Apple Inc - DOC by ambarish1987

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SWOT Analysis on Apple inc.

           R.Michael Ravikanth

             N. Ambarish

             Robin Jain

            Arun Bhansali

            Vishal Karwa

             Tarun Tyagi

   Under the Esteemed Guidance of

      Mr. A. Narasimhacharlu
    SWOT Analysis of Apple inc. IIPM

                               SWOT Analysis of Apple inc. IIPM

      We would like to thank our guide, Mr A. N Charulu for his excellent
guidance and support. His encouragement was essential for us to have
completed this work. We sincerely express our deep sense of gratitude to
Mr A. N Charulu for giving us such a unique opportunity. We would like to
thank our college who helped us at all times throughout the tenure of this

                                        SWOT Analysis of Apple inc. IIPM

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses,
Opportunities, and Threats involved in a project or in a business venture. It involves specifying the
objective of the business venture or project and identifying the internal and external factors that are
favorable and unfavorable to achieving that objective.

        Strengths: attributes of the person or company that are helpful to achieving the objective.

        Weaknesses: attributes of the person or company that are harmful to achieving the

        Opportunities: external conditions that are helpful to achieving the objective.

        Threats: external conditions which could do damage to the objective.

In this project we try to cover the above mentioned topics and find some suitable answers to the
threats and weaknesses of The various products of Apple inc. and the methods in which
they can be effectively improved.

                               SWOT Analysis of Apple inc. IIPM


Company Profile                                 4

Rise and fall of the company                    6

Return to profit                                7

Key people                                      8

SWOT Analysis                                   13

Suggestions                                     18

Bibliography                                    21

                                     SWOT Analysis of Apple inc. IIPM
                                    Company Profile

Apple Inc. is an American multinational corporation that designs and manufactures consumer
electronics and computer software products. The company's best-known hardware products
include Macintosh computers, the iPod, the iPhone and the iPad. Apple software includes
the Mac OS X operating system; the iTunes media browser; the iLife suite of multimedia and
creativity software; the iWork suite of productivity software; Final Cut Studio, a suite of
professional audio and film- industry software products; and Logic Studio, a suite of audio
tools. As of January 2010 the company operates 284 retail stores in ten countries, and an
online store where hardware and software products are sold.

Established in Cupertino, California on April 1, 1976 and incorporated January 3, 1977, the
company was called Apple Computer, Inc. for its first 30 years, but dropped the word
"Computer" on January 9, 2007 to reflect the company's ongoing expansion into the
consumer electronics market in addition to its traditional focus on personal computers. Apple
has about 35,000 employees worldwide and had worldwide annual sales of US$42.91 billion
in its fiscal year ending September 26, 2009. For reasons as various as its philosophy of
comprehensive aesthetic design to its distinctive advertising campaigns, Apple has
established a unique reputation in the consumer electronics industry. This includes a
customer base that is devoted to the company and its brand, partic ularly in the United States.
Fortune magazine named Apple the most admired company in the United States in 2008 and
in the world in 2009.

Apple was established on April 1, 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne,
to sell the Apple I personal computer kit. They were hand-built by Wozniak and first shown
to the public at the Homebrew Computer Club. The Apple I was sold as a motherboard (with
CPU, RAM, and basic textual- video chips)—less than what is today considered a complete
personal computer. The Apple I went on sale in July 1976 and was market-priced at $666.66
($2.5 thousand in 2009 dollars, adjusted for inflation.)

Apple was incorporated January 3, 1977 without Wayne, who sold his share of the company
back to Jobs and Wozniak for $800. Multi- millionaire Mike Markkula provided essential
business expertise and funding of $250,000 during the incorporation of Apple.

The Apple II was introduced on April 16, 1977 at the first West Coast Computer Faire. It
differed from its major rivals, the TRS-80 and Commodore PET, because it came with color
graphics and an open architecture. While early models used ordinary cassette tapes as storage
devices, they were superseded by the introduction of a 5 1/4 inch floppy disk drive and
interface, the Disk II.

