Apple and the Growth Conundrum
Last week, Apple announce that it was launching a streaming service called Apple TV+. While the investment community has focused on the shift from products to services, we think the more interesting point is the shift from innovation to entertainment.
While Apple no longer has Steve Job, it has an incredibly smart team and it has $245 billion in cash. So when that team is evaluating where they focus Apple’s future, they decided not to focus on ideas or services that would improve the well being of people — they have decided to focus on solutions that extract money for accessing entertainment - not solutions that improve productivity and improve quality of life.
While the recent trend is to blast the mobile phone and our society’s reliance on it, the truth is that reliance comes from the fact that it is a hugely valuable tool. Just a few of the huge benefits to individuals and society includes:
· Lost productivity from getting lost, being late and stuck in traffic
· Fear and anxiety from not connection with a family member or friend
· Ability to receive or provide critical real-time information based on changing circumstance
Some people will argue that immediacy of information is giving us ADD, but they forget how agonizing and debilitating life was when we could get the person, goods or information we needed, when we need it.
Obviously, that is what fueled the growth of Apple. But now they are looking toward the future, and the best minds in business do not see any breakthrough ideas in how to make our lives better.
Despite all of the promised of the Apple Watch and health information, despite all of the apps that can be built on its platform, their leadership has invested in Beats headphones, focused on photo image quality, and is now driving easier streaming entertainment.
Looks like the way to make more money in the future less about solving problems, but helping people avoid focusing on their problems.
Until Apple and other leading companies, focus their resources and attention on innovations that help society, we can expect to continue on our current and dangerous path.
