Has Apple gone stale?
Some loyal fans think so, citing lackluster “improvements,” a lack of innovation, and a year that saw sales fall for the first time since 2001.
As Apple celebrates the 10th anniversary of the iPhone, the company appears to have gone into “maintenance mode” while everyone waits for its next big thing to emerge — if ever.
Ronan Timoney, a 23-year-old economics and finance student in Ireland, has had Apple laptops since 2010, iPhones since 2011 and an iPad since 2012.
As a young, avid Apple user, he’s exactly the kind of customer the company should be wooing for their long-term success. But his most recent smartphone purchase was an Android.
For him, Apple has lost its luster. “Their products have become fashion accessories rather than high-powered gadgets, and prices now outstrip quality,” said Timoney. He “will not be buying any Apple products for the foreseeable future,” he said.
2016 was a particularly rotten year for Apple. Annual sales fell for the first time since it launched the iPod in 2001, going from a record $234 billion in 2015 to $216 billion. Its new lineup of MacBook Pros this year failed to impress. The best thing about the iPhone 7 is its camera. It also forced users to invest in $159 wireless AirPods, which had a delayed launch, or use an awkward dongle to use their old headphones. Not very “Appley.”
Core Products for 2017
And what’s in store for 2017? Reportedly three new faster iPad models in different sizes as the company tries to fend off other touch-screen phones and computers, but iPad units have declined in 10 of the last 11 quarters. Instead of “thinking different” the company is “thinking slightly better.”
To be sure, “Apple is a great American success story,” but, “a lot of that innovation came from the Steve Jobs era,” said Colin Gillis, an analyst at BGC Partners known for his bearish views on the company.
CEO Tim Cook is an efficient caretaker but doesn’t necessarily have the late Steve Jobs’ “founder’s fire” that can propel a company past the threshold of what was thought to be possible, said Gillis.
“Amazon, Google, Tesla, Netflix, Facebook, what do they have in common? They’re all still driven by their founders. They’re still able to make big bets and change directions. Is Apple positioned for the next thing?” asked Gillis.
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That’s the big question as longtime users and investors wait to see where the company’s $2 billion annual increase in research and development has been going and on what acronym it might it plant a flag next. AR? IOT? VR? AI?
“What you’re seeing is a point where Apple is making a slower transition away from being a company that historically came out with whizzbang products every couple of years to a company that makes great products we all need,” said Gene Munster, the co-founder of Loup Ventures, who previously covered Apple as a Piper Jaffray analyst for over a decade and remains bullish. “As they shift resources, you get what happened in 2016: Not that exciting of a product year.”
Who’s Driving Innovation?
He thinks the next big things for Apple will be whatever it decides to do in the car space, artificial intelligence, and, according to the kind of Apple rumors that used to capture fanboys’ and pundits’ imaginations, a foldable phone with bendable glass.
But it won’t be Apple making the device, countered Gillis. “They’re not driving the innovation… Samsung will be the ones who make it.”
Even hardcore Apple users say they’ve noticed a change. Apple is becoming more like Microsoft, a former wunderkind that became large, profitable, boring, and angered pro users.
Is Microsoft the New Apple?
As a Mac user, I.T. manager Dan Fox is used to standing out at his PC-filled office at an Orlando-based engineering firm.
“Apple made these gorgeous, sleek, shiny devices that looked like they were from the future,” he told NBC News. “They were cooler than anything else on the market and, more importantly, they actually worked better,” said the 45-year-old Fox. His family members are all Apple fans too, and their house is full of MacBooks, Apple Watches, iPads, iPhones, Apple TVs, and he even sprang for the AirPods.
As of late though, the “cutting edge” upgrades to the Surface and Office 365 have him considering that Microsoft might be becoming the new Apple, with well-built and innovative products, he says, that show an attention to details.
He still loves Apple, but says he feels “Improvements are iterative, and it’s almost as though Apple is now relying on its brand more than its tech. It feels like they are stalling on innovation to squeeze one more model out with a tiny upgrade. Rinse. Repeat. Thing are starting to feel… stale.”
