Why The Apple Will Fall…

Okay, so that’s a link-baitingly, fanboy-angering title.

Caveats first.

I own a _lot_ of Apple gear — iPhone, iMac, MacBookPro and lots of software — but I definitely have a love/hate relationship with them.

And by fall, I don’t mean collapse and disappear in to the ether.

But I do mean fall from their arguably market leading position, especially in mobile.

So hands up who remembers 1994? More specifically, who remembers the great Intel debacle of 1994?

Let me recap. Back then, like now, Intel owned most of the market. They shipped a shiny new Pentium chip that had a division error. Now to be fair, the error was very small and would only tangibly affect a tiny number of customers, but Intel committed two cardinal sins.

  1. They already knew about the error from internal testing but decided to ship the bad chip anyway.
  2. When the matter was brought to their attention, they offered to replace a bad Pentium chip only after they had determined you used the chip in an application in which it would cause a problem.

Guess what? Customers didn’t like this very much. Intel’s stock price dropped, IBM halted shipments on systems with the faulty CPU and a media circus ensued.

[You can read a blow by blow summary of the whole thing here]

Compare and contrast this with the Apple iPhone 4 grip of death problem.

In case you’ve been living under a rock, the brand new iPhone has a bit of a flaw. If you hold it with your left hand and your hand touches certain parts of the bezel, the signal/reception drops to zero. Gizmodo had some of the first coverage.

For a phone that has a history of poor call reception (thanks in no small part to AT&T), this is a big deal.

Except Steve Jobs disagrees. In one of his many famous replies to a random customer, he quite literally said “It’s not a big deal”. In subsequent emails he simply said “Just avoid holding it in that way”. Seriously??? Read more at Engadget.

What’s more, the official Apple response that followed is a combination of “buy a case for the phone” and “don’t hold it that way”.

What blows my mind is that among the Mac faithful, they are getting away with this.

Now compare this to the Intel case I mentioned earlier. Both products have fundamental flaws that impact basic operation, but there are work arounds so you could argue the flaws aren’t critical. Both companies deny the issue and then confirm it while telling you to suck it up, but the outcomes were quite different…

Intel got slammed. They lost millions in market cap. They spent more millions trying to clean up the mess and had a PR debacle that lasted for years.

Apple got made fun of by non-fanboys, the world shrugged and everyone went on with their business.

Why does Apple get treated so differently? Because the are still perceived as a fringe player. They’re not seen as the market leader. Apple isn’t “The Man”, but Intel definitely was.

The cool kid always gets cut a lot of slack — they’re cool, they earned it. There’s a price to being cool, and sometimes that price is a great looking but not fully functional product.

When “The Man” ships a crummy product, they are ripping you off. They are the epitome of corporate greed squeezing you for every dollar. Never mind Intel, Microsoft Vista, anyone?

But here’s the thing. Like a rebellious college student now twenty years into a career and climbing the corporate ladder, Apple are becoming “The Man” whether they like it or not.

They own the Smartphone market in the US. They own 70% of the downloadable music market. I don’t even know how much of the music player market they own, and they are now one of the biggest single manufacturers of desktops/laptops.

That’s a long way from being a computer supplier with 2-3% of the total market.

Don’t get me wrong, Apple are still cool, but choosing Apple is no more of a niche play than a Soccer Mom choosing to buy a Minivan.

At some point, Apple reaches a tipping point where they cross over from niche to mainstream. I would argue that they’ve already done that, but the market perception has yet to catch up.

And when they are mainstream, they become “The Man”. And when “The Man” ships a broken product, people get pissed off.

Apple don’t know how to play that game. Their approach doesn’t work if they’re not the cool kid. Everything the company stands for, and most of its history, is built on the cool-kid-slack factor, and when that goes away, what will they do?

So yeah, when the world realizes that Apple is, in fact, The Man, I believe the Apple will fall. And who knows what will come next.

Watch this space and let time prove me wrong 🙂

2 comments for “Why The Apple Will Fall…

  1. Will
    June 27, 2010 at 12:55 pm

    Great post. It's interesting to see how once "fringe players" are now becoming the big ugly kid on the block and are being attacked. We see it happening with Google right now. Apple is starting to fight lawsuits in Europe the way we used to only see Microsoft do it. Welcome to the top, Cupertino boys . . .

    I've always thought that Apple's stand on spyware/malware on Windows was going to backfire on them. They aggressively went after Windows as being insecure when the real issue is that the spyware experts could have cared less about destroying the data of 2-3% of the pc users out there. We're already seeing more reports of data corruption and data distribution on Macs than ever before. Stupid corporate move IMO. You never, for example hear an airline talk about the other guys' safety record. It's not about bad form, it's just stupid to subject yourself to the blowback that'll come the first time a hatch opens on one of your jets at altitude. Welcome to the top . . .

  2. July 10, 2010 at 3:26 am

    The question I have is whether what you describe will happen before we have a repeat of Apple vs Microsoft and Android takes over the smartphone market.

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