous, after all)
$50 million to family, relations, friends (you are very generous, after all)
That still leaves you (and your spouse) with $100 million in cash. If you’re, say, 40, and live to 90, you have $2 million to spend every single year for the rest of your life, however you wish — not including appreciable interest and investment returns.
Would you continue at your job, with all its stresses and demands, its long hours, and limiting focus?
Why does Cook? Why did Steve Ballmer? Why do Marissa Mayer, Susan Wojcicki, and so many other smart, talented and extremely rich men and women continue? Is there really so much joy, so much power, glory and opportunity from running Yahoo, YouTube, Microsoft or Apple?
Tim Cook has said that “money is not a motivator for me.” No doubt that is mostly true. What does motivate him? The morning meeting with the lawyers over the next patent suit? Responding to customer complaints over iCloud or email? Reviewing highly complex procurement contracts? Testing the iWatch 18 months before its launch? Firing Scott Forstall? Firing John Browett? Interviewing candidates to replace him? Talking with Walt Mossberg? Meeting with the CFO to decide when to buy back the next chunk of the company? Having to sit through that meeting where they discuss how the HVAC plans aren’t up to code on the new headquarters and then being interrupted because PR is upset that so many of the Apple faithful are inquiring about the allegations that Steve Jobs and Eric Schmidt conspired to keep engineering salaries in check?
It all seems so exhausting.
Tim Cook will both never be Steve Jobs and always compared to Steve Jobs. That also seems an unnecessary burden.
So, why?
I really do not know. But, here’s a clue. When Microsoft named Satya Nadella its next CEO, Steve Ballmer emailed everyone at the company:
Microsoft is one of the great companies in the world. I love this company. I love the bigness and boldness of what we do. I love the way we partner with other companies to come together to change the world. I love the breadth and the diversity of all of the customers we empower, from students in the classroom to consumers to small businesses to governments to the largest enterprises. Above all, I love the spirit of this place, the passion, and the perseverance, which has been the cornerstone of our culture from the very beginning.
Have you said the equivalent proud, beaming, loving words to your own child? Do so, now.
Ballmer has billions of dollars — billions! Why even care? That said, I am pleased he does, and that many others, particularly in tech, care just as deeply.
On the occasion of Facebook’s tenth anniversary — yes, the social network is years older than iPhone — Mark Zuckerberg shared his thoughts:
When I reflect on the last 10 years, one question I ask myself is: why were we the ones to build this? We were just students. We had way fewer resources than big companies. If they had focused on this problem, they could have done it.
The only answer I can think of is: we just cared more.
While some doubted that connecting the world was actually important, we were building. While others doubted that this would be sustainable, you were forming lasting connections.
We just cared more about connecting the world than anyone else. And we still do today.
He cared and continues to care.
If I had Mark Zuckerberg money, I would still write, every single day, exactly as I do now. Only, the money would almost certainly alter the pattern of my days. I would never again work for a company, nor for an editor, nor ever look for work. Would my writing then improve? Would the subject matter change? Alas, I will probably never know. I do know, however, that whatever it is beyond money that motivates the Cooks, Zuckerbergs, Ballmers, and Mayers of the world, we are almost certainly the better for it.
On a regular basis, I hear someone mock Apple or disparage Microsoft. Mere Internet flotsam, signifying nothing. The fact is, these companies have enhanced our lives, our work, creativity, play, learning, and connections with one another. We are fortunate that their leaders give so much of themselves, even when they have every reason not to.
Apple is the biggest tech company in the world, worth at least $100 billion more than either Microsoft or Google. Apple has over 350 million active users. Within a few short years, I suspect a billion people will be using Apple computers every single day.
How did this happen? Thus: Steve Jobs proved us all wrong.
In so many ways, ways we now take for granted, ways that Google and Microsoft are rapidly trying to copy, it was Jobs who showed us the way — even as we all were convinced of his wrongness. Jobs proved us wrong not just on technical matters, but on profound aspects of both technology and business.
A few examples of Steve Jobs proving us all wrong:
Building a global retail chain
Requiring customers to pay for content
Demanding high-margins for hardware
Choosing margin share over market share
Emphasizing design over commoditization
Building a touchscreen-only line of computers
Banishing pornography
All of these were business decisions that went against the accepted order. All were correct.
In this same way, Jobs taught us — for we did not initially believe — that:
The big money resides at the top of the pyramid
Walled gardens and well-controlled APIs are the future of the web
Existing standards and popular features are of almost no consequence
There is more money in consumer computing than the enterprise
Set prices, clearly stated, benefit buyer and seller
The web — websites, web pages, web standards — is less important than apps
More users, more developers, more content providers directly benefit from a closed ecosystem than an open one
And here we are today, following decades of Jobs wandering the wilderness, steadfastly implementing the many and varied pieces of his mad grand vision.
