06.28.14 9:45 AM ET
Tim Cook’s Apple: Middling Products Designed to Pad the Bottom Line While Gouging Loyal Customers
At the beginning of The Godfather Part II, Senator Pat Geary, a seedy politician from Nevada whose greed is only matched by his affinity for prostitutes, attends the First Communion celebration for the son of Michael Corleone. He’s a fumbling mess and, after accepting a donation from the family, mispronounces their last name as “Cor-lee-ahn.” Moments later, he’s meeting with Michael in his office, trying to muscle him over a gaming license for a handful of casinos in the Senator’s home state. “I intend to squeeze you,” he says to the cosa nostre, and then insults their Italian heritage, labeling the mafiosos “oily-haired” and “dirty.” And before you can say “sleeping with the fishes” Sen. Geary, having spent the night with a prostitute at a brothel, wakes up from a blackout to find the bed covered in blood and the woman lying next to him dead. The Corleone family consigliere Tom Hagen suddenly materializes, and tells a shaken Geary that the incident will be taken care of. “All that will be left is our friendship,” Hagen tells him. In short: they have him right where they want him.
Apple Inc., the consumer electronics and computing behemoth, a multinational corporation with the highest market capitalization in the country—at $544.84 billion at time of writing—has us by the balls the same way.
Under the reign of product visionary Steve Jobs, the company seduced us for years with a plethora of finely-tuned, envelope-pushing products—the iMac, the iPod, the Macbook Air, the iPhone, the iPad, the list goes on. Shortly after his return to Apple in the late ‘90s, Jobs, a ruthless perfectionist, famously tossed away an earlier version of the revolutionary iPod because it wasn’t “sexy enough.” Under his stewardship, the company conditioned a generation of tech-reliant consumers to be all-in on Apple, heading to their sleekly-designed glass stores to satisfy any and all tech needs.
“He was brilliant. I mean, our Edison. He was our Picasso. He was an incredible inventor,” Oracle CEO Larry Ellison told Charlie Rose last year. But, when pressed about the future of Apple without their fearless (and feared) leader, the billionaire entrepreneur wasn’t so bullish. “We saw. We conducted the experiment. I mean, it’s been done,” said Ellison. “We saw Apple with Steve Jobs. We saw Apple without Steve Jobs. We saw Apple with Steve Jobs. Now, we’re gonna see Apple without Steve Jobs.”
Indeed, the Steve Jobs era, one that transformed Apple from Dell’s ugly stepchild into the premier destination for music, smartphones, laptops, you name it, has sadly come to a close. And the Tim Cook era, which unofficially began with the passing of Jobs one day after the announcement of the iPhone 4s, has thus far been marked by middling products designed to pad the company’s bottom line while gouging their loyal—and dependent—fanbase.
Apple’s recent $3 billion acquisition of Beats, which includes Beats Electronics, the makers of Beats headphones, speakers, and audio software, as well as the streaming music service Beats Music, should be cause for concern.
“Music is such an important part of all of our lives and holds a special place within our hearts at Apple,” said Tim Cook, Apple’s CEO, in a May 28 statement announcing the deal. “That’s why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world.”
The announcement of the deal, which is expected to close in Q4, mainly highlighted Beats’ “world-class subscription service,” which, they claimed, would complement iTunes to “make our music lineup even better. Little attention was paid to Beats’ pricey assemblage of headphones, which were sold in Apple Stores prior to the deal for around $200-300 a pop.
Apple’s emphasis on Beat’s streaming service struck many as odd, considering it only has 250,000 subscribers—compared to Spotify’s 10 million paying subscribers. That squatty number will no doubt improve given Apple’s whopping 800 million customers, but there seemed to be something else afoot here.
Back in 2012, when unveiling their iPhone 5—a lighter, albeit inferior product to the iPhone 4s in many of the major categories that matter to your average consumer (according to some reports, worse battery life, more prone to scratches, etc.)—Cook and Co. introduced a new data and power connector for this and future Apple devices. Dubbed “Lightning”—they even purchased the trademark for “Lightning” from Harley Davidson—the 8-pin power connector was far more compact than the 30-pin computer bus that preceded it, and could also be inserted with either side facing up.
But what it also did, which really riled consumers, was make the devices that were outfitted for this new dock connector incompatible with all other previous cables, unless you affixed an adapter. This built-in obsolescence, a staple of Cook’s Apple, meant that owners of pricey speakers or sounddocks would be forced to purchase clunky Lighting to 30-pin Adapters in order to make them compatible with future Apple devices—an add-on that’s just cumbersome enough to compel you to purchase their new wares. Also, for the everyday consumer, it meant that if your iPhone ran out of gas, you couldn’t, say, borrow your friend’s adapter to charge it if they owned a previous model.
