I’ve written about the supposed end of Apple’s world dominance before.
Now Dave Smith of Business Insider questions the direction CEO Tim Cook is taking with the company founded by Steve Jobs. Of late, certain decision by the Cupertino company, as pointed out in Mr. Smith’s blog post yesterday, have left people wondering if Apple is loosing focus on its core business.
Many may remember Jobs was famously ousted from the company he and Steve Wozniak founded back in the 80’s only to be asked back in the 90’s (after creating a little software animation company called Pixar).
The first thing Jobs discovered when he returned was that the company had too many products:
“It was insanity,” Phil Schiller, Apple’s senior vice president of marketing who was working for Macromedia at the time, told Steve Jobs’ biographer Walter Isaacson. “Tons of products, most of them crap, done by deluded teams.”
Jobs immediately scrapped those product lines and focused solely on making a few products very good. That became the secret of Apple’s success.
With the help of lead designer Jony Ive, Steve Jobs started creating pcs used by a core group of fanatics. They include graphics designers, editors, video producers and creatives the world over.
The hardware and interface was so polished and designed so well, no one cared they were paying hundreds more than the competition.
The next great success would be the ipod, which would revolutionize the tech and consumer world. The company created a newer and better way to listen to music by creating a device that can store your entire music collection in your pocket.
As both a platform for acquiring and paying for music, it can be said, Apple forever changed music distribution and put an end to CD’s and music stores using a single intuitive piece of software, called itunes.
While Microsoft actually beat Apple to the mobile platform with the pocket pc and palm with the palm pc (later webos) and finally blackberry – when the company entered the market place it blew all those companies out of the water.
The iphone and later ipad were so innovative and new and polished, it forever changed the landscape. Its decision to move to apps, which required programs to be rewritten from the ground up, did away with away with keyboard and mice.
Apps consumed less battery power because it was less cpu and gpu reliant. The move was revolutionary and changed everything. It was something only Apple could get away with.
But there is another unprecedented decision Apple made early on that people frequently over look. On the business side, the decision to store money and patents outside of the United States gave Apple the capital it needed to invent.
The company, over the years, has saved 100s of billions of dollars in taxes by parking their money in Ireland.
A former company executive and Irish officials told Reuters the almost tax-free status dates all the way back to Apple’s arrival in County Cork 32 years ago.
Apple must have seemed attractive to Ireland and to Cork. Amid a generally moribund Irish economy, Cork had been hard hit by the closure of its shipyards and a Ford car plant, and in 1986 nearly one in four were out of work in the city.
In the early days, Apple’s staff sat down to meals together. Now the company employs 4,000 in Ireland.
“There were tax concessions for us to go there,” said Del Yocam, who was Vice President of manufacturing at Apple in the early 1980s. “It was a big concession.”
In fact, the deal was about as good as a company can get.
Many believe the company would have had to pay the US almost 60 billion in back taxes if that money were collected today. For these reasons and more, Apple changed the landscape forever and became the most valuable company for all time.
But that was then and this is now.
First and most importantly, Steve Jobs died in 2011 of pancreatic cancer.
Next, the EU has been pressuring Apple and Ireland to end tax avoidance schemes. They recently took the company to court and won a judgement from the European commission. Apple has been ordered to pay 14.5 billion in back taxes to the EU
Ireland mulls an appeal. Apple has even signaled it will repatriate funds back to the US. For sometime CEO Cook has been asking for a corporate tax rate to be reduced to 35% from the new American President. He will most likely get it with Donald Trump.
Now, according to Mr. Smith, Apple is exhibiting the same worrying behavior it has in the past:
Today, Apple sells about 46 models of its various hardware products, from phones to tablets to watches and computers and beyond. But more important than the sheer number of products is the number of legitimate complaints about these products.
He goes on to list the many problematic Apple products:
The iPhone has a bug that users have been complaining about for some time. The phone shuts off for no apparent reason even with a full battery. Apple has yet to fix the problem.
The MacBook Pro
Removal of the SD card slot has a lot of people upset. Those graphic designers and editors that loved the laptop so much used the SD card slot on their projects. Now it’s gone in favor of add ons (see below). Also a pet peeve,cost is too high and battery life is too low.
The Bluetooth headphone replacement look bad and are costly.
The article continues with the Apple Watch (worst home screen ever)/ iCloud (bad interface), Apple TV (the remote is awful), Siri (although Apple was the first out of the gate, Alexa by Amazon and Google Assistant are much better at recognition and function) and Apple’s App Store (along with iTunes is too clunky and needs improvement).
The article also reminds us how smart an ad man Steve Jobs was. Commercials for his products were iconic, from the famous “1984” commercial to the hip ipod silhouette ads. Apple’s two latest ads featured Brad Garrett as Frankenstein’s monster and a 30-second clip comparing the new MacBook Pro to the inventions of gravity, fire, and toilet paper — really.)
In addition according to Smith Apple has talked about expanding to driverless cars and VR while neglecting iconic properties like the Mac Pro.
A man would go broke betting against Apple. But past is prologue. Are the company’s best days behind them? Is Apple repeating bad habits and focusing on too much instead of perfecting a core brand? And if so, who will step in to save it this time?