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Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

51 Responses to “Apple’s Creative Destruction of Competitors”

1. mitchw Says:
   August 30th, 2011 at 9:33 am

   Erm, you do want to include ARM Holdings in the list of companies ‘helped’ by Apple. ARM designs the processor cores in those iPads and iPhones. Apple was an investor in ARM before it went public in the late nineties. Look at the stock chart of ARM beginning when Apple introduced the iPad. Look out Intel, because the storm is still brewing.

2. VennData Says:
   August 30th, 2011 at 9:38 am

   Jobs turned me into a Newt!

   http://www.youtube.com/watch?v=zrzMhU_4m-g

   I got better.

3. Ben Says:
   August 30th, 2011 at 9:41 am

   To say Google is challenged by Apple is pretty ridiculous. I’d argue the other way around. Android OS share has been gaining massively on other smartphone ecosystems, including Apple, in the past year and a half.

   In the destroyed category, what about the music industry???!!

   ~~~

   BR: Remind us how much Google sells the Android for? Oh, that’s right, they give it away for free.

4. crutcher Says:
   August 30th, 2011 at 10:01 am

   “[Sony] slapped from below by the Koreans and from above by Google.”

   Racial hierarchies need lovin’ too, I guess.

5. Trevor Says:
   August 30th, 2011 at 10:02 am

   >BR: Foxconn: …(but still has not resolved its worker suicide issues).

   Barry, the numbers, here, do not support your conclusion. At the time of the multiple reported suicides that made media headlines, the rate of suicides within the Foxconn employees per year was smaller than the rate for the population at large in those areas of China; and there was evidence to that effect at the time, even though the media missed or ignored it. Remember that Foxconn employs hundreds of thousands of workers (just under 1M actually).

   Here’s a quick example of the numbers, easily found in the “intertubes”:

   “That 17 people have committed suicide at Foxconn is a tragedy. But in fact, the suicide rate at Foxconn’s Shenzhen plant remains below national averages for both rural and urban China, a bleak but unassailable fact that does much to exonerate the conditions at Foxconn and absolutely nothing to bring those 17 people back.” http://www.wired.com/magazine/2011/02/ff_joelinchina/all/1

6. Bob A Says:
   August 30th, 2011 at 10:04 am

   benefited:
   Samsung, HTC, MMI and their suppliers who are selling millions upon millions of android smartphones many would say much better meet the needs of the consumers who aren’t served by Apple’s ‘my way or the highway’ approach. 500,000 per day at last count.

   the game is not over…

7. franklin411 Says:
   August 30th, 2011 at 10:04 am

   HP has shown people the way. The actual HP Touchpad device blows the iPad 2 out of the water (I have even less respect for anyone who bought that horrid device now). WebOS is a vastly superior OS as well. People were lining up outside of stores, ordering from multiple sources because they feared they would be canceled, buying for friends and neighbors, selling on Craigslist at 300% markup, etc…

   What HP failed to realize is that it takes a bit of sugar to lure people like Barry out of their iSlavery. The Apple fanbois can’t see anything past their Macs. You need to give them a reason to try freedom.

   Now, think about it. HP took a $100 million loss on the 400,000 HP Touchpads it sold over the last weekend. How much did they blow on those stupid Russell Bland commercials etc? Instead of spending even a penny on advertising, they should have done the following:

   Hold a sweepstakes. Give 10,000 Touchpads to lucky winners. Sell 100,000 pads for $99 to the next 100,000. Sell 200,000 pads for $199 to the next 200,000. Give 300,000 people a free touchpad case, and sell the device to the general public for $299.

   This would have created a huge ecosystem right from the start, generated consumer buzz, and shaken people from their iSlavery.

   When I bought my Touchpad for $99, I thought I would offload WebOS ASAP and load Android (which has already been ported to the Touchpad). I’m not going to do that after 3 days of playing with the device. It’s super speedy when properly tweaked (another mistake made by the bean counters at HP was that they downclocked the unit so they could sell a normal-clocked version at a premium)–tweaking it is a 5 min process that anyone can do. The card system for multitasking is brilliant. The screen is much better than the iPad, and best of all, I’m not handcuffed to doing what Apple lets me do.

   The last part is what really perplexes me–why do normally smart people (Barry?) do stupid things like buy Apple devices? Why would someone buy a device that only allows them to do things permitted by an evil company? Why would someone buy a device that can be bricked at the push of a button if the corporation decides you’re a Public Enemy?

   ~~~

   BR: Sold to you

8. Moopheus Says:
   August 30th, 2011 at 10:17 am

   The iPad gutted HP’s PC business? That seems a stretch. HP’s problems predate the iPad by a long while. It’s kind of sad–the HP name once stood for high quality lab-grade equipment, and the threw that away of their own free will.

