Mark Sigal in O’Reilly Radar on Apple’s segmentation strategy. First, inconvenient facts:
The following inconvenient facts must be an affront to the horizontal, commoditized, open, market share zealots. Apple has launched three major new product lines since 2001: the iPod (October, 2001); the iPhone (July, 2007); and the iPad (April, 2010).
The company’s stock is up 3,000 percent since the launch of iPod, 125 percent since the launch of iPhone, and 20 percent since the launch of iPad.
In that same time period, the major devotees of the loosely coupled model—Microsoft, Google, Intel and Dell—have been, at best, outpaced by Apple 6X (in the case of Google dating back to the launch of iPod) and at worst, either been wiped out (in the case of Dell) or treaded water (in the cases of Microsoft and Intel) in every comparison period.
Translation: Apple kicks butt. Second, the folly of conventional wisdom, which aims for market share:
Therein, lies the problem with conventional wisdom. Namely, that it’s conventional. It doesn’t think outside the box in terms of strategic imperatives, like building differentiation, growing margins or defensibility.
That explains why the top three mobile handset unit sales ‘leaders’ (Nokia, Samsung, LG) are outselling Apple in raw units an astounding 23.5 to 1, yet for all of that effort, combined they are garnering only 82 percent of Apple’s profit level.
Translation: Apple kicks butt.
Apple is a rare bird, pursuing non-linear, high-orchestration, high-leverage strategies. Exactly the type of complex storyline that is easily dismissed by simple-minded analysts, investors, competitors, media and the like.