No, Apple Is Not ‘On the Verge of Being Disrupted’

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Apple Distrupted
Just what will it take to turn Apple’s world upside-down? (Photo by Rishi Deep on Unsplash)

I read the article published this past Friday over at Wired by Molly Wood and the title of the article immediately grabbed my attention: “Apple, the iPhone, and the Innovator’s Dilemma.”

I read The Innovator’s Dilemma by Clayton Christensen several years back as required reading for one of the classes I was taking to get my Master’s Degree. It’s an absolutely amazing read and the message in the book is 100% spot on. Companies that fail to innovate will eventually be disrupted and eventually fail. But in the opening two sentences of the Wired article we get the following statement:

 “Apple is a company on the verge of being disrupted, and the next great idea in tech and consumer electronics will not materialize from within the walls of its Cupertino spaceship.”

First off, I totally agree with the last half of that statement. The next great idea in tech and consumer electronics will not come from Apple. It’s pretty easy to jump to that prediction. All you have to do is look at the history of highly successful Apple products. They aren’t brand new ideas. Apple didn’t invent the MP3 player. MP3 players had been on the market for years when Apple introduced the iPod. Apple took an existing product and put its own spin on the design and went on to dominate the MP3 player market. Fast forward about 6 years and Apple did the same thing again with the iPhone. Apple did not invent the smart phone, but they did help to set a new standard in the quality and design you can expect to get from a smart phone. The entrenched cell phone giants mocked Apple as it announced the original iPhone, and then it wasn’t long before those same giants had to eat their words and (at least some of them) start copying Apple’s designs and styles just to try to keep up with them (the prime example being the touchscreen keyboard that they all said initially would never work). Where is the physical keyboard on smart phones now?  Apple left them all in the dust when you look at who leads the industry in smart phone profits today…the 2nd place competitor isn’t even close.

No, it is the first half of that statement that I take issue with (“Apple is a company on the verge of being disrupted”). The problem with this statement is that Apple’s cash cow products are not single technologies, they are a large number of individual technologies integrated together to form a product. That “integration” process has a name…design.

In order to think about the type of disruption that would “doom” Apple you need to look above the individual technologies level. Apple excels at putting its own twist on an existing product/idea and leveraging its design prowess to churn out a different kind of product with large profit potential. The kind of disruption that has the potential to doom Apple would be if there were rapid technology developments that allowed new products to be designed and mass-produced in weeks instead of years. Or a large and sudden market shift in consumer electronics where consumers drastically reduced how much and how often they bought new tech (we are seeing a very slow version of this now with smart phones but it isn’t drastic enough to doom Apple just yet).

Apple’s DNA (as they like to say) is geared toward good design, and good design takes time and it costs money. If good design stops yielding high profits then Apple’s entire strategy will have to do a complete 180. That is the kind of “disruption” that Clayton Christensen is talking about in his book. Examples like hard drive technologies where the market went from large capacity bulky drives for the lowest cost, to smaller capacity very compact drives for a much higher cost. Everything that goes into designing and manufacturing a hard drive changes when you go from large and relatively inexpensive to very small and costly. The type of company structure and culture that work for the former no longer work for the latter. This is why companies that see a disruption coming need to spin-off a separate and independent branch (or even a separate company) so that the existing company culture doesn’t squash the new culture that is needed to go along with that new disruptive technology.

I would argue that Apple’s core technology isn’t a technology at all, it is a process and that process is design. Apple has time and time again (iPod, iPhone, Apple Watch, AirPods) shown that it can come in cold into an existing market and through the use of its design team bring a strong if not market dominating product to the world. New technology disruptors will come to market first from companies besides Apple and then Apple will do what Apple does best…out-design its competition. I’ll put a different spin on Molly Wood’s analogy (which I really enjoyed by the way):

“You may be tempted to argue that Apple is, in fact, working on other projects. The Apple acquisition rumors never cease; nor do the confident statements that the company definitely, absolutely, certainly has a magical innovation in the works that will spring full grown like Athena from the forehead of Zeus any day now. I’m here to say, I don’t think there’s a nascent warrior goddess hiding in there.”

Rather than use the world of Greek gods for an analogy I will use Star Wars. People view Apple like some Star Wars fans view the Jedi, and are in awe of their ability to wield a lightsaber. They worry one day someone will best them in swordsmanship. But they have it all wrong. It isn’t the lightsaber that makes the Jedi great, it is The Force. The lightsaber without The Force is just a super dangerous toy that will result in loss of limbs (no angry Wookiee needed). Apple’s “Force” is their culture of design. One day that culture will stop being effective, but it will take more than a single technology disruption to do that. It will take a combination of technology disruptions, changes in product manufacturing and changes in consumer electronic demand (all in a very short timeframe) to extinguish “The Force” within Apple.

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