The Apple II was chosen to be the desktop platform for the first "killer app" of the business
world—the VisiCalc spreadsheet program. VisiCalc created a business market for the Apple
II, and gave home users an additional reason to buy an Apple II—compatibility with the
office. According to Brian Bagnall, Apple exaggerated its sales figures and was a distant third
place to Commodore and Tandy until VisiCalc came along.

By the end of the 1970s, Apple had a staff of computer designers and a production line. The
Apple II was succeeded by the Apple III in May 1980 as the company competed with IBM
and Microsoft in the business and corporate computing market.

                                      SWOT Analysis of Apple inc. IIPM
Jobs and several Apple employees including Jef Raskin visited Xerox PARC in December
1979 to see the Xerox Alto. Xerox granted Apple engineers three days of access to the PARC
facilities in return for the option to buy 100,000 shares of apple at the pre-IPO price of $10 a
share. Jobs was immediately convinced that all future computers would use a graphical user
interface (GUI), and development of a GUI began for the Apple Lisa.

In December 1980, Apple launched the initial public offering of its stock to the investing
public. When Apple went public, it generated more capital than any IPO since Ford Motor
Company in 1956 and instantly created more millionaires (about 300) than any company in
history. Several venture capitalists cashed out, reaping billions in long-term capital gains.

                                     SWOT Analysis of Apple inc. IIPM
Rise and fall

Having learned several painful lessons after introducing the bulky Macintosh Portable in
1989, Apple introduced the PowerBook in 1991, which established the modern form and
ergonomic layout of the laptop computer. The Macintosh Portable was designed to be just as
powerful as a desktop Macintosh and turned out 17 pounds with a 12 hour battery life. Apple
sold fewer than 100,000 units.The Powerbook was 7 pounds and had a 3 hour battery life,
and sold a billion dollars worth within the first year. The same year, Apple introduced System
7, a major upgrade to the operating system, which added color to the interface and introduced
new networking capabilities. It remained the architectural basis for Mac OS until 2001.

The success of the PowerBook and other products led to increasing revenue. For some time,
it appeared that Apple could do no wrong, introducing fresh new products and generating
increasing profits in the process. The magazine MacAddict has named the period between
1989 and 1991 as the "first golden age" of the Macintosh.

Following the success of the Macintosh LC, Apple introd uced the Centris line, a low end
Quadra offering, and the ill- fated Performa line that was sold in several confusing
configurations and software bundles to avoid competing with the various consumer outlets
such as Sears, Price Club, and Wal-Mart, the primary dealers for these models. The result
was disastrous for Apple as consumers did not understand the difference between models.

During this time Apple experimented with a number of other failed consumer targeted
products including digital cameras, portable CD audio players, speakers, video consoles, and
TV appliances. Enormous resources were also invested in the problem-plagued Newton
division based on John Sculley's unrealistic market forecasts. Ultimately, all of this proved
too-little-too- late for Apple as their market share and stock prices continued to slide.

Apple saw the Apple II series as too expensive to produce, while taking away sales from the
low end Macintosh. In 1990 Apple released the Macintosh LC with a single expansion slot
for the Apple IIe Card to migrate Apple II users to the Macintosh platform. Apple stopped
selling the Apple IIe in 1993.

Microsoft continued to gain market share with Windows, focusing on delivering software to
cheap commodity personal computers while Apple was delivering a richly engineered, but
expensive, experience. Apple relied on high profit margins and never developed a clear
response. Instead they sued Microsoft for using a graphical user interface similar to the Apple
Lisa in Apple Computer, Inc. v. Microsoft Corporation. The lawsuit dragged on for years
before being thrown out of court. At the same time, a series of major product flops and
missed deadlines destroyed Apple's reputation and Sculley was replaced by Michael Spindler.

                                      SWOT Analysis of Apple inc. IIPM
Return to profitability

On August 15, 1998, Apple introduced a new all- in-one computer reminiscent of the
Macintosh 128K: the iMac. The iMac design team was led by Jonathan Ive, who would later
design the iPod and the iPhone. The iMac featured modern technology and a unique design. It
sold close to 800,000 units in its first five months and returned Apple to profitability for the
first time since 1993.

