CUPERTINO, CALIF.: Maybe we should call him Timid Tim.
As the recent iPhone unveiling event showed yet again, Apple under CEO Tim Cook is anything but bold. The company that reeled off one breakthrough after another under the late Steve Jobs and wasn’t afraid to kill off its own successful products to make room for new ones now seems content to just stay the course.
Instead of completely new or radically redesigned gadgets or dramatically expanded product lines, we get incremental tweaks and changes. When the highlights of an event are that Apple has introduced one new phone that comes in gold and another that comes in brightly colored plastic cases, it’s clear the company’s not exactly stretching itself.
“As time has gone on, each of these events has had [fewer] surprises,” said Bob O’Donnell, an analyst with tech research firm IDC.
Apple needs to take a risk and “shake things up again,” he continued. “Otherwise people are going to write these things off as being not as compelling as they used to be.”
Rumors have swirled for years that Apple is about to unveil an iWatch or an Apple TV, but it hasn’t released a truly new product since the iPad in early 2010.
Yes, innovation doesn’t happen on a regular time schedule, and many of Apple’s breakthrough products took years of development. But the recent drought raises doubt about Cook’s appetite for risk.
The big recent news was that Apple, for the first time, will offer two new iPhone models, the flagship iPhone 5S and a less expensive iPhone 5C.
But the lineup change was largely cosmetic. For several years now, when Apple introduced a new iPhone model, it continued to offer its older ones, but at discounted prices. The iPhone 5C is just a new version of that old strategy. It essentially is last year’s iPhone 5 with a colorful plastic case and a slightly different moniker. It has the same chip, the same camera and the same screen.
It was widely rumored that the 5C would be a new, low-cost model that could reap huge sales for Apple in developing markets like China and India. But it’s not. Sure, you can get it for $100, but only with a pricey two-year contract. If you try to buy it without a contract, it will put a $550 hole in your checking account. The unlocked iPhone 5S will set you back $650.
So Apple still lacks a lineup of differently styled or priced phones.
As Avi Greengart, who covers the smartphone market for research firm Current Analysis, puts it, “That’s their strategy and they’re sticking to it.”
That Apple has taken this long to introduce such a modest addition to its iPhone lineup speaks volumes about the company’s timidity under Cook. For contrast, look back on how Apple managed its iPod line under Jobs.
It’s now been six years since the launch of the iPhone. Within the six-year period following the launch of the original iPod in 2001, Apple had established four distinct product lines — the iPod Classic, the iPod Nano, the iPod Shuffle and the iPod Touch. It had already eliminated its most popular product line, the Mini, and replaced it with the Nano. It then introduced the iPhone, which by combining a phone and a digital music player threatened to undermine sales of the entire iPod line.
With the iPod, Apple offered products at a wide range of prices. And it showed it could meet the needs of different consumers. The Nano and the Shuffle weren’t discounted versions of last year’s model — they were distinct products with unique features that set them apart from the higher-priced classic.
Apple also showed that it could respond to market demand and changing technology. It released the Shuffle in response to the growing market for inexpensive digital music players. And it released the Nano as flash-based players started to become a popular alternative to hard drive-based models.
A year or two ago, Apple arguably had little incentive to do anything different with its iPhone lineup. Sales were soaring and Apple was gaining share in a fast-growing market.
But Apple’s smartphone sales growth has slowed markedly and it’s now shedding market share. Meanwhile, the company’s other business lines have seen sales slump. Apple needs some new products — and more big hits.
Yet its recent record is one of missed opportunities. Given the success that Samsung and others have had with phones with displays of about 5 inches or so, a large-screen iPhone would seem to have obvious appeal. And given that much of the future growth in smartphones is expected to come from less developed countries, a truly low-cost iPhone would seem to be a no-brainer.
But instead of seizing those opportunities, Apple chooses to stay the course. If you want to know why, you’ll have to ask Timid Tim.