Thursday Edition
In its May 12th cover story, "The Mac in the Grey Flannel Suit," BusinessWeek confirmed that Apple has finally made some promising inroads into the corporate market in the last year. As a long-time Macophile and anti-PC-er I'm thrilled to see more company Macs. According to research data from the Yankee Group, 87% of surveyed companies now have some Apple computers in their offices, compared to 48% two years ago—due in large part to the iPhone's success in gaining new Apple customers. Meanwhile, Microsoft's problems with Vista, the latest version of its Windows operating system, have further weakened the MS hegemony and encouraged corporate users to upgrade to Mac.
But as the article points out, Apple CEO Steve Jobs, who wouldn't even comment on the BusinessWeek story, may not be that anxious to get the grey flannel business. Why? Because a corporate sales strategy would require both an expensive sales & support staff and a willingness to modify Mac product designs to suit the conflicting demands of corporate buyers. Apple is doing just fine without these hassles, making high margins catering to students and artists who will pay extra for the Apple cool. Budget-conscious CIOs may not be as accommodating.
If you were Steve Jobs, what would YOU do?
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Comments
As a confirmed Mac user, I'd encourage Apple to leave the business market well alone on the grounds I don't want the world's malevolent virus-makers focusing on OSX, even if (of course) they do it purely in the altruistic interests of pointing out flaws someone else might abuse (oh yeah).
If Apple go for the corporate market, they've got to ask if they are a box manufacturer, a software author or both. Given that many CIO's want cheap PC's that can withstand some abuse, theft and so forth, I doubt Apple want to be in that volume market. On the other hand, Apple might well focus on the corporate server market and on providing desktop software. A version of OSX that that runs on Wintel boxes? Throw in iWork, or just produce a Windows version? If they can maintain the security and virus integrity they currently have, that would be a potent combination.
Posted by Mark JF at May 6, 2008 2:07 PM
If I were Mr. J. I wouldn't mess with the brand.
Posted by Mr. D. at May 6, 2008 2:15 PM
Ignore conflicting demands. Just continue keeping up the good stuff.
Posted by Harald Felgner at May 6, 2008 3:56 PM
It makes you wonder, if Macs were everywhere, would they be as special?
Posted by John O'Leary at May 6, 2008 4:32 PM
I think you are making the assumption that Macs are special because they are rare, John. I'm not sure if that is actually a valid correlation or a coincidence.
Google gives the option - Mac or ThinkPad, which is really great for keeping those die hard brand addicts happy. Happy addicts = happy customers!
Posted by Jeff Licciardi at May 6, 2008 5:22 PM
I love going to commercial art galleries where the latest macs are usually on display. I love going into offices and seeing the odd mac with a bunch of people mulling around saying "How come the design guys get the cool stuff?" :) If I was a CEO I would be giving them all macs as I would love them all to have the best.
Can Apple handle it? Probably, heck they are in business, so the more they make, the more they make...
Posted by steve Gray at May 6, 2008 5:48 PM
Apple is gaining among the "time is money" crowd because they realize commodity tools aren't the way to maximize productivity. I predict that Mr. Jobs will continue to build his products the way HE wants and they will continue to gain in the boardroom based on their own merits. He has changed the face of computing, mobile music, film downloads and will do the same among business computer users.
Posted by Kurt Wendelken at May 6, 2008 8:05 PM
I think catering to the business community would be difficult for Apple. Apple's end of life cycles are much shorter than what the corporate world is used to. Better to keep focused on the consumer market, and take the windfall when a business finds it will work for them, too.
Posted by Brian Oates at May 6, 2008 8:34 PM
Apple has been about thinking differently from its inception. I agree that entering the CIO supply chain mainstream will water down innovation and risk Apple becoming part of the sea of sameness in the PC industry - including the sameness of watered down margins. The MS definition of innovation is buying other products (Web TV at $400M anyone?) and failing to adequately integrate into anything worthwhile. Jobs should stay the course.
Posted by David Porter at May 6, 2008 9:51 PM
I like apple better than regular PC's, but I don't own one because its not what everyone else uses.
I want it to become mainstream.
The Beatles are mainsteam and whats bad about that?
With any luck, Obama will be mainstream too.
Posted by pete at May 6, 2008 9:58 PM
Does Apple cool really cost more when you take into account the total cost of ownership (i.e tech support, user productivity etc.)?
Posted by Craig Kaltner at May 6, 2008 10:01 PM
It makes you wonder, if Macs were everywhere, would they be as special?
If Macs were that special they would be everywhere!
Posted by PaulH at May 7, 2008 2:43 AM
Apple being able to extract above market rents from "starving" students and artists should make us all rethink our strategies. Think different, indeed. It demonstrates the value of leading, not following, in our various endeavors.
Rick
Posted by Rick at May 7, 2008 3:19 AM
Good to hear from you John. It was love at first sight for me when I saw my first Macs in use in the Palo Alto office of Tom Peters Group in 1988. I have been a Mac owner/user ever since. It's still a love affair for me. Specification? Mass popularity? No matter!
Posted by Richard King at May 7, 2008 3:55 AM
Maybe we're asking the wrong question. What Apple should be thinking is NOT "How do we get into the corporate market?" but "What does the corporate market need that we can totally redefine and do better than anyone else?" Mobile computing.