Through this period, Apple purchased several companies to create a portfolio of professional
and consumer-oriented digital production software. In 1998, Apple announced the purchase
of Macromedia's Final Cut software, signaling its expansion into the d igital video editing
market. The following year, Apple released two video editing products: iMovie for
consumers, and Final Cut Pro for professionals, the latter of which has gone on to be a
significant video-editing program, with 800,000 registered users in early 2007. In 2002 Apple
purchased Nothing Real for their advanced digital co mpositing application Shake, as well as
Emagic for their music productivity application Logic, which led to the development of their
consumer- level GarageBand application. iPhoto's release the same year completed the iLife

The entrance of the Apple Store on Fifth Avenue in New York City is a glass cube, housing a
cylindrical elevator and a spiral staircase that leads into the subterranean store.

Mac OS X, based on NeXT's OPENSTEP and BSD Unix was released on March 24, 2001,
after several years of development. Aimed at consumers and professionals alike, Mac OS X
aimed to combine the stability, reliability and security of Unix with the ease of use afforded
by an overhauled user interface. To aid users in migrating from Mac OS 9, the new operating
system allowed the use of OS 9 applications through Mac OS X's Classic environment.

On May 19, 2001, Apple opened the first official Apple Retail Stores in Virginia and
California. The same year, Apple introduced the iPod portable digital audio player. The
product was phenomenally successful — over 100 million units were sold within six years. In
2003, Apple's iTunes Store was introduced, offering online music downloads for $0.99 a
song and integration with the iPod. The service quickly became the market leader in online
music services, with over 5 billion downloads by June 19, 2008.

Since 2001 Apple's design team has progressively abandoned the use of translucent colored
plastics first used in the iMac G3. This began with the titanium PowerBook and was followed
by the white polycarbonate iBook and the flat-panel iMac.

                                    SWOT Analysis of Apple inc. IIPM
Key people

       Steve Jobs (CEO, Chairman, and co-founder)

       Tim Cook (COO) Peter Oppenheimer (CFO)

       Phil Schiller (SVP Marketing)

       Jonathan Ive (SVP Industrial Design)

       Mark Papermaster (SVP Device Engineering)

       Ron Johnson (SVP Retail)

       Sina Tamaddon (SVP Applications)

       Bertrand Serlet (SVP Software Engineering)

       Scott Forstall (SVP iPhone Software)


  * 1977–1981: Michael "Scotty" Scott

  * 1981–1983: A. C. "Mike" Markkula

  * 1983–1993: John Sculley

  * 1993–1996: Michael Spindler

  * 1996–1997: Gil Amelio

  * 1997-present: Steve Jobs (Interim CEO 1997–2000)

  * 2004 & 2009: Tim Cook (Acting CEO during Steve Jobs health issues)


  * Bill Campbell, Chairman of Intuit Inc.

  * Millard Drexler, Chairman and CEO of J.Crew

  * Al Gore, Former Vice President of the United States

  * Steve Jobs, CEO and Co- founder of Apple; also a director of The Walt Disney Company

  * Andrea Jung, Chairman and CEO of Avon Products

                                     SWOT Analysis of Apple inc. IIPM
  * Arthur D. Levinson, Chairman and CEO of Genentech

  * Jerry York, Chairman, President, and CEO of Harwinton Capital


  * Steve Jobs, Chief Executive Officer

  * Timothy D. Cook, Chief Operating Officer

  * Peter Oppenheimer, Chief Financial Officer

  * Philip W. Schiller, Senior Vice President of Worldwide Product Marketing

  * Mark Papermaster, Senior Vice President of Devices Hardware Engineering

  * Jonathan Ive, Senior Vice President of Industrial Design

  * Bertrand Serlet, Senior Vice President of Software Engineering

  * Ron Johnson, Senior Vice President of Retail

  * Sina Tamaddon, Senior Vice President of Applications

  * Scott Forstall, Senior Vice President of iPhone Software

  * Bob Mansfield, Senior Vice President Mac Hardware

  * Daniel Cooperman, General Counsel and Secretary


Since formation of the Apple Computer Company in 1977, it (as Apple Computer, Inc.) has
employed over 75,000 people worldwide. The majority of Apple's employees have been
located in the United States but Apple has substantial manufacturing, sales, marketing, and
support organizations worldwide, with some engineering operations in Paris and Tokyo.

