In: Economics
Develop and discuss with examples of the personal computer industry of apple/mac and windows where appropriate the various aspects that make up Michael Porter's structural analysis of an oligopoly for personal computer industry of apple/mac and windows industry.
Then Apple Computers Inc. was founded on April 1, 1976,in a garage by Steve Jobs and Steve Wozniak who were college drop-outs. The computing industry was in the early stages at that time and the two founders had a vision for improving the way people interacted with computers. By the time, computers were massive bulky devices and Jobs-Wozniak wanted to make computers a mass product so that it could be used readily by the general consumers. Instead Apple revolutionized the market with its graphical interface in colour. The company clocked in sales of US$7.8 million in 1978, which later swelled to US$117 million in 1980, the year Apple went public. Jobs deal with adobe, resulted in smooth sailing for Apple throughout the 1980s. The two companies together created Adobe Portable Document Format (PDF), which led to another iconic computer product, desktop publishing. Technological factors such as hardware product interoperability and online accessibility have brought about restructuring of the industry. Intense competition and the importance of intellectual property rights have played an instrumental role in the industry's growth. The computers and peripherals industry in the USA is considered to be one of the largest global markets. It includes giants like Apple (AAPL), EMC (EMC), Canon (CAJ), Western Digital (WDC), and HP (HPQ). The computers industry is highly dependent on technology thus it is very capital-intensive and has high degree of automated operations compared to other industries. Within this space, giants such as Apple take advantage of economies of scale and are profitable due to mass production and large share od customer purchasing power. On the other hand, smaller firms look for niche and produce specialty product with superior technology. In my opinion, Smart Phone industry is Oligopolistic in characteristics, with few dominant firms in the market. The bulk of market share is vested between Apple and Samsung, with Hawaii and Lenovo as close but niche competitors. In this regard, the level of market concentration is high.
Apple Inc. did not intend to cater a small target audience but
aimed at a larger population with target audience in multiple
segments. In this regard, Apple targeted vast group of consumers
incorporating home users, small and medium sized business users,
education sector and young generation population. Currently, Apple
Inc. focuses on designing, manufacturing, and marketing media and
mobile devices, digital portable music players and personal
computers. The company sells varied related services, software,
networking solutions, digital application, content and peripherals.
Products manufactured by the company include Mac, iPhone, iPod,
Apple TV, different varieties of professional and consumer
software, OSX and iOS operating systems, support and service
offerings, as well as various iCloud accessories. The company
manufactures and markets digital applications and content through
Mac App Store, App Stores, and iTunes Software. These products and
services are sold globally on the company's online stores, retail
stores, and direct selling through sales representatives. They also
sell through third party networks such as value added sellers,
retailers and wholesalers. ecently, Apple Inc. acquired a new Chomp
search engine. Apple Inc., has shown through the consecutive series
of innovations in the smartphone, MP3 and tablet markets that their
propensity to create profitable business models is now a core
competency. Although investors and analysts are debating
about what is the crucial driver to their achievements, almost
everyone agrees about the opportunity to produce goods that offer
outstanding consumer interactions (Brown, 2011). However, Apple has
long been among the most integrated companies in Silicon Valley's
network of businessmen and engineers. Samsung, Google, and
Microsoft are the three predominant competitors for Apple Inc.
These giant firms are fundamentally auspicious in making Apple Inc.
lose its market share. They are utilizing price competition
methodologies and more current and quick line
expansions. The competition is particularly intense due
to existing players and the emergence of replacements, which are
capable of snatching ten percent of the overall industry's market
share (Melnyk & Narasimhan, 2010). The reason for such strong
replacement competition is the clients' low swapping expenses. It
is because they will switch from one brand name to the next
easily.
Apple's most important activities are product development and
marketing. The company develops its products at its California
headquarters. The development process is highly secretive, but it
also contributes strongly to the company's differentiation
(Lowensohn, 2012). The products are developed individually to
appeal to consumers on a number of different levels. Slick design
is important to the success of the products, as Apple aims to have
superior aesthetic value to its competitors. Apple is considered
one of the best companies globally at using a product lifecycle
management (PLM) based approach to planning and executing new
products, often leading to new patents being created in the process
(Tariq, Ishrat, Khan, 2011). This first strategy concentrates on
understanding just what is required from the new product teams in
terms of support and services, then aligning hiring plans
accordingly to ensure the highest possible level of performance to
hiring and recruitment goals.
A second strategy that the company can rely on to effectively plan
H esources is to develop a series of check points throughout the
hiring process to ensure the needs being evaluated with potential
employees accurately align with the broader needs of the company as
well. Apple's primary business is in consumer electronics. The
company's core businesses are in personal computers, mp3 players,
smartphones and electronic media. Apple's leading products include
the Mac line of computers, the iPod, the iPhone and the iPad tablet
computer. The company's media properties include the iTunes music
store and the iPhone App Store. Apple's goal is not making money,
claims Sir Jonathan Ive - Apple's head of design. For a mega
company that is worth a reported $539 billion, this might pass as a
frivolous statement and Ive admits this. However, he asserts that
his sentiments are true and factual. Ive clarifies that their goal
is producing excellent products. These statements were made at the
British Embassy's Creative Summit and were reported by The
Telegraph. He stated that in being successful at this goal,
consumers like the products Apple produces and when the company
operates efficiently then revenue will definitely follow.
so, there are the most of reason make apple different from others .