Apple Losing Its Edge?

Composed by Ivy Kolpon
Edited by Sarah Mejia

With the first introduction of the iPod in 2001, Apple started turning heads.  It catapulted to the most valuable company in the world with the subsequent iPad and iPhone innovations.  Now, 11 years later, is Apple beginning to lose its edge?  Although Apple just released its coveted iPhone 5, along with its iPad mini tablet, Apple stocks have taken a hard hit.  Its shares have fallen from their high at $702.10 to $525.62, a 25% decline.  Is it a coincidence that these hard times follow the death of iconic founder Steve Jobs?

Consumers are feeling “Apple fatigue.”  Sameet Kanade of Northern Securities refers to “Apple fatigue” to describe how all of Apple’s products (iPod, iPhone, iPad) are increasingly similar in functionality, and users are getting tired of seeing the same basic products in different sizes.  Consumers don’t want to spend their small discretionary incomes on repetitive products.  Where is the true latest innovation?

When Apple introduced its IOS 6, 10 million users updated the system within the first week of being released. However, it’s no secret that customers are unhappy with some of the changes Apple implemented.  Apple ended their contract with YouTube, eliminating the YouTube app on all iPhones.  Prior to this, users could instantly access YouTube from their “home screens” as soon as they took their iPhones out of the box.  It provided consumers simple access to view videos on their mobile phones.  Another major misstep involved Google Maps.  With the IOS 6 update, users lost Google Maps and gained access to Apple’s own version of the map app.  Apple Maps has had well-publicized glitches including inaccurate directions and location data.  Users lost features such as public transit directions, real-time traffic, and congestion information.  Because of the backlash Apple received with this change, CEO Tim Cook made a statement, “At Apple, we strive to make world-class products that deliver the best experience possible to our customers. With the launch of our new Maps last week, we fell short on this commitment. We are extremely sorry for the frustration this has caused our customers and we are doing everything we can to make Maps better.”

It cannot be forgotten that Apple lost its visionary founder last year.  Since then, Apple has not only released repetitive products, but it has also made blunders with its operating systems.  These various errors and missteps seem to be symptoms of a much larger issue.  Would these problems be in play under Job’s leadership?

Once a virtual monopoly in the smartphone, tablet, and digital content distribution industry, Apple now faces strong competition.  Apple introduced its iPad mini to fight competition from Amazon and Google’s smaller tablets.  Samsung is stepping up its game in the tablet industry, while Apple loses market share.  Apple lost 10% of the tablet market, while Samsung gained 12%.   Apple is also facing competition in the mobile phone market from Samsung who is currently the world’s top smartphone vendor by volume.

Has Apple run its course?  Some users believe Apple can still thrive by making drastic updates to its operating system.  Such an update would include improvements to the web browser, calendar, e-mail app, keyboard, and additions like a file system.  However, Apple is likely to continue to profit for the next few years. Consumers will continue to purchase Apple’s products until the next big gadget is innovated.  In days gone by, there was confidence that big innovations would come from Apple.  Since the passing of Steve Jobs, it is much less clear.


 **Due to technical difficulties we recently had to switch domains and transfer all of our website content.  Please keep in mind that while we have been publishing articles for two years, the published dates shown may not reflect the initial publish date.


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