Headquarters 1 Infinite Loop, Cupertino, California, USA

Number of locations 284 (January 2010)

Area served Worldwide; United States, United Kingdom, Canada, Japan, Australia, India,
Switzerland, Italy, Germany, and China

                                    SWOT Analysis of Apple inc. IIPM

       Computer hardware · Computer software Consumer electronics · Digital distribution


        Mac (Pro, Mini · iMac · MacBook, Air, Pro · Xserve) iPhone, iPod (Shuffle, Nano,
Classic, Touch) Apple TV, Cinema Display, AirPort, Time Capsule Mac OS X (Server ·
iPhone OS), iLife, iWork


       Stores (retail, online, iTunes, App, iBooks), MobileMe


Revenue              US      $42.91 billion (FY 2009)

Operating income             $11.74 billion (FY 2009)

Net income                   $8.24 billion (FY 2009)

AUM                          $26.83 billion (FY 2009)

Total assets                 $47.50 billion (FY 2009)

Total equity                 $31.64 billion (FY 2009)

Employees                    35,000 (Q1 FY 2009)

               SWOT Analysis of Apple inc. IIPM

                                     SWOT Analysis of Apple inc. IIPM

According to surveys by J. D. Power, Apple has the highest brand and repurchase loyalty of
any computer manufacturer. While this brand loyalty is considered unusual for any product,
Apple appears not to have gone out of its way to create it. At one time, Apple evangelists
were actively engaged by the company, but this was after the phenomenon was already firmly
established. Apple evangelist Guy Kawasaki has called the brand fanaticism "something that
was stumbled upon". Apple has, however, supported the continuing existence of a network of
Mac User Groups in most major and many minor centers of population where Mac computers
are available.

Mac users meet at the European Apple Expo and the San Francisco Macworld Conference &
Expo trade shows where Apple traditionally introduced new products each year to the
industry and public. Mac developers in turn gather at the annual Apple Worldwide
Developers Conference.

Apple Store openings can draw crowds of thousands, with some waiting in line as much as a
day before the opening or flying in from other countries for the event. The New York City
Fifth Avenue "Cube" store had a line as long as half a mile; a few Mac fans took the
opportunity of the setting to propose marriage. The Ginza opening in Tokyo was estimated in
the thousands with a line exceeding eight city blocks.

John Sculley told The Guardian newspaper in 1997: "People talk about technology, but Apple
was a marketing company. It was the marketing company of the decade."

Market research indicates that Apple draws its customer base from an unusually artistic,
creative, and well-educated population, which may explain the platform’s visibility within
certain youthful, avant- garde subcultures.

                                      SWOT Analysis of Apple inc. IIPM
SWOT Analysis of Apple Inc.

SWOT stands for Strengths, Weaknesses, Opportunities and Threats, and is an important tool
often used to highlight where a business or organisation is, and where it could be in the
future. It looks at internal factors, the strengths and weaknesses of a business, and external
factors, the opportunities and threats facing the business. The process can give you on
overview of where the business, and the environment it operates in, is strategically. This is an
important, yet to simple to understand, tool used by many students, businesses and
organisations for analysis.

The following SWOT analysis looks at Apple Inc. which is operating in Communications
industry. The analysis shows Apple Inc.'s Strengths, Weaknesses, Opportunities and Threats.
The SWOT analysis will give you a clear picture of the business environment Apple Inc. is
operating in at the present time.

                                      SWOT Analysis of Apple inc. IIPM
The strengths of a business or organisation are positive elements, something they do well and
is under their control. The strengths of a company or group and value to it, and ca n be what
gives it the edge in some areas over the competitors. The following section will outline main
strengths of Apple Inc.


