This is NOT the End of Apple

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Since the recent keynote by Tim Cook (October 2012), there has been a media furor on how it is going to be the end of Apple, or that Apple after Jobs is dead.

I’m going to risk sounding like a Fanboy and say that this just nonsense and really a “heard” mentality going viral. What is more likely is that people and blogs are jumping on the media bandwagon for more eyeballs or mouse clicks. One prominent reviewer of the iPhone 5 even retracted his initial bored dislike and proclaimed the iPhone 5: “the best phone to ever grace the earth“. Which makes me wonder how can people review a product without even using it first? (Hence we rarely do product reviews here at Design Sojourn.)

My analysis of the iPhone 5 keynote and recent (iPad Mini, 13″ Retina etc) product launch, signals that we are far from the “end of days” at Apple under Tim Cook. For sure there has been some management revamps to be sorted out, but I for one am bullish on Apple’s future.

Here is why.

We have a warped sense of how we define an “Innovative” product.

Here is basically how some of the most influential people online define Innovation.

Dan Crow at the Guardian UK said: “It [Apple] hasn’t introduced a truly new product since the launch of the iPad nearly three years ago; instead it’s making incremental and overhyped improvements to its current lines.”

Since when has Apple made anything “new”? The iPod was inspired by Creative’s Zen Mp3 Player, the iPhone was a mobile phone with a redesigned Xerox Parc’s touch screen interface, and the iPad is a tablet PC (ah la Fujitsu) with optimized hardware.

Furthermore, Apple has never been in the business of selling to early adopters. Apple sells to the early majority and the rest of the groups of consumers as described in the theory of Diffusion of Innovation.

Therefore Apple’s brand of Innovation is in taking matured technology, redesigning them, and packaging them into a proposition that consumers find easy and a joy to use. Packaging the technology so that people get it. This is also the reason why Apple products don’t compete on specifications, not do they contain the fastest CPU or biggest and brightest screen.

Technically, Apple has never been the leader in any form of technology nor products. There is nothing in their product line up you cannot fine an earlier alternative. But they have managed to find the right time to come in and spectacularly take over the market. For example how the iPod, the iPhone and iPad took over the world.

Apple is in the business of Incremental Products.

One of the big gripes of the new Apple line up was the surprise launch of the iPad 4 seven months after the launch of the iPad 3. The iPad 3 was Apple’s biggest selling iPad with 3 Million sold. This resulted in many people saying that Apple just officially pissed off 3 Million of their customers with the iPad 4.

I disagree. We have touched on this before in my previous post. Apple has to keep updating their products to keep up with the technology “Joneses”, but to their credit, they do not obsolete their old products by building an ecosystem where OS updates will work on both new and older devices.

Try updating your Samsung Galaxy S2 to Android’s new Jellybean? The Galaxy S2, at the time this article was published, has no official way of updating the software to the latest and greatest.

However what is really significant about this seven month product upgrade cycle, is that Apple can now beat the fast-followers and OEMs of this world at their own game. This, in my humble opinion, is a huge breakthrough that many pundits have missed. Especially when Apple does not technically own their factory and outsources all their manufacturing.

Think about it for a moment?

A fast follower strategy basically takes a winning product, makes the specifications 10-20% better or cheaper, and then gets it out very quick (on an average of 6-8 months). With this speed up in Apple’s development cycle, when a fast follower gets a product out, they are already obsolete as Apple not only has a the next one out, but a new model that is likely 100% better then their predecessor. (Apple claims that the iPad 4 is 2x faster than the iPad 3).

This heralds exciting times for Apple (thanks to supply chain maestro Tim Cook) and that we should expect more frequent product updates going forward, at least twice a year.

iPhone 5 and iPad Mini: It’s the iMac and MacBook all over Again.

Before we wrap up lets do a quick analysis of the two most significant Apple products of this year.

I don’t really expect any major innovation for the iPhone or the iPad range to come. Apple may be guilty of new product marketing overhype, but Apple’s innovations really only come at the start of the range, after that it is all incremental improvements (some larger, some smaller) through the years. If you look at how the iMac and the MacBooks have evolved, you can see what has happen with those ranges will eventually happen to the iPhone and iPad.

Click to zoom.

Step 1: Create an archetype changing or defining product.
Step 2: Improve it with technology and manufacturing processes.
Step 3: Milk the product for as long as possible.

It is also worthwhile to note that Apple runs on a Castle and Moat strategy.

Therefore the iPad mini is also a purely defensive play. Apple has obviously realized that they might have missed the ebook market, as the iPad’s size and weight is not the best for long term reading. With Amazon’s Kindle ecosystem doing very well, they needed to ensure that they have something in their range to keep their customers from leaving.

So what’s next?

Tim Cook at the recent D10 Conference interview shared a little about how Apple develops new products. The information may seem scarce, but if you are in the industry it says a lot. He said:

1) Can we control the key technology?

2) Can we make a significant contribution far beyond what others have done in this area?

3) Can we make a product that we all want? (Cos we think we are reasonably good proxies for others.)

So if we consider these three points, and the analysis above on Apple’s brand of innovation, we can conclude two things:

1) Apple will not launch anything new if they do not think the timing is right or if it is not right for their customers.

2) To find out what’s next, all we have to do is look at technologies out there that are important but under-performing, and under-humanized.

So with this, my bets are on voice control (which Siri has not done as well) and Apple TV or a new TiVo type system.

As you can see, Apple isn’t doing anything different today than what they did in the past. If they are guilty of anything, it could be marketing overhype or launching too many new products this year.

Regardless, the road going forward is not going to be easy as Apple’s competitors are doing things a lot better. Fortunately, Apple has proven consistent in what they do and that proven recipe is going to help fight off the competition. They will still make mistakes and we, of course, will forgive them. And Apple employees that do not fit well, including Steve Jobs, leave and some do come back again.

I love to hear your thoughts on this analysis, so please do not hesitate to leave a comment below. Thanks!