Apple News, Analysis and Podcasts

One thing not found at One Infinite Loop is mediocrity. Since Steve Jobs returned to Apple their success has been built upon designing and executing excellence. Excellence is found in the iOS — an OS designed just for touch systems. Excellence is found in the Mac Book Air with its super thin sleek design, long-lasting battery life and solid state drive. No matter what Apple product you consider, that product has excellence built-in.

Another way to state this is that Apple does not manufacture commodities. A commodity is an item that can't be distinguished from a competitor's product except for by price, delivery or something that has little to do with the product itself. For example, the Windows PC quickly became a commodity. Speeds and price were the only real differentiators, but in essence, one Windows PC was just like the next one. This commoditization significantly reduced the value of the PC Manufacturer while it raised the value of the Operating System. Apple was able to avoid being seen as "just another PC" by making its products different — better and special — through hardware innovation, design and software integration.

So what does this have to do with Facebook?

Most think that Facebook is a social networking tool that helps people communicate with one another. It's an app, right? Well, sort of. In reality, Facebook is a development platform. While it may be an app on an iPhone/iPad or a website in a browser, Facebook is more so its own ecosystem. Facebook has Search. Facebook manages contacts. Facebook has several applications within itself; moreover, it isn't hard to see the day when Facebook will offer music, movies, books and much more. As Facebook's platform reaches maturity, Apple had better have a counter measure that offers the market continued differentiation for their products.

Facebook has the potential to do to what Microsoft did to all Windows PC manufacturers — turn all computer hardware into a commodity. While Apple builds and sells software, Apple makes most of its money by selling hardware. If Facebook is able to become the #1 platform for application development, where does that leave Apple? The question becomes, not what apps are available for the iOS or Mac OS platform, but rather, "Can this device run Facebook?" Apple's operating system and app development becomes secondary to Facebook's ecosystem. 

This is the threat that must keep Apple excutives up late at night. It's the riddle Apple must solve before Facebook becomes so big and powerful that Apple joins Dell, HP, Sony, Lenovo and Toshiba as just another hardware vendor.

What Apple Can Do

Facebook has over 500,000,000 users, quickly becoming an über tech giant. Apple must take an aggressive approach to Facebook's expansion. Here's what Apple needs to do to continue to offer a unique value in the commodities marketplace:

1. Innovate —Facebook is dead simple to use. In 10 minutes anyone can "get it" and the connection to old friends and family makes it fun (and addicting) to use. Apple must make it's operating systems simple, unique and more useful than Facebook's.
2. Expose Facebook's Dangers — Either overtly or covertly Apple must expose the dirty truth that sharing one's life with friends on Facebook is not private. Every key stroke, every picture, every link in Facebook is documented and archived for who knows what purpose. Facebook also has a track record of caring little about user privacy. Finally, Facebook is not a public traded company — it is private. Therefore, public pressure on its board of directors means less than against a publicly traded company.
3. Excellence in Development — Apple needs to continue to improve its development environment. Developers choose a platform for two reasons: easy to use and profit (not necessarily in that order). Apple's iOS environment caught fire for both reasons. Apple needs to continue making its development environments the gold standard, so developers spend their time in the iOS & Mac OS first, Facebook or elsewhere second.

Looking out over the next five years, Facebook is clearly Apple's biggest threat. Yet since Steve's return, Apple seems to have an answer for everything. Hopefully the answer to Facebook will be here soon.

5 Comments

1. Stanley Farcus ~ December 15, 2010 17:32
   I disagree with the focus of your suggestions. With iOS, Apple has created a "common denominator" interface for the masses. It would be a mistake to do the same with Mac OS X. Despite the herd mentality to consider the consumer the arbiter of computer feature and design, many people still require an advanced computer for producing content and performing complex tasks beyond the scope of and mental demands of playing Angry BIrds. In other words, there has been a focus towards app rather than workflow development, because the bite-size lack of conceptualization provided by apps is perfect for computer-ignorant consumers. However, this strategy does not work for those who require their computer to perform complex workflows that move between applications and OS frameworks. For them, apps become non-communicative silos that block the flow of information and data. Interfaces designed for touch can not compete with automation, keyboard shortcuts, and the other open access points and controls of a robust OS. Secondly, Facebook and "The Cloud" are part of a strategy for users to hand over their data and control to faceless corporate entities and the government, in return for perceived convenience. Try this: substitute the phrase "some else's servers" for the phrase "the Cloud" whenever you discuss the idea of "cloud computing." For example, imagine a business person saying the following: "For efficiency, and to save money, my company is moving our important data and processes to the Cloud." Now substitute the phrases: "For efficiency, and to save money, my company is moving our important data and processes to some else's servers." Totally different impact. The phrase "the Cloud" is meant to sound innocuous, friendly, and fun, in order to hide what is really going on: the dumbing down and capitulation of the computing public.
2. E. Werner Reschke ~ December 15, 2010 21:55
   Hi Stanley, Great points. I'm a huge advocate of keeping the Mac OS going forward for just the purpose of content creation. Can you do an autocad file with a touch interface? How about advanced video editing? How about a complex music piece? How about building a cool website? No. The iOS is more of a consumer friendly OS, whereas Mac OS X is for those who create content (professional content I'll call it). That said, I think Facebook is a grave danger for Apple. It can easily make Apple products just another device for running Facebook. If consumers spend 50% or more of their time doing things in Facebook, Apple's in big trouble... so is Amazon, Google, Microsoft to name a few others. Thanks for commenting. The feedback is always welcomed. -Werner
3. Roger ~ December 16, 2010 01:51
   It's Infinite Loop, not Infinity Loop. Both your spelling and your premise are wrong.
4. m ~ December 16, 2010 04:12
   isn't facebook really just the potential AOL of web 2.0?
5. AdamC ~ December 16, 2010 06:48
   I don't know whether to laugh or cry after reading the first paragraph and yes stop making a fool of yourself with your analysis on this topic. I have to stop reading stuff from this site, the name suggested some intelligence but the contents leave a lot to be desired.

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