TECHTONIC SHIFTS
Daniel Lyons
One Bad Apple
Apple is looking like what Microsoft was 10 years ago—a Bigfoot that squeezes smaller competitors.
A former lieutenant of Steve Jobs's once told me something surprising about his ex-boss. "Steve is a monopolist at heart," he said. "He's just like Bill Gates. He just hasn't been as successful." Well, Jobs is getting there. This summer, Apple's market capitalization surged past Google's, making it the financial king of Silicon Valley. True, Apple still holds only 11 percent of the U.S. consumer PC market, according to researcher NPD, but its influence is far greater than that market share suggests. The iconic iPod dominates its market, and the iTunes music store has sold more than 5 billion songs, making it the No. 1 music retailer in America, ahead of Wal-Mart, according to IDC. Apple's iPhone is the No. 3 smart phone in the United States, according to NPD.
Not long ago Apple was just a niche PC maker selling to diehard fans who were quick to forgive (or even celebrate) Apple's quirks and foibles. But Apple is no longer an underdog. In fact, Apple has started looking like what Microsoft was 10 years ago—a company that so controls certain market segments that smaller competitors can survive only by living on its scraps or staying out of its way. (Apple declined to comment for this story.)
A year ago a small company called Vudu was winning rave reviews for its dynamite little box that attaches to the TV and downloads movies from the Internet. Vudu had advantages over Apple TV: it had a larger catalog of movies, you could rent movies instead of buying them and you didn't need to download the films to a PC first before watching them.
In January Apple struck back, introducing a vastly expanded catalog of movie titles, which it started renting, as well as selling. And it came out with a new, cheaper version of the Apple TV box that matched most of Vudu's features. Now Apple is selling or renting more than 50,000 movies a day, and Vudu is laying off staff. A spokeswoman for Vudu says the company is doing fine. I will point out only that this is what Microsoft's victims used to say, too.
The really scary thing about Apple is that it doesn't just make hit products—it controls entire ecosystems. Just as Microsoft controls both the operating system and the applications that run on top of it, Apple owns popular hardware platforms (iPod, iPhone) and operates the only store that can sell music, movies and software programs for those platforms. Apple sets prices and takes 30 percent of the money.
With iPhone, Apple decides which independent applications will be allowed, and it can pull the plug on any application at any time, without explanation—as happened in July to several developers of iPhone apps. "I spent four weeks trying to get through to Apple via e-mail and phone calls, and they wouldn't return my messages," says Cyrus Najmabadi, developer of an iPhone application called Now Playing, an online movie-theater guide that Apple yanked in July after receiving a complaint about the program. (Najmabadi persisted and finally got Apple to put his application back online; Apple declined to comment on the matter.)
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Member Comments
Posted By: Atch67 @ 11/19/2008 2:08:05 PM
Comment: Yeah, I'm sure Apple misses "those days". You know, like that time they lost $700 million in one quarter.
Funny how people pick on this aspect of business when it comes to Apple, yet blissfully expect it from their competitors. Why is that?
Posted By: VOTENOW @ 10/20/2008 6:25:36 PM
Comment: THE GREAT BUSH DEPRESSION
I follow an economist named Bob Proctor. He has called the top and bottom of every market crash since the 70s correctly.
He perfectly predicted the current meltdown and the picture he paints about what will happen next
is terrifying.He thinks it will be worse then the great depression.
The banks in the U.S. are going under one after the other. Countrywide ,Bear Stearns, Lehman Brothers and Merrill Lynch , Fanny and Freddy Mae ,AIG
The government took them over because they are bankrupt. Even with the goverment nationalizing hundreds of billions of dollars in debt the stock market is crashing
the credit markets are frozen and all of us may suffer beyond anything seen in generations
McCain just like Bush " doesn't understand the economy".
That not just my opinion its his own words. Not only does he not understand how to fix it but he does not understand how its been broken.
It is no surprise that he doesn't. The people that make up these securities use quantum mathematical models very few people understand.
Bush and McCain both can take the credit for this mess since they helped deregulate the laws that were protecting us.