9. Lugnut Says:
   August 30th, 2011 at 10:19 am

   What one has to wonder is whether Apple will now have it’s “Ballmer years” now that the irreplaceble Mr. Jobs is out of the day to day picture. Certainly fair to assume that some of the shine will come off the Apple in his absence.

10. phb Says:
    August 30th, 2011 at 10:20 am

    Overlooked Verizon in this analysis. They benefit in a HUGE way from being associated with AAPL this year.

    ~~~

    BR: I didnt know where to put them.

    Challenged? Benefitted? Foot in each camp?

    There can be no doubt the initial few years saw AT&T take some share with Apple iPhone sales, but Verizon’s reputation for great coverage and savvy advertising limited the damage. Once they grabbed the iPhone, it was a home run for the company. And their Android sales means they are in good negotiating position with Apple for contracts.

11. greg Says:
    August 30th, 2011 at 10:20 am

    @franklin411….hold a sweepstakes?

    Here’s a better idea. Why didn’t they just build a tablet that was better than the ipad, and sell it for $499 or $599?

    Or better yet, they could have built one first, and created the market.

12. Lugnut Says:
    August 30th, 2011 at 10:25 am

    PS I have a hard time believing iPads are cannabalizing PC sales, especially in the business sector. Perhaps with the turtleneck sweater crowd living in a 400 s/f loft in the city, but otherwise correlation doesn’t equal causation. Any surveys of iPad buyers saying they’re chucking their PCs and laptops to Goodwill because of their iPad to back up that claim?

    ~~~

    BR: Forget the turtleneck sweater crowd, how about Computerworld?

    Tablets continue to cannibalize PC sales

    Gartner, IDC report sluggish PC sales in Q1, due to tablets, Japan disaster

    Computerworld – PC sales in the first quarter of this year suffered, and analysts are placing the blame on the tablet market and the disaster in Japan.

    Global PC shipments dropped 3.2% in the first quarter compared to the same period last year, according to industry analyst group IDC. IDC analysts called the decline the first contraction in the global PC market since the end of the recent recession.

    Analysts at Gartner also reported a decline, but gave a smaller drop of 1.1%.

    “Weak demand for consumer PCs was the biggest inhibitor of growth,” said Mikako Kitagawa, principal analyst at Gartner, in a statement. “Low prices for consumer PCs, which had long stimulated growth, no longer attracted buyers. Instead, consumers turned their attention to media tablets and other consumer electronics.”

    Kitagawa said there was a direct connection between Apple’s release of the iPad 2 and the drop in interest in traditional PCs.
    
    “With the launch of the iPad 2 in February, more consumers either switched to buying an alternative device, or simply held back from buying PCs,” he added. “We’re investigating whether this trend is likely to have a long-term effect on the PC market.”

    Tablets are expected to have a large enough effect on the PC market that Gartner lowered its PC sales forecast for both 2011 and 2012. Gartner reported last month that global PC shipments are expected to hit 387.8 million units this year. That’s a 10.5% increase from 2010, but down from Gartner’s previous projection of 15.9% growth this year. It did not provide figures for 2012.

13. franklin411 Says:
    August 30th, 2011 at 10:27 am

    @greg
    Because the Touchpad is better than the iPad for $499 or $599. The only thing the iPad has that the Touchpad doesn’t is mobile network capability, and to compete at $499/$599, they needed that. But those models were coming.

    The whole point of marketing is to convince people to make fundamentally irrational purchasing decisions. Some people will buy a pair of headphones because their favorite tennis player says they’re good, or buy a certain car because they like the color, or drink a certain coffee because the packaging is attractive.

    Apple did a brilliant job of convincing people to make irrational purchasing decisions. It’s difficult, but not impossible, to shake Apple fanbois out of their mental slavery.

    And the tablet market existed long before Apple. IBM was selling Thinkpad tablets for a decade before the iPad. Despite what people have been told, Apple did not, in fact, invent everything from air to Zambonis.

