“‘The Innovator’s Dilemma’ author Clayton Christensen outlines his case for why Apple’s propietary strategy will soon fail, just as it did before,” Peter Burrows reports for BusinessWeek. “For years, many felt that Apple’s past mistakes were bound to come back to haunt the Cupertino (Calif.) company — the refusal to license the Mac OS in the 1980s; the stale products, bloated expenses, and management turmoil that hobbled it in the mid-1990s; the software availability and falling market share that plagued it right into the 21st century. These days, with Apple’s stock price the talk of Wall St. and its products once again defining techno-chic, all that’s a distant memory. That is, unless you’re Clayton M. Christensen, the Harvard professor and author of the seminal 1997 book ‘The Innovator’s Dilemma.’ Christensen, who more recently wrote ‘Seeing What’s Next: Using Theories of Innovation to Predict Industry Change,’ isn’t willing to jump on the Apple bandwagon just yet. As well as Jobs & Co. is performing now, Christensen fears that success is built on a strategy that won’t stand the test of time.”
Basically, Christensen is concerned that when the times comes to license their proprietary FairPlay DRM, Apple will miss it – just as they did with the Mac OS.
As to whether Apple will continue to gain significant share in the personal computer market with the Mac, Christensen says, “I don’t. I think it will allow them to survive for a bit longer. I think most people are satisfied with their current PCs (using Windows and based on Intel chips) and find that the performance of their systems is good enough. Sure, there are people at the bleeding edge who want to do more. But a good Dell PC can be had for $500, and it has performance that’s well beyond what most of us need.”
Full article here.
Christensen is wrong on both counts. Too many people are definitely not satisfied with their current PCs. Christensen needs to get out more. As for iPod+iTunes and the FairPlay licensing issue, we trust that Steve Jobs has a plan and, since he’s running the show this time (as opposed to the Mac licensing fiascos; not doing it early enough and then doing it too late and incorrectly), we bet he’ll license FairPlay when the time comes to do so.
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Related articles:
Analysts: Apple Mac’s 5% market share glass ceiling set to shatter in 2006 – January 09, 2006
Apple’s Mac OS X, Safari web browser show significant market share gains in 2005 – January 05, 2006
Apple portables set to grab share in 2006 with projected 42-percent unit shipment increase – December 19, 2005
Apple’s Mac OS X, Safari web browser show market share gains – December 03, 2005
Analyst: Apple’s Mac market share could ‘double within a decade’ – November 08, 2005
Report: Apple’s Safari browser shows market share gains, Mac OS increases usage share in October – November 07, 2005
IDC: Apple shows rapid growth, holds 4.3% U.S. market share on 48% growth – October 17, 2005
Bear Stearns: ‘We see Apple making further PC share gains,’ raises price target to $58 – September 23, 2005
Microsoft’s Bill Gates’ prediction of Apple iPod market share decline fails to materialize – September 18, 2005
Sounds like the PeeCee weenie is hoping that computerized fascism reigns supreme for the Windows world while bringing a holocaust to the alternative computing world.
Doesn’t make any difference to myself and others if he teaches at Harvard or the local vocational school. He’s just plain wrong; Apple has been around a long time, is thriving and I believe that we’ll not be disappointed by what happens tomorrow or this year.
Harvard professors can be wrong or misguided too.
“But a good Dell PC can be had for $500, and it has performance that’s well beyond what most of us need.”
True. And with Apple on the vanguard of turning the computer into an interactive TV/video and music player media center the need for a new innovative, faster computer is less and less.
—————
There’s a plane leaving for Iraq in 5 minutes, show us what a good neocon you are and be on it.
Hank – that would be cool. iPod that hooks right to the internet, iTunes on my iPod, download directly to the iPod…right now to own an iPod you have to own a computer.
This way one wouldn´t need the computer!!!
“This Harvard guy is RIGHT. Apple (i.e. Steve Jobs) is an ARROGANT BASTARD…
Why is it that ‘arrogant’ is the adjective so often to applied incredibly successful visionaries by ACRIMONIOUS PEONS?
“@ Bib Boy>
So much of a liberal that he was a political appointee during the first Reagan administration…”
LOL… conservative shoots mouth off, hits foot.
so: this explains the success of little billy! as he hasn’t “innovated” anything in his life, his place is assured! gee; it’s all clear to me now!
What propietary strategy? Is Microsoft any different, NO! This is another one for the Apple’s going out of business baloney. It’s been predicted I believe about 49 times including this guy and it hasn’t happened yet and with Apple GAINING MARKET SHARE I think this guy has been living in a closet or underground. With so many PC’s having so many viruses and spyware attacking them everyday people are getting tired of it and are switching. I listen to tech podcasts and radio shows like KFI The Tech Guy where people are calling in saying there fed up with it and want to switch to a Mac.
I don’t see Microsofts DRM being open nor any of the other formats and Apple has about 80% of the marketshare both in the US and europe. So why should Apple change anything? They don’t need to for one reason is there selling to both Mac and PC markets so there really is no reason too. They have the best MP3 player both audio and video and the best online store and definately the easiest to use by far. This guy needs to go back to school and educate himself on Apple’s latest products and get himself out of his little time warp of 1995.
