Apple Inc. (AAPL) Innovation – Look At The List
I know I am a broken record regarding Apple’s policy of secret development followed by grand introductions but I fear it has lead them to ignore small piecemeal upgrades. I put the following in that category.
Failure to routinely upgrade Apple TV
Letting the MacPro die by not improving the data ports and not introducing a 5k external display
Ditto on the data ports for the iMac
Delaying 13 and 15 MacBook upgrades for too long
Going years without introducing new wireless routers
Letting Siri fall behind competing products
I’ll bet if you think for a while you can come up with other examples. I can live with Apple working on secret products like a car for “grand introductions” if they feel they must. But as a recurrent shareholder I cannot accept the slow process of basic innovation. The company has too much talent to dwaddle like this.
In response to my recent Apple posts I got a very thoughtful email from a reader. It was so good that I thought it was worth sharing.
I agree and would also add “improved cloud based products, icloud data/photo storage, Apple Music, etc” to the list.
However, I don’t think that these failures individually are the biggest issue Apple faces.
I believe Apple derived much of it’s strength (and ability to maintain profit margins) from having really good integration within an all Apple system. Personally speaking, I owned Apple products exclusively because they all worked very well together and they were great cutting edge products. I was reliant on and happy with Apple for everything. This was fine when they were aggressively innovating. The switching costs of moving outside an all Apple infrastructure for me was high, and a the few minor annoyances I had with certain products never warranted a change.
However by failing to innovate and keep up with competition, that has changed. I now use Spotify(vs Apple Music) for music, Amazon Echo for Home Auto/Voice commands, Google Drive (vs iCloud) for cloud services, Netgear (vs Apple) wireless routers, and would have gone with a non-Apple external display if I did not already have one.
Failing to innovate on these matters, really threatens the whole Apple “system” and business model. A couple years ago, I would have never even considered getting a non-Apple phone or tablet. Now since I use many non-Apple services and products, the added integration benefit of an iPhone is much less. I am much less inclined to pay a premium for Apple products, now that I no longer “tied” to an Apple system, and I don’t think I am alone.
Granted, it is extremely difficult to remain competitive and innovative in all these areas. However, by failing to do so they are not only losing out on individual services/products but more importantly their entire customer allegiance and relationship.