14. greg Says:
    August 30th, 2011 at 10:34 am

    @Lugnut…wouldn’t it be safe to assume that of the 28.5 million ipads sold, at least some of those purchases would have gone to PC’s if the ipad didn’t exist, therefore, we have some cannibalization taking place?

15. Livermore Shimervore Says:
    August 30th, 2011 at 10:34 am

    I have to agree, saying Google has been challenged is certainly an interesting take.

    It’s pretty clear that Google is trying to pull a “Windows” on the smartphone and tablet sector. Getting all the device makers to use their OS. Before you know it: KAPOW…global domination. The experience has been monetized and not the licensing. The goal is to get everyone on a device that syncs all your personal information and steers you toward their search and services. Billions of users…billions.

    This is the script I see coming: Jobs leaves before the ipod/iphone/tablet lemon has been squeezed dry…which isn’t to say its not one big lemon with plenty of juice left. But unless the actual genius behind the Ipod (whatever his name is) comes up with another game-changer for the company, we start to see the list of things that Apple products can do that others can not…. shrink. While the price difference between Apple products and Android OS devices (particularly tablets) starts to widen. Then the Apple new post-Jobs product misteps start to pile on. Let’s not pretend they didn’t happen during the Jobs/Ipod era either. No new stellar products from Apple, same premium-priced laptops and desktops that cater to a small segment of the consumer pie that can afford to pay up while most consumer incomes are falling. Same landscape as we have now but instead of Windows running most of these new devices its Android with Apple staying content with its fractional share.

16. greg Says:
    August 30th, 2011 at 10:42 am

    @franklin411
    The touchpad is better than the ipad? The public didn’t think so.

    Those models were coming? Why aren’t they here now?

    IBM was selling Thinkpad tablets for a decade before the ipad? Why don’t they own the market then?

    Apple didn’t invent anything? Debatable. I think they invent the same thing over and over…”better”.

17. Greg0658 Says:
    August 30th, 2011 at 10:43 am

    I gotta get a 3D life going
    but .. only a capitalist would talk in terms of destruction in this thread .. real 3Dpeople would say innovation

18. Livermore Shimervore Says:
    August 30th, 2011 at 10:54 am

    p.s.
    Ipad did cannibalize PC sales. But PC netbooks priced at bargain prices never really got off the ground to begin with. Had Android not been so incredibly late to the tablet party Android tablets, and there was no Ipad…Android tablets would have massively eaten Windows PC sales as well. For the vast majority of casual users a full blown laptop at $700+ is overkill. At $1,000 its a deal-breaker. The market was begging for an alternative for years now.
    Since the Ipad is really just an extension of the Ipod that was been in development (in its current form) for at least 3 years, their timing was perfect. As in timing I mean unveiling a laptop alternative product when the competion were still busy doing the smart phone catch up game. Apple benefited insanely from the fact that Micrsoft can’t innovate, Google were late to the party because they were re-inventing search and Blackberry have no vision. Eventually the genius kid who is always late to class will settle down and concentrate. Shooting fish in a barrel time is over.

19. machinehead Says:
    August 30th, 2011 at 11:06 am

    It was smart to expand into mobile so as to not get eclipsed in that space, but it also created another set of headaches: Patent exposure. Apple not only dominates the space, but they also acquired a huge trove of Nortel patents so as to insulate themselves, and challenge all comers. This forced Google to pay up for a comparable portfolio, grabbing (former Apple partner) Motorola for $12.5B.

    Astute observations, and very troubling ones too. You are describing technological oligopolization driven by abuse of the patent system. This serves to suppress overall innovation, one of the factors which is relentlessly driving down living standards in the U.S.

20. streeteye Says:
    August 30th, 2011 at 11:15 am

    One rumor of Apple’s next big disruption – TV. Since they have iTunes and iPad, makes sense for them to try to get control of the whole living room – http://www.technologyreview.com/blog/helloworld/27117/?p1=blogs . (Could be interesting for Netflix, either way, cable operators re: over-the-top content distro, consumer entertainment industry).

    There’s a good case that Google has changed the world more than Apple, disrupting advertising and media, making everyone publishers, information everywhere. – http://www2.macleans.ca/2011/08/26/apple-changed-everything-yeah-right/

    I don’t love some aspects of the iPhone/iPad cloud world. As a consumer, I have to buy every app through the App Store. If you’re a developer, you have to pay an Apple tax and Apple tells you what your business model needs to be, conveniently favoring Apple. For instance, magazine publishers can’t bundle a free app with a paid magazine subscription. And of course, if all my info is in the cloud, I’m pretty locked in. If Microsoft had tried to pull this crap, people would have rightly gone apes**t, which is testimonial to Apple’s strength as a brand people trust.