Now, developers choose Apple first, others second (if at all). Apple towers above Microsoft. Apple isn’t just the biggest computing company, it may also be the world’s biggest, most popular, most profitable gaming company. Symbian, BlackBerry, Palm, Motorola and Windows Phone have been crushed by iPhone. Dell has gone private. HP remains MIA. Jobsian tremors are still being felt across multiple industries as content, data, apps and services all collapse inside the iPhone — or its copiers.
In what turned out to be one of his very last shareholder letters, Microsoft CEO Steve Ballmer spoke with language clearly influenced by Jobs:
“We will continue to work with a vast ecosystem of partners to deliver a broad spectrum of Windows PCs, tablets and phones. We do this because our customers want great choices and we believe there is no way one size suits over 1.3 billion Windows users around the world. There will be times when we build specific devices for specific purposes, as we have chosen to do with Xbox and the recently announced Microsoft Surface. In all our work with partners and on our own devices, we will focus relentlessly on delivering delightful, seamless experiences across hardware, software and services. This means as we, with our partners, develop new Windows devices we’ll build in services people want. Further, as we develop and update our consumer services, we’ll do so in ways that take full advantage of hardware advances, that complement one another and that unify all the devices people use daily. So right out of the box, a customer will get a stunning device that is connected to unique communications, productivity and entertainment services from Microsoft as well as access to great services and applications from our partners and developers around the world.”
And, breathe…
Understand, I do not come here to mock Ballmer. Nor should the Apple faithful: Tim Cook is probably more like Ballmer than Jobs, after all. Besides, Ballmer did far too much to benefit the company he so dearly loved. And yet, in that single paragraph above, where Ballmer references billions of users, seamless experiences, delight, the integration of hardware and software, sounding so much like Steve Jobs, he grounds everything in the obvious, and the near-term. Contained within that same single paragraph Ballmer specifically mentions…Windows, PCs, tablets, phones, Windows, Xbox, Surface, Windows, Microsoft, partners, partners, partners, partners, and developers.
Ballmer’s statement is the beatification of the current product set, the glorification of the existing order, and fully aligned with the rational. This is not surprising. It’s nearly impossible to not be rational. Certainly this is true if you are the CEO of a publicly traded company.
Steve Jobs was not rational. His vision of the future was not dependent upon existing products, existing form factors, partners, developers, nor the established wisdom.
I lived through the years when Microsoft absolutely controlled the direction of personal computing. I was there for the rise of Google — and its destruction of the value of content and user privacy. I would not have dared believe that the radical visions of Steve Jobs would so thoroughly flourish in this world. It’s all so profoundly non-rational.
Steve Jobs was firm in his vision, proudly revolutionary, shrewd enough to avoid the trappings of both success and failure, and fully prepared to prove all of us completely wrong, no matter how long it took.
I am sorry for ever having doubted him.
All of which is prologue to the obvious: Apple is today’s monolith. All must acknowledge, possibly fear, every move Apple makes, each market it enters. We hang on the company’s every word, spin tales from its silence, and have grown comfortable in the knowledge that, as is the new natural order of things, Apple will succeed with each new release, each blessed launch.
Which is prologue to the less obvious: The next Steve Jobs, when she or he finally arrives, will have Apple squarely in their sites. Then blow it to bits.
It’s a privilege to write here, and a joy to focus on the long-term trends in technology, the rise and fall of companies and leaders, and the impact this region has upon not only America, but the entire world. I suspect Silicon Valley’s output will come to equal the impact of Detroit, my hometown, which effectively created the middle class, ensured the Allied victory in World War 2, and fundamentally altered how and where people live.
Silicon Valley is also a region that rivals Hollywood and Washington for talking about itself. It frequently displays the worst elements of both pack mentality and herd mentality, and aggressively covers up its failings, including a truly dismaying inequality in wealth and an almost gleeful ageism, all while insisting it knows best for California, the United States, for industry, for government, and for the world.
I now live here. These are my personal, unvarnished observations on Silicon Valley.
Almost all of the work in tech is done by companies and by people which tech bloggers pay scant attention to or worse, openly mock.
Patent lawsuits have about the best margins of any product or service in Silicon Valley. Consider that Apple recently won $290 million in a suit against Samsung. All told, Steve Jobs’ thermonuclear war has resulted in nearly a billion dollars in jury awards. If Apple only ultimately collects less than a third, $300 million, for example, that’s still about a 10X or greater return, no matter how they account for legal fees.
Does Coca Cola even make 10X on its syrup?
