Apple Fans - Steve Jobs 1955-2011

[11Fan]

Steve Jobs has passed away.

Apple (http://www.apple.com/)

[mixture]

I'll simply repeat what I said over in the Jet Blast thread .... :(


The IT industry has just lost one of its best.

In an industry dominated by commoditisation, product feature-count and undelivered marketing promises, Jobs retained a hands-on, dogged focus on retaining product quality whilst continuing to push boundaries, both in terms of industrial design and product functionality.

In 1997 Apple was staring into the abyss, Jobs's turnaround of the company with the introduction of the "i" generation of products and OS X was an awe inspiring example of business mastery and team leadership.

RIP Jobs and Long Live Apple.

[Parapunter]

I've never been a fan of Apple's products or it's methods. For me, they're far too locked in, over priced and mostly triumphs of style over substance, especially the Iphone, which is not actually very good at being a phone.

However, It's beyond argument that Jobs was one of the cleverest of men & he lived a life of incomparable excellence. A real thinker, aesthete, deal maker and innovator. It's a rare combination & today is a real loss to the world.

[Ancient Observer]

The man was a bright man who did very well for his shareholders. He created lots of money for his shareholders by the unlawful use, world wide, of Retail Price Maintenance. Various premium retail products such as pens (Montblanc) and so on use this unlawful marketing device.

I have no idea why the regulators have not stepped in to stop it.

[SpringHeeledJack]

Whether you liked Apple products or not, you have to hand it to Apple that they introduced products that changed the way the public interfaced with the internet and to the many 'creatives' who swear by the company's software and ease of use. Jobs was the guiding light with the vision to assemble a winning team that have done his bidding. I'm not and never have been a macophile, but the 2 laptops that I have owned over the last 10 years were instinctive enough for me to understand and have almost never given me problems, be it hardware or software and that's good enough for me :ok:

In answer to RPM, I guess that any high-end product that is in demand will always be able to command a certain price, be it Chanel, Rolls Royce, Louis Vuitton etc. Jobs managed to marry function with form and the results speak for themselves. Perhaps there are better computers and phones etc, but for the customer it seems that the offerings are enough to satisfy.

Good job steve say I!



SHJ

[Lukeafb1]

I worked for Apple between 1988 and 1991 and met Steve on a number of occasions. He always struck me as a very friendly type. On the other hand, I never directly worked with him!

Still, RIP Steve.

[mixture]

He created lots of money for his shareholders by the unlawful use, world wide, of Retail Price Maintenance.

Huh ? Apple don't enforce an RRP.

If a reseller wants to shift Apple boxes on tighter margins or at a loss, then Apple are not going to stop them from doing so.

There's no such thing as price fixing in the IT industry. The margins are too low, and the law doesn't permit it anyway.

[Mike-Bracknell]

Huh ? Apple don't enforce an RRP.

If a reseller wants to shift Apple boxes on tighter margins or at a loss, then Apple are not going to stop them from doing so.

There's no such thing as price fixing in the IT industry. The margins are too low, and the law doesn't permit it anyway.

I think he might be referring to the sale of Apple hardware, which is based on Intel chipsets and motherboards that in themselves are worth a fraction of the cost of the full system from Apple, and hence where the price hikes come in.

I once met an Apple rep to talk about becoming a reseller. He offered me 4% off RRP so long as I shifted £50k a month.

I told him to FRO.

[mixture]

I think he might be referring to the sale of Apple hardware, which is based on Intel chipsets and motherboards that in themselves are worth a fraction of the cost of the full system from Apple, and hence where the price hikes come in.

Intel chipsets and motherboards they may be.... but significant R&D costs go into them, and the manufacturing process required is not exactly the same as your run-of-the-mill beige PC box.

As with other things in IT, there are premium products (e.g. Cisco, Juniper) and there are the cheap competitors (Netgear, Huawei etc.)

And anyway.... their margin (around 30% FY10) is nothing compared to Microsoft's gross margin of 78% !

As you should well know, the only winners in the IT industry are the manufacturers/developers .... the rest of the channel are merely bottom feeders. Its one big pyramid scheme that's about as unsustainable in concept.

[Mike-Bracknell]

Oh don't worry, I know where it's at, I was merely trying to clarify AO's stance for him :)

[One Outsider]

Huh ? Apple don't enforce an RRP.Just have a look at iPhone prices outside the US. Despite large differences in sales tax, VAT and what not, the prices are remarkably similar if not identical. Coincedence?

[mixture]

One Outsider,

There are many misunderstandings and untruths out there about Apple.

There is no price fixing and there is no "Apple Tax". It's simple business economics, you'll find the same applies to non-Apple products too, if you are only buying one or two boxes, then your reseller is not going to be willing to cut their tight margin for you. And the tighter the margin to start with, the more similar the pricing will be across the geographic region (EMEA/APAC), there are countless non-Apple examples of this, so no conspiracy theory needed.

Apple has a history of buying niche technology companies in order to obtain exclusivity on their inventions. Similarly Apple expend much R&D on developing new products, and these frequently mandate expensive manufacturing facilities with costly tooling. Apple also differentiates itself in the way it deals with its supply chain (upfront payments, tight control on quality etc). Not to mention all the marketing etc. All of this business model requires a margin if you're going to make it sustainable.