    Amazon’s rumored Android tablet will be interesting to watch. Android is giving iOS a good run for its money, and is in most respects as good or better.

21. ssc Says:
    August 30th, 2011 at 11:33 am

    This is beyond stretching the truth, most if not all of the companies cited as destructed/disrupted by Apple (with the exception of Nokia) started their own self destruct way way before i(pod, phone, pad). Bill Fleckenstein (who, incidentally, wrote the forward for Bail Out Nation) for YEARS, has been saying: RIMM – marching down a dead end street, Dell – cook their books, HP – total dysfunctional board (remember Carly and the Compaq fight? Certainly not because of whatever Apple was doing at the time). With Motorola, remember the satellite fiasco?

    ~~~

    BR: All of that is true — but they could have muddled along for years. They made themselves vulnerable, and danced along the cliff face — but it was Apple pushed them

22. bobabouey Says:
    August 30th, 2011 at 11:40 am

    I would put the major music labels in at least the challenged category as well (and EMI possibly in the destroyed, although the peak-multiple paid was also part of that problem). Ipod destroyed their big profits in CDs, and the early establishment of the 99c per song model destroyed their ability to meaningfully profit from digital either.

    And music retail business is obviously in the destroyed category too.

    ~~~

    BR: The music industry was already hurting due to a number of factors. iPods and legal downloading helped them, but tis almost too complicated to go into here

23. edillon Says:
    August 30th, 2011 at 11:51 am

    Samsung down; TSM to be up.

24. Livermore Shimervore Says:
    August 30th, 2011 at 12:11 pm

    @streeteye,
    Is the NetFlix market really sustaiable in the first place? I frankly find their service underwhelming. I WOULD NOT pay amymore than $8 for it. I don’t maybe if you gave it away for free with actual premium titles and ran advertising on it that couldn’t be fast-forwarded somehow. If this is the winning model I could see Google snapping this up with their Moto acquisition. Apple’s current mentality seems to be get everyone to pay for each goodie whether its a song, book, magazine, movie, etc. while taking a big middleman’s slice.

25. Tuesday links: better credits | Abnormal Returns Says:
    August 30th, 2011 at 12:17 pm

    [...] Winners and losers:  the Apple ($AAPL) disruption edition.  (Big Picture) [...]

26. streeteye Says:
    August 30th, 2011 at 12:38 pm

    I dunno. Is $100+ for cable for crap like Shark Week sustainable? Over-the-top content is going to keep making inroads as long it’s a better deal when the alternative. Netflix is swimming with some awfully big and hungry fish, between Hollywood and the telecom monopolies and who knows, maybe Apple.

27. Theravadin Says:
    August 30th, 2011 at 12:42 pm

    Whoah – over the top “Apple is invincibleism”. Seems to me I remember these same comments about Microsoft just a few years ago… The iphone is ripe for being eaten from below – no really unique features, and Google has made it easy for anyone to build a (probably better) phone at a vastly lower price. The app edge? how many of those 100,000 apps have more than a few users? Google could fix this in a heartbeat – identify the top 5000 apps and just build them.

    And RIM, killed? RIM is the one competitor out there that retains unique advantages not found elsewhere – much harder to eat than Apple. Sure it’s a slow burn, but try a Playbook side by side with an ipad… Better tech doesn’t always win, but in this case, I think it’ll be more than sufficient to make the “killed” label completely ridiculous.

    I’d sell Apple now.

28. Bob A Says:
    August 30th, 2011 at 12:43 pm

    netflix is the best entertainment value in america today. period.

29. mrg Says:
    August 30th, 2011 at 1:33 pm

    It’s not really widely discussed but Jobs (specifically Pixar) has made major contributions to the medical imaging field.

    Pixar created the original algorithm for volume rendering that is the basis of all of this advanced medical imaging today.