       Being a market leader, as Apple Inc. is, is key to their success as it boosts reputation,
        profit and market share.
       Competitive pricing is a vital element of Apple Inc.’s overall success, as this keeps
        them in line with their rivals, if not above them.
       Keeping costs lower than their competitors and keeping the cost advantages helps
        Apple Inc. pass on some of the benefits to consumers.
       Apple Inc.’s marketing strategy has proved to be effective, helping to raise profiles
        and profits and standing out as a major strength.
       Apple Inc.’s innovation keeps it a front-runner in Communications as it is regularly
        turning out new patents/proprietary technology.
       Apple Inc.’s reputation is strong and popular, meaning people view it with respect and
        believe in it.
       A strong brand is an essential strength of Apple Inc. as it is recognised and respected.
       Apple Inc. has a high percentage of the market share, meaning it is ahead of many
       High quality products/services is a vital strength, helping to ensure customers return
        to Apple Inc..
       Development and innovation are high at Apple Inc. with regard to their
        products/services, which is a sure strength in its overall performance.
       Apple Inc.’s position in the market is high and strong – a major strength in this
        industry as they are ahead of many rivals.
       The online presence of Apple Inc. is strong, meaning it is ahead of many competitors.

                                     SWOT Analysis of Apple inc. IIPM
Weaknesses of a company or organisation are things that need to be improved or perform
better, which are under their control. Weaknesses are also things that place you behind
competitors, or stop you being able to meet objectives. This section will present main
weaknesses of Apple Inc.


       Not reducing costs in the same way as their competitors\' means Apple Inc. is
        outlaying more of their profits. Having higher costs than competitors is a major
       Over pricing, setting too high prices for Apple Inc. products/services makes them
        uncompetitive, which is a major weakness.
       The lack of business alliances is a major weakness for Apple Inc., as they will
        struggle to get deals, favours and partnerships.
       Apple Inc.’s lack of innovation limits its success, as there is no forward thinking.
       A limited customer base is a major weakness for Apple Inc. as it means they have less
        people to sell or market to.
       Apple Inc.’s limited product line is a major weakness.

                                      SWOT Analysis of Apple inc. IIPM
Opportunities are external changes, trends or needs that could enhance the business or
organisation’s strategic position, or which could be of a benefit to them. This section will
outline opportunities that Apple Inc. is currently facing.

      Looking at export opportunities is a way for Apple Inc. to raise profits.
      Changes in technology could give Apple Inc. an opportunity to bolster future success.
      The changes in the way consumers spend and what they buy provides a big
       opportunity for Apple Inc. to explore.
      New market opportunities could be a way to push Apple Inc. forward.
      Reaching out into other markets is a possibility for Apple Inc., and a big opportunity.
      Grasping the opportunity to expand the customer base is something Apple Inc. can
       aim for, either geographically or through new products.
      Expanding the product/service lines by Apple Inc. could help them raise sales and
       increase their product portfolio.
      Expanding into other markets could be a possibility for Apple Inc..
      Forming strategic alliances and joint ventures is an opportunity for Apple Inc. to
       maximise profit and gain new business.

                                     SWOT Analysis of Apple inc. IIPM
Threats are factors which may restrict, damage or put areas of the business or organisation at
risk. They are factors which are outside of the company's control. Being aware of the threats
and being able to prepare for them makes this section valuable when considering contingency
plans and strategies. This section will outline main threats Apple Inc. is currently facing.

      Consumer lifestyle changes could lead to less of a demand for Apple Inc.
      New products/services from rival firms could lead to Apple Inc.\'s products/services
       being less in demand.
      Changes in the way consumers shop and spend and other changing consumer patterns
       could be a threat to Apple Inc.\'s performance.
      Not keeping up with changes in technology could be detrimental to the future of
       Apple Inc. as they could slip behind their rivals.
      Slow growth and decline of the Communications market is a threat to Apple Inc..
      Increased competition from overseas is another threat to Apple Inc. as it could lead to
       lack of interest in their products/services.
      The actions of a competitor could be a major threat against Apple Inc., for instance, if
       they bring in new technology or increase their workforce to meet demand.
      Apple Inc. could be threatened by the growing power customers have to set the price
       of their products/services.
      Substitute products available on the market present a major threat to Apple Inc.

