Apple Avoids Competition
Saturday, August 23, 1997 by Dave Winer.
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A sports story
Hey, even if you don't use a Macintosh, you can enjoy a good sports story, right? OK. Two sports, baseball and football. For many years baseball was the big one. If you were a young man, dreaming of fame and glory, you'd think of great outfield catches; a big late-inning home run; or maybe pitching a no hitter, or being part of a triple play.
Along comes football, and even though it doesn't put baseball out of business, it does change the rules. What once was the national pasttime, is now the old sport, replaced by the flashier sport, football, that's also better designed for TV.
So what does baseball do? If Steve Jobs, the owner of one of the teams, were also the chairman of the board of baseball, he'd make a new rule -- only my team can play! And then he'd buy out all the other teams. (Would they get a good price?)
Would it be good for baseball? Hmmm. And then, who would his team play against? It's a no-win. No baseball fan would stand for it, and neither should any Mac fan. What a crazy idea!
Apple avoids competition
If you look at the history of Apple, you'll see that instead of rising to competition, they often ignore it, or try to use legal means, or bundling clout, to erase it.
When challenged by a larger market force, as with the IBM PC and its clones in the early 80s, and with Windows 3.0, 95 and then NT 4.0 in the 90s, they miss obvious marketing opportunities, ways to make their products stronger by participating in markets that others develop. This is an art that Microsoft has mastered, there's no reason Apple couldn't have learned the same lessons, but they didn't.
And when dealing with smaller competitors, Apple routinely and often unconsciously forced them out of business by bundling, or declaring that they will bundle a competitive offering.
When the Internet happened, Apple struggled against it instead of embracing it, preferring to invest in technologies that eventually ended up on the scrap heap. A wasted lead in content development, developers going to Windows, a poor Java implementation on the Mac.
The bottom line, the strategy of avoiding competition has been disastrous for Apple. But they want to do it again.
The same old strategy
The cloners, Motorola, Power Computing, UMAX, IBM and others, are poised to ship products that would take Apple out of the hardware business, because they're cheaper, faster, bigger, more powerful machines than Apple's new products. These are the computers that Mac users want and are, in my opinion, entitled to.
Even though we haven't seen the license agreements with the cloners, it appears that Apple has the contractual right to forbid them to ship the computers, for any reason at all. Apple wants to keep their hardware business, so they exercise that right.
I despise companies that use hardball tactics to put their competitors out of business. I admire companies that rise to competition. I happily buy new products when I have a choice. I don't like to buy products that I'm forced to buy.
Is it a nice business?
If you don't have anyone to compare with, if you aren't subject to customer choice, your product loses direction, you focus inward, and eventually (as now for Apple) your interests become out of synch with the interests of your customers.
Focus on that for a moment. A company whose interests are against their customers. Is that a nice business? Does it have much of a future? Hmmm.
Is it legal?
The customer's interest here is clearly served by competition. The usual benefits apply -- lower prices, more realistic configurations, more diversity.
Apple's complaint that the cloners weren't growing the market can be explained by Apple's licensing policy that kept them from making fundamentally different products than Apple.
Where's the cheap sub-notebook Mac? Where's the handheld Mac? The Mac built into the dashboard of my car? Apple wouldn't let the cloners make these products.
Apple is an economic disaster area. They want Mac users to put all their eggs in Apple's crumbling basket.
Do we have any rights as consumers here?
Why isn't the government looking at this closely?