Never mind that he comes from Bill own Alma Mater.
To MCCFR: Not that I’m supporting Bib Boy’s statement but you’re statement is a tad misleading isn’t it?
“From 1979 to 1984 he worked as a consultant and project manager with the Boston Consulting Group (BCG), where he was instrumental in founding the firm’s manufacturing strategy consulting practice. In 1982 Professor Christensen was named a White House Fellow, and served through 1983 (on a leave of absence from BCG) as assistant to U.S. Transportation Secretaries Drew Lewis and Elizabeth Dole.”
That’s a far cry from “a political appointee”. You make it sound like he was the benefactor of political ideology. That doesn’t appear to be the case. You should try being a little more intellectually honest and a little less emotionally reactionary.
Harvard huh? Gee, I wonder where he gets his grants from?
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“those who can’t do, teach”
Blantantly false. Unfortunately, those who can’t teach, still do.
Anyway, Microsoft became dominant solely due to their affiliation with IBM. In the early 1980’s there were dozens of PC companies and OSs. (Sinclair, Atari, TRS, Commodore, Apple). It was not until THE computer company, IBM, entered the PC market that things really started falling out. In addition, it could be argued that IBM’s failure to own it OS was perhaps one of the most costliest business mistakes in history.
This Harvard professor’s FUD is just that. As well as somebody who is out of touch. Remember Microsoft is Microsoft because their OS and applications are proprietary.
I also think Apple needs to license their FairPlay DRM. They won’t be able to withstand the onslaught of other MP3 players that will keep coming at them. I walked into a BestBuy yesterday and there was a HUGE display of MP3 players. There is a lot of competition right now. Plus, I think the future is going to be Satillite (or cell phone based) MP3 players that allow you to have hunderds of commercial free channels and from which you could download and save any content you wanted to. Apple should ride the iPod for as possible since (I believe) it has added to their computer market share increases.
Regarding the computer market share, I disagree with the writer. I think Apple is doing all of the right things (examples:; Apple stores, Intel, UNIX based secure OS) to keep their computer market share growing. I just hope Apple doesn’t charge higher prices for an Apple computer that is equivalently equipped as a computer from another computer maker such as Dell or HP.
(I also hope they don’t start selling computers with “integrated shared video memory.”
– Mark
Actually MDN, you’re wrong on at least one count. Most people are satisfied with their PC’s for no other reason than most people simply don’t care which computer they use, but hey, keep harping on them. There’s no better way to convert someone than telling them they made a stupid choice when they bought Windows and then ignore the fact that for most people, the PC works 99% of the time. And it’s worth noting that despite all of the MDN rhetoric, XP is a pretty good OS despite it’s shortcoming; OS X has it’s shortcomings as well.
We can only hope Jobs has a reasonable liscensing plan for Fairplay but if he doesn’t Apple will lose that market eventually.
“Arrogant bastard” is often the term used by the ‘little shits’ to describe a successful leader.
In the reigns of Stalin, Hitler et al, the ‘little shits’ took out such leaders they called “arrogant bastards” because they were decent, principled and a threat to their way of doing things. A good recent example of the ‘little shits’ at work was in the novel “Captain Correlli’s Mandolin.
BusinessWeek: How growth at Apple Computer will remain on a tear in 2006
Monday, January 09, 2006 – 12:10 AM EST
“In a world filled with uncertainties, from Iraq to interest rates, you can count on at least one thing: Growth at Apple Computer will remain on a tear in 2006. Sales of iPods are showing no signs of slowdown, and Jobs & Co. appears well poised to keep gaining share in the vast personal computer market with its resurgent Mac product line,” Peter Burrows writes for BusinessWeek.
So much for the professors FUD.
There’s a plane leaving for Iraq in 5 minutes, show us what a good neocon you are and be on it.
YEEEEHawwwwww, shitforbrains. I’m a just a wunderin’ if ya’ll ‘ll join me on my lil’ trip over there!? Ehh, whaddaya say, ya lil’ snotlicker? Yaah, you — the one with his thumb stuck so far up his ass that you can’t see the dangers all ’round ya . . . so ya rely on others to do the shitwork while you post on blogs from yer comfy fauz-leather chair that’s holding up yer 300 pound sweaty, B.O.-ridden, masturbating, never-been-laid carcass.
Tellyawhat, pardner, why doncha shove that attitude up yer fat, lazy ass ‘n leave the job of defendin’ the freedom of shitstains such as yerself to yuckety-yuck rubes like me . . . okay, there, hoss?
Apple is not bound by the Innovator’s Dilemma. This is illustrated by the fact that they discontinued the immensely successful iPod mini to replace it with the nano. A company vulnerable to the Innovator’s Dilemma would never have done that, would never have killed a successful revenue-producing product to replace it with something new.
