Apple to Split into Apple Computer & Apple Electronics
Remember back when the US government tried to split Microsoft apart? They wanted the company to be divided (at the very least) into two separate entities. One that produced an operating system and another that produced applications that would run on that OS. Unfortunately for all that didn’t happen, but for a while there it didn’t look good for Gates & company. Ultimately the government caved and the public never got to experience the software that such a breakup could have effected.
Fast forward to the here and now. I am about to propose that a major player in the computer market split apart, and amazingly enough, it isn’t Microsoft, it is Apple. Yes, Apple computer, maker of the Mac, the iPod and other such wonderful products. Apple, who is currently riding high atop record setting sales. Apple, innovator supreme. Yes, that Apple. It needs to be broken up, and sooner rather than later.
Now, I don’t think it should be split apart along a hardware/software line. That wouldn’t do anyone any good. And this split has nothing to do with licensing OS X or authorizing clones to be built. Rather this split should separate Apple’s computer business from it’s consumer electronic business.
Note: I didn’t say Apple’s iPod business or its media business, because those two things are just pieces of a bigger picture. Do you know what Apple actually sells? I mean, what they really and truly sell? It isn’t computers. It isn’t software. And it most certainly isn’t MP3 players. No, those are just the components most people notice first. What they really sell is an experience. They package up the whole deal and from start to finish they are there, and they make sure everything goes smoothly.
Welcome to the new digital age. This is the time when features aren’t as important as usability. This simple truth has been proven by the iPod’s continuing dominance in its field. Steve Jobs knows this. He also knows that the key to Apple’s success in the future is to ride this trend as far as it will go. And to do that he is going to have to concentrate all his energy on one of two projects, Apple’s computers or Apple’s electronics. My bet is that he will choose the latter.
I think that in the next two years Jobs will put Jonathan Ive in charge of Apple’s computer business so that he can focus his energies on turning Apple Electronics into the premier personal electronics supplier. The iPod is just the tip of the spear. Imagine Jobs churning out every device needed to truly connect the digital home. Apple Electronics can be what Sony should have been had they remained innovative. Give it time and Jobs will allow you to buy any type of media you desire and use it on a custom Apple device, elegantly designed, expertly made and wildly popular.
Give it time and you will see, Apple is destined to become two companies.
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Comments
In fact, business would be near impossible if you had to start over after every success, making sure you don’t appear to be “using” your domainance to (God forbid) harm your competitors.
I disagree. No one is asking businesses to start over or not compete. But they have to compete fairly and openly. As it is now, companies get away too often with collusion, price-fixing, and a lax legal system that allows them to sue smaller competitors out of business.
Otherwise, you end with one company controlling an entire market, doing whatever it wants. I don’t see how you can argue that’s good for anyone but that company.
I disagree. No one is asking businesses to start over or not compete. But they have to compete fairly and openly. -Beeblebrox
But again, the wording (“fairly and openly”) is so vague it could mean anything. Some particularly bad antitrust cases have punished businesses for being so aggressive in lowering prices that it was impossible to compete with them (see the ALCOA case). You might say they were being “unfair” and “anti-competitive.”
I don’t doubt that having huge marketshare gives you the upper hand in negotiations (among other things), but the important point is that any company that aquires such marketshare deserves those benefits.
Gates was smart enough to sell DOS at incredibly low prices to saturate the business world, and smarter still to include it in Windows. Microsoft is now making obscene profits, and as much as I know this will attract flames, I believe they deserve every penny of it.
Of course, I’m still rooting for Apple, because I love their products. But disliking another company is one thing; wishing to forcefully break them up and put them in a straightjacket is quite another.
Again, I’m not suggesting breaking up Apple. I like them as a company and they make good products. Which makes this practice all the more disturbing, and Apple-apolgist excuses all the more pathetic.
If what you’re saying, however, is that corporations should basically be able to do whatever they want whenever they want, that’s a fundamental philosophical difference that’s probably best left for another time. I certainly don’t share it.
In my ideal world, there would be no DRM at all and we wouldn’t even be having this discussion.
I don’t think they should be able to do whatever they want. I do, however, think we should only punish cases of physical force (including indirect force, like fraud or negligence), rather than punishing success.
