Remember when Apple was beleaguered? It seems as if it was only yesterday that we die-hard Mac fans (that’s all Apple had back in the day) would see Apple dead and buried in our lifetimes.
Apple vs. The World
No doubt about it. Those days are gone. Since mid-2001 we’ve seen a resurgent Apple. Not only are the Macs the best ever today, so is everything else Apple cranks out.
After surveying the landscape recently, I’ve come to the conclusion that what Apple is doing to the competition could be considered a crime.
If it just weren’t so awfully funny and fun to watch. Like a train wreck where the bad guy gets his due in slow motion.
Allow me to step away from reviewing Mac apps ad nauseam, and tell you what I see happening in the tech world. Apple is sticking a fork in competitor after competitor.
It all began with iTunes and iPod. Who saw that coming? Who’s the number one portable media player maker now? Who’s the number one music retail store anywhere on the earth?
Speaking of retail, remember when all the tech pundits said Apple’s new stores were doomed to failure. The worldwide number of stores is pushing 400 stores and who makes more money per square foot in retail than Apple?
Then, Apple decided IBM and Motorola were not fit to place their wares into the Mac, and in a single swell foop, Apple eliminated a barrier to purchase by switching Macs to Intel, and letting Windows run alongside (inside) the Mac.
Then, Apple protected iPod and iTunes turf with the next generation computing device. The iPhone. Who saw that coming? True, the iPad isn’t much more than a giant iPod touch, but somehow no one but Apple saw that coming, either.
What does that tell you about both the technology pundits and Apple’s competitors?
A List Of Victims
Where has Apple’s fork been stuck recently? iPod competitors? If you can name one, go ahead. Online music stores? They exist, but Apple’s is the 800-pound gorilla of online stores.
Smart phones. Remember those? Apple said they weren’t so smart. Goodbye RIM and BlackBerry. Goodbye Motorola. Goodbye Nokia. All the big dawgs are losing money hand over fist and in a hurry. Even Google can’t figure out how to make any real money in the smart phone racket.
Meanwhile, all the iPod killers have been killed. Ditto for all the iPhone killers. And, it didn’t take long for iPad killers to die off, either.
Who’s left? Microsoft. Does Apple have a fork sticking in Microsoft. In a word, yes.
Microsoft’s most successful products are Windows and Office. Anything else? Nope. Well, maybe keyboards and mice, but those profits are anemic rounding numbers on the bottom line. The company has failed in search, failed in games, failed in tablets, and failed in phones.
By failed, I mean no return on investment and no appreciable profits. Compare that to what Apple reaps on iPod, iPhone, iPad, and Mac. Huge profits. Profits that now dwarf Microsoft.
The fork is stuck into Microsoft so deep that the company can’t even launch a decent iPad competitor, despite originating mainstream tablets over a decade ago.
What about the new Surface tablets. Uncooked. Microsoft’s Surface launch was so hurried they didn’t have time to bake the wares; software or hardware. They didn’t demonstrate Windows 8 Pro or Windows RT or the built-in apps or the sleek-looking keyboard covers.
No prices, no launch dates, no battery life, no apps. Is that how an Apple competitor thinks they’ll compete with the iPad and an easy-to-use online store of 300,000 inexpensive tablet apps? That’s a huge problem for Microsoft. They’ve made their money by stuffing Windows and Office, both expensive components of modern computers, into OEM PCs.
Meanwhile, Apple sells popular Macs which have higher margins than PCs. Apple makes profits. Big profits. PC makers don’t. The same holds true for iPhone and iPad. High margins and low cost OS and apps.
How can Microsoft compete against that combination? Not well, apparently. In fact, Microsoft’s OEM partners don’t want anything to do with a Microsoft OS tablet, so Microsoft was forced to design and build their own iPad competitor. It ain’t easy, eh, Microsoft?
Even search engine king Google is having problems at Apple’s hand. Android is a huge money loser for Google. How so? Android OS is given away free to smart phone and tablet makers. There’s no revenue there, let alone a return on Google’s investment.
What about advertising? That’s not working out so well, either, thanks to Apple. The iPhone maker has diverted typical, traditional Google searches, and advertising links, to inexpensive apps with focused search, completely bypassing Google’s advertising. Is it any wonder that Google has invested so much in Android and Motorola in an attempt to stop Apple’s reinvent of the search engine business?
Death By Strangulation
What you are witnessing at Apple’s hand is the slow death of major players in four industries. PCs. Smart phones. Tablet PCs. Search.
Most PC makers struggle to make money, continually slashing prices to compete with other makers who have the same problem. Customers don’t want to pay a premium for a Windows PC as they do with Apple.
Smart phone makers struggle to make a profit for similar reasons. Android OS is free, but profits are scarce as makers race to the bottom by slashing prices.
Tablet makers, what few remain, face a similar issue, except profits are non-existent as iPad competitors simply fight for a meager share of unit sales, including Amazon’s Kindle Fire.
There are three major players in search engines. Google, the dominant player, makes money from advertising. Microsoft, second to Google, has yet to have a return on investment and profits are almost non-existent.
Three? Apple. While Apple doesn’t compete directly against Google or Microsoft, either on desktop or notebook PCs or Macs, the iDevice maker created a growing ecosystem of low priced apps which divert search actions and results from Google and Microsoft.
Think about how much you use Google or Bing to search on your Mac vs. how much you use either to search on iPhone or iPad. There’s a difference and it’s burning both Google and Microsoft badly as the trend is away from traditional computing devices to handheld mobile devices where Apple makes the most money.
Apple has exerted a slow, steady, and increasingly deadly strangulation hold on Google, Microsoft, Motorola, Nokia, RIM, Dell, HP, and others. Companies live on profits and those are drying up quickly as Apple takes the lion’s share (no pun intended) or being diverted elsewhere. Profits are used to develop new products and markets. As profits decrease or disappear, how will companies on that list compete against Apple?
Now, imagine what could happen when Apple decides to enter the television and content distribution business.