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After Jobs: Apple and the Cult of Disruption

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Internet Security Threat Report 2014

How Apple changed the world

In many places this morning I've read that Apple was uniquely “disruptive”, or without Jobs in the hands-on CEO role, it should be fine until the next “wave” of “disruption”. Here’s what I think they mean.

When new (cough) disruptive technologies in the 1970s and 1980s appeared, we didn’t expect Matsushita or Sony to disappear overnight. The language of “disruption” implies that they should be in mortal peril – or at least, like Nokia, the executives must rush out and buy lots of copies of Clayton Christensen's book.

What the Priests are claiming is that today, there is now some unique volatility that wasn't there before, and companies have a unique vulnerability to this. There’s a grain of truth to this. But “times change, huh?” isn’t very useful.

So what is going on?

Well, one significant difference is that the media and entertainment industries, which traditionally managed technology transitions pretty well, have spent the last 20 years honking in all directions like rabid geese. Thanks to the flexibility of copyright, technology innovation has made rights-holders and creators richer. The content made technology companies richer, too. All was well.

But suddenly confronted with a technology they couldn’t understand, and taking the apocalyptic rhetoric of showboating screeds such as Declaration of Independence In Cyberspace at face value, the rights industries forgot all about the historic continuum. And that had huge repercussions. With the media and entertainment industries in disarray, the risk for investors in technology and service sectors increased enormously. They could easily find themselves backing the wrong side.

What Jobs figured out Apple needed to do was recreate the partnership between technology and creative industries, and Apple could make a decent fist of doing so. This wasn't some benevolent Jobsian mission to save Hollywood, but a pragmatic reading of what history was telling him. Hence the iTunes media retail operation, and AirPlay. If Apple hadn't rolled its own music delivery system, the major labels may still be arguing about whether it was wise to launch one. (They were not only obsessed with control, but fearful of the antitrust implications of acting in unison).

This strategy is implicitly recognised by rivals who aren’t as good at it. When Nokia CEO Steve Elop talks about platforms and “ecosystems”, what he means is that you can’t get The Economist app on Symbian, for example, or the neat WFMU app that caches shows, and to shop at Sainsbury’s on a Nokia you have to do so through a pokey mobile web browser. He knows that all this adds up: this matters.

Apple was equally happy to embrace something like podcasting, which didn’t require so much schmoozing in Los Angeles, if any at all, because podcasts helped enhance the value of Apple’s hardware. This is quite simple. But the Priests of Disruption hate simple explanations: there's no money in them, hence the obfuscation.

That, to me, seems why Apple has been so successful. It patched up the holes which traditional media and tech partnerships had failed to in the broadband era. And fortune favours the brave.

The challenge for Apple’s new CEO is that he has to juggle two priorities. In addition to the old problems of a Sony – making new gadgets – he has to decide how far into a retail and distribution role Apple should go. Cook and Chairman Steve will have to pick and choose Apple's fights carefully. As an example, the two HD movie delivery systems are going to be UltraViolet and Apple's own (whatever it choose to call it). UV has a wide range of manufacturer support, but AirPlay doesn't, as yet. But how long does Cook decide to fight UV with its own system? Is Apple in the hardware or the media delivery business? Or is it a bit of both.

Now, don't get me started on the word "ecosystem". As you might guess from that piece, that’s on the list, too. ®

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