Why Apple won’t make an iPhone for the masses

Don’t go looking in the detailed cost breakdowns.  Sure, Apple has plenty of profit margin to shave off the iPhone.  They could sell one for $150 and still make a profit better than most.  But it is not in the market share figures either.   And it isn’t some complicated marketing reason, anything about a premium brand and the Apple aura.  The reason that Apple doesn’t go downmarket in price to attract a greater market share is actually much more simple:

They can’t suppport it.

If you have ever played the Mac vs PC game, there are a few trump cards.  Mac users always (rightly) claim superior design and good looks.  PC users however often ask their graphic designer opponent something closer to home:  “…and what OS does the computer you are doing your company’s accounts run?”  Outside the US and UK the answer is usually Windows.  “What company makes the OS on your medium sized companies’ servers?”   That won’t be Apple either.  In fact I have yet to find any compelling proof that even Apple Inc itself runs any heavy duty work of its own on machines made by Apple.  (If you have evidence to the contrary, please drop a comment at the end of this article.)

Apple’s famous ecosystem doesn’t run on Apple servers.  While Google leads the planet in data center design and software economies, while they pioneer efficient energy usage and blazing speed in every transaction, Apple is very very far behind.  And then some.   This is a company that couldn’t even support it’s own emailing system properly, not even for die hard fans was it good enough.  Apple buys capacity from others.  This is a company that basically rebrands other people’s technology, they have no idea how to design a system as elegant in it’s massive scale as Amazon’s server infrastructure.  Others are breaking new groung in improving databases and every aspect of computer transactions while Apple plays around buying patents and suing.

So how exactly would Apple support us if the entire planet started using iPhones and iPads?  While they are all just playing games and – literally – twiddling their thumbs on their touch screens, things hold up.  If they all started looking for serious infrastructure support, if they started actually trying to work online concurrently, the system would crash and the lawsuits would start.  Apple would have to announce a partnership with someone like Google or Amazon to scale up quickly.

We can all find bones to pick with Microsoft but this is a company that has made sure that roughly 90% of the planet’s personal computers and a lot of its servers actually work and exchange software, files and information for the past two decades pretty well.  I can take the accounting software I used on MS Dos, stick it in the latest PC off the shelf and run it.  It will even support an amazing selection of the planet’s hardware and accessories.

So don’t hold your breath.  If Apple wants to take market share, I look forward to hearing about it’s robust infrastructure first.  Doing business in regions where most people won’t actually use anything “smart” online on their smartphoen doesn’t cut it.  Unless Tim Cook just goes ahead anyway and admits it:  “we don’t make the fastest or safest browser, we don’t even control Apple computer hardware ourselves really, heck, we in fact we outsource all our infrastructure.  Get a life!  Apple isn’t about superior technology, it is about the user experience.”


Here is exactly what Tim Cook needs to do with Apple: turn it into IBM!

The thing about us consultants is that we give advice even when nobody asked for it.    The world’s biggest company surely doesn’t need my help.   Even more so since I have historically and openly criticized it at every corner.   But, like my friends always say, I probably have a secret wish to one day buy an iPhone.   So here is my best shot at how this might come to pass:

1. I loved IBM laptops.  In this blog I wrote an almost erotic in intensity elegy.  I still check out the odd Lenovo I see somewhere to see if that keyboard has the old IBM magic, the design details.

2. Tim Cook is essentially an IBM person at heart.  12 pretty important years in his personal development made him so.   IBMers are a breed apart, the corporate ethos was much more intense than Apple those days.

3. IBM hardware was always top quality and slightly more expensive.   You could usually pay 20-30% more for a machine with similar specs.   Remind you of someone?

4. IBM always made conservative decisions about specifications, I/O, software and other components.   Which meant that you have a much better chance to still be relying on the machine even a decade later.  Which justifies the price difference retrospectively many times over.

…and therein is the difference.   I tried to revive an IBM laptop and a top of the range Apple desktop of about the same era.   Started up the IBM, pressed F2, it came back to Windows XP factory settings.  Left it online to update itself and it is ready almost anything.   The Mac impressed my kids more with its massive monitor and fancy hardware.    “We want to play with the one with the Apple!” they chanted as I struggled to prepare it for use at their school.   To no avail.  Getting OS9 to do anything (especially online) requires almost root level hacking skills.   Meanwhile the ΙΒΜ was playing all their latest Flash game favories, YouTube videos, and I could even load up some ancient DOS games I found lying around back from my gaming days twenty years ago.

