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Apple: Do You See What I See?
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DawnTreader
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My latest missive at Eventide.
Snippet: When I look at Apple, I don’t see a company that develops popular products. I see a management team that is focused on revolutionizing the way we use technology to better our lives and better the world around us. Excellent quarterly results are one component of management’s mission.Although tomorrow is the day Apple releases September quarter results, I’m looking beyond this static quarterly snapshot of a dynamic global enterprise. Do you see what I see?
[ Edited: 17 October 2010 03:12 PM by DawnTreader ]
[Edited to correct link reference] -
DawnTreader
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Link reference corrected. Thanks, ratty.
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All of us on AFB see it!
One takeaway from this (btw DT, are you strictly an AAPL shareholder or do you trade from time to time as well?) is that even if Apple posts “lousy” earnings results, that’s only from Wall Street’s (and anguished AAPL investors/traders) perspective. A “lowly” $18 billion in revs this quarter is still close to 50% YOY rev growth, and at least 40% of that rev growth (assuming a lousy 3 million iPads sold this quarter) is from a product that didn’t exist last year. To think that Apple can “disappoint” with 50% YOY growth in earnings and revs and shares could tank while Google posts “better than expected” gains of only 23/35% YOY revs/earnings growth and shares could spike 10% boggles the mind. The companies aren’t in quite the same lines of businesses but the distinction can’t be ignored.
Apple the company doesn’t live or die by its quarterly results. It’s always planting seeds for the future, even though many companies of its size and maturity are either struggling to find new business lines or just passively raking in from their cash cow franchises with little innovation to how for it. It may be that only a company like Apple can make the high-innovation strategy work, but when it works, it works better than anything I’ve ever seen or may ever see.
AAPL the stock is harder to predict, but the future of Apple the company is assured for years to come, which is comforting as I type this on my iMac.
[ Edited: 17 October 2010 03:43 PM by Mav ]Signature
The Summer of AAPL is here. Enjoy it (responsibly) while it lasts.
AFB Night Owl Team™
Thanks, Steve. -
Apple has changed the way we live, from daily usages to how we compute. Just the main points, iPod revolutionized the music player industry, iTunes did the same with the online distribution, iPhone completely changed the game in the smartphone market. I can tell you this, if it wasn’t for the iPhone, we would probably be stuck with 400mhz cpu blackberries and 500mhz nokias. Now it’s time for the iPad to change the way we compute, from a daily basis stand point to the overall environment.
It all started with the Mac. I brought home and played with a few micro computers (to which they were referred at that point in time) but they all went back the next day. I didn’t want to learn to program or learn a bunch of arcane symbols to do my work. I ordered the original Mac the day it was introduced knowing that I wouldn’t have to “learn” computers to use one. Worked out okay.
[ Edited: 17 October 2010 04:12 PM by BillH ]
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I don’t mind being wrong…,I just hate being wrong so FAST!
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Excellent read…
As an Operation Manager what I see, when I look into Apple, is the best management team in decades in any public company. The execution is near perfect, and they are able to transform misstep in success (remember that the iPhone app were suppose to be web app).It amaze me how they can read the market and do exactly what need to be done, when it need to be done, in order to have success. Most people only see Apple as a big marketing genius company. The reality is that this marketing stuff work because the management is able to perform near perfection, delivering the goods that people will need in the best combination of cost and selling points.
I often says to my wife that I will sell my shares in AAPL when the management team begin to do some auto congratulation by selling books on the Apple Way of doing business. That will mean that they are looking for recognition and fame outside Apple.
Looking ahead for this week: Monday AAPL report Card, Tuesday The Wall in Concert, Wednesday Back to the Mac…Nice beginning for a week…
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Johnsonwax
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It all started with the Mac. I brought home and played with a few micro computers (to which they were referred at that point in time) but they all went back the next day. I didn’t want to learn to program or learn a bunch of arcane symbols to do my work. I ordered the original Mac the day it was introduced knowing that I wouldn’t have to “learn” computers to use one. Worked out okay.
