Sunday, March 24, 2013

Why Apple Must Change...Or Die

I own two Apple iPods.  They are my favorite toys.  I listen to music on them.  I download Harvard and Stanford university lectures on them.  I listen to old time radio shows on them.  I listen to audiobooks on them.  I'm still old fashioned enough to consider the Ipod a little miracle, bringing me digital education and entertainment with the push of a button.

After 20 years of frustrated ownership of a Windows based PC I finally trashed Windows and bought an Apple IMAC.  It is a beautiful computer.  It reacts instantly to any command, I do not have to wait long minutes for a boot-up, I have never been confronted with "fatal errors or blue screens.  My Mac is the best computer I've ever owned.

And yet I can't help but believe Apple is bound for a slow death spiral.  First, Apple is far too greedy in their pricing.  When Steve Jobs was around and innovating the hell out of the Apple product line the company was able to command premium prices for their products, despite product flaws that would have put other companies out of business.  Anyone still remember the early antenna and battery life problems with the early I-Phone?  But Apple was able to overcome these challenges because they just kept producing finely engineered, pretty devices.

So customers overlooked the flaws and lined up for I-phones and I-pads and kept paying Apple profit margins more than triple that of other smart phone and tablet makers.

Times change...and they change rapidly in the tech world.  Samsung and LG and other tablet and phone makers are catching up, both in quality and in design.  And they'll price their products to undercut Apple.

And even now Apple's software and operating systems are under attack.  Many, many techies now say Android is the future.  I'm not smart enough to say that but here are a few things I do see.

Apple draws far too tight a circle around it's audio, video and book offerings.  Apple insists that if you buy movies or tv or music that you route it through their I-Tunes program.  Consumers hate to be told where to go for their entertainment.  I hate it too.  I see no reason why I have to download a special program that will allow me to get around Apple restrictions in order to load a movie I want to watch but isn't sourced through I-Tunes.

And I"m thinking hard of giving up cable television and streaming my media through the internet.  My first thought was to buy an Apple TV unit to do this.  Then I began reading about what I can and cannot stream through my Apple device.  I then looked at what a Roku unit has to offer (at half the price of Apple TV) and decided when I cut the cable TV cord it will be with a Roku.

And just this week reports were out that Amazon is getting ready to lower their HD Fire to $99 bucks!  Jeff Bezos over at Amazon is bound and determined to sell his well regarded tablets at costs, just so consumers continue to buy music, movies, books...hell, even toilet paper, made convenient through the touch of a Fire tablet button.

So I can see a time when I have to bid farewell to Apple.  And I suspect millions of consumers just like me are thinking the same.  Apple is reporting lower I-phone and i-pad sales these days as the Apple buzz and Apple dazzle has begun to fade.  If it looks like an Apple, and works like an Apple, why pay three times more for an Apple?

It's still far too early to figure out Apple's future.  Will they cut prices on their products?  Will they begin a temporary price war in an effort to destroy their competitors?  Will they lower their price points to allow them a fair, but not onerous profit?  Will they open up their operating system to allow Apple product users to use more open sources for their entertainment dollar?

Let's hope Apple is smarter than the once internet behemoth America On Line.  AOL owned the internet for years...and they failed to innovate, preferring to rake in huge profits and reside in the sloth of "monopoly".  Now, half of America do not even remember who AOL was.  Let's hope Apple has smarter managers.  Let's hope they realize they had a great lead in innovation, that they enjoyed a head start on everyone else, but that the race ain't over and that they can no longer call the shots on how we choose our entertainment sources.


  1. Thank you for an insightful article. Apple's fortunes have waxed and waned over the years and the death spiral you predict will be it's future if it doesn't innovate new must-have products. Can it? I have no idea, but their monopolistic business practices on content and application sales are terrible, and lose it more fans at the expense of making the experience "easy". Yes, not only is controlling everything profitable, but it is also the only way they can ensure the user experience -- which is the core of their brand.

    Why was your PC running windows a pain to boot and use? Likely because there was some non-Microsoft software installed, which didn't comply 100% with the 'style' in which Windows-based apps should be written, not necessarily because someone was deliberately attempting to subvert rules, but likely because the what windows software was developed was byzantine, error prone, and extremely difficult.

    I worked for a small eCommerce company which sold supplies for musicians. Apple demands 30% of the sale if you create an app which facilitates sales of merchandise; that's outrageous for a business with a profit margin in the range of 10-40% per item. It shows how out of touch with business they are.

  2. All true, anon. And you know what? I think Apple and Microsoft are in a race to see who's first to be obsolete...and right now Microsoft is winning. Gates and company used Windows (which was stolen from Apple) to rip off data base and word perfect programs. They are now showing just how little they can innovate. When they can't steal, they can't win.