Have you ever wondered why Samsung, Google, Microsoft and other technology giants stick their respective greedy little fingers into so many pies that are so far removed from their core businesses?
Samsung is a bit different, of course, but seemed to have little issue with competing against one of its largest vendors, Apple, in smartphones. Google, on the other hand, is a search engine advertising company (over 90-percent of revenue and profits), but, when it comes to diversifying new features, has struck more than Reggie Jackson.
Microsoft doesn’t fare much better, either. Windows and Office accounts for most of the company’s revenue and profits, both enormous, but diversifying attempts have left a string of failures through the years.
Apple’s diversification efforts have met with better success, as each product line seems to grab customers from other lines (iPod halo effect helped the Mac, iPhone halo effect helped the iPad, etc.). So, what if Apple decided to diversify beyond the basic hardware lines and get involved in new products; specifically the content which gets stored, used, and played on Apple’s many devices?
We may think of Apple as the world’s largest music store and media mall, but what if Apple decided to become a record company and signed up independent artists instead of waiting for traditional record companies to do the deed?
Apple’s iBooks is a good book publishing and distribution platform, but Apple itself isn’t really a publisher in the traditional sense, right? What if Apple changed that and expanded the iBook business to include signing bonuses, advance payments for writers in exchange for exclusivity?
Apple could easily drop a billion dollars into the television content business with exclusive TV shows and movies for streaming on iTunes?
Granted, such scenarios make for a lot of ‘what ifs’ but Apple has more money than the entire television and movie industry, the music industry, and the publishing industry combined, so why not grab as much of that business as possible and make it exclusively available to Apple’s customers on Apple products?
Antitrust issues aside, Apple would be presented with the Samsung quandary (not exactly a quandary for Samsung, though) whereby it competes against the very partnerships that exist to make Apple’s content business what it is. Lucrative, yes, but a requirement to help sell the devices where the content is displayed.
Content creators want and need a stage for their creations, and a revenue stream to fund more creations. Is Apple willing to do what Netflix and Amazon are doing and fund independent content, exclusive to their platforms?
I don’t think Apple has a choice.