Computing is the new oil. The Silicon Valley “ecosystem” integrates smart people, start-ups, venture capital, and a cozy relationship between universities and for-profit corporations, has them all working at light speed and with almost zero consideration of the long-term or the existing order of things. It absolutely can be replicated in many parts of the world. This comes with a caveat, however. This area has optimized on this proven model while focused almost exclusively on computing (hardware, software, standards, apps, data, cloud, social media). Unless the copycats focus their efforts on computing-related activities, their returns will never be like what we have here. Note the very limited impact of Silicon Valley’s biotech efforts thirty years in.
Never, ever believe anyone that says Silicon Valley and Washington, DC do not mix. Washington, DC has the power, Silicon Valley has the money. The courtship is in full swing, and it’s far more than simply Washington leaders searching for big campaign contributions and re-election algorithms. Consider that under President Obama, the annual deficit alone is larger than the total value of Apple, the Valley’s biggest, richest company. Follow the money. Silicon Valley and Washington are the new Wall Street and Washington.
I always assume that any start-up whose value is based upon artificial limits is doomed. For example, Snapchat. The company is optimized for mobile, social media and the visual web. That’s almost a can’t miss. Yet, it is riding atop a temporal distortion, a gimmick whereby owners of digital content and services create artificial limits. In Snapchat’s case, the artificial limit is time (e.g. your picture or ad will vanish in 5,4,3,2,1). We all know this is not true. You may remember the briefly popular, and much-blogged-about Mailbox app, which created a sign-up list, despite the near-infinite scalability of such digital services. It may pay off in the short-term, but if you can’t cash out in the short-term, I suspect you will get burned.
There are real limits and there are made-up limits. If the limit is made-up, I don’t invest.
Speaking of investing, anyone using Snapchat for (illegal) insider trading may wish to re-consider their actions.
Almost everything you do online, and almost every time you carry your smartphone with you outside, is a far greater security risk than leaving your home WiFI open. Stop refusing to share. Stop handing over all your private data so easily.
Most people I meet here are very smart and work very hard. This is critical to their success — and to the region. Bonus: most that I meet are good people.
I have been around the world and all about this great country. Nowhere in the US is there a more socially inclusive environment than Silicon Valley — nor a more politically intolerant one. You will be branded if you are a Republican, a conservative. Just so you know.
Connections matter above all else. Except, brainpower. If your brainpower sits atop the 0.1%, you will do exceedingly well. If at the 1%, you will still do great. Nonetheless, and though I can’t say how many people at Apple have actual “humanities” degrees, I can assure you that you better have an engineering degree, science degree, and/or economics degree if you want a good job. It’s not about humanities or the social sciences out here.
Too many here are focused on creating the future or disrupting the current order, and not at all on preserving what is best. This is too bad. Think of all the great stuff we’ve been able to re-capture almost without trying. For example, thanks to iPhone, Yelp and Foursquare, I never again have to eat at fast food joints or franchise restaurants. Now, no matter where I am, I can find a great, local, mom-and-pop eatery. Similarly, classical music in the US, effectively dead on radio, is now readily available, for free, on Pandora and iTunes. I suspect the region is missing a giant opportunity is overlooking things to preserve.
We spend more on apps than on software.
I know of no one here who spends more on television than on connectivity. Internet, WiFi, smartphone and tablet connectivity wildly crush cable television, DVD rentals and the like. And yet, the new cool is to tell the world you’re going to stop reading email, stop tweeting, maybe go off-grid for a week or two. In my experience, no one who tells you this is ever telling you the truth. To be disconnected in Silicon Valley, even for a moment, is to be without air.
In physical space, absolutely no one ever mocks anyone for their choice in smartphone or computer.
Perhaps because there are so many smart, competitive, reasonably well-off people here, but attractiveness and fitness command a premium.
The rest of the world will know soon enough: the best source for breaking news is Twitter. The best links to the best analysis of current events is via Twitter.
In Silicon Valley, the cloud is your real hard drive and your physical hard drive is just a backup, likely to crash.
The last thing we see at night and the first thing we see in the morning is our smartphone.
We get our music recommendations come from iTunes and YouTube.
Design is hard. Really hard. BMW has been making cars for about 100 years. The new 750i is ugly. If BMW still can’t get car design exactly right, 100 years on, it’s probably no wonder that so much hardware, so much software, so many apps, nearly every UI design is so poor. Still, bad design is an obvious failing, with Silicon Valley a leader.
In my time here, I’ve witnessed radically more communications failures and personal angst based on people with obviously different Myers-Briggs assessments than on whether the person was black or white, male or female, for example.
There are so many people out here, so many cars, so little space. Yet barring a literal seismic catastrophe, I believe this area is on a growth trajectory that will continue for at least another generation or two.
If Steve Jobs was alive I would not need to write this column.
