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How Apple Scaled Back Its Titanic Plan to Take on Detroit

bloomberg.com

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Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#11

Post by samfisher83 »

mikeash wrote: post #8
PhoenixWright wrote: post #5

A couple of takeaways from this article: Apple has a problem with leadership. When managers aren't buying into a vision, mostly because it's murky at best, that is a big problem. SV hubris believing you can go into any industry and disrupt the incompetent incumbents is laughable. FB found this out with phones and it sounds like Apple and Google are now figuring it out with cars. The Netflix idea works here too: Apple…

Phones is a really weird example here, considering that the two dominant phone players are both SV companies that went into that industry and crushed the incompetent incumbents. I see no reason to think that Apple could do with cars what they did with the iPhone, but that particular example doesn't make any sense.

You could say the iphone was the evolution from the ipod, and I would argue samsung is quite important to the android growth.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#12

Post by csydas »

mikeash wrote: post #8
PhoenixWright wrote: post #5

A couple of takeaways from this article: Apple has a problem with leadership. When managers aren't buying into a vision, mostly because it's murky at best, that is a big problem. SV hubris believing you can go into any industry and disrupt the incompetent incumbents is laughable. FB found this out with phones and it sounds like Apple and Google are now figuring it out with cars. The Netflix idea works here too: Apple…

Phones is a really weird example here, considering that the two dominant phone players are both SV companies that went into that industry and crushed the incompetent incumbents. I see no reason to think that Apple could do with cars what they did with the iPhone, but that particular example doesn't make any sense.

I can name a few differences, even if I don't think it's impossible.

Phones were ready for a natural complete upgrade from brick phones to smartphones. The mobile environment was there, all the network components were coming online to make it a really useful device, processors were getting to a good stage for mobile usage where it made sense to make the jump and the jump was right into what Apple already knew pretty well. The phone part of smart phones is pretty minor, quite honestly. Smartphones weren't so much an evolution of dumb phones, they were a complete redesign and replacement thereof. The technology that puts an OS in your hand just did the job of being a phone better than a brick phone did[1], and it came with a bunch of extra features that people didn't know they wanted.

Cars are a little different. Fundamentally, a self-driving car is still a car with an OS attached. It's not so much just figuring out the OS part of it, it's also getting the engineering on a vehicle right, and I'm guessing with autonomous cars there's a lot you have to take into consideration when it comes to the mechanical aspects. It's not quite like the phone situation where you just replace brick phone with smart phone - a smart car is fundamentally the same as a dumb car except that you don't drive the smart car (and in some models, you do). There's a lot more to take into consideration, a much larger spectrum of rules and regulations, and honestly the car part of smart cars is pretty involved. It's not that Apple doesn't have the money to throw at car R&D, it's just it doesn't seem to make a lot of sense to do it.

Again, I don't doubt they could do it, but the barrier of entry just seems higher here, and it's not as natural of a segue for Apple either. They're not just building a tiny computer with an iCar, they'd be building a car with an Apple computer.

[1]I realize that many prefer the brick phones to smart phones and that smart phones are pretty bad at the phone part of being a phone, but ultimately between the myriad of communication apps available, you have more communication options available in your hand than you do with a brick phone, and more ways to do the communication thing.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#13

Post by kbutler »

ynniv wrote: post #9

It's only when Steve isn't at the helm that we hear about internal projects that have no direction. It was good while it lasted.

I think the key words here are "we hear about". It seems like the Apple Iron Curtain is getting more permeable than it used to be.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#15

Post by mikeash »

csydas wrote: post #12
mikeash wrote: post #8

Earlier quoted context omitted.

Phones is a really weird example here, considering that the two dominant phone players are both SV companies that went into that industry and crushed the incompetent incumbents. I see no reason to think that Apple could do with cars what they did with the iPhone, but that particular example doesn't make any sense.

