iPhone 4S event represents dawn of new Apple era

My Twitter stream yesterday represented some interesting reading, with probably 90 percent of tweets being related to the iPhone 4S announcement from Apple or the lack of an iPhone 5 announcement so to speak. The event was about more than the iPhone 4S or the iPhone 5 though, it was also about the Tim Cook Apple era compared to the Steve Jobs Apple that we have grown accustomed to.

iPhone 4S launches Tim Cook era

Do I think the announcements at yesterdays events would have been any different if Steve Jobs was on stage? Not really. It would still have been the iPhone 4S, which to be fair represents a decent upgrade from the current iPhone. What would have been different is probably the feeling that there are still the “next big thing” in the pipeline, the setting of expectations of what to come in the future, something that Steve Jobs was a master at. Or perhaps that is the legacy that Steve Jobs left that will be most difficult to fill.

Fact is that the iPhone 4S makes business sense for Apple, or as Chris Taylor put it in his Mashable post earlier, it was a play straight out of Tim Cook’s playbook, looking after the iPhone product lifecycle, getting the right people to upgrade. If we break down the announcement of the iPhone 4S, it delivered a significant performance upgrade, some interesting new features (Siri), an upgrade in storage (64GB iPhone 4S), and a drop in price across the portfolio of iPhone models. It delivered on most areas that are of importance to the majority of the market, and a significant upgrade for the iPhone 3GS owners that are now in the market for an upgrade after 2 years. For Apple this is about what makes business sense.

This is a game of risk and reward. It is about consumer perception vs consumer loyalty. If Apple had not built up a business model that have their customers heavily invested in the iPhone model (think apps, iTunes etc) this could have been a risky move by Apple as the cost to move to a different smartphone platform would have been smaller. This model has allowed Apple to deliver the iPhone 4S, a handset that is on par with what is needed to compete in the smartphone market, not more or less.

When Tim Cook showed off the graph that highlighted that Apple iPhone currently represents about 5% of the global mobile phone market, he also clearly stated that the future is all about growing that market share, and that is not done by delivering costly state-of-the-art solutions that only a small percentage in the market can afford. While Apple can’t afford to alienate their core customer, the base of their success, they still have to keep their focus on growing their market, and their shareholder return on investment.

Perhaps the new Tim Cook era at Apple will give us Apple bloggers and followers more realistic expectations as to the evolution of the products, since the rumor mill is largely to blame for making expectations for the new iPhone too high for even Apple to deliver on.


Filed in: insight, Lead Story

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