I do, however, think we should only punish cases of physical force (including indirect force, like fraud or negligence), rather than punishing success.
What about lying? If a company misrepresents its position in order to gain favorable negotiations with vendors or lax restrictions from the govt and then changes its mind. Would you consider that fraud?
Yes, lying is indirect force, since it makes people do things they wouldn’t otherwise have voluntarily chosen to do. But I don’t see how Apple, Microsoft, or any other so-called monopoly lied to get their success.
Didn’t I provide you with a link that shows Jobs arguing exactly the opposite stance that Apple now takes? And didn’t you call Jobs a hypocrite?
Jobs was arguing this point to record companies in order to secure deals with them involving online music distribution. And who knows what else he told them?
But now that Apple’s THEN position stands to hurt its own monopoly, they’re completely flip-flopping.
It seems to be that Jobs/Apple will do or say anything, regardless of whether its true, in order to sell products and secure deals.
This alone does not prove guilt, but isn’t it worth a look rather than a cursory dismissal of anything and everything they do?
I’m not convinced that record companies would be more willing to deal with Apple if they chant that music should be playable on any device - in fact, it seems like they wouldn’t like that.
At any rate, there’s lying in off-the-cuff comments and there’s lying in official business deals. The former are hard pretty hard to prosecute. I mean, I’m sure when Jobs said “Who’d want to watch movies on a 2” screen?” it made competing music stores more complacent about offering video, but can you really take him to court on that basis? I doubt it.
I should add that the example I gave isn’t entirely the same, since Jobs wasn’t making a deal with his competitors when he said it, but my point remains that off-the-cuff comments aren’t really prosecutable in this context.
I’m not convinced that record companies would be more willing to deal with Apple if they chant that music should be playable on any device - in fact, it seems like they wouldn’t like that.
Remember that these companies were already reluctant to deal with Jobs. Now imagine if he had said to them, “Even though I’m saying the opposite right now, when and if we control a dominant share of the market, we will refuse to share our technology, forcing you to deal almost entirely with us on our terms.”
Think that might have changed the negotiations a bit?
since Jobs wasn’t making a deal with his competitors when he said it, but my point remains that off-the-cuff comments aren’t really prosecutable in this context.
As it happens, I was recently a juror in a lawsuit involving misrepresentation in a business deal. Off the cuff remarks are no different from written, signed documents, as long as everyone agrees you said it. Granted, not everyone is going to take you to task for it (particularly not Apple-fanatic lapdogs), but if they do, they certainly have legal grounds.
If, for example, Jobs made a statement that there would be no video for the iPods in order to drive sales of existing iPods, even though he knew at the time that Apple was designing and manufacturing a video-enabled iPod, one would have legitimate grounds to complain. It would be no different ethically from a CEO claiming the health of his company even while he knew it was going bankrupt and was selling his own shares on the side.
I’m sure it would, but tort law only goes so far. I’m not an expert on it, but I highly doubt it requires that each party reveal their future intentions. That’s pretty much up to each party to understand, and if they don’t, they’re screwed. IBM certainly can’t complain about the deal they made with Gates…
I was replying to post #40, by the way, not #41.
As for #41, I admit that I can see some situations where off-the-cuff remarks would matter. Certainly, if there is provable damage, such as shareholder wealth, it would be admissable in court. But still, I just don’t see it in this case. Arguing that Jobs didn’t warn them that he’d be big and powerful is just too much of a stretch.
“If the government couldn’t split up Microsoft, there’s no way they’re going to be able to split up Apple.”
Seeing as Apple can’t do anything as well as Microsoft, why do you think that’s true?
I’m not an expert on it, but I highly doubt it requires that each party reveal their future intentions.
That’s not really true. In fact, the crux of the case I was dealing with had to do with future earnings potential and whether or not the sellers were aware of future deals that would have affected the buyers’s willingness to purchase the company.
And in this case, we’re not necessarily talking about future intentions anyway, but whether Jobs knew he was misrepresenting Apple’s position at the time.
Again, I’m not trying to make an airtight case. Only suggesting that the appearance of impropriety warrants at least a skeptical look at what companies do and that not everything is defensible.