Apple Rotting From the Inside

appleWhen Apple revealed the iPod back in 2001, a little more than eight months after iTunes was released, the vision was much greater than just the device. An entire online shopping experience, which gathered the credit card numbers of more people than any other company on earth, was attached. The forethought behind a simple, well-timed device changed the way people bought, listened to and interacted with music. Since those days iTunes has not evolved much and despite new and shiny releases, Apple has not innovated their business to much extent. Without Steve Jobs at the helm, Apple’s creativity has stagnated quickly, and seems to be rotting from the inside.

There were many other MP3 players and media devices when Apple came out with the iPod. The difference was that Jobs understood what people wanted, even before they did. The improvements made to the device paved the way for the release of the iPhone in 2007. The iPad followed three years later and ran on the same operating system: iOS.

Since 2011, the year Jobs passed away, Apple seems to have lost their vision. Despite the fact that consumers replace almost indistinguishable devices at a premium year after year, the frustration of knowing how similar they all are is growing. With the iPhone 6 continually being hyped and hinted at, chances are the grand reveal will leave a lot to be desired.

rottenWhen the iPhone 5c and 5s came out in 2013, it was described by Derek Ross of Phandroid as: “A phone that hasn’t changed that much from its predecessor, but includes just the right amount of marketing fluff to make it sound amazing.” Despite sales being high, the Apple mystique that drives people to spend their money on a newer, almost identical model, is beginning to make the consumers look irrational.

According to the research firm Canalys, one-third of all smart phones that shipped in the first quarter of 2014 had screens larger than five inches. The “phablet,” as it is commonly referred to, represents a major share of the market which Apple does not entertain. The market share represent a larger slice of the pie then Apple currently has, and seems like an easy niche to fill given their track record.

The latest attempt at modernization is Apples proposed acquisition of Beats; the Dr. Dre headphone company. While doing well, Beats is not an innovative or original concept, and the company has no remarkable patents Apple would acquire in the deal. It is just a celebrity endorsed headphone company that has gained a reasonable market share.

Speculation about whether Steve Jobs would have made such a move are pointless. However the reasoning, perhaps a hidden agenda we do not understand yet, will reveal more about the internal workings and vision of this stable by increasingly unremarkable company. The real issue is not money. Monetarily Apple is doing very well, but consumer confidence, and with it stocks value, can be lost overnight. There are no guarantees in business, and a company’s ability to align itself with trends, or create them, can be vital for long-term success.

With the years of innovation behind it, and technology changing and improving faster than ever, Apples lack of creative growth might be an indication of the people who are now running it. Sometimes the hardest thing to do is find a new coach, especially when the one who took you to the finals is a relative. Current market shares and sales trends would indicate that all is fine, but actual product lack of growth and development might hint that the Apple is rotting from the inside.

Opinion by J. Benjamin

Sources:
Forbes
The Canadian Press
Phandroid.com

5 Responses to "Apple Rotting From the Inside"

  1. Ralph   January 3, 2015 at 3:28 pm

    Congrats J. Benjamin you made the list http://www.macobserver.com/tmo/death_knell

    Reply
  2. Tom   August 19, 2014 at 7:52 pm

    Apple dont get my buisness. The first time i tried to bluetooth a song i found out apple took the file share part out of bluetooth! So when my very ancient motorola could do this simple thing i realised the iphone isnt for me! I like open source like a computer to much!

    Reply
  3. COOK epic failure kills crApple   June 15, 2014 at 11:01 pm

    ^^ Apple FAGBOIS in urgent need of emergency psychiatric treatment – Apple = creatively DEAD + OVER, FORGETTABLE as B.L.A.N.D MP like COOK’s charisma is – READ it + WEEP FAGBOI = GAME OVER!= GET A LIFE!

    Reply
  4. Jack Barker   May 20, 2014 at 8:41 pm

    What a crock! No evidence offered, whatsoever.
    It’s your brain that has stagnated, Mr. Benjamin.

    Reply
  5. Michael Andrew Bucklein   May 18, 2014 at 8:14 pm

    This is one of the stupidest and most uninformed articles about Apple that I’ve seen in a while. This op-ed writer contradicts himself so many times with clever phrases and baseless statements that it’s hard to keep track of what he’s even talking about. But one thing is clear: This guy wants Apple to fail, but I get the sense that it’s becoming rather irksome to him that the company is doing just the opposite.

    Just a few fun tidbits: I like how the author criticizes Apple’s purchase of Beats, claiming that in his crystal ball of technological wonder, he doesn’t see any real value to the purchase because the company doesn’t really do anything new. The closing statement is especially absurd: “Current market shares and sales trends would indicate that all is fine, but actual product lack of growth and development might hint that the Apple is rotting from the inside.” Oh really? They say numbers don’t lie, but apparently this gentlemen thinks the numbers behind the success of the iPhone 5s and 5c masks a horrifyingly serious problem of company lack of ingenuity – lol. He does this even after he speculated about the iPhone 6 and what it may or may not offer, which shows that Apple has even him waiting to see what they release next. And he’s saying the company has lost their innovation?

