They say that if we don’t pay attention to the lessons of history then we are doomed to repeat it. Since there is plenty about mankind’s history that should not be repeated, maybe we need to pay more attention to the past when we make choices about the future.
I worry about Apple’s future. No, not from a monetary standpoint– even if the company is blowing $200-billion on stock buybacks and dividends. My worry has to do with products and efficiency. Apple’s profit margins are high so profits are high– but where are the products Steve Jobs would have built?
Cloudy Crystal Ball
Let’s put some of Apple’s recent history into two perspectives; each decidedly different, and each with different ramifications. First, Steve Jobs. His tenure at Apple from 1997 to his death in late 2011 brought an unrivaled string of market disrupting technology and success to Apple.
Steve Jobs – Apple Stores, iPod and iTunes, iTunes Music Store on Mac and Windows, Intel inside the Mac, iPhone, iOS App Store, iPad, and Mac App Store. That string of hits disrupted market after market and took Apple out of the shadows and into mainstream.
Tim Cook – Apple’s CEO actually took over a few years before Jobs’ death, and his ability to squeeze out ever greater profits is unrivaled in modern technology history. No company has more cash or a higher value. Yet, Cook’s contribution to Apple’s product line– beyond the iterative improvements to the oldies but goodies– is limited to Apple Pay, Apple Watch, Beats headphones, AirPods, and HomePod. What did I miss? Not much, right? R&D spending is 10 times what it was under Steve Jobs but Apple today is content to rest on its laurels and add accessories to iPhone as the greatest Cook era achievement beyond financials.
What about Apple Services? Already, Services is larger than iPad and Mac revenue combined, but understand that Apple is a hardware company so Apple’s fastest growing revenue stream remains dependent upon a customer base that uses Apple’s hardware.
What of the future?
This is where I worry about Apple. iPhone, iPad, and Mac have reached a plateau and Apple seems unwilling to do much that is new and risky beyond iPhone and iOS. How is this strategy unlike Microsoft’s love affair with all things Windows– to the point where the company missed the mobile revolution entirely?
What’s coming up in Apple’s product pipeline? Faster Macs? That’s Intel’s business. iPad with a keyboard? Been there, done that. A smaller, less expensive Home Pod? Puhleeze. A smarter Siri would be useful, but Apple isn’t even paying attention to its current product line which is littered– especially with the Mac– with older products sold as if they were new (Mac, iPad, and, yes, iPhone).
Apple’s past, just before Steve Jobs died, should have pointed to a gloriously robust future of continued market disruptions with exciting new products. Look at all of the products Jobs brought to multiple industry’s. If past is prologue, and apologies to Bill Shakespeare, Apple’s present after Jobs’ death should be littered with ever new industry changing products. Instead, Apple is awash in profits instead of products, and instead of products has a line of accessories for old products.
Maybe one cannot tell the future from the past. Steve Jobs did what he has always done. Bring the future to customers. If Apple’s recent past is any indication of the future, shareholders will continue to be rewarded while they and continued misuse of resources drain Apple of its future.