                                        SWOT Analysis of Apple inc. IIPM
Indian Scenario of Apple Inc.

IPhone’s launch in India has been dubbed the biggest failure of a top-notch brand from a well
regarded company in recent times. Two months after the dust over the launch and the subsequent
wave of disappointment has settled, it’s time to take an objective look at what actually went wrong
with iPhone in India, given that it has been a runaway success in most other markets it was launched
Unlike the initial argument that it was the steep price tag that queered the pitch for iPhone in
India,there is more to the debacle than just the pricing. Besides a very high price tag, one main
reason behind iPhone’s failure in India is that there was a very weak link as far as consumer
confidence was concerned.

Selling huge numbers in India was not even Apple’s game plan, it seems. Around the time of its
launch, the company had said it hoped to sell 10 million units as India was not a priority market.

IPhone’s comedown in India has been described as a pricing failure by most. But on the face of it, it
doesn’t seem logical. Priced at Rs34,999, Nokia N96 costs around Rs4,000 more than iPhone’s 8GB
handset and Rs1,000 less than its 16GB model. IPhone’s other rivals, such as Samsung’s Omnia and
BlackBerry Bold, are priced even more steeply . “More than the price, it was the pricing
communication that hurt iPhone in India.

Apple CEO Steve Jobs had made a public announcement that iPhone would be priced at $199
globally (about Rs9,490).This built a false hope in the minds of those consumers who wanted to buy
it and turned away those who could have actually bought it.

                                      SWOT Analysis of Apple inc. IIPM

The collective Apple community has been so intoxicated by the iPod, the success of the
iTunes Store, Mac Book sales, and excellent Mac OS X security that no one is reflecting on
the areas where Apple is vulnerable. Perhaps it’s unpleasant to think about, but neither do we
want to live in a state of denial. So here are some areas where we think Apple should pay
more attention.

1. High Performance Computing. HPC is hard work. It requires infrastructure, subject
matter experts inside the company who can actually devote 100% of their waking hours to
HPC, and it requires deep partnerships with HPC customers. When Apple realized that it
would be perhaps a year from the time they announced the Intel transition until Xeon-based
X servers would ship, they pulled back. The best thing Apple has going right now is
workgroup computation for bioinformatics and scientific visualization.

Apple could clean up in this area in slightly larger clusters, say 64 to 256 nodes if they put
their mind to it. They’re no longer constrained by IBM, and customers love what Apple
brings to the table in terms of quality hardware and integration with the OS.
Bottom line: there is money to be made.

2. Enterprise. Despite an excellent server platform in X Server and Mac OS X Server OS,
Apple doesn’t have the infrastructure internally, the business model, or the business software
to make a serious assault on the general enterprise market, not because the products are poor
but because of the image Apple presents.

For example, does a corporate CEO really want to open up his system preferences and be
greeted by an option called "Parental Controls"?

Here is another example. In 2005, Apple stopped providing Internet Cafes for professional
conferences. The argument was that seeing Macs lined up in this fashion dilutes the brand.
What Apple corporate missed out on, and what the field sales people understood, was that
relationships with professional organizations are greased by these Internet Cafes. While the
Mac is the best computer on the planet and the brand is strong, there are Apple senior
executives who don’t get the importance of enduring business relationships. There has to
come a point where arrogance and branding give way to actually selling computers in the

Enterprise customers just can’t get it out of their mind that this is a company without serious
business software solutions that is also focused on consumer electronics. As a result, Apple is
relegated to and remains satisfied to engage some niche areas like small business,
bioinformatics, and audio/video production. But because they’re not on the offensive thanks
to longstanding road blocks by the competition and Apple’s own image, companies that covet
those particular markets have a free hand to attack Apple while protecting their remaining
business segments.

                                      SWOT Analysis of Apple inc. IIPM
As Apple becomes more and more distracted by the entertainment side of computers, they
risk losing what credibility they have in the enterprise, business and government, where
customers desperately want to act like very sober, grown up professionals.

