Apple Inc

Apple Inc

Apple Inc was formerly known as Apple Computer Inc was founded by Steve Jobs and Steve Wozniak on April 1, 1976. It is quite strange right? They really choose a nice date for the forming of their company. April Fools! However the company itself is definitely no Fool. It is the largest incorporated company in the world. Depending on the market valuation, it seems to be between Apple and Exxon Mobil for the ranking of Number 1. This has been occurring since the beginning of 2013. Apple first started with Apple 1 on the 1st Jul 1976 and has never look back since.

Apple products are extremely varied with a foothold in more than one industry. After Apple II, Apple did not really have an appealing product and continue to lose market share until the coming of Ipod. Ipod first came out in Oct 2001 offering 1000 songs in your pocket. That really broke the MP3 market and told a giant share of the MP3 sales. Ipod sold through 2002 was 600 000. In June 2003, the Ipod sales broke 1000 000. As at 1st September 2010, 275 million Ipods were sold. Till now Ipod has about more than 70% share of the MP3 player market and is the leading brand of MP3 players in many countries. Given the amount of competition from China and other countries where cheaper MP3 players are made, Apple has lost some market share but Ipod remains popular especially when integrated with Itunes as the distributor of apps and games.

For Mac, it was Number 3 in the USA market but was not the Top 5 PC manufacturers worldwide as at 2012. The overall PC market however, has been contracting. For Mac to increase sales and crunch the Number 3 position in USA is not easy given that Mac does not price itself to be the cheapest, but appeals with its high tech image. Most of the Top 5 PC manufacturers are all fighting for market share with price being a major differentiator. The newest IMac are slim and slick and differs a lot from the usual PC computers that are being sold by its competitors.

For Notebook series, Macbook has a range of products that cover the basic to advanced users. Apple isn’t really concentrating on this market as we can see that it is maintaining and in fact increasing their share by tiny percentage all along. Apple’s share of the USA notebook or laptop market was about 10% and was also the 3rd in USA behind HP and Dell. Worldwide comparison showed that Apple sold about 2 million laptops compared to 85 million sold worldwide in 2011. This shows that though Notebook sales are important, it is not a major constituent of Apple product lines.

Apple Mac Mini was trying to penetrate the server markets that are dominated by Microsoft Windows Operating System and various distributions of Linux such as Redhat, CentOS, Debian and so on that are running on Apache. However Apple server market share is still negligible compared to the two Giants, Windows and Linux. I have not seen much effort in the promotion of Mac Mini and its other servers by Apple. Apple seems to be contented in letting the rest dominant this market while it dominate the consumer markets with its high margin gadgets and products. It seems to be just contented holding on to its tiny foothold. I guess with the widespread usage of Cloud computing, the server markets are getting a paradigm shift. It may be hard for existing giants to look for new opportunities of growth.

Apple most popular product is arguably the Iphone. For the USA market, Iphone is leading in the Smartphone industry with about 38% of the market as at the first quarter of 2013. Besides Samsung with 21%, the rest of the Smartphone makers have yet to crack double digits. This is amazingly fast considering that Iphone was started by Apple in Jun 2007, in the span of 6 years it has defeated the incumbents such as Nokia, Sony-Ericksson and Motorola. Microsoft seemed to have ignored the threat and are paying for it with its late entry into the Smartphone market. In 2007, Microsoft CEO Steve Ballmer and David Lieberman of USA Today had an interview with David asking the Steve about his feelings concerning the passion users have for Apple products such as Iphones and Ipads. Its reply was legendary “It's sort of a funny question. Would I trade 96% of the market for 4% of the market? (Laughter.) I want to have products that appeal to everybody.”

Ipads, the latest addition into the Apple family and the last release before the sad and early demise of its CEO Steve Jobs created a new industry, the Smart Tablets. The first Ipad was released in 3 April 2010, with the latest Ipad Mini on the 7th November 2012. The ease of usage and the seamless integration with the other Apple family makes it a bestseller so much that already 5 generations of Ipads are out on the market redefining the hand carried PC and notebook industries. It is perceived as a threat so much that Android was launched to counter both Iphone and Ipads by Google. In the first quarter of 2013, Apple has about 48% of the Tablet market, ceding a lot of share to Android with 43%.

What links all the Apple Products, Mac, Imac, Ipod, Macbook and Ipad together is their OS, the MacOS which serves to seamlessly allow for connection within the Apple family. This is a key barrier to entry by competitors. The second which provides and ecological systems to the Apple family is the Itunes store where you can purchase videos, music and apps. The combination of the two gives Apple a large niche in the various industries it is competing in. Apple is also starting to benefit from the Cloud industry, one of the rapidly growing service industries, with its ICloud and it is getting into the consumer market with iTV and there are rumors of more evolutionary consumer products to be launched by Apple.


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