But the Mac now lives outside of these ideals. It hasn’t benefitted from most of the things Apple has done for the last decade. It’s still potentially vulnerable in the same way as PCs. In terms of ease of use, the gap between the Mac and Windows is significantly smaller than the gap between the Mac and the iPad. The ease of purchase and installation of software, and the corresponding reduction in cost due to volume hasn’t even been attempted.
Yeah, there’s been some improvement to the Mac, but it’s negligible compared to everything that Apple has done from iPod onward. It’ll be interesting to see what they do there once they get around to it. Steve always had a marketshare goal of 10% for the Mac. I think they just hit that in the US. I wonder if that’ll start to bring some more energy back to the platform.
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Like on Wednesday?
The Mac has benefitted in less obvious ways. Graphics are good enough for the OS and most games Mac users will play (Starcraft 2, for instance). Apple realizes it needs powerful enough components to match up with OpenCL, Grand Central, etc. Industrial design - unbeatable in finesse, materials and particularly design cohesion across the lineup. Aluminum, glass, black trim - that says it all. Energy consumption is quite low and it’s also reflected in the MacBook family’s battery life being at the top of the class. Pricing is not an issue, and Macs have increasing value each year while holding the line on price or reducing it.
Snow Leopard is just fine as an OS as long as Windows 7 is around. And a Lion isn’t more than a couple years away…
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The Summer of AAPL is here. Enjoy it (responsibly) while it lasts.
AFB Night Owl Team™
Thanks, Steve. -
Johnsonwax
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Like on Wednesday?
The Mac has benefitted in less obvious ways.
But these aren’t revolutionary things, not like what Apple brought to the iOS space. There’s no reason why there can’t be an app store for Mac OS, but Apple hasn’t made any real effort to do it. The video handling on iOS is arguably better than it is on the Mac. Even as a gaming platform, iOS has real advantages including Game Center, and that shows - most of the game developers have left MacOS for iOS.
These are all elements that clear away administrative hassles for the user. They aren’t even particularly technically challenging. Presumably Mac users would want the same, but Apple hasn’t delivered it.
Sure, the Mac has kept up with the evolutionary technical bits and pieces, but Apple hasn’t really tried to bring a revolutionary experience to it. Maybe they will in 10.7. I think they will eventually, but (and I say this as a very loyal Mac user) the fundamental problems that users have with Windows exist, or potentially exist, to largely the same degree that they do on the Mac. All of the really exceptional work that Apple has done to improve the user experience has been directed at iOS.
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DawnTreader
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Like on Wednesday?
The Mac has benefitted in less obvious ways.
But these aren’t revolutionary things, not like what Apple brought to the iOS space. There’s no reason why there can’t be an app store for Mac OS, but Apple hasn’t made any real effort to do it. The video handling on iOS is arguably better than it is on the Mac. Even as a gaming platform, iOS has real advantages including Game Center, and that shows - most of the game developers have left MacOS for iOS.
These are all elements that clear away administrative hassles for the user. They aren’t even particularly technically challenging. Presumably Mac users would want the same, but Apple hasn’t delivered it.
Sure, the Mac has kept up with the evolutionary technical bits and pieces, but Apple hasn’t really tried to bring a revolutionary experience to it. Maybe they will in 10.7. I think they will eventually, but (and I say this as a very loyal Mac user) the fundamental problems that users have with Windows exist, or potentially exist, to largely the same degree that they do on the Mac. All of the really exceptional work that Apple has done to improve the user experience has been directed at iOS.
The iOS is an extraordinary industrial achievement that has gone virtually unnoticed by the tech press. This iOS platform is turning traditional application development on its head, reducing costs and the time involved in bringing solutions to market. Apple’s iOS, of all products, is the one that’s apt to cost Microsoft the most over the next five years as that company must change its focus and/or acquire revenue generating assets that can compete in the new marketplace.
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How do you see Apple’s size playing into your assessment of Apple’s continued growth potential?
I’m wondering if Apple will soon be targeted (more so than now) just due to its shear size.
thanks!
