Professor Mark J. Perry's Blog for Economics and Finance
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
29 Comments:
Whoo, Apple came late to the mp3 player market, which had already moved 4 million non-iPod units in 2001, then came to dominate it through their integrated solution of a music store, DRM so you couldn't share the music with others, and their own mp3 player. The analysts were right that the Apple solution didn't look too promising at the time, as the original iTunes store only worked on Macs and wouldn't come to Windows for another two years, which the analysts couldn't know would ever happen since Apple didn't have much of a history of developing Windows apps. So yes, with hindsight, it is easy to look back and say how successful Apple has been, but nobody could know which good decisions Apple would make to get there. And frankly, Apple doesn't have a clue about where any of this is going. Their entire M.O. is simply to take existing music, tv, movies and stick it online in their little stores, but they do almost nothing with the burgeoning podcast and online market. Those markets are going to kill off the broadcast market that Apple is simply moving online, so Apple is in for the mother of all collapses. Yet again, nobody will see this till it actually happens. ;)
Never owned one. Never needed one. Have no idea what it does. Would not even know how to turn it on. Steve was visionary in finding 300 million people who think they need one.
But while industry analysts said the device appeared to be as consumer friendly as the company said it was, they also pointed to its relatively limited potential audience, around seven million owners of the latest Macintosh computers."
Actual number of iPods sold as of January 2011: More than 300 million
That IS one of the best ways to Get Rich: Be smarter than industry analysts.
Jobs did it a number of times. Even Apple's later Mac failure wasn't really his fault (though I personally suspect, from Apple's recent actions, that he would have made the same mistakes, that's unprovable), as he wasn't even performing a significant, if any, role AT Apple in that time frame, from the late 80s to the early 90s.
>>> Never owned one. Never needed one. Have no idea what it does.
A remarkably stupid series of statements.
A fact, followed by an utterly unsupported claim, followed by the reason for the middle claim being unsupported.
Reasoning worthy of a Wall Street Protester, even.
If you have no idea what it does, then how the hell can you possibly know whether you need it, you dunderhead?
Or is your criteria "It's not food, water, or shelter, so I don't 'need' it"?
You know, by that criteria, you don't need clothes or a house, either. You could just go live naked in a cave, and, by all indications, you'd be just as effective at critical thinking.
You may well not need it, you may well not appreciate it at all. I'm not claiming you do. But if you're ignorant of what it does, then you cannot make ANY rational statement as to its utility to yourself, much less anyone else.
Dumbass.
And keep in mind, I'm NOT an Apple fanboy. I'm actually quite critical of Apple, and, for different reasons, much agree with Sprewell's opinion that Apple's days are numbered. Apple is historically brilliant at creating "insanely great" products that perform a cutting edge function radically better than anything else on the market. Their fascist-inspired control-freak attitude about their products almost doomed them to also-ran status (can you say "Wang"? -- it's been years since anyone else did! -- ar-ar) following the Mac downramping -- though Jobs came in and saved the day. But all this did was create new cash cows to keep Apple going. Without Jobs around to find new cash cows, Apple is doomed. I give them 5 years, offhand, unless they have one or two more IGTs in the pipeline before they run out.
OBloodyHell, I agree with you that Apple's inferior model has been sustained by finding hits, ie IGTs, to keep it alive. There was an interesting online-only bit in the recent 60 Minutes interview with Jobs's biographer, where Bill Gates supposedly said that Apple's integrated model only worked because Jobs was good enough to make it work (3 mins into the video). I think it's more than that: the Apple integrated model only works when you're seeding a new market, like the first mp3 player, the first smartphone, the first tablet, all of which initially depend heavily on an integrated content and app store in iTunes. This integrated product is also what made Apple successful back in the early '80s, before the IBM PC and it's clones commoditized the computer market and Apple fell. The same will inevitably happen with the markets Apple now dominates- we're already seeing Android take over the smartphone market- so unless they can keep seeding entirely new markets- supposedly the Apple TV is next, but I don't see anything after that- they're going to be fucked one of these days. That's likely why Apple initiated the father of all patent wars with Samsung, the most successful company using Android for high-end products: they're scared history is about to repeat itself. :)
Easier to use only if you're tripping on Jobs' LSD stash.
Hopefully things get better when all of the plans that Jobs has are all gone - and saner heads prevail. They were better when the guy from Pepsi was at the helm.
Quote from Sprewell: "... but nobody could know which good decisions Apple would make to get there. And frankly, Apple doesn't have a clue about where any of this is going."
As is the case for everything in the world. Yet we are constantly bombarded with the predictions and demands of the somehow clairvoyant central planners and macroeconomists as to what the right answer is and how the government should steer us to it. All they're doing is projecting the present trend forward and using the political process for their own gain.
