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Top 5 take-aways from Tim Cook on Apple's Q3 earnings call

John Cox | July 24, 2014
Apple's Tim Cook says iPhone thriving, iPad innovation on tap, Apple is an enterprise company.

 iPad sales have dropped for two consecutive quarters overall. Cook pointed out that Apple has sold 225 million of them, that current owners report very high satisfaction with the product. It's interesting to speculate on what Cook means by "significant innovation." Does that cover evolutionary changes such as making the iPad thinner and lighter? Or does he have in mind something more radical (and, yes, evolutionary changes over time can result in something radically different from the starting point)...and, if so, what would that be?

 He also made clear that a big market for future iPad growth is the enterprise. Cook noted that while 99 percent of the Fortune 500 have at least some iPads, "the penetration is business is low: it's only 20%." Penetration means the number of users actually working with an iPad or iPhone. By contrast, notebook PC penetration is over 60% , he said. That represents a big iPad opportunity with a "substantial upside" in the business market, according to Cook.

 Which brings us to....

 -5 Start thinking of Apple as, also, an "enterprise" company

 "And this [substantial upside] was one of the thinkings [sic] behind the partnership with IBM that we announced last week," Cook said. "We think that the core thing that a better go to market, which IBM clearly brings to the table, but even more importantly apps that are written with Mobile First in mind. Not all but many of the enterprises apps that have been written for iPad have been essentially ports from a desktop arrangement and haven't taken full advantage of mobile."

 Mobile First is IBM's comprehensive plan to help enterprise customers marshal the resources to design, deploy, manage and operate a mobile business, ranging from point apps, through redesigned business processes, to "business transformation."

 In his opening statement during the earnings call, Cook said "We forged a relationship with IBM to deliver a new class of mobile business solutions to enterprise customers....We are working together to provide companies access to the power of Big Data analytics, right on every employee's iPhone or iPad. Using Swift [Apple's new programming language], we will collaborate to bring over 100 Mobile First apps to enterprise clients, each addressing a specific industry need or opportunity."

 It's interesting that Cook focuses on what he sees as one the main failing, and hence opportunity, for enterprise mobility: apps that have not yet fully exploited mobility -- the ability to engage with customers and partners, and with enterprise data and systems, anytime and anywhere. Apple seems to be betting that iOS can become the enterprise mobile standard to the degree it can improve the way people work today.

 Later in the discussion, Cook added: "And we win if we can drive that penetration number I spoke about from 20% to 60%. That would be incredibly exciting here. The walls would shake. And so that's what I hope for."


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