Page Impressions Ltd Blogcetera: Goldman Sachs Technology Symposium - Apple Developments

Friday, February 27, 2009

Goldman Sachs Technology Symposium - Apple Developments

Here are the highlights of Tim Cook the COO of Apple comments at the Goldman Sach Technology Conference currently going on in Redwood City, California and favourite to replace Steve Jobs as CEO.  There are some very interesting comments here as to the future direction of Apple.

Economic decline

“I’m not saying Apple’s immune to the economy. But if you look at last quarter as an example … last quarter in the U.S., the GDP growth was less than one percent.  It was miserable by anybody’s calculation. Apple, in the U.S., grew 27 percent.

For us, we’re focused on what we can control. And what we can control is how much we innovate, what products we do, the experience in our stores, the experience in our channel — all of those things. I think Apple’s success depends on how we do on those things versus whether the GDP is slightly above one (percent) or slightly below zero or whatever.”

IPod Touch cannibalizing iPhone sales

“I’d rather Apple cannibalize Apple than somebody else cannibalize Apple. It was very key for the iPod line to go in this direction.”

The iPhone SDK and platforms vs. products

“First of all, I think it’s really important to realize that very few companies in the world know how to build a platform. You can count them on a few fingers. Apple is one of them. We’ve had the Mac platform for years and really understand this.

When we started with the phone, we started by getting developers to focus on web 2.0 apps. And there’s over a thousand of these today. There are probably many people in this room that use them. But people also want to do more than that. And as we got into the phone more and more, it became clear to us that we should release an SDK and we’re going to talk more about that next week at our event. But in essence what it does is it will make the product even more compelling. This is a product that has the highest customer satisfaction (rate) of any Apple product ever shipped, which is a very, very high bar. We’re super excited about where this can take us.”

The real iPhone controversy (aka the missing iPhones)

“The real controversy, if you will, from some people’s point of view is the difference between phones that are activated on Apple-chosen carriers, and the total number of phone sales. So people want to know where are the iPhones? Here’s my short version of this: We have a situation where we’ve purposefully rolled out iPhone in four markets (the U.S., the U.K., Germany and France). We did this at this chosen speed so we would learn, and could apply those learnings to future rollouts, etc. And we are right on track where we want to be. The four million units that we’ve sold over the first 200 days gives us confidence that we can achieve 10 million units in 2008.

So where are the iPhones? Here’s the privilege, so to speak, of this problem. The demand for the iPhone is so intense in the markets where we aren’t offering it that people are exporting it out of the U.S. in many different ways and then running it on local carriers … The thing that I like about that is it shows there’s a lot of worldwide demand. And I think the most important thing for Apple by far in this first 8-10 months of selling in the iPhone world is to deliver a product that would delight customers.

Of all the problems we face, this is the one I face looking at with a little bit of a smile. Because it means there’s great demand for the phone. And to have people stepping over each other to have the phone isn’t a bad thing.”

The one carrier model vs. multiple carriers for the iPhone

“In the U.S., our fundamental choice was do we want to develop two phones: a CDMA phone and a GSM phone. We didn’t. We wanted to do the simplest approach in the beginning because that’s the fastest way to learn. We wanted GSM. GSM is a worldwide standard and AT&T is the largest carrier. The business relationship that we could work with AT&T allowed Apple to be Apple and AT&T to be AT&T. This is the power of this relationship. We feel very good about that. We went into Europe and picked the top carriers in three countries and got going in those countries. Now, are we married to his model? Will we do this everywhere? We’re not married to any business model. What we’re married to is shipping the best phone in the world and continuing everyday to innovate to make (the iPhone) better and turn it from a device into a platform. We are married to that.”


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