Subscribe / Unsubscribe Enewsletters | Login | Register

Pencil Banner

How Apple's new speed bump could make it a stronger company

Michael Simon | Jan. 29, 2016
The last time sales were stagnating, a new product category emerged to change everything.

“We experienced lower than expected September sales due to a business slowdown in all geographies,“ said Fred Anderson, Apple’s then-CFO. ”Our Education sales, which normally peak during September, were lower than expected. And our Power Mac G4 Cube is off to a slower than expected start, resulting in revenues below expectations."

imac g4 cube 
The Cube was a looker but not so much a seller. Credit: Apple

It was the beginning of decline for PC makers across the board, and while it would be short-lived, Apple saw the writing on the wall. Instead of simply riding it out and doubling down on its strategy like its competitors did, Jobs switched gears. A greater emphasis was put on portables, starting with the Titanium PowerBook G4 and a mature iBook that ditched the candy colors and handle for a compact, all-white design. The Cube was “put on ice” less than a year into its lifespan, and just 13 months after the fateful crash, Apple would release its first non-Mac product since the eMate, and a new period of growth was born.

The next big thing

The iPod represented a new tone and a new direction for the company. It took a while for people to see it, but Jobs had pivoted Apple from a personal computer company to a personal electronics one. It was an important change, and it might not have come about without September 2000’s crash.

Apple’s position today isn’t quite as comparable, but despite its size, the company has always been unique in the tremendous attention it gets and the influence it has. And I think it will use this situation in a similar manner, as an opportunity to push even harder into new categories that will carry the company into the future. Tim Cook said as much in his remarks last Wednesday:

“We’ve invested through economic uncertainty in the past, and we’ve always come out stronger on the other side. In fact, some of the most important breakthrough products in Apple’s history were born as a result of investing through the downturn. We’ve also seen these times as opportunities to invest in new markets, just as we’re doing now in areas such as India and other emerging markets.”

I’m not saying that the iPhone is going away or even in a major decline. Like the Mac, the iPhone will be a part of Apple for decades to come, but that doesn’t mean Apple won’t move beyond it. It could be that Apple Watch or Apple TV is the breakthrough growth product for Apple, but in all likelihood it’s something we haven’t seen yet. But whatever the case, there’s no need to worry about the company’s health or prosperity.

Because that’s the last thing Apple’s going to do.

 

Previous Page  1  2 

Sign up for CIO Asia eNewsletters.