“When you think about Apple’s strategic advantage over competitors, the fact that it has the brains of Steve Jobs, Jonathan Ives [sic] and other top visionaries usually lands at the top of the list,” Tim Bajarin writes for PC Magazine. “It’s true that having this type of brainpower at the head of the company gives it quite an advantage over its competition. But it would be a mistake to think that only these few are the only driving force behind all of Apple’s products and long term strategy. Indeed, as I understand it, the visions that drive Apple are a collaborative effort.”
Bajarin writes, “Apple recently disclosed that it pre-bought $7.9 billion in components in Taiwan, and China says that Apple bought up as much as 60% of the available touch screens in the market. So how does this impact its competitors? Apple gets a huge price break because of the quantity it purchases. Apple can do this for two reasons. First, it has the cash. Secondly, it has an assurance that there will be actual customer demand for its products and that it can sell all of the products it makes with these screens.”
“Apple’s strategic advantage is in high gear here and unless… competitors can match its buying power, Apple will continue to have at least a one to two year lead on them with pricing alone,” Bajarin writes. “Now add to this Apple’s attention to details and focused brainpower and you get a better sense of how Apple’s strategic advantage is a rather big one.”
Read more in the full article – recommended – here.
Jonathan Ive. Is it really so hard to get a name right?
Makes one wonder how many stupid people are running companies today. Don’t get me started on government departments.
Oh, he was thinking of Burl Ives. Or Charles Ives. : )
In other words, keeping cash on hand allows Apple to pursue certain strategic moves that many of its competitors cannot.
Great observation. Steve is certainly the visionary that will never be equaled in our generation at AAPL. But he couldn’t do it by himself. Obviously he hasn’t thought of or designed the great products that AAPL has had from the iPod to the iPad. But he has the final say. He has the hammer. He get’s the credit and accolades because he is the great salesman and the guy who can figure out which product in which version will sell. He’s the showman that the public (and fanboys) love to watch. He is the ultimate carnival barker. He is the ultimate marketer. They do seem to hire the right people who can
thrive in that environment. Because you know that it isn’t easy
working for Steve. They also have mountains of cash. As a
stockholder I would love to see a dividend but will , at least for now,
go along with the idea that they can do better things with it. I have done ok since 2004!
At this point in time it’s far more important for Apple to cripple its rivals so they can’t bring their products to market in great numbers. Apple may have spent $7.9 billion, but it now Apple makes that much cash every quarter. Compared to weaking competing companies and possibly ending an Android threat before it evens starts, a dividend pales in comparison.
Android tablets seem to be fighting a losing battle in profitability, no matter how many Android tablets get to market. All those Android tablet vendors will be beating up each other just trying to get tablet components and likely paying a premium for them. The Android tablet vendors continue to say that they’re going to drive prices down for users, but unless they cut some serious corners, I don’t see how they can undercut Apple by a whole lot. But maybe for consumers, a lower-quality product at a cheaper price may be sufficient.
But intellectually, Apple may possess something greater than buying power which was accentuated above.
The ability to see a new product or feature through a typical customer’s eyes and then integrate both hardware and software to achieve performance & CONSISTENT ease of use is simply & inarguably THE major technical advantage the collective Apple design group has which seems unmatched elsewhere, even in Seattle-Redmond.
This collective Apple advantage started with UNIX and then the programming interface & developer software Next-Apple built to continually support the new feature designs that Apple continues to execute at a high level.
This deep software & hardware integration depth Apple has developed is arguably their highest technical advantage they have.
What the heck does this mean, “even in Seattle-Redmond?” They only know how to copy!
Copy? You jest.
Perhaps you missed taday’s blast of innovation from Redmond.
InTUNES
Unbelievable !!
“Perhaps you missed taday’s blast of innovation from Redmond. InTUNES”
I rest my case!
Apple is years ahead of the copiers & accelerating its development. Some competitors are bound to fail or give up competition with Apple in order to try to survive.
It’s not that people running companies are not smart – it’s that very few of them have good taste nor do they trust the good taste of their designers and creatives. Then they turn around and let their engineering dept. run wild with the technology of tomorrow that’s not quite ready yet. Apple does the opposite with the designs and functionality of tomorrow using the technology that is ready for today – the bleeding edge makes for a poor user experience – saturate the damn bandwidth or stop talking about 4G.