The document discusses Apple and its business model. It notes that Apple has revolutionized various industries through products like the iPhone, iPad, and Apple Watch. Though iPhone sales are slowing, Apple still captures the majority of mobile industry profits due to its ecosystem of integrated hardware, software, and services. The document argues Apple's continued success depends on maintaining its innovative products and walled garden ecosystem, rather than rapid growth.

1. Apple
By Raza Ashai (uniqname: mashai)

2. Why Apple?
● Long time Apple fan
○ Convert to both macOS and iOS
● Massive influencer and trendsetter in consumer tech
● One of the most valuable companies in the world
despite:
○ slim product line and
○ mostly consumer focus

3. Problem: Accessibility
● “Computing is inaccessible and difficult” → Apple II and
Macintosh
● “Computing and the connectivity (the internet) should be more
accessible on-the-go” → iPhone and Apple Watch
● “Songs are restricted to CDs and albums” → iTunes, the iPod,
and Apple Music

4. Timeline
1998
iMac G3
Representative of a shift company culture
towards beautiful design during the Steve
Jobs comeback
2001
iTunes and the iPod
iTunes ushered in the ability to get music in a
totally different method, and the iPod was
created to handle this new digital era of music
1977
Apple II
The first real Apple success that made
personal computing a reality for millions
1984
Macintosh 128K
Commercially successful GUI

5. Timeline (continued)
2010
iPad
Revolutionized the tablet market off of the
back of the iPhones success
2015
Apple Watch
Became the world’s most popular wearable
within two quarters of its release
2007
iPhone
The phone that defined the subsequent future
of smartphones
2008
Macbook Air
Among the first ultrabooks to be
commercially successful, lead the industry in
designs

6. Persona:
Steve Soloway
● Older, values
simplicity/usability over
advanced customization
features
● Owns and enjoys a Macbook
Pro
● Most of his family and
friends own iPhones, he
does not

7. Secret Sauce
● Software? Not really.
● Hardware? Definitely not.

8. Secret Sauce
● Streamlined Innovative
Products
● “Walled Garden”
Ecosystem

9. Business Model
● “Own the consumer” ← get customers to the ecosystem and
make it too inconvenient to leave
● Sell a wide range of products that sell each other
● Services either serve to keep you in the ecosystem (iCloud) or
sell you something directly

10. Financials: Revenue

11. Financials: Annual Net Income

12. Financials: Overview

13. Addressing an Elephant in the Room...

14. iPhone Sales vs Mac Sales

15. Context
● Even in the 2018 Q2 iPhone sale slowdown, Apple accounted
for 62% of the profits of all smart phones
● With 7% market share, Mac captures 60% of profit (2016)
● Takeaway: slowdown in sales ≠ the death of Apple

16. Competition: Mobile space
Apple Android
Flagship/Premium
Phones
Android
Budget
Phones
Convenient
integration
into robust
ecosystem
X
Integrated
privacy
(messaging,
etc)
X
Customization
X X

17. Competition: Mac vs PC
Mac Windows PCs Linux PC
Easy to use
X
Quick, easy,OEM
repairs
X
Value for
hardware
internals X X

18. Prediction: Success?
● Depends on your definition of success
● Probably won’t grow as much as it did ever again
● Still will be very relevant in the future, making strides
to improve sales

19. References
https://www.telegraph.co.uk/active/10593527/Apple-Timeline.html
https://www.businessinsider.com/apple-comeback-story-2010-10
https://www.scientificamerican.com/article/whats-changed-since-my-first-column-for-scientific-american/
https://www.theinquirer.net/inquirer/news/2418517/apple-watch-is-worlds-best-selling-wearable-with-42-million-shifted-in-q2
https://techcrunch.com/2015/01/27/tim-cook-says-apple-watch-should-ship-in-april/
https://www.sciencedirect.com/science/article/pii/S015599821300032X
https://www.macrotrends.net/stocks/charts/AAPL/apple/revenue
https://www.macrotrends.net/stocks/charts/AAPL/apple/operating-expenses
https://www.macrotrends.net/stocks/charts/AAPL/apple/net-income
https://www.cnet.com/news/apples-iphones-hit-a-wall-now-we-know-how-bad-it-is/
https://www.theguardian.com/technology/2019/jan/27/apple-greatest-crown-slipping-results-tim-cook-comeback
https://www.marketwatch.com/story/tim-cook-apple-swapped-out-11-million-iphone-batteries-2019-01-15
https://www.techradar.com/reviews/iphone-8-review
https://appleinsider.com/articles/18/04/17/apple-grabs-86-of-smartphone-profits-globally-iphone-x-alone-seizes-35
https://www.ped30.com/2016/11/03/apple-dediu-macbook-pro/
https://wccftech.com/apple-iphone-sales-62-percent-global-profits/
http://fortune.com/2018/12/03/analyst-says-airpods-sales-will-go-through-the-roof-over-the-next-few-years-report-says/
https://www.businessinsider.com/apple-must-reverse-angela-ahrendts-luxury-brand-strategy-2019-2
https://www.statista.com/statistics/276306/global-apple-iphone-sales-since-fiscal-year-2007/
https://www.statista.com/statistics/276308/global-apple-mac-sales-since-fiscal-year-2002/