That’s why Apple must re-invent the automobile as we know it. Why? Look at how much software is in today’s most mundane car brands. Dashboards are like controls in a jet airliner; complicated, complex, and a necessity for modern driving. Thanks to technology the automobile industry stands on the threshold of a brave new world which marries convenience and transportation in ways only science fiction writers dreamed of a few decades ago.
Self. Driving. Zune.
Google has been touting self-driving cars for years. Tesla’s latest models can drive themselves down the highway, virtually unattended, and a growing number of cars can already park themselves as well or better than most humans.
What’s the world coming to? Self driving automobiles and that means a merging of software and hardware the likes of which the transportation industry has never seen. Where is Apple in this coming revolution? Outside of Car Play— Apple’s standard that lets your iPhone integrate with your car– only Apple knows.
What Apple is very good at doing is disrupting industries with a clever mixture of hubris, hardware, and software that solves problems and evokes usage in ways people never thought possible. How about a quick history lesson?
Apple Computer – Apple’s first PCs were unique, expandable, somewhat geeky but usable by school children.
The Mac – Apple did not invent the graphical user interface, but it brought point and click to the masses.
Apple Store – Name a retailer that serves more customers and sells more hardware per square foot.
iPod – The portable media player was not invented by Apple, but the iPod became synonymous with pocket-sized devices that played music.
iTunes – We can argue than one beget the other, but it doesn’t matter. iTunes needed iPod, iPod needed iTunes, but together they became the world’s largest retailer of music, movies, TV shows, and, yes, podcasts.
iPhone – Apple’s original goal was 1-percent of the smartphone market. Today, the company controls 95-percent of the industry’s profits, and the iPhone is the standard by which other smartphones are judged.
Watch – Arguably the holiday season’s hottest tech gadget, Watch is merely an iPhone accessory but it’s already had a negative impact on the Swiss watch industry, the smartwatch industry, and first year sales will be in the billions of dollars.
In short, Apple disrupts on a huge scale, and few industries are as ripe for disruption as the 120-year-old automobile industry. Looking back at the list above what you’ll see is that Apple usually isn’t the first in line with any new product, but the combination of hardware and software integrated with the company’s growing ecosystem sets the stage for rapid success and imminent disruption.
Vehicles that drive themselves are being touted as the next wave in automobiles and trucks, but Apple tends to cobble together a mashup of existing technologies to create a unique and well-defined product that becomes the standard bearer for the future.
One can ask, “Why bother?”
Automobile industry profits are nominal and margins are gross (not the kind of gross margins Apple is used to in the 21st century). Why does Apple need to be in the automobile industry? Why does the industry need Apple?
If we stand on the threshold of new technologies (batteries, hydrogen, sensors, LTE data come to mind) which are already changing how we drive, if companies such as Tesla, Google, and Microsoft are spending billions to advance the modern automobile, then Apple– the world’s largest technology company with the most well known and valuable brand– must be involved.
Unfortunately for major players in the industry, the entire industry is highly fragmented and most of the profits come from the premium end of the product spectrum (think Lexus, Mercedes, BMW, Cadillac, et al; in addition to standard products with premium features).
Does that sound familiar?
What Apple designs and manufactures occupies the high road of the premium end of the product spectrum, regardless of the product, and an Apple designed car will not be any different. Their exists a sweet spot, a vulnerable position between entry level luxury cars, and high end electric cars (occupied by Tesla and others) which would be prime business real estate for Apple; historically, and realistically.
Apple must re-invent the automobile to prevent the likes of Google and Microsoft from foisting their version of travel upon an unsuspecting world. The Android car will know where you go and when and listen to every word of your conversation while it drives you to wherever. A Microsoft Zune Sedan may be popular, may drive itself, but it’s likely– based upon how much customers have grown to hate Windows and Office, and how well Windows Phone has made an impact in the smartphone industry– to get you only near to your destination and not on time.
Word on the streets is that Apple is hiring hundreds of designers and engineers to bring a self-driving, self-sustaining automobile of the future to the present.
Godspeed, Apple. The human race depends upon your success. China, too.