There has been much ado about whether Tim Cook can step into the shoes of Steve Jobs as CEO of Apple. But the other side of the coin hasn’t been explored. How can we expect Tim Cook to put his own stamp on the corporation?
This is all speculation, but it’s speculation worth delving into. After all, Mr. Cook is is his own man with his own strengths, weaknesses and preferences. Several times, I have used the analogy of the new skipper of a ship: the new Captain won’t be the same as the old Captain, and some of the crew will be disgruntled. But the new Captain might have amazing new talents and perspectives that come to be appreciated in time.
So it seems worth speculating on how Tim Cook might go his own way and surprise us.
1. Philanthropy. There has been a lot of discussion about how American companies are rolling too much money to the top — to the detriment of employees or ex-employees. Now certainly Apple pays its full-time salaried people in Cupertino well and hasn’t had any notable layoffs. Perhaps that’s an even better position from which Mr. Cook might establish a foundation for hungry American kids.
Just the interest on one billion dollars, about 1 percent of Apple’s total cash and securities holdings, would feed thousands of hungry kids each month. If Apple is loved and revered now, this move would cement that image in the minds of customers even more so and set an amazing example.
2. Content ownership. I’ve been following Apple for a long time. I always got the feeling, and rightfully so, that the focus of Steve Jobs was on design aesthetics, the user experience, and moving technology forward in ways that delight us. That’s why I think Mr. Jobs steered away from certain kinds of acquisitions. Simplicity and focus were his watchwords.
Mr. Cook on the other hand is the ultimate businessman. There are others on the executive team who are experts at the user experience: Jonathan Ive, Scott Forstall and Phil Schiller. That leaves Tim Cook free take his own direction, and that may include an analysis of the strategic positioning of Apple.
Here’s what I mean. Mr Jobs was, we all know, a bit paranoid about having enough money in the bank to tide Apple over if there were a major problem. At one point, just before the NeXT acquisition and the return of Steve Jobs in 1996, Apple almost missed payroll due to a very poor cash position. So Mr. Jobs focused on accumulating a lot of cash. That has worked out very well, as we know, in cash payments for commodity parts that has given Apple an advantage over competitors. Perhaps it’s too much cash in the estimation of some, including some analysts and General Electric’s Jeff Immelt who said (on 60 Minutes 10/9/2011) that “if companies are just going to sit on cash, they’re going to lose. Only the people who are going to invest their way through this crisis are going to win.”
All of which makes me think: can Apple do better? What is Apple missing out on? What investments might there be out there that Tim Cook might size up differently than Steve Jobs that might further strengthen Apple? One issue that comes to mind is that Apple, along with other companies, remains at the mercy of Hollywood executives.
For a long time, It was suggested that Apple, like Sony, should complement its line of consumer products with content ownership. Content is king. Content owners are ever increasingly protected by U.S. law. Content owners want great ways to deliver their content to customers, but they have not shown the taste and judgment about consumers that Apple excels in. They’ve already shown how they can wrap Netflix around the axle. Perhaps, and this his just food for thought, perhaps Tim Cook is thinking that the acquisition of Disney, and all its secondary companies, is finally the right way to invest Apple’s billions.
That’s been suggested before, but things are different now. Apple has technologies these days that they didn’t have before for content delivery: the iPad, an iPhone capable of 1080p, AirPlay, an Apple TV with iOS 5. Perhaps its own line of TVs.
I leave it to you to ponder.
3. Technology Popularization. One thing that Apple is very good at is developing new technology. But adoption rates are not often what they should be because many companies in a position to adopt them are financially conservative, focus on PCs and lack vision. We’ve seen how slowly DisplayPort percolated into displays made by other companies. We’re going through the same thing now with Thunderbolt. Accessory companies are waiting until there are enough Thunderbolt Macs out there to make it worth their while. Meanwhile, the technology lingers, customers are impatient, and observers wonder if the technology is going succeed or fail. Apple products are great, but supporting technology often doesn’t become popular fast enough.
In the past, the PC companies went their own way. Examples are eSATA, Blu-ray and USB 3. They dabbled in some Apple advanced technologies when it was a low risk, incremental business. But we’re in the post-PC era now, and consumers are less likely to lean towards technologies that will die along with the PC. That means that Apple may have to carry more of the load in developing and providing new technology accessories. In turn, that could mean more investment in (or acquisition of) certain accessory makers.
Food for Thought
All of this is just speculation. I put it forward for your consideration, not to champion any specific idea, but in order to remind us that Apple will continue to evolve as a company under a very business savvy CEO. Where Steve Jobs was the visionary, we can now, I surmise, expect to see Tim Cook focus on infrastructure that amplifies the effects of Mr. Jobs’s enduring visions. That could also include getting back to a more formal support of science and enterprise, being more vertically integrated in delivery mechanisms, an even more global approach to manufacturing and retail sales, (if that’s possible) and so on.
Apple certainly will remain a powerhouse of innovation and vision. Even so, a different Apple CEO will mean a man who thinks differently, and the texture of Apple’s success might shift in subtle (and good) ways. We should watch for that.