immensely in popularity from 2007 when smartphones represented a mere 10% of all mobile phone sales, when in 2012 Apple had achieved a whopping 6.9% plus of all mobile phone sales. With the growing popularity in smartphones, industry competition grew more intense focused mainly on improving operating systems such as: iPhone (iOS), Samsung (Google’s Android), Nokia (WIndows OS), and Blackberry (RIM). It is expected that Android devices will continue to capture the majority of market share through 2016. One market Apple appears to have a great deal of control over is the tablet market. In April 2010, Apple released the iPad. The iPad later became very popular in the business, education, and entertainment industries because its “features like the sleek design, touch screen, multiple apps, and fast and easy-to-navigate software”. Apple is beginning to see a drop in its percentage of tablet computer sales, citing a drop from 95% in 2010 to 78.9% in 2012 largely due to the entry of competitors such as: Samsung Galaxy, Google Nexus, Amazon Kindle Fire HD, and Microsoft Windows 8 surface tablet. Apple continues to dominate the online media sales industries through the creation of iTunes and The App Store. These softwares allow third party developers to create and sell music, videos, games and other applications with millions of users worldwide with great ease. In 2013 Apple reported a total of 435 million iTunes accounts stored in its database. Slowly Apple is beginning to lose market share in this industry as Google Play continues to attract more top tier talent developers and quality titles to its marketplace. The next force is the threat of new entrants into the market place. This threat appears to be relatively low due to the large amount of capital required to establish a company with quality brand recognition in any of Apple’s core industries. Additionally it requires a great deal of capital to rival the level of research and development by current industry leaders. Since its inception
Apple has been known for spending a lot of money on R&D. In the 1990s when John Sculley was CEO Apple spent 9% of sales on R&D, 4% more than its closest competitor. Nowadays Apple’s R&D expenses are only outdone by those of Microsoft, Google, Hewlett-Packard, and Amazon. Another major key to Apple’s success is their great deal of bargaining power over their suppliers. Apple is known for entering multi-year agreements with suppliers for key components. Historically Apple has been known for having the highest profit margins in the industry largely due to their simpler products, which require lower manufacturing costs and ease of outsourcing.
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- Fall '11
- Management, Personal computer, release of Apple II