Apple Losing its Edge Under Tim Cook?

Apple Losing its Edge Under Tim Cook?

From June 11- 15th Apple Inc. (NASDAQ:AAPL) held its annual World Wide Developers Conference to luke-warm review. Many were expecting or at least hoping, for an unveiling of the iPhone 5. And just about any WWDC without an iPhone 5 was all but bound to fail to meet expectations. Perhaps more tellingly, Apple failed to unveil any true innovations or ground-breaking developments.

Some pundits are already beginning to wonder if Apple is losing its step and if the lack of ground breaking products and services since the loss of Steve Jobs points to a loss of creativity and innovation within the firm. Is this true, and does Apple have reason to worry?

The most talked about announcement at the WWDC was the inclusion of the retina display on the Macbook Pro line. The Retina display is Apple’s ultra-high resolution 15.4” screen sporting 2880×1800-pixel resolution. Yes, scaling up the retina display for the Macbook Pro line is certainly an achievement, but it doesn’t have the “oomph” of launching a new iPhone or Mac line.

On the other hand, the launch of the Macbook Pro line with Retina does dispel a major rumor, that Apple would be dropping the Macbook line.

More importantly, Apple has arguably failed to launch a ground-breaking product since the release of the first iPad in April of 2010 and iPhone 4 in June of the same year. Since then, Apple has focused on incremental upgrades across it’s line of hardware, and despite rumors of an iPhone 4, the company has launched only the moderate upgrade iPhone 4S.

The iPhone 4S did contain a major software upgrade, however, the SIRI voice control system. Siri aims to allow consumers to practically go hands-free and to control their electronic gadgets all at the command of their voice. While this concept is not particularly new, Siri is one of the most advanced consumer level versions of voice command. Still, while this software could eventually evolve into a major development, so far its actual practically has remained somewhat limited.

So is Apple losing its step? While it may be too soon to tell, the news coming out of Apple does seem less revolutionary these days. Whether this is due to the loss of Steve Job’s business genius, difficulty in pushing an already pushed envelope, or part of a larger business strategy remains to determined. Yet after years of leading the consumer electronics market, Apple will now have to look far and wide to come up with a truly innovative product.

And while Apple may be losing some innovation momentum, the competition is catching up. Microsoft seems to have finally realized that Apple isn’t just a niche threat, but could potentially unseat them globally. Traditional electronics manufacturers, like Sony and Panasonic, have experience shrinking market share and profit margins. And traditional phone manufacturers, like Nokia and Blackberry, have been decimated. For some companies it may be too late, but for others, the time to launch an aggressive counter attack against Apple is now.

Meanwhile, Samsung has gone toe-for-toe with Apple in the smart phone category. Samsung smart phones now make up 29.1 percent of the smartphone category for 42.2 million phones compared to Apple’s 24.7 percent market share at 35.1 million phones. Yes, Samsung is relying on dozens of models and versions of their phones to compete with Apple’s single iPhone line, but either way Samsung’s strong showing demonstrates that Apple can be unseated. While the iPhone defined the touchscreen smartphone market, another company now commands the largest market share.

Apple is still the unchallenged king of the tablet market but change may be on the horizon. The Android-based Amazon Kindle Fire debuted in the 2011 Christmas season and had a strong showing, selling some 4.7 million tablets during the 4th quarter (2011). In total Android tablets account for

Meanwhile, Microsoft is about to launch Windows 8 for tablets and will enter directly into the market with their own tablet, the “Surface.” While it may be too late for Microsoft to enter the tablet market, early previews have been largely positive. Windows 8 has received promising early reviews, while other innovates, such as the small rubberized keyboard/cover, have received positive feedback.

While Apple has failed to dominate the tradition laptop and computer market, they do have a strong following, especially among college students and younger consumers. While Apple does not lead in market share, they do lead in profit margins and aesthetics.

Even in this arena, however, Apple may be losing its lead. Traditional PC makers are launching a slew of thin-and-sleek Ultrabooks and are generating a lot of buzz on the Internet. While inspired by the Macbook Air line, many of these computers feature original and sexy designs that stand on their own right.

Can Apple’s competition turn the tide, and if so will Apple “sit on its laurels” and wait for them to catch up, or will the company continue to lead innovation and design within the industry? Maintaining a decisive lead with such a large target on its back may prove difficult for Apple. While Apple has shellacked their competitors in recent years, now many companies seem to finally be gearing up for a competitive fight.

Yes, it is still too early to declare the downfall, or even decline of Apple, but change may be on the horizon. Fierce competition and the rise (or resurgence) of capable competitors means that Apple will have to launch groundbreaking products and services. Will Apple be lost without Steve Jobs? Certainly the direction Jobs provided was vital and now Apple will have to figure out how to replace Jobs and his ability to synthesis an understanding of markets, consumer wants, and design. For now, Apple is still winning most of the battle, but they have not yet won the war.