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Unsinkable Apple starts to flounder
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Old 23rd April 2013, 06:10   #1
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Default Unsinkable Apple starts to flounder

Tomorrow Apple is going to announce its results and it is starting to look like there will be few who will be cheering.

Ever since the shine came off Apple in September, the news from Cupertino has been becoming progressively worse. Not only has it lost far too much ground to rivals such as Samsung, it is also being accused of running out of ideas.

Shares which were expected to be $1,000 by the end of 2012 are now selling for $400, stripping $280 billion from the value of the company.

Apple's fall has also given its suppliers a good kicking. Some, which used to get a rise in their stock price just for the rumour that they were taking part in some Apple product, have had enough of the company. Some told Reuters that they were looking for more reliable customers.

In Japan the industry often jokingly refer to the company as "Poison Apple" because of its hard-to-meet high standards and low price expectations, Reuters wrote.

So what went wrong?

While some corners of the press might tell you that it is all due to the death of Steve Jobs, this is based on the myth that it was the Apple co-founder who came up with ideas.

Memos from Apple suggest that the company has been following a glorious five year plan set up by Jobs before his death. The iPhone 5 and its successor were all effectively signed off by Jobs before he croaked.

New CEO Tim Cook has been stuck by the fact that he does not dare alter it, even if the plan is clearly going wrong. As far as Apple is concerned Jobs' prediction is much like those made by mathematician Hari Seldon in Isaac Asimov's Foundation series. People attribute religious accuracy to them until they are proven unable to cope with a random element.

In this case Apple's random element should have been incredibly predictable and it was one that Jobs was well aware of before his death.

Apple's iPhone and tablet model assumed that it would repeat the success of its iPods. There people paid to be locked into a Walled Garden of Delights and never leave it. iPods were also fashionable at the time, and Apple managed to knock aside competition with some slick marketing. Once customers were locked into the iPod it was jolly difficult for them to get out, and besides, there were few products which were up to the iPod's standards.
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