    From the NYT in 1987
    http://www.nytimes.com/1987/12/13/magazine/works-in-progress-hip-graphics.html
    —————
    THE COMPUTER-GENERATED images above represent a human hip. Reading left to right, two rows at a time (the white images illustrate bone structure; the surrounding musculature is in red), the hip appears to be rotating on a vertical axis. It’s stop-action photography. Imagine the rotation performed before your eyes on a screen, the illusion of three dimensions, and you envision the accomplishment of innovative hardware and software now being readied for market by Pixar, a computer firm based in San Rafael, Calif. ”It’s as if the physician has the hip in his hand,” says Elliot K. Fishman.

    An associate professor of radiology at the Johns Hopkins Medical Institutions in Baltimore, Dr. Fishman heads one of 15 medical teams nationwide working with Pixar technology and participating in the Pegasus Project, research in 3-D medical imaging sponsored by Philips Medical Systems of Shelton, Conn. The Pixar images are created using data from computed tomography, the computer-enhanced X-ray commonly known as a CT (or CAT) scan. Physicians routinely prescribe treatment based on as many as 50 separate CT-scan images. The new technology, Dr. Fishman says, frees the physician from having ”to mentally integrate all these separate images. By creating three-dimensional images, we can define the extent of an injury more fully and better than before.” In one study dealing with hip fractures, surgeons given access to three-dimensional imaging altered their treatment strategies a third of the time.

    By now, 3-D imaging has been applied in some 500 cases at Johns Hopkins. The Pixar hard- and software package will be available next spring, but research goes on. ”Nearly all our work has been orthopedic,” Dr. Fishman says. ”We’re working now on looking three-dimensionally inside organs.”

30. Apple's Creative Destruction of Competitors | The Big Picture | i280 Silicon Valley technology blog Says:
    August 30th, 2011 at 1:34 pm

    [...] post: Apple’s Creative Destruction of Competitors | The Big Picture Comments [0]Digg [...]

31. Orange14 Says:
    August 30th, 2011 at 1:54 pm

    The iPad is nothing more than a digital content manager/provider. Hardware sales will always have a self-enforced limit in the same way that other hardware does and iPads are never going to be found with everyone in this country. In line with the Gillette razor blade model, Apple needs to make money on the content/aps that they sell through the store. This works fine in the absence of competition but with the example of the Android phones, it’s not going to last forever. HP’s big mistake as noted by others was not to price their tablet below Apple and offer preferential prices to content providers. This would have sparked real competition in the marketplace. I don’t know how the Samsung tablet is doing but there is still a lot of room and opportunity to undercut Apple

32. ToNYC Says:
    August 30th, 2011 at 2:32 pm

    “Why would someone buy a device that only allows them to do things permitted by an evil company? Why would someone buy a device that can be bricked at the push of a button if the corporation decides you’re a Public Enemy?”

    Baby Boomers return en masse to preschool Fisher-Price toys. Perfect for folks that sit and watch Fake Life on 55″ LCDs and call it all Real Life. Touch and drag second-party information as if you knew what any of it was like if you turned off the devices and took a hike, showing up where they told you about and see for yourself what the process actually delivered.
    Creative destruction happens to the current paradigm king as well as us all. The King is dead; Long live the King.
    Honi soit qui mal y pense.

33. JimRino Says:
    August 30th, 2011 at 2:33 pm

    To be Fair to Microsoft.
    The code Quality has Greatly Improved under Balmer.
    Hiring of people who know what their actually doing has increased.

    But, Microsoft was Always, a Number TWO player, Always a Copy Shop.

    Today, More People are putting their money on the True Innovator, to keep those innovations coming.
    Apple is a huge Innovation Engine.

34. Livermore Shimervore Says:
    August 30th, 2011 at 2:33 pm

    Orange14 Says:
    “I don’t know how the Samsung tablet is doing but there is still a lot of room and opportunity to undercut Apple”

    I purchased an Ipad1 last year and have been using a Samsung 10.1 tablet. The Samsung works flawlessly, EXCELLENT browser, Google mail works well and you can get blazing fast 4G which makes 3G look like two coffee cans and dental floss. It is lighter, thinner and has a better display than Ipad2, not Ipad1, Ipad2. I see why Apple is suing the shit out of them and making every effort to stop Samsung from selling it. Patent issues to my knowledge have never stopped an excellent product from selling. It just serves to rework who gets how much.
    Think about in less than a year an Apple competitor has managed to outbuild the current Apple offering with no indication of when Ipad3 will be out. From a manufacturing perspective this has been an undereported story. Apple’s model to farm out the building of their products doesn’t really leave them with a plan B when a strong competitor come in. Frankly, this also doesn’t address the possiblity that Apple competitors could start collaborating in joint ventures to build these tablets. Samsung providing PenTile displays (think 2560) , HTC providing UI enhancements, and RIM providing some enterprise solutions. Sooner or later someone will figure out that they can do more working together than individually against their lunch-eating Apple rival.