 3. Music industry. People are more and more concerned about the things they read about the
music industry being annoyed with Apple. Yes, Apple saved the labels. Yes, Apple ignited
the portable music revolution. Yes, the music labels couldn’t have developed their own
iTunes Store if C.S. Lewis returned with a legion of angels.

Apple has been enjoying this success and believes that inspiration, perspiration, and
innovation will allow them to maintain the iPod mania for a long time. But it’s also, in our
view, distracting the company from the idea that the time for gloating is over, and it’s time to
start working with the other players in the industry to further everyone’s goals. Otherwise,
everyone’s goal will quickly become the eradication of Apple.

The Zune is not a device designed to stand on its own merits. Instead, it’s a strategic platform
that gives Microsoft an entry point into the industry and a ticket to raise havoc with business
deals that only Microsoft knows how to do. After all, all the other players want to do is make
money selling music.

4. Entertainment industry’s plans. There is great confusion but also great ambition in the
video entertainment industry thanks to all the new methods o f delivery. The Hollywood
studios have carefully studied where the music industry went wrong, and they’re learning
fast. The industry as a whole is working together, and Apple isn’t exactly on their Christmas
card list.

All factions in the entertainment industry, the content providers and the carriers, are scurrying
to make sure that Apple doesn’t dominate the movie business the way they did the music
business. So far, Apple hasn’t made any headway, and it’s only the cosiness with Robert Iger
at Disney that has allowed Apple to make its first foray into selling movies. But Disney
hasn’t been standing still either, having overseen an agreement between ABC and Comcast to
deliver various video content on demand.

Motorola is working very closely with the cable companies, Comcast, Time-Warner, and
Cox, et al, to deliver hardware and software that will keep their customers glued to the TV
set, not the computer, and keep that cable bill cash flow ongoing.

We suspect that it has been this massive effort by all concerned, the studios, the networks,
and the set-top-box manufacturers to make sure their customers have wide choice, workable
DRM, and that all of them prosper in this new century. That could well be the reason behind
the endless delay of the so-called "true- video" iPod with a full 100 mm (diagonal) screen.
Apple can’t invest a lot of effort in a portable video platform until they’ve secured broad
agreements for content, and those seem to be hard to come by lately.

To avoid taking the leap it can offer two options to its customers. They can have the choice to
buy the iPhone with an AT&T subscription which would be cheaper. C ustomized bundling of

                                      SWOT Analysis of Apple inc. IIPM
similar apps and selling it at a lower price-clever implementation and marketing, stripping
certain hardware features - reduce cost, removing of unnecessary or less popular apps,
consumer specific customization and hardware packaging- increase product diversification
and eliminate threat of competitive alternatives. Buy it at a higher price but with the liberty to
choose a service plan provided by any service provider. In this way the customers can make
the choice depending on their liking and budget.

 5. iPhone : Strike alliances with service providers; exploit international markets especially in
China. Substantial presence internationally but still has to be introduced in many Asian
countries including China, most Arab countries and most of Africa. Gaining access to
additional distribution channels and sales outlets in the international market.

Should exploit its R&D Apple iPhone 3G is currently priced 20-30% over its competitors.
Should drive down costs per unit to enable price reductions- attract customers. Cost
Reduction & People in a deep recession might respond better to a lower price, even if it was
for a stripped-down lesser model.

Overcoming Technical Hitches, R&D should come up with solutions to sustain competition.
Problems with Apple iPhone 3G connectivity with a 3G network. The blame game is on with
AT&T. The switch between EDGE and 3G networks leads to broken web sessions that can
be detrimental to many business applications and annoying to all, for some the switch
between the networks leads to dropped calls, the battery life has worsened as the new
applications combined with GPS and 3G connectivity mod ules suck enormous amount of
power. Apple has to constantly innovate to appeal consumers by directing concentrated
efforts on R&D. Management has a huge role. Managers have to provide motivation and
incentives to the employees and implement an effective re ward systems.

                          SWOT Analysis of Apple inc. IIPM

Blogs and forums.


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