    What other company is doing what Apple does better than Apple? Yet another contradiction in this article is when dear J. Benjamin states that Apple somehow tricks its customers into buying the same product year over year, despite little technological difference between the product iterations. (I guess he hasn’t seen a lineup of the iPhones, from the first iteration to today, and how EACH was a gigantic financial success. But never mind the numbers, lol.) He goes so far as to say that consumers now appear “irrational” (to whom??), and then later states in the article that Apple could lose its devoted consumer confidence overnight, oh and its stock value too—lol. Does he mean the consumers who wait outside the store for days before the next phone or gadget is released, the ones who have switched to Apple in the early 2000s and have never looked back, or the uncountable millions of American college kids who wouldn’t be caught dead with something other than a Mac laptop, or does he mean the 60% of consumers that bought an iPhone 5c converted from Android? This guy has his facts all backwards. The same Apple that has garnered a cult following can lose its consumer confidence overnight, because according to this guy, Apple hasn’t bought companies he likes or made phones he thinks are any good. How can someone so unfamiliar with Apple’s last, oh, 15 years of explosive growth and success be writing about something on which they are totally uninformed?

    I’m curious which company he would prefer to model? Let’s look at Google, now an inch deep and a mile wide, and the numerous launches and services and buyouts it has leveraged that have been total failures. Remember the MotoX? Flop. Samsung sells every single one of their phones at break-even simply because they have no other way to compete with Apple’s uniform quality other than to gouge the prices. Samsung has seen their margins collapse over the years, and you wanna say that Apple is rotting from the inside when your own article agrees Apple is flush with cash? Here are some other numbers: Motorola lost Google $700 million in the last six months of MotoX sales, and you wonder why Google couldn’t sell Motorola fast enough.

    Why the need for a presence in hardware? First, Google’s partners have been terrible at implementing Google’s reference designs across the board. Additionally, Google just announced results for the March quarter that outlined that the profitability of its core ad business is collapsing, with 26 percent more clicks resulting in 9 percent less revenue. Compare that against Apple’s opposite situation, where its core competency in hardware is progressively getting more profitable as its hardware sales have grown rapidly and into new markets, branching off into new product categories.

    Google also detailed that the vast majority of its ad business is stuck on top of the plateauing dinosaur of the desktop PC, and that it hasn’t rapidly adapted to the new era of mobile devices (the way that, say Facebook, has). That shouldn’t even be slightly surprising to anyone paying even cursory attention to the mobile market. On mobile devices, Google’s ad-centric business is not just failing to generate 2000s-era ad paid ad placement search profits; it’s actually failing to replicate the usage patterns that might lead to that ever happening in the future.

    Steve Jobs pointed out four years ago that Apple had discovered that mobile users were different from desktop PC users in that they don’t start with Google’s search in the web browser when looking for entertainment, information or products to buy. They use mobile apps. The revenues Google is seeing from mobile are far lower than yesterday’s web PC ads, and Google hasn’t been able to get a toe into the mobile hardware market where Apple is earning its billions, despite many attempts. You wouldn’t know from mainstream media reports, but Google’s latest innovation for reaching mobile ad audiences (launched around the same time as Moto X) is a copy of what Jobs presented three years previously back in 2010. In a high production ad brochure posing as a Wired news article entitled “The Inside Story of the Moto X,” Levy continued, “What was Google thinking? Finally, we have the answer. The Moto X, announced today, marks the arrival, finally, of the Google Phone. The Moto X is the first in a series of hardware products that Google hopes will supercharge the mother company’s software and services.”

    Instead, just months later Google’s entire Moto hardware subsidiary has done nothing but incinerate $704 million across the last two quarters. The whole operation, including a second, even cheaper Moto G phone that also failed miserably, is now not only being sold off for scrap but isn’t even being acknowledged by name in Google’s financial summary.

    And not hardly a peep about any of it from anyone in the media.

    Instead, over the same period that Google’s hardware experiments at Motorola were hemorrhaging hundreds of millions of dollars, the public has been subjected to a constant din of “research” intending to describe exactly how and why Apple’s iPhone 5c failed, if not commercially, then at least in some sort of philosophical or metaphorical way. When Tim Cook explained in the company’s January earnings call that, for the top of the line iPhone 5s, Apple had seen “growth in that portion of our line despite adding a new phone – an entirely new phone underneath it,” analysts were so confused by their own belief system that they decided that this unexpected demand must somehow be upside-down doublespeak.

    Asked about how well iPhones, and particularly the 5c, were doing at attracting former Android users rather than just upgrading Apple’s own customers, Cook answered, “we particularly saw that [new user growth] on the 5c, which is what we wanted to see.”

    iPhone 5c not only attracted away lots of Android users; it also managed to outsell every Android flagship, including the vaunted Moto X, but also even Samsung’s Galaxy S 4 flagship, the world’s top selling Android phone. In fact, in one quarter the 5c managed to outsell a year’s worth of sales of a wide variety of Android flagships.

    So yeah J. Benjamin, other than that stuff, it was a very good article.

    Reply

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