Why Apple is so ambitious

176
5
Why Apple is so ambitious

It is now seeingsawing back and forth between the mark for the thrill of it.

It is a remarkable feat for a company that needed a cash infusion from Microsoft in 1997 to stay afloat. It was the news that $3 trillion was going to be announced on Monday. There is the obvious - more iPhones that get people into the company's ecosystem and accessories like the Apple Watch and AirPods to keep them hooked. The company will have to take big risks on its way to $4 trillion.

The kind of market power that they've enjoyed with the App Store and the price of the iPhones is going to disappear, according to Campbell Harvey, Duke University Fuqua School of Business professor.

Apple already has a track record of jumping into established device and services categories and outshining its competitors with ease. Apple developed some of the Apple's products by cribbing notes from competitors before leaving them in the dust, to name a few of the products Apple developed by cribbing notes from competitors.

The company s most anticipated products — its mixed reality headset and long-rumored Apple car — will be different from anything Apple has previously offered.

Apple needs to change that, because headsets are clunky and uncomfortable.

I have used headsets ranging from the Oculus Quest 2 to Sony's PlayStation VR, and besides making me sweat like an animal after 15 minutes, the on-screen content is relatively pixelated.

Apple has a knack for taking problematic products and making them hit. The iPhone was not the world's first smartphone when it launched in 2007. The Apple Watch and AirPods were not the first smartwatch and wireless earbuds when they debuted in 2016. They have gone on to be bestsellers because Apple has improved its design and capabilities.

Apple will have to improve comfort and image quality when it comes to headsets, and it will have to ensure that many apps can take advantage of the hardware, even when it comes to headsets. While current consumer headsets are mostly geared towards gamers, Apple is looking for volume sales, which means that it offers apps that appeal to non-gamers as well.

If Apple launches its headset, it might be a while before mainstream gets on the bandwagon, if it ever does, according to Gene Munster, Loup Ventures Gene Munster.

When they come out, the initial headsets demand is going to be muted, according to Munster. I think it will grow into something that we use all the time. We are talking about a $2,500 to $3,000 headset that's going to be uncomfortable for a lot of people to wear. The headset could become an essential product. Apple has managed this before with the Apple Watch, which had a chilly reception before the company moved its focus to fitness and sales explode. Munster said that it could eventually rival the iPhone's sales if Apple can do the same with the headset.

The rumored Apple car is about as far afield from its base expertise as it gets, which is easy to see where Apple's headset fits into its product portfolio. If Apple can pull off a car of its own, it could affect the company's future as much as the original iPhone did.

The journey of the car has had its own set of fits and starts with Apple initially opting for its own electric self-driving vehicle, then switching to producing just the self-driving technology to power a car, and back to an electric self-driving car of its own.

As Tesla has shown, building a car brand is no easy task. With companies like Rivian RIVN bringing its trucks to market and contenders like Vinfast bringing its electric cars to the U.S., Apple is entering a crowded space. Traditional automakers like Ford F and GM GM have also jumped into the EV space. Sony is about to reveal a second electric vehicle prototype, and plans for an electric vehicle company at CES 2022.

Apple's car is immediately desirable because it is made by Apple. In October, the company sold a polishing cloth for $19, which sold out in a matter of days. A polishing cloth isn't the same as a car, but brand loyalty can go a long way.

For Apple to pull all of these off, it will have to invest heavily in research and development. In 2021, the company spent $21.9 billion on R&D. Microsoft, the closest company to Apple in market cap, spent $5.6 billion.

I think part of the stock price today is because investors are confident that Apple is going to do something really innovative in the future, Harvey said.

He said that it will be a key to keeping Apple ahead of the competition, in order to prevent it from becoming complacent with its current profit drivers, its iPhone and services.

Do you believe that people will be carrying around a clunky iPhone in 10 years? What's the best thing we've got today? Harvey asked.

It is clear that Apple understands how to change with the times. It has gone from selling computers to iPods to iPhones to Apple Watches. Its foray into the still-unproved headset market and push into the automotive arena will be its biggest test yet.