Give me a switch-on, very light, very robust device with great battery life and connectivity to WiFi and ethernet for when I'm in other offices. Make sure it's got corporate e-mail, pda, Word, Excel and PowerPoint software (iWork will do fine). It may be an iPhone, it may be a revised Newton, it may be a next generation MacBook Air but give me such a device at a decent price and I'm in there.
Posted by Mark JF at May 7, 2008 4:06 AM
As mentioned on the study Mac has entered the corporate market due to the success of example the Iphone. I would make sure to continue innovating peripherical solutions that would drive even futher demand for the corporate market.
Microsoft always had problems with new Windows versions and Vista is not new to that.
Posted by Vassilis Syropoulos at May 7, 2008 6:31 AM
John, as you know, I was a late convert to Mac, and cost was certainly a consideration. Now I simply can't imagine going back to pc. It is a good example of price vs value. The initial investment may have been a bit more, but the increased performance and wonderful design quickly overcame the price gap. However, I have little faith that current managerial thinking embraces value over price. Perhaps it is the metrics used really don't pay due to the cost benefit. Investment doesn't seem to have a chance compared to daily operational cost.
Posted by Mike Neiss at May 7, 2008 7:03 AM
As mentioned on the study Mac has entered the corporate market due to the success of example the Iphone. I would make sure to continue innovating peripherical solutions that would drive even futher demand for the corporate market.
Microsoft always had problems with new Windows versions and Vista is not new to that.
Posted by Vassilis Syropoulos at May 7, 2008 8:10 AM
I think your comment about "conflicting demands" applies even beyond corporate buyers. Many people buy Apple products precisely because they are not standard corporate gear. If Apple modifies their stuff to please businesses, they run the risk of alienating their loyal fans.
One of my favorite sayings is that "if you try to be everything to everybody, you'll end up being nothing to nobody." Jobs should be careful to avoid diluting the Apple brand.
Posted by David Rendall at May 7, 2008 9:38 AM
What should Apple do? Nothing; because corporate want computers and Apple do not sell computers – they sell lifestyle. The culture of innovation (which is Apples prime brand value) is run by Jobs. As he fades in years to come learn from Sony’s mistakes – how many walkmans were there? Jobs facilitates a culture of innovation, but does he facilitate generational innovation?
Mac going corporate will be less a choice and more an indicator of the health of the Apple brand. If they do it in a Jobs way then they will change the fundamental relationship between computers, inventory and business. If they do it like Dell then it will be game over. See Seth Godin’s post yesterday about mainstream and alternative market cultures and that the 2 are mutually exclusive.
http://sethgodin.typepad.com/seths_blog/2008/05/avoiding-the-pa.html
Posted by Gilbert Halcrow at May 7, 2008 11:33 AM
When people have a choice in their hardware you get diversity (some will want Dell, some HP, some Apple (for instance)). By the late 90s IT departments thought going to all one manufacturer was going to save them time and money. Turns out, it does not - so the pressure from the employee side has driven IT managers and CIOs to look more toward the bottom line than which computer people have. Which is good - focus on keeping your employees happy instead of Draconian BS that does not serve the bottom line.
So we'll see Apple continue to infiltrate businesses by virtue of increased choice - insofar as which computer you use does not adversely impact productivity, that is. Most of the computer work is web-based or based on cross platform applications, so the reasons for restriction have dissipated. And then you have more mac-loving CIOs around...
What should Jobs do? Nothing yet. Right now some rogue employees fight against the grain to get their macs - and some are succeeding. As this continues, the nature of the need on Apple's side will get more defined. As far as the iPhone goes - as they increase support to please business customers the openings for other Apple products will come - but since this environment is changing away from the previous more restricted IT policies the opportunities will come there too.
Apple needs to continue to execute with excellence - their previous downfall in business came in 1996 with the "flamebook" 540c. Because their products were not reliable, IT dropped them like a hot stone.
btw: mainstream and alternative markets are not mutually exclusive - not at all. Godin's piece is very confused and conflates some pretty basic issues. Businesses have known for ever about what could be called the volume v. quality dichotomy - but this has little to do with alternative v. mainstream markets. A great analysis of the power of alternative markets can be found with Chris Anderson's "The Long Tail".
Posted by Martin Koning-Bastiaan at May 7, 2008 2:25 PM
I am not fully developed on this idea but I throw it in the ring...
Google developed and built their own servers to populate their server farms to great benefit.
I am not sure that Apple should go after the corporate market as a whole instead of some subsegment. And perhaps someone other than Jobs should lead it - someone like him but different. Maintain the brand but differently.
Above all, style, ease of getting work done, not creating work of an IT department, etc. Apple's brand is taking away options to give us new options with style and verve (a contradiction? Of course - the balance of the tension is where Apple shines). Make it easy to do our work and dreams.
Two concerns are maintaining security as Apple products gain visibility and getting locked into proprietary items (file formats, etc).
Posted by s g at May 7, 2008 3:03 PM
For those of you that posted to this blog, and those debating the pros/cons of the Mac environment, I encourage you to read the recently released "Inside Steve's Brain" book. As a Mac convert that got hooked on the experience when Jobs geniusely opened the itunes platform to windows users with the master plan to get me to go with a MAC when I would be in the market for a PC, don't underestimate the long term future of MAC in corporate America. It won't happen overnight, but after transforming movies, music, phones and computers, can there by any doubt? All of these young creatives and programmers will eventually be making these decisions for all of us. The migration has just begun. Check back in ten years or so. The story will be quite different as many more become MAC digital immigrants per se.
Posted by Alex Vergara at May 13, 2008 10:46 PM