Q: Turning to Apple, where is it at right now as a company in this post-Steve Jobs period?
A: Still too early to tell. They seem to be cooking a lot of things and the great experiment of whether a company can be Jobsian without Jobs is still going on. I have been trying to put together a picture of how it operates. It’s hard because that’s their biggest secret. It’s also a picture that few people have ever seen, even those who worked there a long time. The glimpses so far are tantalizing but there is so much we don’t know and thus can’t assess how robust it is. One thing that is clear to me is that there is no absorption by mainstream observers of what makes Apple tick. It’s hiding in plain sight because what it is isn’t anything anyone can recognize. Case in point is the functional and integrated dimensions. It’s the largest functional organization outside the US Army and more integrated than Henry Ford’s production system. Just describing it sounds medieval and it’s so far outside convention that it’s not something reasonable people are willing to believe actually exists.
Q: Is Tim Cook the right CEO for the company at this time?
A: I hold the belief that he’s been CEO for much longer than it seems. Jobs was not a CEO in any traditional sense. He was head of product and culture and all-around micromanager. He left the operational side of the company to Cook who actually built it into a colossus. Think along the lines of the pairing of Howard Hughes and Frank William Gay. What people look for in Cook is the qualities that Jobs had but those qualities and duties are now dispersed among a large team. The question isn’t whether Cook can be the “Chief Magical Officer” but rather whether the functional team that’s around Cook can do the things Jobs used to do.
Look at it another way: I subscribe to the idea that any sufficiently large company is a system and needs to be analyzed using a lost art called “Systems Analysis”. This is a complete review of all parts and the way they inter-relate. However, since for most of its life Apple was personified as an individual, what came to pass for Apple analysis was actually the psychoanalysis of that individual. It makes for great journalism and best selling books. It’s also banal and almost certainly wrong. The proof is in the vastness of complexity and number of people involved. Engineers tend to think about constraints and the constraints on companies are innumerable.
Q: You’ve written extensively on the post-PC period, when will we come to the post-phone period – if ever?
A: I think less than 10 years. Maybe even five. A wristband today can have more processing power than the original iPhone. An iPhone has more power than a desktop did 4 years ago. The speed of change is incredible.
Q: What’s going to be the “next big thing” for Apple? Watches, TVs, something else?
A: I segment along “jobs to be done” which are basically unstated and unmet needs. Unstated because they are usually so deep and so pervasive that they’re taken for granted. We have the need to feel good about our lives, to be healthy and to be connected in meaningful ways to others. These jobs are very poorly served by technology today and there are many non-technology products that are hired as poor proxies to help. The speed with which technology changes means that the trajectory of improvement will undoubtedly intersect that of the job. Even a small job like losing weight and eating well is probably worth as much as half the mobile phone market. Imagine if someone gives us a magic tool that does that for us. How much would you pay? How many of us would pay? There are so many next big things that I cannot choose. (By the way think of the job Facebook is hired to do: make me feel good about myself because I can show others how good I am. Boom!)
Q: What’s your take on how they’re handling their expansion into China, India, and other emerging markets?
A: It’s depressing how slow things are moving on that front. We can draw lines on a graph but we don’t know the constraints. Again, the issue with adoption is that the timing is so damn hard. I was expecting smartphones to take off in mid 2004 and was disappointed over and over again. And then suddenly a catalyst took hold and the adoption skyrocketed. Cook calls this “cracking the nut”. I don’t know what they can do to move faster but I suspect it has to do with placement (distribution) and with networks which both depend on (corrupt) entities.
Q: As you look at the rest of the mobile internet competitive landscape, do you expect any big surprises from other players (good or bad) in the next 5 years?
A: The big question in my mind is the sustainability of the arbitrage models which underpin pretty much every internet business plan. Essentially we have two markets: one where everybody consumes but pays in metadata and another where everybody consumes aggregated analytics but pays in cash. An internet business is the arbitrageur who takes advantage of the inability of each market to price the other. History shows that arbitrage markets tend not be stable as information begins to leak across markets. Therefore what would blow the internet up is if consumers could become wiser about what they are giving up and advertisers would become wiser about aggregating consumer data. I imagine a system where each individual would allow bids on their consumption and a market mechanism where bidders competed for that data. This of course depends on users taking control and ownership of their own data. What might help is the realization of what mass state surveillance can do and the realization that internet giants have more information about us than the government could ever hope to possess.
It would create a new era which will have political dimensions. I imagine we’ll need an internet citizen’s bill of rights or some such movement which will reset expectations. Economically, could bode well for those who position themselves as protectors of the individuals and be a crisis for those who take advantage of consumer ignorance.