Apple: The eco-system giant flexes its muscles
This time last week there were great expectations for the keynote speech at Apple's annual World Wide Developers' Conference. Some even expected new hardware, such as the much-rumoured iWatch, but this was always unlikely. The focus of the WWDC, after all, is on developers and in giving them the ammunition to provide us with new and exciting systems and software. It is a beacon for the future. Last week we were not disappointed. It was arguably the most important and productive WWDC that I have monitored in my nine years of Apple commentating.
With announcements of exciting systems developments, including OS 8, OS X Yosemite, Extensions, Handoff, iCloud restructuring and costing and a dozen other gems (including Swift, an all-new language), Apple gave developers what they have been asking for for years. Above all, Apple has handed them the opportunity to further enhance the unique eco-system that is now one of the most compelling reasons to buy Apple hardware and one of the greatest incentives to stay once inside.
Being able to move from one device to the next and find your work exactly as you left it, being able to use your Mac as a switchboard for all your iPhone calls, experiencing seamless and even cheaper cloud storage―all these things have the power to transform Apple. It is no longer a hardware company, not even a software company. It is now an eco-system company.
When I left WWDC last year I felt like I had a long todo list of things that I needed to do. Apple had made a lot of changes (most notably to the appearance) of iOS 7 that were a lot of work to adopt but that didn’t fundamentally change my apps. I couldn’t wow my customers with the resulting changelog, it felt like the same app but in a different dress.
This year is the opposite. I don’t have a todo list of things that I need to do, I have a list of things I want to do. This year Apple has taken the lid off and given us everything that we have been asking for. It is now our responsibility to step-up and take advantage of the new opportunities created.
The most lasting impression I took from the keynote speech was the new energy, enthusiasm and general competence exuded by the presenters, particularly by Craig Federighi who has managed to transform himself from a fairly nervous performer into the new star of the stage. I can't help feeling that he provides Apple with that zest and sheer enthusiasm that has often been missing since Steve Jobs died.
In a few hours Apple passes another big milestone. A stock split may not be considered a huge deal but it is a very significant move by Apple, a company that has split its stock on only two previous occasions. The seven-for-one adjustment when Wall Street opens today will see Apple trading at a much more reasonable price of around $90 a share instead of the $645 at Friday's close. There is more to this than meets the eye. The unusual figure of 7:1 was chosen with one object in mind―to bring the share price under $100. For the first time in nearly ten years small investors will see Apple stock as more affordable to trade in smaller lots. I think it could lead to a groundswell of support from the grass roots, from Apple users who feel that they would like a bit of the action but have never felt able to afford the entry price. The stock will not long remain under $100.
All of these developments, the announcements at WWDC and the new "cheap" Apple stock, set the scene for crucial hardware releases later in the year. We know the iPhone 6, a larger iPhone, is sure to be announced. The iWatch, too, is looking more than likely and we will almost certainly see updates to the iPad and Mac ranges. We have already pencilled in the imassive productivity gains that will be wrought by OS 8 and Yosemite.
I believe the tide has turned for Apple after a year of fairly negative news and repeated tales of woe from Wall Street. Even the analysts are now wavering. Yet they still do not understand Apple: A company that delivers now and has a bright future rather than a company that has nothing to offer now but rides high on future expectations.