Where will Apple be in five years time? That’s a difficult question to answer, but the company's CEO, Tim Cook, dropped a few hints recently. We may not be able to see the whole picture, but we get a sense of its future plans.
Apple has got a lot better at partnerships. Speaking to the Washington Post, Cook notes the company is “collaborating much better with key partners,” particularly in the enterprise. This slightly more open approach is visible elsewhere, from the company’s environmental and labor reports to its effort to open up to a wider tranche of media and more. It’s reasonable to assume that Apple across the next five years will continue to expand its network of partnerships, if only that it can’t be disappointed at the actions of the small number of key allies it used to maintain. I don’t think Apple wants to get burned that way again.
Cook called the hit Nintendo game “Pokemons” when he referred to it during his recent fiscal call, but that can’t hide the huge heap of cash being generated by the title. And nor does it occlude the potential of VR and AR across multiple industries. Is Apple planning something? Of course.
In fact, Cook sees it as a “core technology,” admitting the company is doing a lot of work on it. So what is a core technology? Company watchers may remember Rendezvous and iSync, both of which have become fundamental technologies, opening up things like Continuity, iCloud Photos and more. When Cook calls AR “core” I don’t imagine he’s focusing on creating AR solution, he imagining AR at the center of Apple’s ecosystems. And Apple’s been working on core technologies that could become part of that for a very long time.
No, not that Intel, I’m talking artificial intelligence. I realize it’s popular to pretend Apple has only just begun working with A.I., but Cook – and history – prove this wrong. “Let me take exception to your question. Your question seems to imply that we’re behind,” he told the Washington Post. “We’ve been using A.I. for a long time,” he told Fast Company.
Cook’s correct. Apple now has almost a decade working with these technologies. It introduced Genius recommendations back in 2008. When thinking about new technologies the company follows the old Steve Jobs adage, “Real artists ship.” Technology roadmaps mean nothing. Shipping engagingly useful products that meet a need means everything.
The majority of iPhone users are already running 64-bit processors. Do you really think Apple has put all that effort into developing those chips and the graphics and OS software that lives on them so it can look good in some pointless specs shoot-out? It’s about sewing the seeds for a platform evolution. No one else can match this. “Over time, I’m convinced every person in the world will have a smartphone,” said Cook. “Our goal has never been to make the most. It’s always been to make the best.” However, as mobile device processors are so quickly matching those used in desktops, how long will Apple remain dependent on other processor suppliers?
Apple’s iCloud, App Store, AppleCare, Apple Pay, Apple Music, iTunes, iBooks and other services already contribute 12 percent of Apple revenue. Cook clearly thinks this is going to grow. "I expect it to be huge," he told Fast Company. It is already expected to be the size of a Fortune 100 company by next year.
With 41 retail stores in China and plans in place to launch more in India, emerging economies are part of the company’s future plans. Next year’s introduction of 4G networks across India (where fixed line infrastructure is relatively scarce) will unlock the market for connected devices there. Cook’s consistent – he noted the importance of 4G for India in May.
Cook comes in for criticism for his commitment to social responsibility and a focus on core company values. Some say these commitments don’t reconcile with the needs of company investors, but they’re wrong. To survive and to retain the talent to survive in a connected age demands brands like Apple operate through a much wider lens than just the figures on the balance sheet. “As we enter the Age of Ideals, people will expect brands to go further. Not just to make idealistic gestures, but to act on them,” said Gareth Ellis, Planning Partner at Ogilvy & Mather. Cook’s not the only CEO seeing this transformation, here is what Virgin boss, Richard Branson Tweeted this morning:
The public is tired of cynicism. The world is changing. Values are important. The popular mood supports Cook’s position. Get out the stock.
“Apple is the only company that can take hardware, software and services and integrate those into an experience that’s an “aha” for the customer,” said Cook. “You can take that and apply to markets that we’re not in today.”
That’s why each “core” technology supports and influences development of the other, and with Apple R&D spend at an all time high it will be interesting to see which core technologies the company introduces next.
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