Today brought the pleasure of sitting in a location with cable television. On the cable television was a selection of cable news channels. I’m sure there were other things on the cable television, but I was mesmerized by the crawls these channels have, especially when I got to CNBC’s cable television channel. Their crawl goes so fast! And I don’t understand most of it! Therefore, I became entranced by the crawl, and left it on for … I lost track.
One of the topics that managed to pull me away from my hypnotic state was a piece about whether Apple is getting ‘too big to be cool.’ Apart from the absolutely horrible observation that the mainstream press loves to tear down the winner and so does the American public there was a debate between a CNET editor and one of the presenters about which mattered more to consumers, the software or the hardware. The presenter said he loves his iPad because it’s a great toy. The CNET editor said software matters to software developers, and if the software developers don’t like Apple, then they won’t make fun stuff for consumers to play with, so neener-neener-neener. The exchange reminded me why I do not have cable.
I’m, sigh yes, actually going to respond to several of these things.
Size Matters? Yup.
Okay fanboys who like to pretend it’s still 2000, let’s face it:
In 2009, Apple recorded about $43 billion in revenue, and $8.24 billion in profit. It employed 34,300 people. They made up 7.2% of the US market for PCs, 28% of the smartphone market (though smartphones are only 18% of the total mobile subscriber marketplace, and Apple doesn’t rank in the top mobile OEMs), and 74% of the MP3 mobile player market. It ain’t small. In fact when you look at these numbers, you understand why Apple decided to drop ‘Computer’ from its name. To be seen as significant, it had to stop looking like it was a computer company, competing against the likes of Dell, HP, or yeah, Microsoft.
But by revenue, that places Apple as being bigger than Google but smaller than either Nokia or Microsoft (key competitors in a few different sectors), and a third the size of the partner it supposedly wields an iron fist over, AT&T.
So which size are we talking about? Ah yes, market cap. Now, if you were a cyborg with remote access to the basestar, then you know what a market cap is. But if you are like me, you have to look things up. Market cap is a simple enough equation: number of shares outstanding x share price = market cap. “It represents the public consensus on the value of a company’s equity.” It’s what the bettors say it’s worth, in other words. And indeed, in terms of market cap, last month Apple surpassed Microsoft. I used to work for a company where people wandered the halls, ghostlike, muttering, “EBITDA” all day long. I have a vague understanding of the term, and won’t define it here, but that, too, is significantly larger for Apple than for Microsoft.
Okay, so that settles it, little Apple Computer, now Apple, Inc., has gone and figured out how to make itself profitable, wealthy, and valuable. Guess we better start shootin’. It’s a rule, right, that when a company in tech gets big, we all have to call it a monopoly and start pondering its imminent death? Those are the Rules. We just follow them.
Everybody Hates a Winner
So then there’s the part where the press and the public like to tear down a winner. I’ll agree to the first part of the statement, but not to the second. Do none of you remember the post-impeachment approval ratings of Bill Clinton? Have none of you ever watched a NASCAR race? Rooting for the underdog, forgiving the sinner, cheering on Horatio Alger – that is the American way. Once you’re at the top, well, we only hate you if you suck. Americans love winners. Even when we tie we think we won. There are some exceptions, but I’d wager these are tribal in nature – for example, people hate the Yankees, the Lakers and Duke for winning all the time, but that’s also why some people love the Yankees, the Lakers and Duke. So let’s acknowledge that some people like to be haters, and some people can live, peacefully, with success.
No sorry, being successful isn’t enough – the reason people don’t hate Warren Buffet is that he is GOOD AT WHAT HE DOES. And, as the point was made on whatever CNBC show I listened to long enough to inspire this rant, Apple won’t likely be hated by consumers as long as the products they make continue to rock. I was told by an AT&T employee that while customer satisfaction ratings for AT&T pretty much suck, they suck a lot less if you’re an iPhone owner. Isn’t that something?
Hardware or Software
Somehow, this conversation always makes me think of this old ad:
It’s not the shoes, it’s the awesomeness.
[We're getting closer to the part where I mention robots, so hang on a minute.]
The guy who says he loves his iPad because it’s a great toy? Take away software and it’s not a toy. It’s a pretty object made of aluminum and glass and silicon. It would make a rather large, but very attractive paper weight. What makes it a toy, my dear, is the stuff that lets you play with it. Without the stuff that the touchscreen interface is designed to aid you in interacting with, you have two buttons that have limited functionality. I love buttons. The button is everything, but the button is not enough.
It’s the Interface, Stupid
Talking the other night with a friend who plays music, we mused over how the quality of recording has improved considerably over just the past 10 years, but how the quality of the listening experience has declined. We listen to music through crappy earbuds, on compressed sound files played through a phone. We watch television that way too.
A few years ago I did some work for a television client and they wanted to know about the potential for mobile video. At the time, there wasn’t much heart for it – mobile phone screens were tiny and low resolution, not all phones had audio outs, and the bit rates over a mobile network in the US were atrociously slow. I said, “When someone makes a phone with a high quality screen and we get 3G, then you might find yourself with a mobile outlet for your shows. For now, only sports will work on the platform, because dudes will still listen to those little transistor radios with one earphone to get the play-by-play.”
People thought I meant, “It’ll never take off.” Why don’t you listen?
And then the iPhone happened. 3G networks came to the US. The world changed. We evolve and adapt to the technology we create. Our expectations of quality have to do with a great many factors, including convenience, and while one minute you will not settle for less than 5.1 sound and a 40″ screen, the next you will happily catch up on reruns of The Office on a 9″ screen in something that is, arguably, ‘stereo’ sound.
My friend said, when it comes to TV, you don’t need a big TV and surround sound, because it doesn’t make the show better – what makes the show better are storytelling, dialogue/action, direction and acting. Your screen size and sound quality can’t enhance those elements. The proof? Check out people watching TV on their Droids and iPhones, happily watching VH1 on the in-seat screens on JetBlue, and people showing each other videos on their iPads.
Which brings me to Minority Report dude. Please watch this video, it’s amazing for several reasons, and two are: he talks about the importance of the interface and navigation in dealing with data, and he demonstrates some awesome technology.
Now then, the Singularity
Lots of people have been posting on twitter links to this article in last Sunday’s New York Times. I’m about halfway through, but here’s the part where I went from just mildly persnickety about daytime cable news, and lost my mind slightly.
In many ways, this is all related, because when a friend who works for CNBC told me that he loves Cylons, and that he thinks it could all happen like Battlestar Galactica said, I did not say to him in my worst impersonation of Jennifer Jason Leigh’s worst impersonation of Dorothy Parker, “You’re drunk!” Instead I thought, hang on a second! Everybody’s fretting that the singularity means the end of humanity. But if BSG has anything to teach us, it’s that what comes after the Singularity, is … MORE HUMANITY.
[Hang on one more second, I'm almost there.]
That’s right folks. Technological improvement will continue to accelerate at a pace where we simply don’t know what humanity will look like after some magical inflection point. Some think that inflection point will occur when we all become cyborgs, merging our intelligence with that of ‘computers’ (more likely a cloud of data with very powerful server farms). Some people think this looks like the Matrix, but a slightly more, let’s say optimistic view is that it’s more like Cylons. We invent machines that eventually become just as intelligent as we are, and these machines build machines, and so on ad infinitum until Something Amazing Happens. I realize all this may sound menacing until you realize that [SPOILER] the machines and the people fall in love and they all live happily ever after.
And this serves as yet another reminder, that if you want to know what the future looks like, you only have to go to Japan.