Apple introduced the two new iPhones in a typical presentation. The stock market, tech media critics, and competitors blasted the news as too little, too late, nothing to see here, move along. Meanwhile, customers are already lining up at Apple stores.
What’s Really Happening?
I’m on record as saying the problems with government are not so much the elected officials as it is with those who elected them.
When it comes to what’s wrong with Apple and the new iPhones, it’s not so much the phones themselves as it is the company’s many critics.
What is wrong with the new line of iPhones depends upon which perspective the critic, writer, or customer prefers to take. It’s a choice, not a fact.
Apple is known as a technology innovator, and any new product announcement is met with howling criticism unless the company’s new products are disruptive game changers.
Or, so it is when critics and pundits rewrite history. Remember the iPod? It was a disruptive innovation to the portable media player industry and roundly criticized by the tech media.
The iPod dominated (and still does) portable media players until the iPhone came along. Oh, yes. The iPhone heralded the new smartphone era, but was also criticized by technology pundits.
The iPhone was overpriced, under powered, didn’t come with 3G capability, and very few apps. Yet, the iPhone ushered in a sweeping change to the smartphone landscape, demolishing Motorola, HTC, Samsung, Microsoft, and others.
Historically, Apple engages in two types of innovation. The first, disruptive innovation is what causes massive change to a market segment. The iPod, the iPhone, the iPad are all examples of disruptive innovation.
Can you name another company that has spawned four disruptive technological changes?
The second is iterative innovation, or simply polishing and improving products until the next disruptive innovation occurs. That’s where Apple is at the moment, steadily improving the product line.
So, what’s wrong with the new line of iPhones?
Nothing. The iPhone 5S advances the smartphone bar– the first with a biometric fingerprint identity sensor, and the first fully 64-bit CPU and operating system. Otherwise, it’s just an improved iPhone.
The iPhone 5C, on the other hand, is more or less an iPhone 5 but with a few improvements here and there, a colorful polycarbonate case, and a slightly lower price tag.
Critics Don’t Run Businesses
Apple is taking a lot of heat from the aforementioned critics for not engaging with the cruft of Android smartphone manufacturers and putting out a much less expensive iPhone for the masses. Good for Apple. Name a profitable smartphone maker that uses Android OS and isn’t named Samsung.
Just in case you hadn’t noticed, the iPhone 5 was discounted here and there over the past year as supply began to exceed demand. A discounted price often increases demand. I have no doubt the iPhone 5C also costs less to manufacture than the original iPhone5 yet probably has similar margins. That means Apple can institute discounts here and there to increase demand.
Critics claim Apple must build a cheap iPhone to compete against Android, which owns somewhere around 80-percent of the emerging smartphone market. Apple has experience in the David and Goliath scenario. Windows PCs maintain and 80-percent to 90-percent marketshare, with Apple’s Mac taking up most of the rest. Yet, it is the Mac that is the most profitable line of PCs, so it should be obvious that marketshare doesn’t equate to profits, yet it is profit which equates to longterm survival and prosperity.
So, what’s wrong with Apple in 2013? It’s easy to make a list, but Apple looks healthy and still acts like, well, Apple. Meanwhile, Microsoft is throwing away billions to remain less than relevant in the post-PC era. Google has spent tens of billions on the Android venture yet has no profit or return on the investment. Other manufacturers are but a ghost of their former selves. Nokia. HTC. Motorola. BlackBerry. Dell. HP.
Apple seems to be operating much like Apple has for the past dozen years or so. Customers stand in line to by the latest and greatest. Apple laughs at critics all the way to the bank. Same old Apple, no?