Skating to the puck
Listening to Steve Jobs unveiling the 3G iPhone last week (thanks to an online video feed), I got to thinking about what it is that Apple’s revered CEO does that has consumers in such awe of the company’s products. Hint: keep an eye on the puck.
Analysts, the press, and millions of geeks worldwide already knew most of what Jobs would announce at his annual keynote address to Apple’s developer conference in San Francisco. But that didn’t stop people from streaming to websites carrying live video and audio feeds of the Apple CEO’s address.
Jobs’s biannual keynotes have become eagerly awaited industry events. Apple fans and investment analysts alike pick apart every word uttered onstage by Jobs, who is always dressed in his trademark Levi’s 501 blue jeans and black St Croix poloneck sweater.
Last week the prekeynote hype reached unprecedented levels, despite everyone already knowing the most important details of what Jobs would be unveiling: an update to the company’s smartphone, the iPhone, that would support faster, 3G cellular networks. The only real surprise was the price — the entry-level iPhone will cost half as much as its predecessor (US199 vs $399).
The rise in Apple’s share price over the past few years has been breathtaking. Despite the Mac having worldwide market share of less than 3,5% — the PC market with Windows has more than 90% — Apple’s $153bn market capitalisation is more than half Microsoft’s. A $1000 investment in Apple five years ago would have netted a profit of nearly $20000, a performance that outstrips even Google’s.
That’s quite an achievement for a company whose famous logo appeared just 11 years ago on the cover of Wired magazine, encircled in barbed wire, with a single word, “Pray”, beneath it. But within months of the Wired story, Apple had ousted its beleaguered CEO Gil Amelio and rehired cofounder Jobs, fired in 1985 by then-CEO John Sculley (who Jobs, ironically, had hired from PepsiCo to run the company).
On his return, Jobs cancelled a number of noncore projects, including the ill-conceived Newton personal digital assistant, and set about reinventing the Macintosh in a world that had become enamoured of Bill Gates and his Windows operating system.
By most accounts, though, Jobs is not a pleasant person to work for. He is highly demanding and doesn’t suffer fools gladly. Books about Apple describe Jobs as egotistical and temperamental. He would terrorise employees but also earned their respect.
How does he do it? Though Apple’s products mostly use standard industry components, they are lauded for their design style. The company’s new ultraportable notebook, the MacBook Air, is arguably the best-looking machine in its class. Even though it lacks a built-in optical drive and important communications ports, the machine’s aesthetics — Apple claims it is the world’s thinnest laptop — mean it will sell in large quantities.
Similarly, the first iPhone was not as powerful as rival handsets from companies such as Nokia and Samsung, yet the phone’s intuitive touch-screen interface and innovative operating system made it the most-talked about and desired consumer gadget of the past year.
Apple has perfected the art of anticipating technology trends, and then packaging them into products that consumers lust after.
Any CEO will tell you that it is incredibly difficult to create an innovative product line. It is even more difficult to maintain the innovative edge year after year. Yet that’s exactly what Jobs has achieved.
Jobs summed it up well in a 2007 keynote address in which he quoted retired Canadian ice hockey player Wayne Gretsky: “‘I skate to where the puck is going to be, not where it has been.’ And we’ve always tried to do that at Apple. Since the very, very beginning. And we always will.”
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