He is not, tragically, and yet as I cover Apple, the smartphone industry, and the rapid spread of mobile personal computing throughout the world, I never hear the end of analysts, bloggers — and haters — telling me exactly what would be different if Steve Jobs was alive.
Google “If Steve Jobs Was Alive” and you are delivered 760,000,000 results. By comparison, “If Einstein Was Alive” yields only 142,000,000 results, and “If Jesus Was Alive” a distant 490,000,000. Obviously, people care deeply about ‘what would Steve do’ if he was still with us.
I used to fight this line of questioning, in the vain hope I could make it stop. I failed, and so here I embrace the idea, basing each and every supposition on my knowledge of the man and his work and not at all to prove a point, gain some advantage, nor even start a fight.
If Steve Jobs was alive…
There Would Be No iPhone 5c
The iPhone 5c combines the worst of iPhone 5 with the most iconic of the Nokia Lumia. Worse, it has no reason for being other than as a cash generator. It offers far less than the iPhone 5s and for the price there are far better smartphones available from Sony, Samsung, Nokia and others.
Apple will no doubt make a good deal of money from iPhone 5c, though I don’t believe Steve Jobs would have let that sway him. He would have said no. To quote Jobs: “I’m as proud of what we don’t do as I am of what we do.”
The iPhone 5c is a waste of the very best that Apple can do. The iPhone 5s is the latest truly “insanely great” product from Apple. Its brightness, however, is diminished by the far lesser yet ironically far brighter iPhone 5c. If Steve Jobs was alive, the 5c would not exist.
The Thermonuclear War Would Still Be Raging
Google wildly overpaid for Motorola — for patents. Nokia, near death, clings to its patents. BlackBerry is being sold for a bit more than its cash, its only other assets its patents. Intellectual property matters dearly — few in Silicon Valley understood this as well as Jobs.
Angry at how partners and colleagues shamelessly copied from Apple’s many years of hard work, and no doubt still wounded deeply by what he (wrongly) considered Eric Schmidt’s personal betrayal, the smartphone patent wars would be raging if Steve Jobs was alive.
Steve Jobs could change his mind. He listened to those around him. He knew when to move forward and what to leave behind. The patent wars, however, is that rare Jobs crusade that he would refuse to set aside.
Mentoring Mark Zuckerberg Would Make Him Happy
I am not convinced that wearable computing would excite Jobs as much as it does the rest of us. This despite the cool new “motion chip” in the iPhone 5s and the obvious benefits for Apple Inc. I am convinced, however, that having The Beatles and Bob Dylan always available, for free, via iTunes Radio, would excite him a great deal.
I also believe that mentoring Mark Zuckerberg would bring Jobs much joy.
There is much about Silicon Valley that I suspect would deeply trouble Steve Jobs. So much small thinking, so much incipient press coverage, the bourgeoning NSA – Silicon Valley mash-up, and the near-religious focus on get-rich-quick and sell-for-today.
Mark Zuckerberg is not like that.
I suspect Jobs would look forward to meeting regularly with Zuckerberg, even if just to talk.
The Reality Distortion Field Would Burn Just As Bright
If there is any company that does not need cheerleaders — or to distort reality — it is Apple. The company’s scale is almost hard to fathom. Consider that in less than a week they have sold more than 10 million new iPhones and gotten 200 million of their customers onto their latest operating system (iOS 7). No one else can achieve anything close to this.
Apple is the biggest tech company, has the most profitable global retail footprint, maintains stunningly high product margins, controls the biggest media ecosystem on the planet, and builds the very best mobile computing devices at a time when the world’s billions are clamoring to have one.
Cheering today’s Apple is like cheering on Microsoft — in its fight against Netscape. Right or wrong, it’s not really a fair fight.
But telling us all just how great Apple is was never what the “reality distortion field” was about, at least, not primarily so. Nor was it about masking any of the company’s shortcomings. Reality distortion, so-called, was Jobs’ way of showing us what he saw, of helping us to glimpse the possibilities of the future.
Indeed, perhaps reality distortion is the wrong term. It should be called Jobs’ “time distortion field” instead.
Steve Jobs used his ‘time distortion’ powers to remind us that our talents and abilities, those unique parts of us, would soon be liberated. Apple just needed a little bit more time to make it happen. Each product moving us one step closer.
Discuss
What do you think Steve Jobs would do? About anything? Have at it. Clearly, we all need to get this out of our system.
Do not be misled. Microsoft purchasing (the best of) Nokia — at firesale prices — is a brilliant move. Nokia + Skype + Bing + Office + Outlook + Nokia Maps + Nokia imaging. That is a very powerful proposition.
Apple, however, remains at least one step ahead, and iPhone continues destroying and disrupting all in its path. The mostly wise and semi-literal sacking of Steve Ballmer is but the latest casualty of the iPhone. There will be more.