35. JimRino Says:
    August 30th, 2011 at 3:01 pm

    The IPad has two strengths, the hardware, and the software.
    What you’re not getting is the software when you buy a copy cat product.

    As Apple has long lead times, you can always out spec an Apple product if you’re willing to wait 3 to 6 months for a competitor.

36. Dervin Says:
    August 30th, 2011 at 4:32 pm

    Apple didn’t do in the Name Brand PC makers, they were done in by themselves in a race to the bottom. Compaq, Gateway, Micron, Toshiba Dell and HP cannibalized IBM sales. And now a bunch of no-name companies can easily do the same keeping the margins razor thin and any error these companies make is the fatal error.

    Apple did kill off the netbook market – a sluggish, cheap, plastic computer vs. a slightly more expensive, well designed, responsive, trouble-free tablet. Who knew consumers liked to buy quality products!?

    Apple lost the PC battles because the people who purchased the computer weren’t the people who use the computer. The defining quality in the enterprise market was price. And Apple couldn’t compete on price alone.

    In the consumer market, a whole host of other qualities becomes just as, or more important than price.

37. readerOfTeaLeaves Says:
    August 30th, 2011 at 5:05 pm

    lugnut -at least in one subsection of the biz sector, iPad appears to be building. The medical sector seems to be taking to it like fish to water: my understanding is that (at least some) hospital and medical clinic IT admin’s get sick and tired of helping people find lost files. This problem is almost eradicated with iPad. I’m hearing about IT admin’s who are recommending iPad purchases to reduce needless support issues. I’m also hearing about nurses who find the iPad ideal for their workday, as well as a growing interest in using iPads or similar devices with hospital patients. I think we’re at the beginning of a whole new era.

    Street eye-it’s true that people might have had a fit if Microsoft had tried to put the constraints on on app store items the way that Apple has––but I think that you are comparing MS oranges to iPad Apples. On a desktop with a lot of memory, there is more room for error when software gets buggy; it can burn through memory and most users never know it, they just think the computer is sluggish. But by putting the walled garden, Apple implements some quality control. They have conveyed that performance and software design are key for keeping their user and developer ecosystems flourishing. Microsoft was never as clear thinking about maintaining quality control on the software that went to their systems.

    I say that in part as someone who had a Compaq PC tablet, which used a MS OS and the Office Suite. It was nice to use, but fairly limited. I used Microsoft Journal on it and liked it quite a lot. However there is no comparison between that old PC Tablet and my iPad. Real, genuine touch screens on iPhine and iPad change everything. And I mean everything. It is actually really cool to see Corning do so well from Apple’s ingenuity.

    But one more winner was not listed–I think there’s a lot of persuasive information that not simply the e-book, but the iBook pricing model and ease of distribution has been a real gift to publishers large and small. And now for the 1st time books are really going to morph into multimedia experiences––this is something that is being built on the iPad, or more frankly, the Apple developer code used to build apps as companion pieces for books. (Publishers were, for the most part appalling late to the shift and some will retire rather than transition. But this opens a new conceptual realm for textbooks and other kinds of publications – for iPad and Android and other devices.)

    In addition, Amazon basically had publishers by the short hairs with their 9.99 pricing lid. This was simply wreaking havoc, and I reserve judgment about whether that was good or bad. Basically I see it is good-AND-bad. The point is, once Apple told publishers to set their own prices, it really was a godsend for publishers and authors, and anyone in that network.

    So under potential losers, brick-and-mortar bookstores should be added to the list. And if Amazon had not expanded a big part of their business to cloud computing, one wonders how they’d be doing. Kindle is simply no match for iPad.

38. Livermore Shimervore Says:
    August 30th, 2011 at 5:49 pm

    ^ I’m not sure I agree with that characterization of Amazon’s book pricing. Whetherits $9 or $15 very little of the upcharge that Steve Jobs colluded with the major publishers (think Gates Antitrust except Jobs actually admitted to it in interview) actually went to the author. I’m sure BR as an author has some say about where this upcharge for ebooks, particularly those in paperback!, ends up. Amazon was giving publishing a much needed shake up.