"Hopefully things get better when all of the plans that Jobs has are all gone - and saner heads prevail. They were better when the guy from Pepsi was at the helm"...
Interestingly I've seen equally inane and silly comments over at the Occupy web site...
BTW sethstorm were Apple shares worth almost $400 per share when John Scully (that Pepsi guy) was at the helm...
BTW sethstorm were Apple shares worth almost $400 per share when John Scully (that Pepsi guy) was at the helm...
If you bought shares at the first offering, I'd imagine you'd have some nice gains. Not $400/share, though.
Mind that John Scully was the one that kept the company going.
If you have no idea what it does, then how the hell can you possibly know whether you need it, you dunderhead?
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It does not matter what it does, if I do not need it. If I had a need for whatever it does, I would have searched for something to meet the need.
Dunderhead.
I wonder how many of the 300 million are still operational?
much less anyone else.
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Where did I make any comment about anyone else, or their needs?
Jobs sold a lot of gizmos. He never sold me one. I guess my level of critical thinking is different from 300 million others.
"Jobs sold a lot of gizmos. He never sold me one. I guess my level of critical thinking is different from 300 million others."
No doubt.
I smell the odor of sour grapes.
What sour grapes? Jobs did what he did well. He made a lot of money off something. Good for him.
He didn't get any of that money off of me, is all.
"Mind that John Scully was the one that kept the company going"...
Good one sethstorm!
The company was hugely successful until the company hired ex-Pepsi CEO John Sculley to run the company.
Sculley eventually pushed Jobs out the door in the early 1990′s and almost ran Apple into the ground...
>>> Easier to use only if you're tripping on Jobs' LSD stash.
I won't claim it's easier. It IS much, much more flexible. And as a developer, how much would you want your entire business to depend on one single releasing agent that can arbitrarily say "yay" or "nay" on your sales? How much do you want to spend the time and money creating a product, only to have a single company tell you "No, sorry, you can't sell that."
Q.E.D., if not now, then soon, nearly every developer will develop for the Andy first, the iP second, and what happens to Apple's market share then?
A: The same thing that happened to the Mac's.
>>> Hopefully things get better when all of the plans that Jobs has are all gone - and saner heads prevail. They were better when the guy from Pepsi was at the helm.
LOL, Scully (along with that idiot Frenchman, Jean-Louis Gassée) was running the company into the ground, only Jobs' return, and his ability to find and promote successfully The Next Great Thing, saved the company from becoming another name littering the history of computing, like Wang, DEC, or Osborne.
Apple, Pre iP:
They Coulda Been a Contender
Ca. 1986 or 1987, Apple literally OWNED the computer market. Where they led, everyone would have followed. Had they not yielded the low-end to IBM clones we would ALL be using Macs nowadays.
Apple sorely misunderstood the market, failed to grasp the significance of software to the promotion of hardware, failed utterly to grasp that making 100k machines at 'x' profit didn't mean squat in the long term if your opposition -- collectively, mind you -- were making 500k machines at .75x profit.
They failed to Get It that being Business Nazis is not Good Business. In the long run, open systems rule. The more open, the better (the biggest major complaints about Microsoft are all along the fringes of its openness-vs-proprietary elements in one way or another)
>>> It does not matter what it does, if I do not need it. If I had a need for whatever it does, I would have searched for something to meet the need.
This assumes you are absolutely correct about every single possible thing you need, an utterly arrogant assumption of world-knowledge that even a child can grasp is faulty.
You can be the most capable, spectacular woodworker the world has ever know, an incredible artisan with wood and woodworking tools, and yet have no clue that someone has invented a new, never-before-considered device which makes some aspect of your work incredibly easier.
Yet, since you have no idea it exists, you have no idea you have a need to "search" for it.
Can you do "without" it? Yes, and, as suggested, if this is the definition of "need", then this can be claimed regarding about 99% of the things in your life, almost certainly. The vast majority of things people "need" derive from utility and enhanced quality of life and work. They fail the "cannot live without" test.
Either
a) you're adopting a preposterous definition for "need" which almost certainly you don't apply in Real Life (you don't need a computer... why the hell are you here?), marking you as a hypocrite.
b) You're being arrogantly presumptuous about how much you know about the world around you, when most non-dunderheaded people have at least an inkling that what they don't know is far more vast than what they do know.
Q.E.D., you're a dunderhead...
You are pretty arrogant if you think I don't decide what I need and what I don't.
If I can do without it, I don't need it.
I also actually have a lot of stuff I don't need.
But the iPod was never important enough to me to even make that list. Along with high Def TV.
OBloodyHell said...
