The foolhardy notion that Apple is ‘too rooted to hardware’ and that hardware is ‘becoming a commodity’

“Venture Capitalist Fred Wilson recently spoke at the TC Disrupt conference in NYC where the outspoken investor had some interesting things to say about Apple,” Yoni Heisler writes for TUAW.

“Not one to mince words, Wilson boldly proclaimed that Apple by 2020 will no longer be one of the top three tech companies as measured by market cap. Instead, the top there spots will be occupied by Google, Facebook, and another company that we haven’t yet heard of,” Heisler writes. “Now to be sure, anticipating which companies might be market cap leaders six years into the future is a fool’s errand. Nonetheless, the reasoning Wilson proffers is nothing more than the oft-cited drivel that folks who don’t really grasp what Apple is all about like to bring up.”

“The notion that Apple is “too rooted to hardware” isn’t a new one. Still, it’s perplexing why some folks continue to gloss over the fact that Apple’s business model of developing both software and hardware is precisely the reason why the company has been so successful,” Heisler writes. “As for the argument that “hardware is increasingly becoming a commodity”, well, there’s a big difference between hardware being prevalent and hardware being a commodity”

Read more in the full article here.

Related articles:
VC Fred Wilson: By 2020 Apple won’t be a top-3 tech company, but Google and Facebook will – May 5, 2014

18 Comments

  1. Hardware docent matter? That’s crazy. I will pay to get nice(Apple) hardware any day. Accepting crappy hardware because it’s cheap/free is a foolish mistake. Clearly this guy has no appreciation for quality in workmanship. I’m guessing he owns some Samdung phone he got free with a contract and a $200 Chrome book.

  2. Part of the reason Android phones are so annoying to use and have such problems is because the Android universe is fragmented into numerous hardware configurations, most built on the cheap so that the handset maker can squeak out some profit.

    The best software in the world is useless without good hardware to run it. And Apple has by far the best integration of hardware and software in any industry.

    Plus, Apple is investing heavily in specific hardware innovations to separate itself from its competitors and make its products far superior.

  3. Is he going to write the related articles about how Ferrarri, Porsche, Burberry and Tiffany are all going to collapse… because cars, clothes and jewelry are all commodities?

  4. “‘…it’s perplexing why some folks continue to gloss over the fact that Apple’s business model of developing both software and hardware is precisely the reason why the company has been so successful,” Heisler writes. “As for the argument that “hardware is increasingly becoming a commodity”, well, there’s a big difference between hardware being prevalent and hardware being a commodity”

    I’m not sure the important notion is that there is a difference, it’s that even when hardware becomes a commodity, there is always a market for superior hardware. Chasing marketshare means making shit when hardware is commoditized. However, despite the sage advice of the Enderles of the world (does he even exist anymore? We used to get linked to his drivel all the time 4+ yrs ago), chasing marketshare in hardware is not the key to making profit – it’s simply one possible way. While that avenue is pursued by everyone else, Apple focuses on making flagship class hardware. More importantly than that, their software, again not focused on profit by itself, is customized to work with their hardware instead of being diluted by front end bullshit of carrier or hardware manufactures, is optimized to work with their hardware and provide a great user experience. Are there flaws in UE? Sure. But those problems are inherently more frequent in the Android ecosystem.

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