[GANNET FAN]

10 years ago we had Steve Jobs, Bob Hope and Johnny Cash... Now we have no Jobs, no Hope, and no Cash

[Ancient Observer]

Apple do appear to me to enforce Retail Price Maintenance. As do some others, such as Montblanc.

How they do it is about mechanism, not principle.

if they only offer retailers low margins, that is one way, but it is not the only way. Their staff get a 30% discount, as do many retail staff in high value items, (think jewellery - staff discounts of 35% and 40 % exist today in the UK High Street). So Apple can afford to lower their prices. They do not want to - they simply make ginormous profits. So do Microsoft. Just cos one does, no need for the other to follow by ripping off citizens.

[mixture]

Ancient Observer,

Nonsensical argument you're putting forward unfortunately.

Name me an industry that does't have staff discounts. The aviation/travel industry has AD50/AD75 for example.

It's simply not feasible to use staff discounts as a means to show companies are ripping people off. And in the case of the IT industry, believe me, there's not enough margin to rip-off the end-user, plus the competition is so fierce at the bottom end of the foodchain.

Similarly, in the IT industry, there's a concept of NFR ("Not For Resale"). Expensive stuff can generally be had at substantial discounts by resellers, on the understanding that it's only to be used for the purposes of demonstration and staff training (which makes sense !)..... you can't then go on to say that just because a company is able to give an, say, an 80% NFR discount that they're ripping everybody off. The NFR price is set at (or frequently below) cost, is subject to quantity and contractual limitations, and not all manufacturers run NFR programmes.

The vagaries and complexities of the IT industry are too vast to explain here on PPRuNE. The same goes for the basic concepts of business. This is my last post on this thread, I can't be bothered any more, as it's obviously one of those hamsterwheel threads that could be debated until the cows come home.

[IO540]

The man was a bright man who did very well for his shareholders.

Only if you bought their shares not too long before 2004.

He created lots of money for his shareholders by the unlawful use, world wide, of Retail Price Maintenance.

Very true.

How that is done, without getting into trouble, you can look at the electronic component distribution business. There are several ways. The most obvious one is that if you offer unauthorised discounts, your franchise/dealer agreement will not be renewed next year, or it will be renewed but on poor terms :) Other ways include the use of arbitrary price support from the manufacturer, which can be used to support a co-operative reseller, or punish a naughtly reseller.

I think Job's biggest achievement is to make millions of relatively broke teenagers part with c. £30/month (at astonishing amount of money at that age, and in most cases their parents' money) for the benefit of having a smartphone. Not all smartphones are Ipads of course, but Apple's success in this area is something which HTC, Samsung, etc, etc, are more than happy to take advantage of :)

In my family we have an Ipad2/3G and an Iphone4. Both are pretty slick at what they do (except the Iphone is actually a rather poor phone, and both have naff reception on GSM, GPRS, 3G and WIFI compared to just about everything else) and thus have found ample uses.

Apart from the aforementioned substandard RF performance, the hardware is of superb quality which nobody in the business has yet emulated. They could do so of course (there is no special manufacturing or electronics technology in an Iphone/Ipad) but the whole industry got caught with its trousers down, thinking that nobody would pay such a price premium for quality.

They will probably never catch up, because they have only one way to go (Android) and that market is deeply fragmented, and with little opportunity for product differentiation. And Nokia, desperate to do something different to the rest, will probably get stuffed by M$ with their pile of bugs called Windoze Mobile :)

Unfortunately, for all but trivial/dumb users, Apple have soured the package by a raft of irritating political restrictions, starting with banning all kinds of stuff from their shop.

As for Jobs himself, some of the obituaries (http://www.telegraph.co.uk/news/obituaries/technology-obituaries/8810037/Steve-Jobs-obituary.html) suggest he was less than a nice chap.

[Ancient Observer]

Mixture is not going to reply, and I don't blame him/her. Whilst I know little about IT, I know a lot about business.

The key bit of analysis of either a sector or a dominant player in a sector, is called "value chain". In that analysis, you look at the final retail price, and move backwards up the design/production/distribution chain to see who is capturing the value in the product.

For a UKP 500 product in the shape of a phone or an i-whatever, someone has captured a lot of value. If (post above) the retailer is only getting 4%, the wholesaler/importer won't be doing much better. The International distributor won't be getting a lot. That is a very competitive sector. We know the products are made by that company-with-suicides in China. They are simply the cheapest assembler in the world. They don't get much of the UKP500.

So where has the value been captured? Apple.

Probably by Licensing arrangements, run through Holland for tax-mixing via BVI for tax minimisation. The USA tax folk can approve whatever licensing rate they want to............and they have always been kind to the nice folk on the West coast.

Don't forget, Apple do not make any "profits" in Europe, and do not pay taxes in Europe.

Compare that with other value chains for £500 items - where often the distributors and distribution chain capture up to 60% or more of the final retail price.
They do not use RPM and they do pay taxes.