One of the things Apple has demonstrated over its lifetime is that it has become the great disruptor. When the Mac came on the scene in 1984 and introduced computer users to the graphical user interface, it shook up the text-based DOS market so dramatically that it forced Microsoft to follow Apple’s lead quickly in order to stay relevant. Now graphical user interfaces are the norm on all PCs.
Eighteen months later, Apple pushed the Mac as a disruptor to the publishing market with the introduction of desktop publishing. Marrying the Mac, a desktop laser printer and Aldus’ PageMaker software, Apple championed a desktop-publishing solution that completely changed the publishing world by letting people create content on demand and publish it without the help of the publishing industry’s big-iron solutions. Today, personal publishing on the desktop or on the Web has its roots in Apple’s disruptive desktop-publishing blitz.
In the early 2000s, Apple upended the music market with the introduction of the iPod and an easy way to access, buy and play music on the go. While pirating music was the real disruptor to the music industry back in the late 1990s, only the tech literate went online to get MP3 files. While early MP3 players came out to make digital-music playback more portable, it took Apple with the iPod and iTunes to really disrupt the digital-music market and bring it to the masses.
Then in 2007, Apple disrupted the cell-phone market with the iPhone. While Apple did not invent the smart phone, the company reinvented it in ways that completely disrupted the wireless carriers’ way of controlling their own programs and added the element of a truly intelligent operating system and apps to the smart-phone landscape. The iPhone has literally redefined what a smart phone is and has dramatically disrupted the entire telecommunications world.
In 2010, Apple introduced the iPad. The company did not invent the tablet. It reinvented the tablet and in the process reinvented the personal computer. Now the iPad has become a major disruptive force in changing the dynamics and fortunes of the traditional PC industry. Thanks to the iPad and tablets overall, traditional PC and laptop sales were off around 10% in 2012. Our estimate is that PC and notebook sales will be off at least 10% in 2013 and could see an even steeper drop as tablets gain more ground in business and consumer markets. A more interesting projection is that for the first time, tablets will outsell notebook computers worldwide in 2013.
The disruptive nature of the iPad was not predicted by anyone except perhaps Steve Jobs, who clearly understood the impact the iPad would have on the market. To all PC makers’ chagrin, they too did not see tablets coming and were not prepared to make the transition from a high-volume PC business to the next big personal-computing device for the masses. Although they are trying to play catch-up with Apple and Samsung, the Wintel crowd is behind in tablets, and I am not sure they will ever really gain ground against Apple and Android.
Has Apple Peaked?
While Apple continues to deliver record sales and record profits, the financial community seems to think that Apple is done innovating and disrupting markets. Their demands for outlandish quarterly profits have sunk Apple’s stock over the past seven months. I have heard some even suggest that Apple has peaked and that it’s downhill from here on in.
However, if you study Apple’s history, especially since Steve Jobs returned to the company in 1997, its actual cycle of creating innovative and disruptive products is around three to four years, on average. In the case of the time span from the iPod to the iPhone, it was actually seven years. This suggests that Apple is not driven by clocks or stock price when it comes to innovation. Rather, the company takes its time to think things through. It focuses on the fusion of the hardware, software and service ecosystem of new and innovative products before bringing them to market.
There is a key reason for this attention to detail. Apple has an internal mantra that when it introduces a new category of product that has the potential of shaking up or disrupting a market, it must be done so that Apple will have a two-year lead at the very least over the competition. If not, Apple won’t touch it. That is why the company didn’t just deliver a new MP3 player, but rather an entire hardware, software and service approach with the iPod. The same goes for the iPhone and the iPad. In both cases, from the time of launch to the time competitors come even close to catching up, Apple had at least a two-year lead.
What’s Left to Disrupt?
So, is Apple done disrupting markets? Don’t bet on it. Most likely the next market it will disrupt will be the TV market. And while we don’t know exactly what Apple’s doing, given its track record, I’m pretty sure that this product will have a dramatic and disruptive nature on the television industry when it does come out. If done in dramatic fashion, competitors may need more than two years to catch up with Apple this time.
Another industry Apple could disrupt is the auto industry. Although cars are getting smarter, they have a lot of room for innovation around embedded screens that are now popping up in cars even in the midrange price categories. Imagine if Apple and one or two major carmakers got together to write the next chapter of intelligently connected automobiles that marry dedicated applications, an ecosystem of services and constant Internet connections. Think what the impact could be on the future of road travel.
Yet another industry Apple could disrupt is the watch industry. Many people are closely watching the Pebble smart watch that’s just now shipping to see if its connection to iPhones and Android phones takes off. This particular product is an interesting first step in marrying the smart phone with a watch, but it mainly relays smart-phone alerts and calling info to the watch’s screen. While I really like the Pebble smart-watch idea, what I really want is Dick Tracy’s watch — and I’m betting that Apple is the company that will eventually give this to us.
Could our homes get smarter too? Of course they can. It is not a coincidence that former head of hardware at Apple, Tony Fadell, has created the Nest thermostat that is connected to the Internet and is smart enough to watch your heating and air-conditioning habits, adjusting them automatically. This suggests to me that the concept of the smart home was in the works when Fadell was with Apple and that Apple has been working on this internally for some time. I am convinced that Apple will be the company that eventually disrupts the home-automation apple cart, so to speak, and makes it another prime market that gets disrupted in the near future.
Controlling the Smart Screen
In each of the examples I stated, you may have noticed that a “screen” is involved. Screens are mostly necessary for managing, viewing and even controlling content. In the case of Apple TV, there is a possibility of Apple actually doing a physical TV set, but if so, think of it as mainly a giant iPad in that it could have the same guts and intelligence found in an iPad. However, if I were a betting man, I would bet that the heart of Apple’s true TV product lies in the way the iPhone and iPad interacts with the giant iPad or any other TV via a smart box, and that the real disruptive products comes in the way Apple marries the iPhone and iPad into the next generation TV-viewing experience.
All smart cars will have screens in them too. Imagine a dedicated iPad embedded in a car that doubles as the car’s map as well as the vessel for a whole host of automobile-dedicated apps. As for the smart watch, what if Apple could create an iPhone or iPad that’s a 2-in. (5 cm) square, which could be worn on our wrists. While it may have some touchscreen features, the real way you would interact with it is via Siri, à la Dick Tracy. As for the smart home, imagine iPads integrated into appliances, in the kitchen or even in bathroom mirrors as well as being the center of a whole home’s automation system.
If anyone thinks Apple has stopped innovating, then I have a bridge I’d like to sell them. Apple is a very smart company run by some very futuristic thinkers that have a toy box of integrated products and services to work with. To think that the company won’t use its experience to disrupt other markets is shortsighted. It might take time, but Apple is more than capable of continuing to innovate and drive markets in new directions.
- Your Smart Phone Will Become the Hub of Your Digital Lifestyle
- Four Guiding Principles for Understanding Apple’s TV Strategy
- How Apple Could Own the Interactive-TV Market
- Would Apple Create a Smart Watch? If So, When?
- 6 Reasons Apple Is So Successful
Bajarin is the president of Creative Strategies Inc., a technology-industry-analysis and market-intelligence firm in Silicon Valley. He contributes to Big Picture, an opinion column that appears every Monday on TIME Tech