Bush's economic advisor Phil Graham wrote the deregulation bill that allowed banks to take huge risks with all of our future.
Now, Phil Graham is the head of McCain's economic policy.He is also McCain's choice for the next secretary of the treasury.
No one in this country can afford for that to happen. The last time Bush met with his economic advisors was in March. He was the last to know somthing was wrong. Phil Graham had the guts to say that we are in a mental recession after he helped create the worst economy meltdown in our lifetime. Check out this link to the truth http://my.barackobama.com/keatingvideo
It will take the best and brightest minds in the world to get us out of this nightmare. As bad as Bush has done, McCain would be
even more destructive because things are in much worse shape. The next president will not inherit a budget surplus like Bush did but a crashing economy and a 11,600,000,000,000 (trillion) dollars deficit. Most of it Bush created and it will take decades to pay it back.
If you do what you have always done then you will get what you have always got.
When it comes to policy Bush and McCain are the same 90 percent of the time.
So why are the polls even close then ?
Mccains team just said they no longer want to talk about the economy.Instead they would like to spend time talking about obama
which means running the biggest smear campaign in history.
They think they can just tell you lies and you wont be smart enough to see through it
Let's teach him we are smarter than that
Stand up and hold them accountable
Bush isn't on the ballot this year but his policies are
Elect Obama Biden 2008
Check out this video of sarah palins interview and ask your self if she understands what she is talking about.
http://www.youtube.com/watch?v=r36Xc0GG4iQ
Posted By: VOTENOW @ 10/20/2008 6:25:27 PM
Comment: THE GREAT BUSH DEPRESSION
I follow an economist named Bob Proctor. He has called the top and bottom of every market crash since the 70s correctly.
He perfectly predicted the current meltdown and the picture he paints about what will happen next
is terrifying.He thinks it will be worse then the great depression.
The banks in the U.S. are going under one after the other. Countrywide ,Bear Stearns, Lehman Brothers and Merrill Lynch , Fanny and Freddy Mae ,AIG
The government took them over because they are bankrupt. Even with the goverment nationalizing hundreds of billions of dollars in debt the stock market is crashing
the credit markets are frozen and all of us may suffer beyond anything seen in generations
McCain just like Bush " doesn't understand the economy".
That not just my opinion its his own words. Not only does he not understand how to fix it but he does not understand how its been broken.
It is no surprise that he doesn't. The people that make up these securities use quantum mathematical models very few people understand.
Bush and McCain both can take the credit for this mess since they helped deregulate the laws that were protecting us.
Bush's economic advisor Phil Graham wrote the deregulation bill that allowed banks to take huge risks with all of our future.
Now, Phil Graham is the head of McCain's economic policy.He is also McCain's choice for the next secretary of the treasury.
No one in this country can afford for that to happen. The last time Bush met with his economic advisors was in March. He was the last to know somthing was wrong. Phil Graham had the guts to say that we are in a mental recession after he helped create the worst economy meltdown in our lifetime. Check out this link to the truth http://my.barackobama.com/keatingvideo
It will take the best and brightest minds in the world to get us out of this nightmare. As bad as Bush has done, McCain would be
even more destructive because things are in much worse shape. The next president will not inherit a budget surplus like Bush did but a crashing economy and a 11,600,000,000,000 (trillion) dollars deficit. Most of it Bush created and it will take decades to pay it back.
If you do what you have always done then you will get what you have always got.
When it comes to policy Bush and McCain are the same 90 percent of the time.
So why are the polls even close then ?
Mccains team just said they no longer want to talk about the economy.Instead they would like to spend time talking about obama
which means running the biggest smear campaign in history.
They think they can just tell you lies and you wont be smart enough to see through it
Let's teach him we are smarter than that
Stand up and hold them accountable
Bush isn't on the ballot this year but his policies are
Elect Obama Biden 2008
Check out this video of sarah palins interview and ask your self if she understands what she is talking about.
http://www.youtube.com/watch?v=r36Xc0GG4iQ