Fifteen years later, Apple has a hugely profitable business model to defend — and a lot to lose. Companies change when that happens. “The business model becomes a gilded cage, and management won’t do anything to challenge it, while doing everything they can to protect it,” says Larry Keeley, an innovation strategist at Doblin, a consulting firm.
It happens in every industry, but it is especially easy to see in technology because things move so quickly. It was less than 15 years ago that Microsoft appeared to be invincible. But once its Windows operating system and Office applications became giant moneymakers, Microsoft’s entire strategy became geared toward protecting its two cash cows. It ruthlessly used its Windows platform to promote its own products at the expense of rivals. (The Microsoft antitrust trial took dead aim at that behavior.) Although Microsoft still makes billions, its new products are mainly “me-too” versions of innovations made by other companies.
Now it is Apple’s turn to be king of the hill — and, not surprisingly, it has begun to behave in a very similar fashion. You can see it in the patent litigation against Samsung, a costly and counterproductive exercise that has nothing to do with innovation and everything to do with protecting its turf.
And you can see it in the decision to replace Google’s map application. Once an ally, Google is now a rival, and the thought of allowing Google to promote its maps on Apple’s platform had become anathema. More to the point, Apple wants to force its customers to use its own products, even when they are not as good as those from rivals. Once companies start acting that way, they become vulnerable to newer, nimbler competitors that are trying to create something new, instead of milking the old. Just ask BlackBerry, which once reigned supreme in the smartphone market but is now roadkill for Apple and Samsung.
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