Anecdotes aside, here is the point:   there will always be a need for high quality hardware.  Even more so if it is matched with great design.   Even more so if it has a tidy ecosystem to make it easier to use.   This does not however require stone walls and proprietary tricks.   We don’t want Apple to invent a new connector for our monitors, much less so for our mobile phones.   We are willing to pay Apple to produce 20-30% more expensive hardware because they have put more effort in its design and quality.   In its ease of use.   In good marketing, which means getting the right people using the platform; it benefits everyone on the platform after all when this happens.

Apple is doing none of this right now.   But Tim Cook has a seriοus personal – leadership problem.   He can’t get people to forget the (inevitable) mistakes he makes like Steve Jobs did.   No glossing over.   He talks simply.   No magic involved.   So why doesn’t he take Apple towards the good old hardworking IBM ways he broke his teeth on?   If he doesn’t, Samsung will.   And I will still prove my friends wrong for another decade by not buying an iPhone for another ten years…


Apple won’t sue Google and Cook is a better manager than Jobs. Which is bad.

Of course Apple won’t sue Google!   Getting a positive verdict when fighting a foreign company in a US court is one thing.   Going up against Google is quite another.  Even without the closet of Motorola patents, Google wouldn’t lose.   It would be like going up against the water utility company; they just leave you to die of thirst while you wait for the verdict.   And even if you win, you will always worry what they might put in your water…

And Tim Cook, unlike Steve Jobs, is a good manager.   He doesn’t take chances like that.   He doesn’t believe in hocus pocus quack medicine.  He has made Apple a much more “normal” company.   After almost two decades of irrationality, he finally gave out dividends.   He actually talks to investors.   After a decade of forcing slave labor in China he finally decided to look like he is doing something about it.    Employees in the US no longer live with the fear of a Jobs’ attack on them; they actually have time to drink coffee now.

There is more formal organisational structure; without Jobs, other people actually get some real responsibilities.   Around 53% of the employees who reference “MBA” on their Linked in profile have been at Apple (non retail)  less than 22 months.  After a lifetime of closed garden design …hey, OK, he can’t change everything all at once!   There might be a few chinks in the armour but it is still a secretive company.  Only problem is, we are less and less interested in their secrets anymore.

Apple is based on the wow factor.   Tim Cook will make the best of disappointments like the iPhone 4s.   The company will of course not remain as succesful as it has been in the past years.   But it will not fall down all of a sudden.   He is milking the brand carefully.   But making it a “normal” company is obviously a very…unApple thing to do.   Normal companies don’t perform like Apple did under Jobs.

So don’t hold your breath.   Some people say “let’s wait and see the new product launches before we decide”.   I don’t think you need to wait for anything.   It won’t be a spectacular success.   And it won’t be a spectacular failure either.

Normal.   Heck, they might even start giving away more than 1$ a year to charity…



Steve Jobs was right to “go thermonuclear” against Android

“I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”

The point isn’t whether he said it or not.   Nor is it whether it is admissable in court (it is).

“I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40 billion in the bank, to right this wrong.”

The real issue with Apple versus Android is a much more important point about their underlying business model.   Both rely on market dominance.   Some may call it an abuse of a dominant position.   I prefer to call it the “give away” model.

Here is Google’s version:  “we spend millions developing a cutting edge telephone OS.   We give it away to any phone manufacturer that wants to use it.   Guess what?   Android phones are cheaper that way!   We spend billions buying companies and developing Google Maps.   We give it away for free and even include navigation in Android phones.   Who cares if we destroy an entire industry, it’s not our industry!   We spend billions buying, developing and running YouTube, Gmail and loads of other services.   You know what?  You can have them all for free!  And everyone along the chanel can do what they please and make money anyway they see fit.   All we ask of you is that you click on an advert now and then on Google search, YouTube, Gmail or wherever else we put one in front of you.”

And Apple’s version: “We spend millions selectively buying cool companies or those that have developed some technology we need because we don’t really invent anything.   We package them as cool as we can and charge as much as we can.   We squeeze everyone in our supply and distribution channel dry.  We drop prices or add features only when the competition forces us or Steve Jobs isn’t around to persuade Apple fans that whatever we have done is cool.”

Put that way, which phone OS do you think is heading for global dominance?   The philosophy of free with Android extends to apps of course.   Forget Apple style scaremongery about locked devices.   Rooting an Android phone is almost included in the package and applications that unlock any app you find are almost automatic.   Android 5.0 might include a “crack that app” in the OS…

Steve Jobs was right to feel threatened about Android.   Not because they “stole” some iPhone features.   He, of all people, knew very well that the iPhone was never about features.   It is Google’s business model that is the real threat.   If Apple wants to beat Android it should be spending it’s money not on law suites, but on buying more companies with new features to give away.   They have done it before in other sectors when they felt desperate.   Apple’s involvement in the digital video is a good example.   Final Cut came out of nowhere to become the darling of a new movement (it’s always a “revolution” or a “movement” with Apple, isn’t it?) mainly through features they added by buying up companies.   Buy a company that makes a 4000 dollar color management software and throw it in the next version….

