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To keep it in Apple-pie order

Without Steve Jobs’ creative genius, Apple Inc will have a tough time in price-sensitive markets.

india Updated: Aug 26, 2011 21:18 IST
Hindustan Times

The brain, heart and sinews of any Apple device are made by somebody else. Yet when they came together in the hands of Steve Jobs, the company’s creator and resurrector, people queued up overnight for the privilege of being the first buyer of his latest electronic toy.

The digital revolutionary has done more than any other man in shrinking wardrobe-sized laboratory computers to fit into our palms. Apple’s graphical interface computer brought college kids on board, its music players had the pre-teens tuning in, and toddlers can now doodle on its touch-sensitive tablets.

The icult worship around Jobs goes beyond the prosaic admiration that has made Apple, if just briefly, the world’s biggest company. But it doesn’t conceal the workings of an egotistic micro-manager who has been probed for dodging taxes. Apple today faces the existential angst of most personality-driven companies when the Great Leader hangs up his boots.

The Apple stock fell 5% after Jobs announced he would be stepping down as its CEO but investors were more concerned in 2004 when he first underwent surgery for cancer of the pancreas. In the seven years since, Jobs has lined up a big chest of innovative products and has also built an enviable second rung of leadership, with formidable reputations apiece. This and a pipeline of maverick engineering — Jobs himself holds 230 patents — should keep the company going for some time. History, however, shows Apple going downhill when Jobs was away, The $2.75 stock at listing in 1980 was trading at slightly over $3 in 1996, when Jobs returned 11 years after being booted out in a boardroom coup. Over the next 15 years of relentless innovation, Apple has climbed to $368 a share. The beast Jobs is leaving behind this time around is gorilla, not the chimp of the mid-1980s.

Apple is what it is today because it marries cutting edge hardware and software to provide the user an experience she hasn’t had before. This walled garden approach could, however, be its nemesis. In an industry where innovation is a commodity, locking consumers into proprietary platforms is not a good idea.

Open source yields technological improvements on a scale no individual company can hope to match. Computer and cellphone makers have mostly burnt their fingers with home grown software. Costs of keeping up with Android, Google’s free operating software for mobile phones and tablet computers, can be prohibitive. However brilliant the marketing, the iPhone and iPad are under intense pressure from cheap handhelds that use free software operating platforms. A large part of Jobs’ halo is due to his marketing chutzpah, yet it can’t face the onslaught of the price warriors.

Expensive itoys are yet to carve their territory in price-sensitive markets like India, which mark the new frontiers of the digital world. Jobs’ creative genius has been a holding operation, a more conservative leadership at Apple will have to contend with the sobering reality of prices when his legacy begins to wane.

First Published: Aug 26, 2011 21:06 IST