In less than a decade, Apple’s iPhone has fundamentally altered computing, connectivity, work, play — and industry after industry. Its impact simply cannot be overstated.
Bet you didn’t see that coming.
Ballmer was absolutely not alone, of course, in failing to realize early on that iPhone was the personal computing equivalent of gun powder. Fact is, excepting Steve Jobs and Larry Page, nearly all in the computing industry whiffed on the iPhone’s game-changing potential — until it was much too late. Even the beleaguered Apple faithful, whom cheered when the iPhone was first launched, and aggressively downplayed the device’s initial glaring shortcomings, perceived it as little more than a touchscreen iPod with calling capabilities. They, like the CEOs of tech’s biggest, baddest companies, simply could not fathom how this little device with nearly no buttons, no software and no keyboard would soon re-construct our future, re-make Silicon Valley and devour content like some technological black hole, everything collapsing inside its glowing screen.
Now, we know better. Well, most of us. Far too many remain stubbornly clueless. Despite controlling the most used, most engaging mobile platform on the planet, despite the ongoing turmoil inside the Android camp — and, frankly, I still question Google’s long-term commitment to Android — we are treated to such nonsense as Fred Wilson’s “fear” that Android will obliterate iPhone and iOS.
Hard to take such unthinking proclamations serious. The iPhone is just getting started.
The iPhone Second Wave
Apple has an astounding 600 million users on the same version of the same operating system. This is more than anyone else. Given the global thirst for smartphones, it’s hard not to see this number reaching at least 1 billion in under two years. That ensures at least a decade of self-sustainability. There is more to come, however, much more. I believe the value of each individual iPhone, old and new, is on the cusp of a sizable increase in value and utility.
This is the most under-reported story about the iPhone
iPhones connect us to apps, to the cloud, to the web, to our content. The unstated genius of the iOS 7 operating system, however, is that our iPhones will increasingly connect to each other. This represents yet another fundamental computing shift.
iPhone to web (or cloud) was merely the first implementation of iPhone. Soon, it will be iPhone-to-iPhone-to-iPhone.
With iOS 7, Apple is rolling out AirDrop, which supports proximal one-to-one and one-to-many sharing of apps, web content, photos and other services. The new iOS will also leverage iBeacons, allowing us to connect our iPhone with (Apple-approved) wearables and intelligent accessories.
The value of these interactions is not derived from the web, but device to device, location to person.
In other words, Apple is on the cusp of having a billion users on the same platform, their computers always in hand, everywhere they go, connected to each other in physical proximity, not via the web, not via the public switched network, but iPhone to iPhone. I can only begin to fathom the unprecedented innovations we will quickly witness in location-based social sharing, gaming, and commerce.
Only Apple Can Do This
No one else has this. No one has ever even had this potential.
Yes, Android phones are far more prevalent. Yes, Google does a far better job of connecting us to all that the world wide web offers. But, only Apple will be able to connect us en masse to one another, device to device.
Think of three modes of connectivity. All are vital, all are valuable.
Apple does the very best job of connecting user with device — via the most intuitive operating system and a richer, simpler ecosystem.
Android does a better job of connecting users (and their devices) to the real-time and increasingly personalized richness of the world wide web.
The third path is entirely new: connecting device to device for all manner of sharing of content, data, money, photos and whatever else clever app developers invent.
Again, this is something only Apple can deliver. Hundreds of millions of devices, nearly all on the same version of the same OS, similar hardware, same modes of connectivity, same (Apple-based) standards, same simple method of sharing, same payments and distribution platform.
It will take years for Microsoft-Nokia, or Samsung or even Google-Motorola to catch up with, if they ever can.
My advice: Do not once again underestimate iPhone’s impact. It’s just getting started.
Apple is doomed. No innovation, no market share, no new products, no Steve Jobs. Death — soon — is all but certain.
This is the consensus, at least, from mobile analysts, Nobel-winning economists and tech bloggers alike. It’s nonsense, of course, the product of a herd mentality tucked inside a middle manager’s vision. Apple has the best mobile computing products in the world, controls the most robust mobile computing platform, and operates the industry’s largest retail footprint. Apple’s near-term future is as secure as any company, ever. Indeed, with Microsoft now in the throes of long-term turmoil, and Google’s CEO placing bets on every square in hopes of once again hitting the jackpot, expect Apple to pull even further ahead of the competition.
That said, Apple attained its present lofty status by embracing “crazy” ideas — ideas that changed the world as well as the company’s fortunes. In that same spirit, here are my crazy ideas to make Apple even bigger, even better, well into the future.
Are you listening, Tim Cook?
Lay Down (Arms) With Google
Apple and Google are the superpowers of global tech and they do not like one another. Thermonuclear war, however, is of little value to anyone.