The real problem with Google’s threat however for Apple, is that Google hasn’t got to worry about hardware.  Chinese workers killing themselves, the cost of components and copycats will find it hard to beat Google at its game.   Not even Microsoft has managed to mount a credible threat to its search monopoly.   Facebook’s floppy IPO shows just how little anyone really believes that sexy newcomers, no matter how big, can really effect Google.

Business Technology

Apple doesn’t break the rules; it doesn’t have any!

What is Apple’s mission statement?

Apple designs Macs, the best personal computers in the world, along with OS X, iLife, iWork and professional software. Apple leads the digital music revolution with its iPods and iTunes online store. Apple has reinvented the mobile phone with its revolutionary iPhone and App Store, and is defining the future of mobile media and computing devices with iPad.

Seriously.  Not kidding, it is from the Apple website under “Investor Relations”.   If I had written a mission statement like that, even at that project at the end of Year 1 of business studies they would have failed me.    Even the other gem, hidden in the same section isn’t much better:

Apple is committed to bringing the best personal computing experience to students, educators, creative professionals and consumers around the world through its innovative hardware, software and Internet offerings.

Yeah right.   That defies all rules of mission statement making.   Pretty sure nobody in the company even knows it.   Apple’s mission statement was probably more like:

We all do whatever is cool and seems to please the Allmighty Steve Jobs.   He always knows best, even when it doesn’t seem to make sense; he will make it work sooner or later.

Forget social responsibility (no charity, iKill workers abroad) it is all about profit maximisation.   And now that Jobs is gone a few shareholders are daring to ask whether they might actually have a share of the monumental cash pile at last.    You can only pretend to be emotionally impaired by those times aeons ago when you were cash strapped and even borrowed from Microsoft.    Apple is one of the richest companies in the world.   More than 100 billion in the bank just sitting there for what?   And they don’t even pretend to have some masterplan!

Forget increasing market share.   They could easily drop prices, increase product range or just buy a few companies and give away something of value like Google does.   Buy Adobe, give away Photoshop or something.   (More or less what they did with the digital video market which they then almost abandoned.)  But no, the ghost of Jobs walks the sleek halls of Apple still.   They still shamelessly do everything they can to maximise profit.   Nothing else.   After all, if everyone has a Mac how could they urge you to “Think Different”?

But that is no mission statement either.   To cater to weird designer type people and make them feel special.   I made that up but it would still be more accurate than what they have now.    So Macs are stuck at much less than 10% market share globally and iPhones not much more than that, 25% globally for the optimists.   Depending on your mood you can do statistical hoopjumping to consider iPads a threat to the global status quo or not.  To force other technology companies to produce cooler gadgets than the geeky stuff they did so far.   That would show some awareness, some commitment to helping the planet in some way.   It would give us an idea where it might be heading and all that stuff we learnt about missions statements.   We all thought it was really necessary for a well functioning company…

Sorry to be the party pooper but this doesn’t make sense.   What is the point of this company again?   And without a magician to tell us that the emperor is not naked, how will it pull off any future tricks?


Mac vs PC: is anyone ever going to run proper benchmarks again?

OK, it is a sign of age.   Do you remember back when people actually tested computers for their performance?   I especially fondly remember Charlie White’s heroic efforts.   He is now high up the Mashable food chain and doesn’t “attack” Macs anymore…. heck he writes about them like everyone else.   But who does actually give Apple machines an honest run for their money?   I’m not talking about their business practices, whether they do any charitable donations (they don’t) or kill loads of people in their factories without any serious signs of caring or doing much about it.   This is a techie question, not a social responsibility sermon.

It is a well established (statistically, theoretically, practically and well…obviously!) that Apple has journalists wrapped around its finger.   It’s i-finger or i-whatever it does.   It gets more coverage for free, more positive coverage and more simply adoring coverage than anyone else.   It gets in more movies than anyone else.   And it doesn’t pay for it.   They are marketing demi-gods.   The only recent mac vs pc test I could find ends up almost equating the two solutions even though the Mac is $450 more expensive!    (To be fair they end the comparison like this: “So, if you love Macs, stay put. For everyone else, the choice is simple: Save your money and buy a PC. It’ll get the job done.” )

But wait a minute.   These are, for the most part, tools.   Not gadgets but machines we use to get a job done.   Sure most of the iPad lot are just scrolling up and down aimlessly and playing Angry Birds.   But for every 100 PCs out there, at least half are for actually producing something.   In a finite Universe with finite time.   We should care how quickly it gets done.   If you are crunching numbers, running a business, serving a customer, these things matter.   Which is why you don’t see Macs in mission critical environments.   They are not only more expensive; some businesses would pay for the style.   They are also slower.