Meanwhile, it was no secret that Apple had a headphone problem. Their EarPods, bargain-priced in-ear headphones, are brittle, and will effectively piss off everyone within a 10-foot radius on your train or subway car. And, the existing 3.5 mm headphone jack, or “TRS” connector, doesn’t exactly provide a gateway to high-quality sound. So, similar to Apple’s 30-pin to Lightning transition with the launch of the iPhone 5, the Apple-centric blog 9to5Mac reported that the company is planning to create headphones that connect to iOS devices using a Lightning connector instead of the “TRS.”
Now, there are some added benefits. “The Lightning headphones will be capable of receiving lossless stereo 48 kHz digital audio output from Apple devices and sending mono 48 kHz digital audio input,” said the report, adding, “The headphones will be able to draw power from an Apple device (even if the device is asleep), which for some products could eliminate cost associated with an internal battery. It could also work the other way around by providing power to an Apple device from an internal battery or external power source. That enables you to listen to music and also use a passthrough setup so you could charge the device simultaneously, much like you can with an audio dock that uses a Lightning connector. The headphones will also be capable of receiving firmware updates.”
The problem? You’d need a very expensive pair of studio-quality headphones (think: over $500) to register that 48 kHz pristine digital audio. But oh, there’s more. It stands to reason that Apple would no longer have any use for the standard headphone jack, and future iOS devices would thus be stripped of this and outfitted with a Lightning port. That could mean that any pair of non-Beats/Apple headphones would be rendered incompatible with Apple products without a clunky Lightning to 3.5mm jack adapter, which is just cumbersome enough to force you to toss your old headphones in favor of some Beats by Dre. To recap: this new development could mean that Apple would force everyone to purchase either a pair of Lightning-ready Beats/Apple headphones, or an adapter. And you’d be further bound to Apple’s ecosystem.
When contacted by The Daily Beast, a representative for Apple said, “We refuse to comment on any rumors or speculation about the company.”
This potential new, semi-shady development isn’t really anything new under Cook. Aside from the disappointing iPhone 5 and its new Lightning cable, which many users have claimed is vulnerable to breakage, one of Cook’s first big splashes as CEO came in June 2012, when Apple introduced iOS 6 featuring Apple Maps which was a total mess, to put it lightly. Although it did inspire this great New Yorker parody cover, courtesy of MAD magazine. In Oct. 2012, Cook fired Scott Forstall, Jobs’s longtime pal—he’d worked with him since 1992, when he joined NeXT—who’d served as SVP of iOS Software since 2007. Why? Because, like his mentor, Forstall was a bit of a jerk.
According to Michael Lopp, a former senior engineer at Apple, Forstall “was the best approximation of Steve Jobs that Apple had left” and “the only legit successor to Jobs.” Like Jobs, Forstall reportedly wasn’t easy to get along with and didn’t jibe with Cook’s new, harmonious atmosphere he was trying to instill at Apple. However, Apple’s ability to innovate “came from tension and disagreement,” claimed Lopp.
On Sept. 20, 2013, Apple launched two new iPhone models—the iPhone 5s and the iPhone 5c. Both models really didn’t add all that much to the equation.
“The 5s is the current iPhone 5—same size, shape, metal body and 4-inch Retina display—with upgraded internals and one terrific new feature. The iPhone 5c is to all intents and purposes the current iPhone 5 housed in a new plastic body,” reported Bloomberg.
What they did do, however, is subtract. SquareTrade, a provider of protection plans for gadgets, tested the new iPhone models and found that both the iPhone 5s and the iPhone 5c were less durable than the iPhone 5. The report confirmed my suspicions that the iPhone 5c, a cheaply affordable option ($99 with a 2-year plan), and offered in a variety of five tween-targeting candy colors—“fun colors of white, pink, yellow, blue, or green,” according to Apple’s website—were easier to break. There’ve also been some major gripes with the recent cheap Apple iMac, which Forbes dubbed a “rip-off,” and on the other side of things, conditions, it seems, haven’t really improved at the Apple factories in China, either.
Back in March, The New York Times, who’ve long suckled at the teat of Apple, ran an overwhelmingly positive puff piece on the success of the Cook era. It made hardly any mention of Apple’s post-Jobs products, instead relying on company numbers, e.g. that their “annual revenue has grown by about 58 percent, and its profits by about 40 percent,” and that “last holiday season, under Mr. Cook, analysts’ estimates put Apple’s share of smartphone profits at between 76 percent and 87 percent.”
But profits aren’t everything. Yes, the alternatives to Apple products aren’t there, and yes, we’re all hopelessly tied to Apple’s ecosystem. But Steve Jobs was a product guru, and the products that the company he co-founded are churning out these days would not pass muster with the master.