When one looks at the position of the Apple Inc. (NASDAQ:AAPL) corporation today, rated as the world’s most valuable brand, with the highest market value of any corporation on the planet, and reporting the second highest profit in 2013, it’s hard to believe that the recent history of the company has been anything other than sparkling.
Of course, this is very misguided. In the mid-to-late 1990s Apple Inc. (NASDAQ:AAPL) was going through a lot of problems, and its prominence as a manufacturer of computers and other technology had faded spectacularly from its 1980s high point. Apple had so manifestly faded from the public consciousness that ‘The Simpsons’ televisions series even saw fit to poke fun at the Apple corporation, including a gag in a May, 1996 episode in which an adolescent hadn’t even heard of Apple computers.
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Shut Apple down
This satirical swipe at the reputation of Apple Inc. (NASDAQ:AAPL) was reflected rather more gravely by an extremely prominent and powerful individual in the computing industry just one year later. At the Gartner Symposium of 1997, Michael Dell, founder and CEO of Dell, opined that if he were in charge of Apple he’d “shut it down and give the money back to the shareholders.” With a declining market cap and few apparent prospects of profitability or growth, the future looked extremely bleak for the manufacture of Macintosh computers.
Seventeen years later, Apple Inc. (NASDAQ:AAPL) was able to distribute $2.6 billion to its shareholders, a figure greater than its entire market value back in those dark days. Apple has denied the doubters in numerous ways, establishing a hugely flexible and profitable business model, and even setting up its own retail chain which has proved to be hugely successful despite the explicit doubts of many market experts at the time that it was originally conceived.
Bill Gates writes off the iPad
Time and time again, Apple Inc. (NASDAQ:AAPL) has silenced the critics by launching products that have been monumentally big sellers and come to define the market. One such device was the Apple iPad, which was discussed rather disdainfully by Bill Gates shortly after its launch in 2010. Many others shared Gates’ view that there was nothing particularly special about the iPad and that it would struggle to attract an audience. Four years later, over 170 million iPads have been sold, and any company attempting to enter the tablet market has some pretty stiff competition to go up against.
John Dvorak, a famous technology columnist, had been similarly dismissive of the iPhone. At the time Apple launched its smartphone, BlackBerry was hugely dominant in this market, and Dvorak opined that the iPhone was in fact “trending against what people are really liking in phones nowadays”, emphasizing the public fondness for the keypads which are a particularly feature of the BlackBerry Ltd (NASDAQ:BBRY). As we know now, he was completely wrong, and the iPhone quickly established itself as the world’s most popular smartphone, and the benchmark against which all other smartphone are measured.
Defiance and innovation
If there are two words which describe the success of Apple Inc. (NASDAQ:AAPL) it is defiance and innovation. At every step of its successful journey, Apple has defied its critics and released products which have defined or even created a market, niche or genre. The challenge for the company going forward will be to keep doing this in the increasingly competitive tech environment.