I can name a few differences, even if I don't think it's impossible. Phones were ready for a natural complete upgrade from brick phones to smartphones. The mobile environment was there, all the network components were coming online to make it a really useful device, processors were getting to a good stage for mobile usage where it made sense to make the jump and the jump was right into what Apple already knew pretty…

I completely agree, however people were saying pretty much the exact same things about Apple's phone efforts about ten years ago. In hindsight, it's clear that smartphones lined up just about perfectly with Apple's core competencies, but before they proved it in the market, people were saying just this sort of thing: the engineering is tough and different, the stuff Apple is good at isn't the stuff that's hard, regulation is far more difficult, it's not just a tiny computer, etc.

Now, just because they were wrong to say it then doesn't mean you're wrong to say it now. I think you're right. I'm just saying that phones are a terrible example to bring up if one is arguing that SV companies can't take over industries with entrenched incumbents.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#16

Post by maxerickson »

samfisher83 wrote: post #10
PhoenixWright wrote: post #5

A couple of takeaways from this article: Apple has a problem with leadership. When managers aren't buying into a vision, mostly because it's murky at best, that is a big problem. SV hubris believing you can go into any industry and disrupt the incompetent incumbents is laughable. FB found this out with phones and it sounds like Apple and Google are now figuring it out with cars. The Netflix idea works here too: Apple…

For all the hate GM get the EV1 was way ahead of their Time. Its sad that GM didn't have the leadership that supported that effort. We would probably have viable low cost EVs by now.

What's the path they would have followed? The battery in the EV1 was crappy and expensive, is the thesis that billions of automotive dollars would have accelerated progress in battery research? Is it useful to lose money producing electric vehicles while doing that research?

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#17

Post by coldtea »

ynniv wrote: post #9

It's only when Steve isn't at the helm that we hear about internal projects that have no direction. It was good while it lasted.

There were internal projects with no direction all the time under Steve as well.

Heck there were even EXTERNAL projects with no direction, like the Apple TV (still flailing around), the Apple Cloud offerings (only got robust in the last 2 years or so, and the most touted part back then, the "office"-like iCloud apps are universally ignored), the Apple boom box, and other things besides.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#18

Post by coldtea »

hodder wrote: post #6

As an Apple shareholder, I am thankful Apple has shelved plans to dump billions into a cyclical, low margin, low return business.

Low margin? They wouldn't be making Yugos. Like with their laptops and such, they'd be targeting the higher end of the market.

Cyclical is also great -- that's exactly what the laptop and especially the phone market are.

Re: How Apple Scaled Back Its Titanic Plan to Take on Detroit

#19

Post by TheOtherHobbes »

csydas wrote: post #12
mikeash wrote: post #8

Earlier quoted context omitted.

Phones is a really weird example here, considering that the two dominant phone players are both SV companies that went into that industry and crushed the incompetent incumbents. I see no reason to think that Apple could do with cars what they did with the iPhone, but that particular example doesn't make any sense.

I can name a few differences, even if I don't think it's impossible. Phones were ready for a natural complete upgrade from brick phones to smartphones. The mobile environment was there, all the network components were coming online to make it a really useful device, processors were getting to a good stage for mobile usage where it made sense to make the jump and the jump was right into what Apple already knew pretty…

Apple Car was and is a fundamentally bad idea.

Limited/no cross-sale synergies with other products

Massive up-front costs to establish a manufacturing network

Massive up-front costs to establish a dealer and maintenance network

Strong existing competition which will only get stronger with time

No clear USP ("Made by Apple" is not a USP)

The only way to crush the market would be to make a car that flies and to set up the infrastructure to make flying cars usable for domestic and work commuting.

Since that's not going to happen, the absolute best anyone expects from Apple Car is a me-too car that looks a bit nicer and rounder than the rest. And is available in white, black, pink, and gold. And it absolutely has to self-drive, because that's where the competition will be.

Me-too isn't enough to win in that market.

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