JohnG -
Like on Wednesday?
The Mac has benefitted in less obvious ways.
But these aren’t revolutionary things, not like what Apple brought to the iOS space. There’s no reason why there can’t be an app store for Mac OS, but Apple hasn’t made any real effort to do it. The video handling on iOS is arguably better than it is on the Mac. Even as a gaming platform, iOS has real advantages including Game Center, and that shows - most of the game developers have left MacOS for iOS.
These are all elements that clear away administrative hassles for the user. They aren’t even particularly technically challenging. Presumably Mac users would want the same, but Apple hasn’t delivered it.
Sure, the Mac has kept up with the evolutionary technical bits and pieces, but Apple hasn’t really tried to bring a revolutionary experience to it. Maybe they will in 10.7. I think they will eventually, but (and I say this as a very loyal Mac user) the fundamental problems that users have with Windows exist, or potentially exist, to largely the same degree that they do on the Mac. All of the really exceptional work that Apple has done to improve the user experience has been directed at iOS.
The iOS is an extraordinary industrial achievement that has gone virtually unnoticed by the tech press. This iOS platform is turning traditional application development on its head, reducing costs and the time involved in bringing solutions to market. Apple’s iOS, of all products, is the one that’s apt to cost Microsoft the most over the next five years as that company must change its focus and/or acquire revenue generating assets that can compete in the new marketplace.
iOS is a subset of OSX. To understand what Apple has accomplished over the past years and why it has such a large mote it’s crucial to recognize that. Steve has been developing this OS since he left Apple and founded Next. First introduced in 1988 it now has 22 years of development behind it. It’s one of the reasons I don’t think there is a viable competitor in sight. Google may be able to “emulate” iOS the way the Mac use to emulate multi-tasking but I’m guessing most of it will be window dressing. If I’m wrong about this I’d really welcome hearing about it. Sleepy?
“the fundamental problems that users have with Windows exist, or potentially exist, to largely the same degree that they do on the Mac.”
I could not disagree with this more. My days of living in virus/trojan/anti-virus hell were put behind me when I switched to OSX.
I’m not really trying to Hi-Jack this into a Mac vs. PC thing but you’ve hit a couple of my key buttons. I’m trying to get over them…,really…,okay maybe just a little.
Great article DT.
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I don’t mind being wrong…,I just hate being wrong so FAST!
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Apple had done something revolutionary to MacOS snow leopard and have let the system unchanged for awhile to see whether there are any unintended consequences. The coming Lion version should be mind boggling. In other words, Apple could be ready to push Mac to a new height.
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Stay Hungry. Stay Foolish. - Steve Jobs
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I think you guys might be missing the point a little. Or I am. Remember SJs last talk a few months ago, the “PC’s will be like trucks” talk?...
Computing is changing, and the goalposts are moving significantly. Mobile touchscreen devices like iPad, iPhone are the new “Personal Computers”. They are cheap, very configurable, very easy to use and administer, and very personal.
The old “PC” faces a changing role. In the workplace it will continue to be a workstation in roles that it suits. In the home it will become the “Home Computer”, a multi-user-account hub, powerhouse and content creation tool. Affluent households that have until now had one or more computers per person will now just have one or two for the household, whilst every household member will have a personal device.
As such, a revolution in tradtional computing OS’s may in fact just be a distraction. If the above vision indeed comes to pass and these new personal devices grow to 200m+ per year as Gartner suggests, the traditional PC space will plateau and start to fade. Why revolutionize a platform that at best faces a role change that can’t yet be clearly determined, and at worst will soon begin a long slow downhill slide…? In Apple more than most companies, creative effort is very carefully channeled.
I think OS X will continue to evolve, but i don’t see and nor do I want a desktop OS revolution. The future lies down a different path.
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I think you guys might be missing the point a little. Or I am. Remember SJs last talk a few months ago, the “PC’s will be like trucks” talk?...
Computing is changing, and the goalposts are moving significantly. Mobile touchscreen devices like iPad, iPhone are the new “Personal Computers”. They are cheap, very configurable, very easy to use and administer, and very personal.
