So Apple has come out with new iPhones—the 5S and the 5C. Reviews have been lackluster. We’re bored.
“Elvis has left the building and the magic’s gone out of the smartphone business, leaving companies and their advocates to argue about slightly faster processors, more megapixels, or slightly improved battery life,” writes Charles Cooper of CNET News. “That’s progress, but it’s the equivalent of three yards and a cloud of dust.”
The problem is that a lot can happen in six years. “When Apple came out with the original iPhone in 2007, that was the real game-changer,” Cooper recalls. “Before then, the phone carriers were able to dangle access to their networks to dictate what got built into handsets and how much the devices would cost. Handset makers complied or they got frozen out. The result: crappy phones.”
Now the journey is over. “Smartphones, which are so baked into our lives, belong to a maturing industry, which means that it’s going to get harder and harder for any company—Apple, Samsung, or any other would-be challenger—to make a splash,” Cooper predicts. He hopes Apple has a new game-changer on the way, “because the status quo is boring me to tears.”
In Management Challenges for the 21st Century, Peter Drucker laid out three phases of industry: A growth industry is one “in which the demand for its products, whether goods or services, grows faster than national income and/or population.” A “mature industry” is one “in which the demand for its products or services grows as fast as national income and/or population.” And a “declining industry” is one “in which the demand for its products or services grows less fast than national income and/or population.”
If Cooper’s analysis is correct, then Apple with its iPhone is in a delicate transition — and that demands a change of approach. A growth industry, wrote Drucker, “needs to take the lead in innovation and needs to be willing to take risks.” But a “mature industry needs to be managed to have a leadership position in a few, a very few, but crucial areas, and especially in areas where the demand can be satisfied at substantially lower cost by advanced technology or advanced quality.”
That said, it has to stay nimble. “A mature industry shifts from one way of satisfying wants to another,” Drucker wrote. “A mature industry therefore needs to be managed for alliances, partnerships and joint ventures to adapt rapidly to such shifts.” Either that, or cough up that iWatch already.
How do you think Apple should be handling its iPhone development differently, if at all?