Those of you old enough to remember Apple's 1st era of market dominance in the early 90's, before it fell off the cliff of near bankruptcy, only to be saved by Steve Jobs' return --- this will feel all too familiar: Apple pioneers a new market segment, dominates market, refuses to budge on price. A competitor comes out with an inferior but widely-licensed product (then, Microsoft/IBM), and gradually Apple loses market share to the point of obscurity.
All this stuff of Phil Schiller's -- "we're not going to reduce price to compromise quality" -- is the same tape recorder as Apple's approach in the late 80's, when Apple did not see it coming. Apple did not see it coming then, and Apple does not see it coming now.
The $120 billion cash pile perhaps makes Apple less vulnerable, but, as you can see from RIM Blackberry, a cash pile will prolong the torture as the victim dies a slow rather than quick death, but a cash pile cannot save you when the market says, "Hey, iPhones aren't cool anymore." That is the point of the death spiral, when a sufficient critical mass says, "Hey, Apple's not cool anymore".
And don't anyone say that's not possible.
All I can say is, the seeds of arrogance have been sowed. Apple thumbing its nose at important market segments, saying they "can't please everyone", and only focusing on the crowd that brings in the money. Well, I have news for Apple. That segment that Apple is kowtowing to, the consumers, are the ones that can, within the space of 1-2 years, decide that Apple is no longer cool, and move to the next cool thing. Is Apple then going to crawl back to its original user-base - the creatives, the professional artists, and start supporting them again.
In history, there is a phenomena known as castles crumbling because of a poor foundation. Apple is destroying its solid base by only focusing on the crowd that, apparently, seemingly, brings in the most money. But, like RIM/Blackberry, that crowd can spin on a time and turn on Apple in an instant.
Apple has rejected the strategy of building a broad user-base, by rejecting its formerly core user base.
Take for example, Apple's 6 year total rejection of the professional graphics market that needs matte or anti-glare screens on its desktop equipment. Do you realise that Apple - as a major supplier of a worldwide OS -- does not provide ANY desktop hardware that has an anti-glare screen.
All fanboys can laugh, and think it is funny, citing that Apple just can't please everyone, and claiming that everyone loves glossy screens.
Well, when the fickle users do a RIM/Blackberry on Apple, at the tipping point when they decide that Apple is no longer cool, Apple will realise the folly of not catering to a wider user-base.
If you think this a rant, you just need to refresh your memories to the recent past when Blackberry was the cool kid on the block, when we admired people with Blackberries, and it was a status symbol.
Anyone who thinks that that can't happen to Apple is no student of history, and those types are bound to repeat history's mistakes.
I think more than a few conspiracy nuts are starting to see things now.
