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  • Why Do They Want Apple to Fail?

    February 1st, 2011

    Just this week, I caught several articles quoting Patrick Lo, CEO and global chairman for Netgear, a maker of network gear, viciously attacking Steve Jobs. Typical of many executives who cannot cope with Apple’s incredible and ongoing success, Lo went after the well-known ego of ailing CEO Steve Jobs, and the company’s closed platform.

    The most telling statement demonstrate’s Lo’s bad taste: “Once Steve Jobs goes away, which is probably not far away, then Apple will have to make a strategic decision on whether to open up the platform.”

    Forget about the timing of this morbid-flavored comment, coming at a time when Jobs has taken his third leave of absence to deal with ongoing health issues. Lo is one of those forgotten executives that nobody pays attention to, so he clearly hoped to leverage Apple’s success, and the Steve Jobs mystique, to get his name in the papers.

    It’s not that the statement is anything new. Apple’s business plan has proven to be amazingly successful. These days, Apple’s total revenue exceeds that of Microsoft, and is only a few billion dollars short of the figures just posted by Ford. Imagine Apple eventually reporting higher sales than the second largest auto maker on the planet.

    If Lo has his way, that isn’t going to happen. Like other Apple critics, Lo believes that Apple cannot possibly sustain record growth with a closed, vertically integrated platform that covers all their products, from Macs, to iPhones, even to the Apple TV. How dare they?

    To paraphrase an online political blog, maybe we should call this “Apple derangement syndrome.” This ailment apparently infects people who desperately want Apple to fail, and are very frustrated that Apple’s near-death experience of 15 years ago hasn’t been repeated. How dare they?

    From stem to stern, Lo’s rant criticizes everything Apple does, warning that we’re about to see a repeat of the Mac versus Windows wars, where Apple was nearly destroyed by Microsoft’s industry dominance.

    When it came to Jobs’ concerns about Flash, Lo said, “What’s the reason for him to trash Flash? There’s no reason other than ego.”

    What Lo needs to do is actually read Jobs’ blog post on the subject, where he discusses several serious technical issues that define the problems with Flash. The poor performance exhibited by the mobile version of Flash, available in the newest versions of Google’s Android OS, have clearly vindicated Apple’s approach. Besides, Adobe has never been able to demonstrate that they can actually build a functional version of Flash for the iOS that addresses all or most of Apple’s concerns. That, in and of itself, shows how wrongheaded Lo has become.

    Oh, and Microsoft wasn’t immune to Lo’s wrath. He trashed them too.

    In the real world, Microsoft’s overwhelming Windows dominance is slowly eroding, largely because of the growth of the Mac OS, which is way ahead of most PC makers. Windows Phone 7 remains a non-starter, and the market share of the Internet Explorer browser has been on a steady decline at the expense of Mozilla’s Firefox, Google Chrome, Apple Safari, and, to a lesser degree, Opera.

    Here maybe Lo hit pay dirt: “Microsoft is over — game over — from my point of view.”

    So much for open PC platforms, or maybe Lo didn’t notice.

    The real issue, however, is that Lo sought his 15 minutes by making Apple and Jobs the main subjects of his wrath. Nobody outside the tech industry ever heard of Patrick Lo, or even Netgear. Few customers of commodity network products actually look at the brand names. They buy on spec. Today it’s Netgear, tomorrow Buffalo Technologies, and the next day, Cisco (or their Linksys subsidiary). There’s little to no innovation to be found, and differences tend to be relatively minor, except where one product exhibits substantial failure in implementing one or more product features.

    Attacking is easy, and Apple is a prominent target. That they won’t pay attention to most critics only frustrates those critics more. A reality check doesn’t hurt either. You see, even if Jobs doesn’t return to Apple, there’s little to no chance that they will, of a sudden, alter their marketing strategy. Apple has tens of thousands of employees, and a tightly organized executive team that has carefully managed product development, releases, and sales initiatives.

    It’s clear Jobs has assembled a team that is infused with the company DNA and will, at least for a number of years at least, survive the departure of the CEO without suffering or changing direction. Well, at least they won’t change direction unless that’s required by changing market conditions.

    Fifty years from now, MBA students will be carefully examining the life and times of Steve Jobs. Nobody will pay a lick of attention to Patrick Lo, then or now. Speaking of which, he’s had far too much time in the limelight, and, in fact, has already begun to walk back some of his more incendiary remarks. Now what was his name again?

    Another story that delivered a smile was the frantic wish from a CNET blogger that, based on early sales of Android OS tablets, the iPad’s share took a nosedive in the last quarter. The reason for the smile was the news from Samsung that the initial sales reports actually represented some two million shipped to dealers. Actual sales to customers were described as “quite small.” So much for the alleged popularity of the largest selling iPad killer.