The old “PC” faces a changing role. In the workplace it will continue to be a workstation in roles that it suits. In the home it will become the “Home Computer”, a multi-user-account hub, powerhouse and content creation tool. Affluent households that have until now had one or more computers per person will now just have one or two for the household, whilst every household member will have a personal device.
As such, a revolution in tradtional computing OS’s may in fact just be a distraction. If the above vision indeed comes to pass and these new personal devices grow to 200m+ per year as Gartner suggests, the traditional PC space will plateau and start to fade. Why revolutionize a platform that at best faces a role change that can’t yet be clearly determined, and at worst will soon begin a long slow downhill slide…? In Apple more than most companies, creative effort is very carefully channeled.
I think OS X will continue to evolve, but i don’t see and nor do I want a desktop OS revolution. The future lies down a different path.
I think you’re missing my point actually.
They are one and the same. Grand Central’s role in utilizing multiple processors is just as important (and maybe more) in the iPad as it is in the Mac. I understand what Steve is saying about trucks but I think that had more to do with processing power than form factor. When I’m home I prefer working on my desktop. Sitting at the cabin while I’m working (or as close as I come to work) is where I use a laptop. I’ll be buying an iPad sooner or later for travel. All of these form factors are important to me and I’d like to have some finish options as I shoehorn even more into individual rooms.Signature
I don’t mind being wrong…,I just hate being wrong so FAST!
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Johnsonwax
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I think you’re missing my point actually.
They are one and the same. Grand Central’s role in utilizing multiple processors is just as important (and maybe more) in the iPad as it is in the Mac. I understand what Steve is saying about trucks but I think that had more to do with processing power than form factor. When I’m home I prefer working on my desktop. Sitting at the cabin while I’m working (or as close as I come to work) is where I use a laptop. I’ll be buying an iPad sooner or later for travel. All of these form factors are important to me and I’d like to have some finish options as I shoehorn even more into individual rooms.You’re focused on technology. This isn’t about technology, at least not primarily. Those technical bits had nothing to do with the rise and widespread adoption of iPhone/iPad. It might serve as a necessary piece to advance it, but it’s meaningless without something profoundly beneficial to users.
I’ll give an example. Last night my wife needed to leave for an event. She needed to get some content out of an excel file on her Mac onto her new iPhone. She was going to type it in, but she was late. Her ride was going to pick her up in a few minutes. I had intended to install Pastebot on her iPhone, but never got around to it, and this was the perfect solution. Within 30 seconds I found it, bought it, and installed it on her iPhone. It took me almost 5 minutes to find and install the free companion on her Mac. Connecting the two and copying the content over took a few seconds. Had I needed to buy the Mac component, it would have probably taken at least another 5-10 minutes, what with fishing out my credit card and all that.
Why was the more advanced, more technologically advanced platform the harder of the two to deal with?
Apple stripped away a huge number of expectations with iOS. No access to the file system. No side-loading of applications. No alternate stores. No installers. All of those things means that developers can’t help but get the experience right for me as a user. Even with the app store experience out there for all to see, the Mac still can’t replicate it, even with 3rd parties able to be the implementers, even for free things. Can I make Facetime calls with my $1000 Mac which I can with my $229 iPod Touch? No. Will I be able to easily shove video from my Mac to my Apple TV the way that I’ll be able to do with my iOS device? No. Can I stream Netflix to Front Row? No.
There’s absolutely no reason why these things can’t be on Mac OS, but they’re being brought to iOS. That’s the future for consumer computing. Mac OS X will get the heavy lifting bits, but it’s increasingly clear that if you want the really cool user stuff, the Mac is not going to be the place to be. It’ll always be the technology incubator, but the real application of that technology that consumers care about will take place on iOS.
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DawnTreader
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How do you see Apple’s size playing into your assessment of Apple’s continued growth potential?
I’m wondering if Apple will soon be targeted (more so than now) just due to its shear size.
thanks!
JohnGMy response on that question from late July: Apple and The Law of Large Numbers