I propose a “cold war” solution: Apple and Google sign a long-term licensing agreement. Google will abandon Android, and instead optimize its mobile services, all of them, for Apple’s iOS. In return, Apple will offer nearly unfettered access of its iOS platform to Google engineers.
Under this scheme, Apple will sell vastly more devices, continue to earn sky-high profits on hardware, and provide its (billion plus) customers with the best mobile experience on the planet. Google liberates itself from the Android noose, which has cost it billions already. Since iOS users are far more engaged with their devices, Google also receives more and better data using my scheme, which enables them to offer more and better advertisements.
Lastly, this frees up Apple to focus on what it does best. After all, there is a very real chance that iCloud, Siri, Maps, Spotlight, Mail, Calendar, et al, will never be as good as the Google equivalents. Jettison them all.
Merge With Samsung
Not sold on a Apple – Google partnership? Challenge accepted. Instead, Apple should merge with Samsung, their only real threat for smartphone sales.
While many still view Apple as a “computer company” this is misleading. Imagine a pyramid with design at the top, software beneath that, retail below that, electronics and materials next, and supply chain management at the bottom. Samsung is similar, albeit with a far wider base and increasingly less skill as you venture up the pyramid.
Samsung makes some of the very best affordable washers, dryers, refrigerators and sundry other gadgets and appliances. Unfortunately, every one of them is needlessly complex. As everything becomes a “computer” and as the interface to every computer becomes our touch or our voice, we need Apple’s design and UI expertise more than ever.
Apple + Samsung equals the greatest global electronics design, development, manufacturing and distribution conglomerate in the world, ever.
Own F1 And Kill Cable Television
Apple TV remains a “hobby.” This may be fine for Tim Cook, but it sucks for the rest of us. Because the rest of us continue to pay far too much money for television content we do not want.
Why should we pay for 24 hours of ESPN, for example, if we only watch it 30 minutes everyday? Fox News dominates the ratings while MSNBC barely rises above statistical noise. Yet, we are required to purchase a “news” package that includes both. We want to watch a favorite series yet are forced to buy the entire channel’s programming line-up. This all seems terribly unfair and criminally outdated.
We need Apple. Before Apple can remake television, however, they will need to own top tier content.
I suggest Apple buy the massively popular F1 and the English Premiere League. Make these available solely via Apple TV. Fans of these sports will purchase Apple TV units in droves and quickly learn that the best viewing experience is the one that Apple already suggests (if not quite yet realizes): buy just what you want to watch, when you want to watch it, no matter where you are located, and no matter on what screen you prefer (TV, smartphone or tablet).
Speak Often And Kill The Bloggers
There was a time when Apple was left for dead. It was during these dark times when an Apple priesthood sprang up, discussing every new product, praising every minor change, and writing daily on the wonders of Apple — keeping the few believers securely within the flock.
Tiny pirate Apple is dead, yet the Apple blogger ecosystem, like kudzu, is everywhere now, and does more harm than good, I think. Apple bloggers, now bursting with readers and well-heeled sponsors, oblige both by touting every whiff of every rumor.
When Apple finally does release its newest product, we are instantly let down. We already knew. Our disappointment is further compounded because Apple inevitably fails to live up to many of the craziest rumors.
Apple should speak to the press and to the public on a regular basis. We shouldn’t need to get our Apple news from second-hand sources anymore.
Take Control Of Windows
To change the world you have to be crazy enough to believe you can. Case in point: Apple should buy Windows.
Microsoft’s generations-long hold on the personal computer operating system is in its dying days, laid waste by Apple’s iOS and Google’s Android. The more Ballmer and his successors focus on protecting Windows, the quicker they accelerate the company’s demise. To survive, Microsoft must focus on applications and devices, not operating systems and bundled software packages.
That said, there is value in Windows. Or, at least, the Windows team. They built a platform that worked for well over a decade for well over a billion users. More impressive, they did this without controlling the hardware!
Apple will soon operate at least two platforms — iOS and iTunes — that will touch more than a billion users. This is foreign territory for the once small American company. But it is not foreign for Microsoft’s Windows team.
Stay Crazy After All These Years
I have many other crazy ideas, in fact. Buy Bloomberg and use ownership of financial data to swarm the enterprise, starting with banks and financial institutions. Go private, and use some of their cash for an “endowment” to keep the company alive forever (yes, literally).
Buy Tiffany’s and create a new line of premium-priced computing-based “jewelry.”
Integrate iCloud, fingerprint technology, and an open API. Touch any connected screen and it instantly re-calibrates itself to our preferred, personalized settings, ST:TNG-like. In this way, Apple becomes the company that manages every screen in our life, everywhere, all the time.
I know, I know. None of these make sense, none will work, they will never happen. But maybe Apple needs a jolt of crazy.
