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Re: Tuesday, November 7, 2001
A bunch of thoughts come to mind here. First, Apple service and support is infinitely better than it was when Steve Jobs arrived, even though he immediately shut off the 1-800-APPL free support line, pissing off a lot of people (me included) in a big way. But credit where due: when I call for service now I get somebody almost immediately, and help is always patient and useful. There's plenty of evidence (e.g. Consumer Report's recent survey of PC vendor support) that Apple is now doing a good job there. And let's not forget that they're making computing easy and fun again with some outstanding hardware. I don't want to discount that. But that's individual stuff. At the enterprise level, you're right: it's not there. When Apple looks in the enterprise direction it sees many, many burned bridges and a Microsoft Empire on par with Rome under Augustus Caesar. The enterprise also doesn't appear to interest Steve much anyway. And who knows what unspoken agreements exist between Steve and Bill, quite aside from Microsoft's huge holdings in Apple, whose legitimacy rests rather largely on a steady series of Microsoft Office upgrades? Steve Jobs is a peerless technology innovator and consumer marketer of the first rank. He's profoundly original, wickedly smart and an unusually tough businessman. What he's done with Apple, from product choice through design, branding, retailing, merchandising and even service (through the "genius bars" at Apple's stores) has served to reposition Apple as a premier consumer electronics player. We're only seeing the beginning of it. Your Mac will be the "hub of your digital lifestyle" Steve said at Macworld last January. SKU by SKU, you'll see Apple get back into the peripherals business. Maybe not in printers (where they once had a fabulous position under Terry Bailey but wouldn't let the profitable division operate independently), but certainly in MP3 players, DVD players, and other devices that attach to PCs and flank what Sony is doing, rather than taking that giant head-on (in, say, Camcorders). But consumer electronics is far from the enterprise, where desktop hardware margins are molecule-thin, thanks to the very cloning business that in retrospect Steve was wise to have dumped when he returned to Apple in 1997. So you're right. Relationships are the only way Apple gets into the Enterprise in a big way. The question is, with whom? Sun would make sense. There we'd have a couple of high-margin, high-style players working together. Oracle would make more sense at a personal level for Steve and Larry, who are old friends. I think the biggest problem for Apple in the enterprise is hardware. Its gear isn't, as they say, "compatible." Sure, Macs can get along in the enterprise, in the sense that anything that lives on the Net is compatible with everything else on the Net. But too much of the enterprise computing conversation is about what can only be done on Microsoft OSes and X86 iron. This is Linux' problem to a lesser degree; but Linux runs on X86 iron and is too easy for geeks to sneak in, set up and put to use without showing up on the corporate radar. Apple's stuff won't get past security unless it arrives in the laptop bags of outside contractors or high-clout employees. Another partner that might make sense is AOL, or perhaps AOL in cahoots with Sun. That's because AOL/Time Warner through its publishing empire is already a huge Apple customer. And affinities between AOL and Apple go back a very long way. AOL is also big in Entertainment, where Steve Jobs is perhaps the most expert executive around. (At Pixar he has driven Godfather-grade deals with Disney — and he's still going strong there.) But I think other parties will need to take the initiative here. Meanwhile millions of new Apple desktops are trojan horses for UNIX. To the extent these boxes find their way into enterprises, Apple at least achieves a secondary significance.
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