Apple’s plan to remake itself

“Apple has a plan to remake itself. Its new business model is all about leveraging its hardware ecosystem to sell software services,” Jon Markman writes for Money and Markets. “Unfortunately, hardware isn’t what it used to be.”

“The subscription business is booming,” Markman writes. “Apple Music, App Store, Apple Pay and all of the other bits and pieces Cupertino throws under the Services heading are now almost a $6 billion-per-quarter business. Tim Cook promises that by 2017 Apple Services will be a business big enough to make the Fortune 100 all by itself.”

“Tim Cook is prone to hyperbole,” Markman writes. “Cheerleading seems to be part of the job description for modern corporate leaders. He has continually talked about the rate of Android switchers to iOS despite all of the evidence to the contrary. He also recently opined about the growth rate for Apple Watch being on par with the early days of iPhone. Although he’s understandably optimistic about Apple’s future, building a business model based on declining sales growth has never been a great idea.”

“While it’s tough to bet against the world’s largest company and its pile of cash ahead of a product cycle, reducing exposure into strength is the best course of action right now,” Markman writes. “Just as investors became too pessimistic about earnings this quarter, they’re likely too optimistic about the prospects for the next iPhone.”

Read more in the full article here.

MacDailyNews Take: iCal’ed for future use.


        1. Where else are people going to invest their money, Frank? Banks only pay around 0.2% on savings accounts, so you are losing money relative to inflation. CDs are a little better, but still not even break even. Bond yields are low. What is left?

          I certainly do not trust Wall Street or any of the major players that control that game. They have all of the advantages and are focused on making money at any expense. Morality and legality are handicaps in that business. But, despite the disadvantages of the individual small investors, I have no other good way to accumulate money for retirement.

          It is not trust. It is not greed. It is simply necessity.

  1. Doesn’t it seem like Apple has *already* remade itself. People are trying to guess what Apple is going to do and they’ve been very open about their plans from long before Steve Jobs died even.

    Steve made it clear they were going to build “cars,” not “trucks.” We see ever shrinking information appliances from Apple, still powerful computers, but it seems clear that the conventional desktop is going the way of the dinosaur.

    Mobility, portability, and Connectivity seem to be the primary features, while those of us who lament the days of ports on all sides of our computers are going to have to adapt. The appliances that Apple is building are cloud centric. From the MacBooks to the iPads, iPhones, and AppleWatch, Apple is providing services online that used to require additional physical storage, etc.

    Apple’s shrinkage of the personal computer seems to be right on track to collide with gigabit Internet connections in the home and business.

    Apple is building data centers not manufacturing centers. Apple has turned all of that over to foreign interests. Apple doesn’t build servers for their data centers either. They use other people’s hardware and software.

    If you look closely, the DNA for all of this was already there, as far back as the 80s and 90s when Apple made movies like the Knowledge Navigator featuring virtual assistants, high bandwidth Internet connections etc.

    It’s like they’ve been on course all this time, and yes there have been branches off the tree, but the tree trunk has steadily been growing steadily toward compact, highly powerful, information and communication devices.

    So I don’t see anything surprising in the article or Tim’s pushing of services.

    Apple is also redefining who the pro computer user is. If you use Youtube a lot you will see many young people being inadvertently trained as video editors using MacBook Pros (and Premiere unfortunately). Or maybe it’s not inadvertently at all.

    It should be noted however, even a 13 year old making how to MakeUp and shopping videos and raking in cash doing it, wants to know what’s up with the next damn MacPro!

    Apple’s future customer… and it ain’t necessarily us.

    1. Astute as usual. I recently retired and am impressed with myself now that I have stopped caring so goddam much about the tiresome technical details that I once wrote up in project proposals. I’ve been dreaming that in Utopia, where everyone was retired, trucks would no longer be needed. The morlocks would provide tables laden with succulent food requiring no effort on our part. Computers and technology, even writing, would be quaint artifacts of a painful past when everyone had to labour unnecessarily. Yet somehow I have the nagging feeling that the morlocks would still maintain their own Windoze computers, hidden somewhere, but indispensible in their management of the rest of us.

    2. I took the time to check out Jasmine’s video and her YouTube site. She is one sharp young lady with a pretty promising feature. Really talented, devoted and energetic, for sure. While she isn’t 13 years old, she’s got a pretty good following that is probably 13 years ol! She’s a pro, for sure.

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