Introduction
The Apple iPod seems to be everywhere these days. Kids want them; teenagers carry them proudly and adults simply love the miniature player for the quality of the music that is being produced as well as its incredible storage capacity – the capability to store thousands of music in one compact package. But the company that manufactures these iPods are not new to this kind of success. According to their press release, “Apple ignited the personal computer revolution in the 1970s with the Apple II and reinvented the personal computer in the 1980s with the Macintosh” (Morrison, 2006). And yet it is common knowledge that after the decade of the 80s it was Microsoft and Intel that dominated the computer industry. The following SWOT analysis will provide an overview as to why the Apple brand in general and the Apple iPod in particular is currently the leader in the miniature music business but is also in danger of losing their advantage and getting relegated once again and never improving on their status as a niche player.
There is no need to purchase an Apple-made computer to realize that this company is serious about quality and performance. Just one look at an Apple Macbook will make the person appreciate the kind of hard work poured into the creation process to come up, in the words of Apple’s founder and CEO, Steve Jobs, creations that he described as “insanely great products” (Morrison, 2006). While the company is enjoying the accolades from computer enthusiasts, Apple went on to challenge Sony, a world-renowned global leader that manufactures miniaturized music players. This is the type of electronic gadget that is easy to carry around and can fit inside a pocket. Sony walkmans are not only small but these tiny music players produce quality sound and during its heyday there was nothing as revolutionary in the music industry.
Strengths
When Apple decided to enter the world of miniaturized music players it blew the competition out of the war. The Apple iPod was not only beautifully crafted, it can play beautiful music but aside from that the storage capacity was just way beyond the norm. Thousands of songs can be downloaded into a tiny device – much smaller than a Sony Walkman – and owners can enjoy listening to their favorite music for hours at a time. The miniaturized music player is fun to carry around and it is so reliable with a decent battery life that there is no way one will revert to playing cassette tapes in a Sony Walkman.
The major asset of the company is its research and development department that can deliver the goods so to speak. Apple’s technical knows how and its ability to attract the best minds to work in the company give it the advantage to create groundbreaking products and computer applications. Aside from technology the other reason for Apple’s success can be attributed to its commitment to form and function. An iPod is not only a thing of beauty but it also performs even better as compared to many portable music players.
Steve Jobs is determined not only to provide highly functional gadgets he is also committed to producing products that are also beautiful to look at. Peter Burrows of Businessweek call it techno-chic (Burrows, 2006). There is no need to elaborate why so many people desire for an iPod. The following figures will show the profitability of the iPod from the first quarter of 2006 to the same period in 2008. Sales are affected by seasonal changes but overall one can easily be impressed by the consistent pattern of growth in terms of sales. According to Macworld Apple reported 4580 units of iPod sold in 2005 and this rose dramatically to 22121 units sold in the first quarter of 2008 alone (Macworld, 2008).
Aside from the computer hardware and software capabilities of the company, Apple is fortunate to have a visionary and daring leader in the person of Steve Jobs. Their founder and CEO continually push their researches and computer programmers to aim high and create revolutionary products. Steve Jobs is not only an excellent leader but he is also an astute businessman able to see what others fail to comprehend. When the music industry was suffering from a slow and painful death that can be attributed to piracy, Jobs clinched deals with several gigantic music companies to sell music for 99 cents each. The prices were not the only incentive to lure in music lovers but it is also the ease at which a customer can pay and use music in the blink of an eye.
Weakness
There is one word that can best describe the inherent weakness of Apple’s iPod and it is proprietary. This is synonymous to private ownership and can roughly be translated as control. In the case of Apple it is total control of both hardware and software. Experts are saying that it will take some time before Apple will open up to the world and share its technology with others so that the company can further expand its share of the market (Burrows, 2006). As of today Apple is the only source for all the stable computer applications that will work in an Apple iPod. Unlike Microsoft software that can be installed in any personal computer, the operating system of Apple products cannot be shared and installed unless it is a computer hardware coming from Apple.
In an age of globalization and international collaboration, Apple stands proud and yet alone. Apple can survive the onslaught from competitors because the online music industry is still new (Burrows, 2006). But if the technology will mature then Apple may be in for a surprise as competitors will be able to match their level of technical sophistication. When this will happen then there will be very little difference between an Apple iPod from the other miniaturized music players in the market. Customers will then switch to a brand that is cheaper or the one that can deliver music to their mp3 players much faster.
Opportunities
As of this time Apple holds all the aces. There is a huge demand for online music and with the partnership of Apple and a significant number of music producers it will take some time before a rival can match the 99 cents being offered by Apple for every music download. The quality of music that can be acquired from the Apple iTunes makes this deal truly difficult to beat and together with the price of the songs being offered customers will naturally gravitate towards an iPod and Apple’s music store.
Threats
There will come a time when other companies will be able to develop sleek-looking and highly efficient miniaturized music players that can download music more efficiently and even store more songs than an Apple iPod. There will come a time when rivals can create music players that can go on for days without recharge. There will come a time when rivals will be able to offer music at a much cheaper price. If the technology matures and the system of delivering songs through the Internet will become commonplace there will be very little incentive to stick to an Apple iPod and endure its “proprietary straight jacket”. Computer enthusiasts and music lovers all over the world would love to have the same liberty they are enjoying with open source computer applications and they would demand the same thing from Apple.
Conclusion
Without a doubt Apple products are not only functional but also nice to look at. It is the epitome of “techno-chic” but all of this will soon pass if Apple will not think ahead into the future. This strong corporate culture can be seen as its strength and weakness. This enabled Apple to design and manufacture “insanely great products” but it is also this same corporate culture that will prevent Apple to make the necessary changes that will prepare the company for more the upcoming changes that will soon hit the computer and music industry. There is a need to adapt to a fast changing world.
It has happened before and it will happen again. The Apple brand is always in the forefront of radical technology that revolutionizes the way people live. But rivals have a habit of catching up. It will not take long before rivals companies will be able to design and manufacture a product that is as beautiful and as powerful as an iPod but half the price. When this time will come, Apple will surely lose because at this point its rivals would have software that can be integrated with other devices. One can only imagine a miniaturized music player that can be integrated into a home theater, a car’s entertainment system, a mobile phone, laptop etc. At this point an iPod will only work using Apple software and hardware. This limitation can be the bane of Apple and its iPod.
References
Burrows, P. (2006). “How Apple Could Mess Up, Again: Innovator’s Dilemma.” Web.
Macworld. (2008). “Apple Reports $1.58 Billion Profit.” Web.
Morrison, J. (2006). International Business Environment: Global and Local Marketplace in a Changing World. New York: Palgrave Macmillan.
Sony. (2008). “Welcome to the World of Sony.” Web.