    Kindle is no match for Ipad because they’re not even in the same category. you can’t compare a $114 device with one that’s five times the cost. That’s like comparing a Hyundai Sonata and the new Porsche 991.
    Funny thing is after buying an Ipad1 I still went ahead and purchased Kindle 3 because Ipad doesn’t do text to speech for newspapers/most books and the Ipad isn’t all that practical as a listening device when multitasking like running, biking. That’s the real shocker to me. Still no mini Ipad like the 7″ Galaxy Tab or Sony S2. Apple would sell millions to commutters who don’t want to carry around picture frame under their arms.

39. Livermore Shimervore Says:
    August 30th, 2011 at 5:56 pm

    The obligatory link to brand loyalty, a major factor in Apple’s success over their hapless (up until now) MS, RIM, Google rivals.

    http://youarenotsosmart.com/2010/05/19/fanboyism-and-brand-loyalty/

40. kaleberg Says:
    August 30th, 2011 at 5:57 pm

    mrg: I agree that Pixar was a pioneer in volumetric imaging, but 3D volume imaging was originally developed by the oil companies in the 70s to use with seismic sampling in their search for oil. The floating point boxes developed for the oil companies were adapted for the first CAT scanners.

    The funny thing is that Apple is that last old fashioned computer company. Back in the 50s and through the 70s, each computer company designed and built its own hardware and its own operating system and basic software suite. Sure, they purchased what components they could from outside and conformed to a variety of communications standards, but they wanted to control the hardware and primary software, just the way Apple does today. Just about every other computer company built its own hardware, but they bought an operating system and all the other basic software, even if they had hardware and software capabilities in house. (For example, HP had HP|UX – hockey pux, as they called it – and could have turned it into a consumer friendly system, but their PC division was completely isolated.) It’s strange to find the original formula coming through so dramatically.

41. wunsacon Says:
    August 30th, 2011 at 6:46 pm

    VennData, LOL. I never noticed before. But, a man with shaving cream on his face appears for a split-second @ 0:14.

42. Theravadin Says:
    August 30th, 2011 at 6:59 pm

    And just to add another view of Apple, take a look at this from Der Spiegel today: http://www.spiegel.de/international/business/0,1518,783345,00.html

43. WaltFrench Says:
    August 30th, 2011 at 7:22 pm

    I think it’s charming that some readers trot out code-word anti-Apple-isms here, such as “fanboi,” “nothing more than a content consumption device,” “great marketing of over-priced products” before they blithely wish away Apple’s awesome business successes versus the stark list of failures that BR has listed.

    Enough Apple successes, in fact, to say, as one of my favorite analysts has, that Steve Jobs’s greatest piece of work is Apple, Inc. And who but people with their heads in the sand could argue that Apple’s success has come from:
    * planning out its business for at least a decade in advance (see the 1997? YouTube vid of the just-returned-not-yet-in-power Jobs telling the faithful, “NO” to their favorite products, and laying out what is to become iCloud as the Promised Land;
    * insisting on first-class quality;
    * timing products, waiting years in some cases, for when the technology and business conditions were ready to support an offering;
    * identifying whole atherosclerotic industries ripe for disruption, whether in new hardware, software, distribution, … that Apple knows about;
    * utterly owning the top spot of production, so that no competitor competes with it on cost of production in phones, tablets and laptops.

    And as much as I am in awe of its business success and how a nearly-bankrupt firm has been transformed into the country’s greatest success through the passion, drive, creativity and solid business sense, I will make no claim, nor should anybody, that somebody more clever, more hungry and more lucky won’t be able to do the same. People who whine about the Reality Distortion Field are willfully ignoring teachable moments that are dropped in front of us.

44. RecencyEffect Says:
    August 30th, 2011 at 7:56 pm

    iPad gutted HP’s PC business?

    I don’t think the numbers back you up there, the iPad has more made its own market than gutted anything other than maybe ultracheap netbooks.

    Apple didn’t gut HP.
    HP is gutting HP…

45. mtdrevil Says:
    August 30th, 2011 at 8:48 pm

    Finally I see an example of the book “The Halo Effect” in action!