Just as a disclaimer, I've preferred IBM's equipment. Thinkpads, mid-range boxes, et cetera. I've worked with Apple's equipment as well. They still make the same mistake.
I'll work with Apple's equipment, but I've not seen a reason to buy it. Decent construction, but bad company practices and zealotry around their products is what kills the deal. I want to buy a product, not join a cult.
From your article:
. Not surprisingly, the engineers, led by the enigmatic Jean-Louis Gassée, proved far more interested in hoarding a technology they created than in establishing a standard the rest of the industry could follow. That mistake sealed Apple's fate, dooming the company to a downward spiral that it is still trying to overcome today.
Still nothing that implicates Scully, but plenty that implicates Gassée. The article was stating that they blew a good chance to succeed.
There were saner (and more sober) folks than Jobs. There still are.
Yet, since you have no idea it exists, you have no idea you have a need to "search" for it. Can you do "without" it? ..
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Ridiculous. Whether something exists, or whether I know it exists has nothing to do with what I need.
If I decide I need electric mayonnaise, I will go look for some.
"It does not matter what it does, if I do not need it. If I had a need for whatever it does, I would have searched for something to meet the need."
But you wouldn't. The beauty of innovation in a free market, where self interest drives entrepreneurs to try ideas not tried before, is that they sometimes create something no one knew they needed until it's available. Few knew they need cell phones, or smart phones, or Kindles before they existed. How many things do you own that you didn't realize you needed before you saw one?
"If I can do without it, I don't need it."
You are merely trying to differentiate between "need" and "want" - an impossible task.
I believe you struggle to write comments here using a Droid device, that you needed, or you wouldn't have bought it. You may say you can do without it, but it was something you wanted more than everything else you didn't buy instead.
If you are worse off because you own one, then indeed it was a stupid thing to buy. Otherwise, you "need" it.
I doubt that you went looking for a modile wireless device with the capabilities your Droid has, before you knew something like it existed. Once you knew of it, you realized how useful it would be, and you gave up a list of lower priority things to get it.
geoih, I agree with you more than you know, but that's why the same uncertainty especially applies to Apple too. Jobs and his brain trust were particularly good at taking categories that others had already brought to market, whether mp3 players, smartphones, or tablets, waiting for others to get the tech small/good enough for the mass market, then improving the product enough to make sure of that success, along with a bunch of brain-dead marketing that has been likened to a cult. But Apple is now the largest corporation in the world, so they are almost like a small govt in size. Will those who replaced Jobs be able to do more than project "the present trend forward and using the political process for their own gain?" I suspect not, that such change will actually come from all the startups out there, looking to put Apple out of business.
Apple is a transitional success story, where an integrated model helps ease the transition to mobile computing devices and online media, but what do you do when the transition is over? You inevitably fail hard when you actually have to rethink old broadcast models for the new technology, which is why podcasts or blogs are completely killing off radio and newspapers. All Apple does is help those old broadcast businesses get online, but they don't really bother to help the new podcast guys sell their product, largely because they know all the money is still in selling TV shows and movies. But that's a big mistake, which they will not be able to recover from, as podcasts and other online content will kill off the broadcast content in the coming years, and the only new device that they can help seed is the TV.
If you are worse off because you own one, then indeed it was a stupid thing to buy. Otherwise, you "need" it.
++++++++++//+++
Care to put that in a social context? If society is better off with a policy in place, then we need to have It?
Pretty arrogant of you to redefine my needs as anything that will make me better off, whether I want it or not. Wether I think it makes me better off or not
"Care to put that in a social context? If society is better off with a policy in place, then we need to have It?"
No. Who can decide if society is better off with a policy in place? Each individual can only judge for themselves, not for others.
"Pretty arrogant of you to redefine my needs as anything that will make me better off, whether I want it or not. Wether I think it makes me better off or not"
Au contraire! All such judgements are yours alone. No one else can make them for you. Obviously if you don't want something, and don't believe it would make you better off, then you don't need it.
You are all of a sudden Mr. soverign individual, with a right to self ownership, instead of Mr. collectivist! what's up with that? You are out of character.
My point was that most people seem to define something they need, as something that makes them better off. A meal when they are hungry, an iPhone when they realize how much easier it makes their lives, etc. I know of no instance of anyone asserting they needed a poke in the eye with a sharp stick, something we can assume wouldn't make them better off.
No one knew they needed an iPhone before any existed, so your claim that you would go look for one because you needed one is bogus.
If in fact you have the vision to imagine something like that, you might consider applying for the now vacant position of visionary at Apple, or start your own company. Something that's possible in a (relatively) free market economy such as we have in the US, but not possible in the centrally planned economy you prefer, as some bureaucrat would see no need for your idea, so it just wouldn't happen.
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