Steve Ballmer, Microsoft CEO, is officially out — sometime in the next 12 months. Another victim of Steve Jobs and the iPhone.
Blame that crazy, rebellious vision of Jobs which somehow changed the world, rendering Microsoft and the once impervious Windows as nothing more than fat, dumb, slow-moving dinosaurs.
Note the radical shift in value for Apple ($AAPL) from the very day the iPhone was first released (29 June 2007). Note Microsoft, standing still. Microsoft stayed big as the new world favored the small, the fast — the mobile.
Ballmer, for all the good he did for Microsoft — and anyone who says differently is either too young to be taken seriously, or too foolish to be tolerated — made the singular critical strategic mistake that has befallen so many of his ilk: a belief that the past is prologue.
Whereas Steve Jobs sought to destroy everything in his past, to remake the world, Ballmer sought to bring more and more of the past into the future. Ballmer’s way was right, for nearly a generation. Then it was completely wrong.
From the early days, when Microsoft became the Bill Gates – Steve Ballmer show, the men and the company were stunningly rewarded for pivoting from a software application company to a computer gateway troll. With Ballmer as the giddy lead tackle, Microsoft singularly changed computing: a computer was placed on every desktop and every computer required Windows to function.
There was no alternative. None. Every competing company was killed off. Excepting, Apple, which lay on the ground, bloodied, beaten and nearly dead.
As Steve Jobs remade himself, so too he soon remade Apple. Jobs understood immediately: to survive against Microsoft, there was only one way: to alter the very definition of “computer”.
As Ballmer clung to the strategy that had so richly rewarded Microsoft, building gateway upon gateway, attempting to create a “standard” for PCs, for gaming, for businesses large and small, for the Internet itself, Apple — under Jobs — took an alternate path: highly personal, highly mobile computers, with no keyboard, no mouse, and a relatively non-existent operating system.
A generation from now, perhaps Tim Cook will be forced to leave Apple, having missed some massive tectonic shift, just as Ballmer did.
Handicapping the Next Microsoft CEO
Steve Ballmer made many people very rich, few more so than himself. His future is secure. Microsoft’s much less so. A decision looms large for the company’s board: who will be the next CEO?
I caused quite a stir back in 2011 when I predicted the death of both Windows and Office by 2016. Time will prove me right. Nevertheless, right or wrong in my prediction, I believe that the next CEO of Microsoft must radically re-make the company. This will not be an easy task. As we learned once more with Ballmer, it is extremely hard for any CEO at any company to not focus on those areas that are raining down cash.
The new CEO must, however. Windows and Office have a limited future, no matter the profits they are bringing in today.
I believe the next CEO of Microsoft will be Stephen Elop, the current CEO of Nokia. Nokia is mobile and global, exactly what Microsoft needs.
What about you? Vote — and leave your comments below.
I’ll trade you one Twitter re-tweet and a Facebook Like for two LinkedIn endorsements. Deal? How about if I throw in a recommendation on Yelp?
In a world where it seems as if everything has a value, adjusted in real-time, tailored for each specific person based upon their unique wants, needs, interest and location, auto-managed by Big Data, leveraging platforms eagerly funded by Silicon Valley, and all of it executed by a ever-expanding range of bartering algorithms which forever traverse the world wide web, why is it so damn hard to put a actual price on anything?
Excepting Apple products.
I love love love the fact that Apple cares enough about its products – and me – to put a specified price on each of its products, clearly marked, unchanged by locale or season or aggressively savvy salespersons.
Want a Mac? An iPad? Want to download that song on iTunes? Want to purchase that book on iBooks? Want that newest app? The price is obvious. No games, no gaming.
Why is it that so few tech companies, even (supposedly) great ones, are unable to match this simple act?
Microsoft Office has been around for about 20 years. I would honestly not be surprised if every single reader paid a different price than I did. Worse, if you want an online version, or want to be able to access Office on your iPad or Android, for example, you may need to hire an accountant to decode the pricing scheme.
This is not done for our benefit.
I am here, money in hand, ready to buy your product. Just tell me: what does it cost? It cannot possibly be so hard to answer so simple a question, can it?
I’m not simply picking on Microsoft. Amazon is constantly gaming me. Offering an endless series of deals, specials, “gold boxes”, cheaper prices if I subscribe to Prime, free stuff if I get a Kindle, virtual coins if I download their Android store.
Still worse, they further compound their anti-customer complexity by offering different prices for the exact same product to different customers. Apparently, Amazon’s big data cloud can alert the company in real-time to exactly how much I am (really) willing to pay. Clever tech, I suppose, but it makes me feel used and cheated.
Apple seemingly stands alone in standing behind its products. The price is listed, take it or leave it.