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    10 Responses to “Why Do They Want Apple to Fail?”

    1. Jon T says:

      There is a psychology study here somewhere…

      If I could add one more dimension to your discussion I believe that there is a part of the world’s population that does not truly want excellence or greatness.

      As to why, it may be that they can’t live up to it, or they feel threatened by it, and they prefer to live with more mediocre standards, which reflect their own expectations of what they do..

      For that rude and aggressive CEO you quote, he is being measured, knowingly or unknowingly, against the amazing things Apple is achieving. And I bet that’s pretty uncomfortable for him.

      In reality Apple isn’t perfection of course, but it makes you wonder whether technology standards, expectations, and innovation aren’t being supremely raised by it.

      If they are being raised (I’d argue yes – Android for example wouldn’t exist without iOS), it’s the perfect opposite of the years of Microsoft dominance.

    2. Czar says:

      It figures that a CEO of Netgear would make this kind effort, perhaps this company should focus on better quality products. In my experience (and perhaps many others) Netgear makes some of the most shoddy electronics I’ve ever had the displeasure of using. I wouldn’t recommend their products at all based on the experience I’ve had with them.

    3. Dave Barnes says:

      @Gene,
      Ford was 4th (not second) in 2009 and probably 5th in 2010.
      http://en.wikipedia.org/wiki/Automotive_industry#By_manufacturer
      ,dave

      • @Dave Barnes, Yes, I noticed that after the article went up. I was taking it from a Ford claim, which probably should have more accurately reflected their U.S. sales. But if Apple’s revenue soon exceeds that of Ford, my point will have been made, more or less.

        Peace,
        Gene

    4. Louis Wheeler says:

      It is the “vision thing” which attracts people’s envy.

      Apple is unique in that it does not sell products or services, so much as a life style or a world view. Apple turns out great products which satisfy ordinary people’s needs, but that is secondary to why it does what it does. Beauty, panache, ease of use and simplicity is a life style choice, just like being a geeky technocrat is. The fact that Apple is appealing to an ever growing market can induce fear in the technocrat. He can see himself, and the market he long dominated, being diminished. This causes him to blindly strike out.

      “Opening up the platform”, as he puts it, would destroy what is unique about Apple: that it controls the whole widget. That is, it takes responsibility for the user’s satisfaction. Lo laments the end of Microsoft’s dominance, because with it goes the need for a technocrat’s expertise. No longer will complexity provide the best service. No longer will people like him be called on to make sense of endless specifications and tradeoff choices. No longer will people think him special.

    5. Kaleberg says:

      It’s the age old software vs hardware rivalry. Apple is a software company. They only make hardware so they have something to run their software on. Everything they do is from a software point of view. The software team wanted a machine with a mouse and a graphical display, so the hardware team built the original Mac. The software team wanted plug and play device connections, so out when serial and SCSI and in came USB and Firewire. The software team wanted wireless internet, so the hardware team put in an Airport card and later built the iPhone. The software team wanted a touch screen, so the hardware team built the iPad.

      In every case, they started with a software interface design and let it drive the hardware technology. They wouldn’t release the software product until the hardware was ready and affordable, so who knows what else they have under development in the back room waiting for the hardware to catch up. The hardware rarely impresses the hardware guys who like faster processors, overclocked I/O buses, exotic interfaces and so on, but it supports the software rather well. They go down their list of bullet items explaining point by point why Apple hardware just isn’t state of the art, but when the user sits down at, or picks up, an Apple device, they don’t see any of that. They see the software and the user interface.

      On a well designed system, the hardware is invisible, and hardware guys hate that.

      Hardware guys just don’t get it. Apple does.

      • John Brauer says:

        @Kaleberg,
        From a business standpoint, they are a hardware company, insofar as the bulk of their income is hardware based. They have always striven to make excellent software, to better drive hardware sales. Realistically, they are neither a hardware company nor a software company, because they recognize the distinction as absurd and realize that they need to control both the hardware and the software to provide the degree of excellence for which they strive. Really, have you ever used hardware without software? Vice versa?

    6. Peter says:

      I just like to remind people, regarding the Samsung comment, that Apple does the same thing. When Apple says it sold 7 million iPads, that includes the ones sitting on AT&T and Best Buy shelves.

      You’ll notice that the conference calls with analysts refer to having n weeks of inventory in the channel? That’s what they’re talking about.

    7. Juliant says:

      Frankly I think that most of these anti Apple people are envious of Apples’s success. They look at Apple and wonder how Apple can just walk into a product segment and do so well without seeming to break into sweat while they do so much work and hardly make a dent in the market that they are in.

      Most of these people forget just how tough it was for apple in the early 90s. Personally I think that Apple is just like any duck out there in the duck pond. When you look under the waterline Apple is paddling just as furiously as any duck out there

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