Greetings. Apple released its Q3 2013 earnings report today. The company beat estimates for earnings, revenue, and iPhone sales, and yet still I must bring to you another Apple Death Knell, #63. Writing for CBS News, one Dave Logan penned a piece titled, "Why Apple is a dead company walking."
Yes, a dead company walking. It's only a matter of time before Apple's corporate body realizes it has no more orders to remain standing and keels over.
My assumption would be that Mr. Logan was concerned the burden of carrying the $150ish billion in cash Apple has, but instead we are treated to another attack on CEO Tim Cook and how his lack of vision is destroying Apple.
But I love Apple...
As many recent Death Knellers have been sure to tell us, Mr. Logan is a fan of Apple, so much so that it pains him to tell us how bad off the company is. He goes way back to the Apple ][ days, and he owned the first Mac. He loves the company's products, blah blah blah, and Apple is doomed.
The source of his pronouncement is the time honored practice of analyzing word mapping, or analyzing the speech of people to see what they're all about. This is vaguely like looking at someone's Twitter or blog word cloud to see what they're talking about. I have one on my personal blog, if you're interested. It's in the lower right side bar.
I'm actually a fan of this concept. There's a lot that can be understood about people, literature, political speech, and even crowd consensus by mining words for patterns, frequency, and usage. But just as is the case with programming, the weakness in such analysis is that when you put garbage in, you get garbage out.
And that's where Mr. Logan went wrong. He's not asking the right questions, and in my (seldom) humble opinion, he's misinterpreting the answers he does get. That said, let's start with his take on word mapping Steve Jobs, something he did pretty well:
An analysis of Steve Jobs' word mapping is that he focused on "honoring greatness," emphasizing "those things that don't change," getting Apple "back to its core," to its "core values." Jobs believed that the world "wants to know what Apple is about" and "what it stands for." Jobs contrasted this focus to things that he dismissed: features, boxes (as in, computer boxes) and speed. This word mapping revealed a true visionary.
I don't know that it's accurate to say that the word mapping "revealed a true visionary," though I understand where Mr. Logan is coming from. I think it would be more accurate to say it reveals Mr. Jobs's passion for change and his belief that core values shape a company. Interestingly, that's a key aspect of what Mr. Logan is missing concerning Steve Jobs's replacement, Tim Cook.
Mr. Logan's thesis for Apple's walking death is that Tim Cook is "cannibalizing [Apple's] luster" while failing to bring anything new to the company. He has, according to Mr. Logan, the opposite view of Steve Jobs, and he is destroying the Apple brand.
From the piece:
An analysis of Cook's word map reveals the mirror opposite of Jobs. He emphasizes market share, customer satisfaction, an array of new features, better speed, increased battery life, more money paid to developers, more awards and more growth. In perhaps the most telling comment at Apple's recent developer conference (at about 16:30 on the video), he said, "We're not standing still... We have lots of innovation left."
This is the garbage in/garbage out part. Mr. Logan concludes that Tim Cook emphasizes market share when the exact, precise, polar, and total opposite is the case. Mr. Cook's word mapping might show that market share is often a topic of conversation, but it's because he's constantly asked about it by interviewers and analysts.
Tim Cook's actual response to these questions? That Apple is concerned with making the best products and that market share isn't a priority.
In addition, even when Steve Jobs was still alive and running Apple, it was Mr. Cook who fielded questions about market share from analysts during quarterly conference calls. Mr. Jobs attended only a couple of those conference calls during his time at Apple, and thus the questions fell to Mr. Cook. Since Mr. Jobs's passing, many analysts and a few interviewers have been the ones obsessing about iPhone and iPad market share.
That's the reason such concepts show up in his word mapping for Mr. Cook. It's not because Tim Cook is concerned about them, it's because people who don't understand Apple and somehow can't see that Apple makes more money than all of its competitors combined think Apple should do things like those competitors.
Dave Logan might love Apple, but he apparently isn't paying any attention.
He is absolutely correct that Mr. Cook emphasizes different things than Mr. Jobs, but that's where we run into more garbage in/garbage out problems. Mr. Logan is mired in the mindset that Apple must be lead by a revolutionary visionary to succeed, and the proof of this opinion (to him) lies in the fact that Apple hasn't released a disruptive product in the "several years" since Tim Cook took over as CEO.
From the piece:
His word map reveals a relationship to innovation that should deeply trouble Apple employees, investors and fans. Instead of producing innovation, innovation is something to be used, like a scarce resource.
Please note that it has been "several years" since Apple released the iPad—three to be precise—but that Tim Cook has been CEO for less than two years, not "several." He was promoted in August of 2011.
Garbage in, garbage out.
Why does Tim Cook get less than two years to disrupt a market and blow us all away? It's not a rational position, and even if it were, it misses the boat entirely. It will take years for us to know if Apple under Tim Cook can deliver more disruptions. Years.
And we've been hearing this stuff since the fall of 2012, when Mr. Cook had been at the helm for 15 months. It's frakking nonsense.
The Apple Culture
Tim Cook's job is to ensure that the culture that Steve Jobs built—the Apple culture—continues and can self-perpetuate. I've come to realize that the last thing Apple needed was for a product visionary, someone as revolutionary as Steve Jobs, to take over after Mr. Jobs died.
Any such person would have remade Apple in their image, tossing out whatever they didn't like and rebuilding the company anew. Just like Steve Jobs when he came back. That's fine, in and of itself, but we wouldn't be talking about Apple anymore. We'd be talking about a new company called Apple.
That's why Steve Jobs the visionary picked this man for the job. It turns out he knew what he was doing. Apple needed time to process the death of its founder and to figure out its place in the world without him. Tim Cook is the only man on the planet who could shepherd Apple through that process, and he's doing a great job at it.
In two years if Apple hasn't disrupted a new market, then you can start to grumble. In the meanwhile, Tim Cook's actual emphasis on making the best products, on being maniacal about making only the best products, about never rushing something to market, about being focused only on making the best products and letting the profits and the market share take care of themselves, shows that Apple still has its priorities straight.
Bryan Gets Cranky
Mr. Logan also said this, the bit I included as the representative quote in the Apple Death Knell Counter:
Apple appears to have a few years of its magic left. It will use this scarce resource to make its existing products better, faster, cheaper, with longer battery life, support for more displays and so on. It will introduce new products based on existing ideas.
But the days when Apple would imagine the unimagined, led by its core values, and bridge the worlds of technology and aesthetics by doing what no one had ever thought of before -- that's the Apple of the past.
I tell you what, Mr. Logan. Let's meet again in two years and see what you have to say.
One more thing: the magic that Apple is doing behind the scenes to increase battery life is way cool, it's hard as heck to do, it is remarkably innovative (though less sexy than a stunning form factor), and it's something only Apple can do because it controls the hardware and the software. Dismissing it as unimportant is foolish.
In fact, that's an idea worth exploring in a standalone piece.