46. hypnotosov Says:
    August 31st, 2011 at 4:29 am

    The “agency model” that Apple and the publisher worked out isn’t so much about helping the publishers as it is about gutting the Kindle. One of the most agonizing things about owning a Kindle is that every time I buy I book I find that the Kindle version is the most expensive and I end up paying for the convenience of having no physical product.
    Now no amount of sanctimonious talk about “the real costs of a book are not in the printing” or “there are costs associated with the conversion to e-book format” is going to convince me that it is somehow more expensive to mail me a digital text… rather than print out said digital text as a hardcover book, ship this book halfway round the world and store it in a warehouse, and finally send it to me by airmail. So I end feeling like I’ve been had for a couple of quid each time I buy a Kindle book.

47. Hot Links: The Road to Outperformance | The Reformed Broker Says:
    August 31st, 2011 at 8:14 am

    [...] A list of competitors Apple has killed or maimed along the way.  (TBP) [...]

48. readerOfTeaLeaves Says:
    August 31st, 2011 at 1:50 pm

    hypnotosov,
    I don’t know the specifics of the books that you are reading, but the costs that I’m aware of for eBooks are related primarily to encryption technologies and security. Otherwise, you are correct that in terms of media costs, everything that I have ever seen suggests the costs of printing are far above the costs of digital text — although that shifts if you are talking about developing interactive features (i.e., for a biology text). Even if you develop interactives there is * no* guarantee that Kindle will support them.

    Bottom line: iPad enables apps, built with the code Jobs oversaw at NeXT Step in the 90s. Kindle can run Flash apps, but that is far more limited than what an iPad can do. Kindle does not have a native code base that developers can use to enhance the ‘reading’ experience on Kindle; iPad does.

    And then there is an altered social meaning of ‘book’, which B&N seems to be best situated to create and build on. (Nook may turn out to be B&N’s smartest move, ever.)
    B&N has enabled Nook to share a title “X” number of times; two members of my family have Nooks and share their latest sci-fi reads, which builds Nook loyalty and makes that device more social. If iBook has a ‘share’ feature, I have not seen it — but that feature is key for education buyers and many individual book buyers. Think how many book sales are built around Reading Groups; B&N probably has the best shot to exploit that. Nook appears to be developing a ‘share’ model that kids, tweens, and teachers I see are getting excited about.

    In that area of ‘shared reading’ or ‘group reading’, B&N is ahead of Apple. But in terms of writing supplemental content for books, Apple has it locked up, as near as I can assess, because they have a native code base that developers can use to create “book apps” or “enhanced books”.

    The iPad will probably lead to some fantastic opportunities for book illustrators and artists – I’d have been quite happy to pay an add’l $1.99 for a version of “Bailout Nation” that included archival photos and timelines to augment the historical sections, for instance.

    The iPad and Nook seem at this point better designed for fundamentally reinventing ‘a book’ with richly enhanced illustrations and other social features; IMVHO, we are on the cusp of a reading and ‘book’ renaissance enabled by iPad.

    I know a number of school librarians whose budgets have been squeezed so terribly that the Nook may be the only thing that keeps their libraries functioning — plus, no more time wasted shelving books! Their tight budgets are shiftinh to screen readers, and lower cost per-read ‘books’.

    Pricing digital rights is definitely an area where — by letting publishers set their own prices — Apple made a move that strikes me as pure genius. B&N is probably the best positioned for tweens, teens, and reading groups if they can figure it out; pricing models will be key. In terms of cos and social uses for some categories of readers, B&N may be in the lead.

    But Apple is in the lead for reinventing what a ‘book’ means. Because its code is available to developers, and also because the beauty of the screen lends itself to extraordinary illustrations.

    I don’t think anyone yet understands how Apple is — via iBook — fundamentally morphing the idea of ‘a book’. And iPad is not yet 2 years old. Incredible.

49. tippet523 Says:
    August 31st, 2011 at 5:01 pm

    And GLW just keeps going down this year. It has to be a reasonable buy now

50. The Patent Pledge, double-agent comment spammers, and the “myth” of dangerous bad links Says:
    September 1st, 2011 at 4:36 pm

    [...] Ritholtz has a nice list of companies Apple has creatively destroyed. Even the companies that benefited from Apple’s rise are somewhat beholden to them. [...]

51. Is Amazon the Latest Victim of Apple? | The Big Picture Says:
    October 26th, 2011 at 11:31 am

    [...] in August, we made a list of companies that were collateral damage of Apple’s Creative Destruction. That eventually morphed into a Washington Post column, And then there were none: Apple’s [...]