Even when Apple , was mainly a computer manufacturer, people used to compare it to BMW. It was because it made animal, nicely designed products for a niche market composed of wealthy, design-conscious customers who also served as an enthusiastic – nay – fanatical evangelists to fire. It was seen as innovative and quirky but not part of the industry's mainstream, which was dominated by Microsoft and the companies that make PCs, ran Windows software. This view of Apple was summed up by Jack tramiel, head of the Commodore, when Steve Jobs showed him first Macintosh computer. "Nice, Steve," growled contentedly and Tramiel. "I guess you want to sell it in stores."
It was a long time ago. Now is the Apple with a market capitalisation of just over $ 331bn, the second most valuable company in the world – bigger than Microsoft ($ 220bn), Oracle ($ 167bn) or Google ($ 196bn). Quirky little computer company has grown to a giant. But not necessarily a huge-friendly variety, as the world's magazine publishers have recently discovered and as music and software industries have known for a long time. To Apple now controls the commanding heights online content business, and it seems to do the same mobile phone company. At the moment it looks as though no one has a good idea of how to stop it.
Each year, Fortune magazine sends queries to a sample of us CEOs asking for their opinions of their competitors. Results for the year 2011 has just been released and they show that the Apple is the "most admired" company in the United States. This is the sixth year in a row, it has held this title.
The reasons are obvious. Product page creates Apple beautifully designed, extremely functional and user friendly devices, joy customers and give fat profit margins; It has a culture which reliably delivers these products at specified dates; It is much more innovative than any of its competitors; and it has a unique mastery of both hardware and software.
On the strategic side, has the company displayed a deep understanding of technology and an astute assessment of potential devices and services that people will pay over the odds. Most CEOs would kill to run a business, each having a quarter of these competences. Apple seems to have all of them. Its current dominance is built upon three main ideas. First is that the design really means something. It is not something you can outsource to a design consultancy – which is what most businesses do – and design is as much about ease of use, as it is about aesthetics. The second insight was that of illegal music downloading maelstrom triggered by Napster could not item, and the first company to offer a simple way to legally buy music (and, later, other types of content) online would clean. And third — and most important – there was insight that mobile phones are really just handheld computers happen to make voice calls, and that it computing is the bit that really means something.
Most of the media comment about Apple attributes all these insights to its charismatic Steve Jobs, co-founder, with the explanatory statement, that Apple Renaissance began when he returned to the company in 1996.
It may well be, although it seems unlikely that such a comprehensive corporate recovery could be a single person, no matter how charismatic work. What is more plausible is that Apple's corporate culture trains on some of the characteristics of its CEO personality, much as Microsoft was once a corporate extension of Bill Gates, with all that implied in aggression and drive.
Regardless of the legend, is that Apple now has a dominant position in several Central enterprises (content distribution and mobile computing) and have a seriously disruptive consequences for the mobile phone industry. In particular, its iTunes Store it control over tollgate through which billions of paid for music tracks and albums, videos, and apps cascade down to millions of customers worldwide. It charges a Commission on anything that passes through this gate. And each Apple mobile device sold can only be activated by connecting to the entrance.
This will give Apple unprecedented power. Plenty of other organizations offering paid for downloads, but none have credit card information with so many internet users are accustomed to paying for things online. This was a reason why holders of printed periodicals began to slaves when iPad appeared. Here at last was a way to get people to pay for online content: just make it available on iTunes and let Apple collects money. It rankled sure that Apple took 30%, but – hey – at least it would bring an end to the parasitic free riding, which was endemic on the web. In the future, the web was dead: publishing of magazines as iPad apps was the future.
Then Apple changed abruptly with the rules of procedure, stipulates that any salesperson a digital subscription on a Web site publisher must also make the same subscription offer within app from Apple would take a cut of 30%. Publishers have been furious over this, but there is nothing they can do about it if they wish to do business on the iTunes store, you have to do it the Apple way.
This was just one example of the large unfriendly Giant flexing its muscles in itself, but it could be a harbinger of the future.
Umberto Eco once wrote a memorable essay claimed that the Apple Mac was a Catholic entity, while the IBM PC was a Protestant. His reasoning was, like the Roman Church, Apple offered a guaranteed route to salvation — Apple way – provided a fixed to it. PC users, had, on the other hand, to take personal responsibility for the work out of their own routes to heaven.
ECOS metaphor applies with a vengeance for the new generations of Apple iDevices, which is strictly controlled appliances. You think maybe you own your lovely, shiny new iPhone or iPad, but in reality, an invisible virtual string connects it back to Apple HQ on an infinite loop, Cupertino.
You can not install anything on it, which did not have the prior approval of Mr jobs and his subordinates. And if you are foolish enough to break the rules and examine your own path to salvation, so that you can find when you next attempt to synchronize with iTunes, as it has become an expensive paperweight, designed beautifully. If there is no power, so I do not know what is.
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