Kiss my ass, you f-ckin’ liberal puke:
Settle down ‘Chuck Norris’. As a great man once said, talk is cheap, and internet ‘tough talk’ is the cheapest talk there is. So, since you’ll never make good on any of your spewings here – ever – do us all a favor and roll on.
Let the grown ups talk in peace now. Y’hear? An we promise we’ll be ’round to tuck y’all in later.
G’nite sweetie!
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Dear Kiss my ass …
You’re demented.
Apple should license Fairplay now. As it is people are using iTunes predominantly because they like the iPod, so the final equation is ipod vs. other player. The software is not very important. If they licensed Fairplay the choice would still be a hardware one – iPod vs. another player – and the iPod would still be superior, so Apple could put the nail in WMV’s coffin without sacrificing hardware sales figures.
Except there would be a boost for other manufacturers, as some iPod owners experiment with other players before coming back to the iPod. So really, Apple should have done this last year or the year before, when the other players were less mature.
That aside, it’s ridiculous that this guy thinks Apple is going to crash and burn, just as it’s ridiculous for MDN to suppose that Apple is going to rise up and slay M$. Apple is a fabulously profitable niche player, and I like them that way. Sure, get the other guys to adopt more open standards, like ODF, so as to increase interoperability; and hope that Linuz matures and provides an increasingly competitive alternative to Windows on the desktop; but keep my platform on its comfortable little island (say, between 3% and 10% market share), please, and keep my Apple stock shooting skyward.
This Guy Is An Academic Dolt
OH MY GAWD is this dolt’s hypothesis stupid!
To keep to the 5000 character limit here I have to skip some of my points. Let me just jump in:
“But once the technology matures and becomes good enough, industry standards emerge.”
The first and still only computer with a solid, reliable, stable standard is the Macintosh. I don’t think this is what he meant to say. He is implying that the Windows PC has better standards than the Mac. No. Just no.
“That leads to the standardization of interfaces, which lets companies specialize on pieces of the overall system, and the product becomes modular.”
So far I am hearing not-a-thing differentiating the Mac from the Windows PC. He is not making a point. The entire frickin’ software engineering industry with standardized GUI elements. They were begun by Xerox, elaborated on and standardized by Apple. Microsoft knew this was the case, which is why they blackmailed Apple into licensing Mac OS GUI elements, which resulted in Windows.
“At that point, the competitive advantage of the early leader dissipates, and the ability to make money migrates to whoever controls the performance-defining subsystem.”
Agablagablehbleh? What the hell is ‘performance-defined subsystem’? It is meaningless rhetoric used to cover up the fact that he does not know what he is talking about. OK, hit me and call me ignorant, but I see nothing meaningful in his claim. If you want to do statistics on performance, as in speed of the computer, efficiency of usability, return on investment, cost of ownership, etc., then we are still talking about the Macintosh as the winning computer technology.
“In the modular PC world,”
Like Macs are not modular? Huh?
“that meant Microsoft and Intel (INTC),”
AND Apple’s Macintosh! Do you have a point yet? No!
“and the same thing will happen in the iPod world as well.”
What will happen? This dolt has no idea what he is talking about and is presenting NOTHING regarding the real history of the Apple Macintosh and the Windows PC. I claim that Clayton Christensen is blowing air out his anus.
“Apple may think the proprietary iPod is their competitive advantage,
Blunder #1 in this phrase: There is nothing proprietary about an MP3 file. Anyone with an MP3 file can use an iPod. There are ways to make your Windows DRM protected WMA file into an MP3 just as there are ways to turn your Apple DRM protected AAC file into an MP3.
Blunder #2: There is absolutely no benefit to Apple to invite WiMP (Windows Media Player) media on to the iPod. They are not in the business of giving away their technological advantage. And you want to know something fascinating? If at such time as WMA files may actually have any kind of advantage or popularity Apple can swiftly and simply add compatibility to the iPod. Result: This guy still has no point.
“but it’s temporary.”
This statement is entirely unproven. Prove, prove, prove professor! All you are providing here is wishful Apple-hate.
“In the future, what will matter will be the software inside that lets users find exactly the kind of music they want to listen to, when and where they want to, with minimal effort.”
And what is it specifically about iTunes and the iPod that does not fulfill this prediction?
“…it’s comparable to the fork they faced when they chose not to open up the Mac in the 1980s, when they let Microsoft become Microsoft.”
No it’s not! Nice try! Easy argument! Completely wrong! The ‘Mac’ in this case is iTunes. What did Apple do? They wrote it to work on any Windows PC!!!
Now, Professor dumdum, has Microsoft followed suit with WiMP, allowing their DRM protected WMA and WMV media to work on the Macintosh? NO! What was that? NO! In other words, the shoe is on the other foot in this situation, making Microsoft the loser, according to your twisted logic.
–abridged–
So much for that prediction of DOOM. Next pundit please! And next time, skip the credentials. Just get someone intelligent who knows how to make a hypothesis, then back it up with actual facts and make logical conclusions. Any blowhard can conjecture with bullsh*t.