Google, meanwhile, dares not charge any of us for their service. This speaks volumes. Of course, while they may be unable to divine a price for their very own search and map offerings, they’ve clearly determined how much I am worth to anonymous advertisers.
It really is this radically simple: Build a great product, one that is desired, and market demand will ensure you always achieve the optimum price. Construct a sub-par offering and you must always play a sort of Big Business version of three-card monty.
For example, can you actually tell me how much you paid last month for cable? You’ve had cable television for years. They send you a bill every single month. Yet you aren’t sure of the price being charged? Really? How much does your HBO cost? ESPN? Cable without ESPN? These really should not be unanswerable questions.
Why did every single person on the very same flight pay a different price than you? Does that make you feel like you cheated someone – or were cheated on? Can all these various businesses really only succeed by using vastly superior computing resources to effectively steal from us?
Not Apple. Not Steve Jobs.
Yes, Jobs was a “product guy,” a visionary, a demanding SOB – one of the crazy ones. He was also a damn smart businessman. Jobs understood that gimmicks and obfuscation are the hallmarks of those unable to offer a truly great product.
Do not be fooled. The oft-promoted notion that our personal algorithms will latch themselves to various network bots and travel the “google” and buy what we need at the best price available, is a con.
You really think your “price bot” will ever out-compete Amazon’s or Google’s?
It’s time we use our sizable purchasing power – all of us – and disrupt Silicon Valley and the Big Data hegemony, which insists upon ever-changing prices, at inexplicable times, for unknowable reasons, based on their constant and hidden buying and selling of who we are, what we care about, and what we need. This is a game we can never win – because it’s been designed to work against us.
Of course, this battle cry should not be considered a call to revolution. Rather, a simple demand for the obvious: Show me your product. Tell me the price. I can then make the decision if it’s worth it. That’s all I’m asking for. And that’s exactly what Apple delivers. It’s just another way they make my life easier, better.
Steve Jobs was on our side. Too many others are not.
Intelligent debate is welcome and there are many questions surrounding Apple’s newly announced Apple Watch. But patently dumb allegations should not be debated — they should be mocked. So here are a couple (hundred) of my most unfavorite quotes, in all their glory, arranged sorta, kinda alphabetically by topic. Let the mocking begin.
Did you take pictures at public events using a ginormous tablet? Of course not. Who would do that? Well, turns out, lots and lots of people. (And it’s usually the ones seated just in front of you.) Why the change in behavior? Change in technology.
Apple will launch a mobile phone in January, and it will become available during 2007. … After a year a new version will be launched, but it will lack the innovation of the first and quickly vanish. The only question remaining is if, when the iPod phone fails, it will take the iPod with it. ~ Bill Ray, The Register, 26 December 2006
$500 fully subsidized with a plan! I said that is the most expensive phone in the world and it doesn’t appeal to business customers because it doesn’t have a keyboard, which makes it not a very good email machine. ~ 
It’s as if Steve Jobs was speaking to us — and particularly to Tim Cook — from beyond the grave. Tim Cook has to be his own man and do his own thing. We know he’s got the know-how to do the job. We’ll have to wait and see if he, and Apple, still retain the know-why.
I suspect they can offer this because you will soon discover you have agreed to purchase far more than you really need. Win for them, less so for you. Plus, if you are subscribing to Amazon — for anything — you can’t spend that dollar anywhere else. Share of wallet and all that.
With all due respect, you simply cannot compare the creation of a movie franchise to the creation of a disruptive, game-changing, category creating product. They’re at different orders of magnitude.
It’s not as if Apple’s tech competitor’s have gotten any traction in the marketplace with the “next great thing” in tech. In fact, when it comes to products like wearables, tech companies clearly don’t have a clue what they should be offering. They keep throwing every conceivable sort of device at the consumer in the hope something sticks and the consumer, in their turn, keeps chucking everything right back at them.
Anyone who follow Apple closely knows that they are a bundle of paradoxes. One of the most baffling of these is that Apple has literally tens of billions in excess cash but seems always to be chronically short of critical software engineers.
Real Genius assures us that we can remain fully ourself, with all our quirks, all our awkwardness, and still be welcome into its egalitarian world. The movie likewise reveals that to love what you do, love what you are good at, love working with others who feel just the same, then it’s not really work at all, its’ more a calling.
In so many ways, ways we now take for granted, ways that Google and Microsoft are rapidly trying to copy, it was Jobs who showed us the way — even as we all were convinced of his wrongness. Jobs proved us wrong not just on technical matters, but on profound aspects of both technology and business.
I propose a “cold war” solution: Apple and Google sign a long-term licensing agreement. Google will abandon Android, and instead optimize its mobile services, all of them, for Apple’s iOS. In return, Apple will offer nearly unfettered access of its iOS platform to Google engineers.
