The story of Apple

It’s the biggest US company again. It’s worth $1.39 trillion. Let’s go back to the beginning, and then speculate about what’s next in the story of Apple.

Article updated: 14 January 2020 2:00pm Author: Michael Baxter

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A beginning of the Apple story:

January 9th 2007: Macworld conference in San Francisco. It was not the beginning of Apple but it was the beginning of a revolution. Steve Jobs was on stage: “This is a day I have been looking forward to for two and half years,” he said. “Every once in a while a revolutionary product comes along that changes everything...One’s very fortunate if you get to work on one of these in your career. Apple has been very fortunate, it has been able to launch a few of these into the world.” He then talked about the Macintosh — “it didn’t just change Apple, it changed the whole computer industry. In 2001, we launched the iPod, it didn’t just change the way we listened to music, it changed the entire music industry. Today, we are introducing three revolutionary products of this class...a wide screen iPod, with touch controls...a revolutionary mobile phone, and a breakthrough internet communications device.” He then teased his excitable audience for a few moments, only to then reveal that the three products were in fact one product, a product called the iPhone.

That was the biggest business announcement of the century thus far.

The iPhone has arguably done more than change communication, it has changed us — it has created a removable appendage to our faces, a looking glass giving us a view into eternity which we can hold in our hands. And it’s the main reason Apple is worth more than one and a third trillion dollars.

It’s no longer the biggest company in the world, of course. That accolade belongs to Aramco, now worth just shy of $2trillion. But Aramco deals in a 20th century product that we now know poses an existential threat to human civilisation. Apple deals in the future.

But there were other beginnings. There were the two dates referred to above, 1984 and 2001 — the Macintosh and iPod. But I would like to mention some more.

The beginning of the Apple story

The first date, of course, is April 1, 1976, in Cupertino, California. On April’s Fools Day that year, a year of a record heatwave in Britain, Steve Jobs, Steve Wozniak and Ronald Wayne founded Apple Computer Company. Wayne sold his 10 per cent share to his co-founders 12 days later for $800.

1981: the company’s IPO took place.

The Sully and post Scully era

In 1983, the Apple story took a side turn. Jobs persuaded Pepsi man, John Scully to become Chief Executive. “Do you want to sell sugared water for the rest of your life or do you want to come with me and change the world?” went the Jobs sales pitch to Scully.

Spring 1985: Jobs was fired as Apple’s boss — “Being gentle and polite was not part of his demeanour,” said William Simon, co-author of 'iCon: Steve Jobs, the Greatest Second Act in the History of Business.' 

September 16th 1985: Jobs quit Apple. He forms NeXT and then animation studio Pixar.

1993: Apple releases the Newton, its first foray into the PDA market.

1996: Apple’s Pippin, a multimedia machine is released.

The return of the prodigal son

December 1996: Apple buys NeXT.

January 1997: Apple announces the return of Steve Jobs.

On September August 6th, 1997 at the Mac World Expo, Boston: Apple reveals a tie in with Microsoft — with many fearing that the deal would mark the end of Apple’s reign as a provider of a non-Microsoft compatible computer.

1998: Newton production ends.

April 2003: Apple share price is less than a third the price from two years earlier, some fear whether Apple can survive. Its market value fell to less than $5bn.

2007: Apple Computers changed its name to Apple Inc, at one point threatening legal action from the other Apple, the Beatles record label.

In 2008: Apple’s market cap passes $100m.

August 9th, 2011: Apple overtook Exxon Mobil to become the world’s biggest company and in August 2018 its market cap passed a trillion dollars.

It’s a funny thing, but many then speculated that Apple’s growth would slow rapidly, that it would become a victim of the law of large numbers. In fact, less than two years later, shares are up almost 40 per cent.

The future of Apple

So, what about the future?

Apple is trying to present itself as the golden company — the tech that doesn’t encroach on our privacy. That has become one of its strengths — even its privacy policy is a good read.

But as it tries to generate more revenue, the temptation to take a bite from the forbidden fruit that is customer data — perhaps to Apple what an apple was to Adam and Eve — may be hard to resist.

Critics miss the point.

As a general rule, Apple rides technology innovation and sets trends. It didn’t invent a windows style operating environment or the mouse, but it did make it famous and invent the double click. It didn’t invent MP3 players, but did make them fashionable. The iPhone was only possible thanks to progress elsewhere — Moore’s Law increasing processor speed, commoditisation of components, wireless internet access, 3G and 4G.

In consumer electronics and computers, innovation is always reliant on the state of technology at that time.

The next big leap, the product revolution comparable to the iPhone hasn’t occurred yet, not because Apple boss Tim Cook hasn’t got Steve Job’s vision, it hasn’t occurred because technology isn’t ready.

I believe the next leap will be a convergence in augmented reality products, perhaps goggles, perhaps glasses, perhaps contact lenses, with AI assistants that can, among other things, anticipate our needs, and new interfaces, maybe via speech, maybe flick of the wrist, maybe via AI anticipating what we want, maybe via thought.

Then we will have ‘always on’ devices, we will communicate hologram to hologram, as if the person we talk to is next to us, even if in fact they are on the other side of the world. Our AI assistants will constantly remind us of stuff —who that person is, for example. It will enable us to have romantic meals or business lunches with people a thousand miles away, via the aid of green screens, AI and super-fast computers.

And I think Apple will be in the vanguard.


These views are those of the author alone and do not necessarily reflect the view of The Share Centre, its officers and employees

 

Michael Baxter portrait photo
Michael Baxter

Economics Commentator

Michael is an economics, investment and technology writer, known for his entertaining style. He has previously been a full-time investor, founder of a technology company which was floated on the NASDAQ, and a director of a PR company specialising in IT.

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