Newsletter Issue #1025
November 8th, 2021For many, Apple is the counter-culture company, or one of the remaining firms to fit into that category. No doubt that feeling revolves around the two founders, Steve Jobs and Steve Wozniak. Indeed the first project they delivered, before there was such a thing as an Apple Computer, was a blue box. That was a device designed to hack the touch-tone phone system to make free calls.
Officially, they sold between 40 and 100 of these devices for $170 each. So they weren’t so cheap, since that would be roughly $866 in today’s dollars. Regardless, hacking the phone system was illegal and the police soon shut them down. So no more blue boxes, and I suppose Jobs and Wozniak should have felt lucky that they weren’t jailed for their transgressions. The story goes that they gave up on the illegal stuff and decided to build legal gear instead.
Now even though Apple’s computers were decidedly normal technological gadgets, Apple’s renegade reputation stuck over the years. It certainly didn’t hurt that they opted not to conform to industry-standard processors and operating systems. Rather than “borrow” someone else’s achievement as a certain fellow gearhead was said to do, they went their own way.
The famous 1984 Macintosh commercial revealed the new personal computer with a graphical interface as the force of good, fighting against the evil computing Big Brother, then known as Big Blue, or IBM.
While Macs were more or less reasonably successful, they never dominated the marketplace, and the shenanigans of Bill Gates to license portions of the original Mac OS to graft into Windows, Microsoft’s imitation, delivered a competitor that dominated the PC space.
After Steve Jobs lost the power struggle with Apple CEO John Sculley, he gathered some Apple employees to work with him to create NeXT. And, as we know, the company was an Internet pioneer, and made a Unix-based interface warm and fuzzy. But it didn’t succeed so well in the marketplace. By 1993, they discontinued the cutting-edge hardware and focused on the multiplatform operating system.
The one that became Mac OS X after the turn of the century.
After Apple acquired NeXT in late 1996, Jobs jockeyed the corporate moving chairs the following year, and became the Interim CEO, make that iCEO. He finally ditched the “i.”
Now remember that Apple was still struggling with sales and a bloated product lineup. Jobs did what came to be called a “Steve,” where he discontinued products right and left including the Newton Message Pad, a forerunner to tablets such as the iPad, and even printers.
Now while I never quite took to the Newton, I had always bought Apple LaserWriters — until I didn’t. I think I owned an HP laser printer at the time Apple discontinued its lineup of output devices.
The Mac lineup, which had so many models that executives would have trouble separating one model from other, was shaved to focus on simplification, subdivided into consumer and professional machines. Although this practice has taken on some confusing aspects over the years, it is fundamentally how the lineup is organized now.
Even the iPhone. So the latest and greatest consists of two iPhone 13s, and two iPhone 13 Pros, the latter with enhanced camera technology and more professional capabilities. The subdivision in the iPad product line is more confusing with the iPad and iPad mini being essentially consumer models, the iPad Air sitting in the middle, and the iPad Pro being the, well, Pro model.
You get the picture.
In any case, Apple may not be number one in all its products, but overall sales, which include expanding wearables and services divisions, have put the company at or near the top of the corporate ladder in recent years in market cap. Sales and profits have reached incredible levels compared to anything Apple did in its first generation of existence.
When it comes to services, Apple is also a movie studio, investing billions of dollars to become the next Netflix with Apple TV+. Or the next Amazon Prime. Or at least a healthy competitor with deals involving such notables as Steven Spielberg. Forgetting whether it has garnered enough success compared to the competition, there’s clearly a motive behind this and other services, and that is to exact as much money as possible from existing hardware customers. But you don’t even have to have an Apple gadget to watch content. Streaming boxes (even the ones not made by Apple), major smart TV brands and even gaming consoles include support. And, at $4.99 per month after a 7-day trial (or three months if you buy a new Apple gadget), it’s not a major investment.
If there’s something to watch of course, and that might be the problem. You might prefer, as I’ve done with various services, to wait until interesting shows pile up, binge for a month or two, and cancel your membership until more shows are available. Just a thought if you find yourself confronting the inevitable fact that cutting the cable TV cord doesn’t always save you money, especially if the ISP you use will exact higher fees if you exceed their bandwidth limits.
To be fair to Apple, its emphasis on the environment, making products easier to recycle, focusing on renewable energy and so on and so forth, does demonstrate that it wants to be a responsible corporate citizen. But not at the expense if losing opportunities to exact as much profit as possible on every sale.
So who benefits if Apple earns loads of money from everything they sell? Other than having plenty of cash for a future rainy day, and engaging in such fancy corporate money maneuvers as stock buybacks, how do you and I benefit? Well, if we’re not stockholders in Apple of course.
I realize Apple suffered financially in the years before Steve Jobs took control and reorganized the company, but if they gave their retail store workers, say, a 25% wage boost, and cut prices 10%, they’d still earn sizable profits. All right, maybe they wouldn’t give Tim Cook and other key executives cash reserves of tens of millions of dollars to sustain then after they retire, or if they need fancy new cars, yachts and homes.
But how do customers benefit as prices of new Apple gear increase? Isn’t Apple Silicon supposed make Macs cheaper because they don’t have to buy the parts from Intel, and they can produce them more efficiently themselves through their manufacturing partners? Sure, I realize that the present supply chain woes might increase the costs of some parts, but I do not recall any danger signs in their last financial statement.
I’m sure the financial wizzes in our audience will be happy to tell me how large profit margins help preserve Apple’s health, so they can continue to deliver great products, and why allowing enough for stock buybacks will be a boon for those who can afford to invest huge sums in the company.
I prefer to look at my bank account and credit card balances. It doesn’t mean that I’m going to buy someone else’s personal computer to replace my aging iMac. I just don’t see the Windows alternatives as being suitable for my workflow. But I think Apple needs to rethink its choices when it comes to pricing.
And when it comes to the App Store, the dangers of sideloading — allowing you to go to a different vendor for iOS and iPadOS apps — are overwrought. Apple could surely establish a set of standards and practices for other software repositories to allow them to become secure and compatible. If they don’t meet the standards, dump them. Now maybe only a small number of mobile customers care, but I don’t see the logic of now allowing it to happen. With safeguards of course, and it may be the antitrust regulators will finally force such an action regardless of what Apple wants.
Long and short is that Apple may have become too large and too greedy and they need to get over it and work harder to benefit customers. They do not, of course, have to listen to me or anyone else, and the alternative multinational tech companies are really no better and usually worse. Maybe it is time for a startup somewhere to find a way to become the next Apple, although it may take far too long for it to benefit me at this point in my life.
THE FINAL WORD
Gene Steinberg’s Mac Radio Newsletter is a weekly information service of Making The Impossible.
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