I will gloss over the pro Apple arguments.   About a sleeker interface, myths about it being more stable or more safe none of which apply for many years now and especially since Windows 7.  I am talking about performance.   You use Photoshop?   You should care if it takes forever to load an image, or twice as long to execute a plugin effect as an equally priced PC.   You spend all day doing it.   You could be gaining valuable hours of free time.   There are good business reasons why Apples are slower.   Not just because Apple spends all day figuring out how to sell phones, not PCs anymore.   Even seemingly secondary things like hybrid HDD drives have good Windows drivers months or years before they have any compatibility with Macs.   It’s simply not worth the time of any manufacturer to bother doing any research for a company like Apple with such a small hold on worldwide PC sales.   And on top of that, Apple doesn’t make any partner’s life easy of course…

Back then, even with huge, proven differences in performance of common tasks, Mac fanatics simply refused to change.   Even when they finally conceded that they were slower, much slower, they came back with “yeah, but PCs are ugly“!

What’s your excuse?


The planet is lucky Steve Jobs stuck to making gadgets

I think everyone in branding envies Steve Jobs.   Some turn it into adulation, others into hate.  He was the ultimate spin doctor.  From “we burn Pentiums to the ground” to “we love Intel” in the space of a few months.  Or “we will never use Adobe Flash” to “OK, we will implement it in everything again”; most politicians would do well to study how he did it.

From the Apple IIe back in the early 80s, to my Macintosh and then the Quadra at University, I must admit I never agreed with the company’s approach to doing business.   Because there was only one beneficiary:   Steve Jobs!  The concept of a sales channel simply didn’t exist in his mind.   Up or down his supply chain everyone was milked for everything they had.  5,6 or 8 billion dollars or whatever his net worth was as he died and not a cent given to charity.

And yet the whole planet mourns.   If this man was in charge of a country, he would have set his neighboring country off doing space exploration (he would keep the rights and take the credit though), we would all be earning $100 a month and he would be re-elected every time.   We would all believe we are living in a golden age of a perfect life as we waited for the next version of his social policies to actually work.   He would be president of the United Nations and kick everyone else out of the meetings.  We would put up with his laws being practically a dictatorship; and like it too!

We should all breathe a huge sigh of relief at the passing of this genius.   Because it wasn’t evil genius.   Simply a megalomaniac without a real vision.   Selling gadgets for people to play “Angry Birds” on, isn’t a vision.   Fighting poverty in Africa, famine or cancer is a vision.   Getting rich people to buy shiny hardware doesn’t change the world.

Read here about “The Other Steve Jobs: Censorship, Control and Labor Rights”

Business Communication Technology

Don’t spend good money on SEO. Start a blog!

OK, I admit it.  I never liked Flash.  But Apple isn’t killing Flash.  Google is.

Back when I sold ‘real’ animation software I hated it.  Computer geeks idea of making stuff move on a screen really was the absolute worse way of doing it.  I objected to it as an animation tool.  Then I started getting annoyed at Flash as the cause of all those ridiculously complicated websites which took forever to load and didn’t really tell you anything.

I felt the need for content. Content isn’t king, it is our bread and butter.   And while corporate websites got FLASHier (pun intended) they got less and less interesting in terms of content.  It was like a one page brochure on nice shiny paper.  Almost useless, you can’t even use it for starting the fireplace in winter.

Which is why blogs took over.  Google likes blogs better than Flash sites.  And people find content through search.  At least if you are interested in attracting new customers.  Having a flash based website you end up paying for SEO to achieve what? If someone enters your brand name, your official website appears near the top of search results.  Which is like saying that if someone opens the physical copy of yellow pages, when they get to your listing they see you!

What you really need is to appear next to relevant topics.  And Flash doesn’t do that.  Wordpress does.  Or any other mechanism that puts the emphasis on content.  So rather than spending through the nose to try and make your flash website more SEO friendly, just start a blog next to it!

Your flash website is like your business card.  Flashy and almost useless but it gives a better (safer) sense of your brand.  And the blog is like your newsletter.  Less aesthetically pleasing but with more juicy content, worth revisiting.  I predicted the demise of Flash back in 2007 but here I am now in some ways backing it.  There is no good reason to go tearing down work already done on the platform 98% of connected computers use!  Just because Steve Jobs and a bunch of iPhone touting fashion maniacs in California say you should?  (Remember than iPhone penetration is much much lower in most of the rest of the planet.)

I still don’t like flash by the way.