A quick guide to Apple’s successes and failures

This post is mainly just to lay the groundwork for another post I’m writing on the mythical “Apple Car”.

The most successful Apple products blend hardware and software to deliver an unparalleled experience to consumers. When Apple is either not selling directly to consumers or doesn’t get to use its advantage in design or hardware/software integration, it loses.

Apple 1.0: Apple Computer

Apple’s first product was the Apple I, released in 1976. Industrial design and marketing, things that define Apple in 2015 were not really part of the companies DNA yet. In 1976, when Apple was founded, Jony Ive was still attending elementary school. The Apple I was sold in a kit, in pieces! It was successful in part because of its low price (it was not a luxury brand). But, the Apple I solved a need. It allowed people to join the personal computer revolution with just a TV and a keyboard.

The next Apple product was the Apple II. Released less than a year after the Apple I it eliminated the need for consumers to build their PC! It was then teamed with the first “killer-app”, the VisiCalc spreadsheet. Together the Apple II and VisiCalc solved a problem for people as they used PCs to do number crunching for business.

Next came Apple’s first failure, the Lisa. It had a new fancy graphical user interface (GUI), but failed because it was too expensive and there weren’t enough useful apps for it.

Apple picked itself up and launched the Macintosh, to much fanfare. With a famous 1984 themed Superbowl ad the Macintosh sold well. It sold even better when it was teamed with the LaserWriter printer, thus beginning the desktop publishing revolution. The GUI first debuted in the Lisa was now solving a real need for customers. This was the beginning of Apple’s connection with users engaging in creative pursuits, like artists and designers.

There was much wailing and gnashing of teeth in the years that followed, but what mattered to customers were the products Apple was producing, not all of which were successful.

Apple 2.0: Apple Inc (or iDevices)

You can debate the exact timing, but I think the launch of the iMac in 1998 was the end of Apple Computer and the beginning of Apple Inc (the actual name of the company wasn’t changed until 2007). The iMac was a computer designed for consumers instead of businesses. It had beautiful design by this guy called… Sir Jonathon Ive, who is now the company’s chief design officer. It threw out legacy requirements like having a floppy drive and it embraced the internet by having a built in modem. For these reasons the iMac was a big success and so began the rebirth of Apple.

The next big new product for the company was the iPod. Again, the seamless integration of hardware and software (iTunes), beautiful design and leading-but-not-bleeding edge hardware choices made turned the iPod into the dominant portable music player. The iPod was so dominant that it became a proprietary eponym like hoover, kleenex and xerox and spawned whole new words and industries like “podcasting”.

After the iPod Apple proceeded to launch the iPhone and iPad which came to define the smartphone and tablet markets respectively. Apple has collected the majority of profits in the smartphone market and dominated the tablet market to the point that one developer famously commented that “There really isn’t a tablet market. There’s an iPad market”. These products were again doubling down on Apples strengths. Those strengths are integrating hardware and software, beautiful design and eventually, supply chain optimization.

Apple’s non-Blockbusters

Like a discman, but uglier?

Apple’s failures began with the Lisa, but there were other famous ones like the Apple Newton. And some that were so abysmal, yours truly was not aware of them. The Newton was definitely aimed at a real need. The explosion of mobile devices after the year 200 showed just how real this need was. The first problem with the Newton was that the price was too high for most consumers. The second problem was that there were no problems that this device solved for the consumers. Calendaring and scheduling were only useful to some people like busy corporate executives. There was nothing really compelling beyond that. The handwriting recognition might have been a useful feature but it was famously faulty.

Even the remade Apple Inc has had it’s fair share of flops and fizzers. Remember Xserve? Neither does Apple’s main wikipedia page (as of 04/29/2016). iCloud has never capitalized on the huge advantage of being shipped on every Apple device. iCloud itself was supposed to be a do-over of MobileMe. AppleTV has never caught on in the way that it should have and Apple is likely about to cede the home automation/AI overlord space to the likes of the Amazon Echo/Alexa.

What separates the blockbusters from the failures?

I contend that the following features define every Apple blockbuster:

  • Killer app(s) — The Apple II had VisiCalc, The Macintosh had desktop publishing, the iMac had The Internet(tm), the iPhone had Facebook, Instagram, Uber, Google Maps (hehe), the iPad had Games, a bigger screen for video and the Apple Watch has ummm...
  • Mass consumer Appeal — Many Apple products have been expensive but the successful ones have been priced low enough that they are within reach for a significant proportion of the population. You don’t sell forty eight million of something in three months if it’s just a luxury item. Many of Apples flops, especially in the Apple Computer days were simply priced too high. Others, like the Newton, only appealed to a subset of consumers.
  • Hardware/software integration — Apples blockbusters are in spaces where tight integration of hardware and software matters. The iDevices (iMac, iPod, iPhone and iPad) were all at the cutting edge of portability for their time, where power and space are at a premium. When Apple is building just hardware, like CD players or just software like iCloud then it is no better than the competition.

On the flip-side, Apple’s flops and fizzers have one or more of the following characteristics:

  • Trying to sell to businesses — Microsoft still dominates the corporate IT market, even after software developers and consumers have been flocking to Macs for years. Apple couldn’t even use Xserve to create a beach-head in the server market even though it was running a Unix based operating system! Steve Jobs famously laughed Drew Houston because Dropbox was a feature not a product. Now Dropbox, Box, Google, Microsoft and Amazon are all going going after the corporate storage and productivity market and iCloud is nowhere to be seen.
  • Doesn’t solve a real consumer need in a novel way — One thing that the Newton and Apple Watch have in common is that nobody knew what to use them for upon launch. On the other hand, literally toddlers can have fun playing with an iPad.
  • Pricing themselves out of the consumer market —Some of Apples early flops like the Apple III fall into this category and I think that the Apple Watch is at risk of doing so.

So, here is your quick guide to predict the success of an Apple product. If it combines hardware and software, has a killer app and is aimed at the entire consumer market, it will likely be a success. If it’s aimed at businesses, doesn’t solve a real need in a novel way or is too expensive, it will be a flop.

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