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This seems like a weird market for Apple to be pursuing because they’re such a consumer oriented company, but it seems likely that the future of transportation
by Tiktaalik 11y ago
This seems like a weird market for Apple to be pursuing because they’re such a consumer oriented company, but it seems likely that the future of transportation will be less oriented around individual car ownership.
Additionally there’s a good argument to be made that we hit “peak car” several years ago, so consumer oriented automobiles may not be a real growth industry.
I’d seriously question any business plan that assumes that the transportation mode share of cars, especially individually owned cars, will be greater than it is now.
Maybe I’m thinking too long term here.
- blazespin 11y agoNot at all. By the time Apple gets any traction, this indeed may be the reality. That being said, people will always want to travel in style, whether they own the car or not. Think black car versus beaten up taxi. Apple wants to be the luxury brand intersected with technology. Who else does that as well as they do? Also, as per below, Apple's model of making things which can't be serviced by the owner fits the idea of no ownership. Finally, this new business model is going to obliterate all the old car makers that can't evolve fast enough. When significant disruption vectors clearly exist that can only be leveraged by the extremely well capitalized... well, this is really a no brainer for Apple. The only really question is, can Tim Cook create the tech? Google is struggling with it and they are by far the most skillful at AI. In the end though, we'll all be better off with Apple in the race than out of it.
- Tiktaalik 11y agoApple is getting more into services with Apple Music, so maybe Apple Car as an automated car service isn't so unreasonable.
- untog 11y agoApple wants to be the luxury brand intersected with technology. Who else does that as well as they do? Honestly, in terms of car manufacturers, I think there are a lot who do luxury better than Apple. Agreed their technology intersection isn't so great, but I'd rather own a BMW outfitted with Apple software than an Apple car.
- weinzierl 11y agoMaybe the Apple car will be a BMW outfitted with Apple software. Tim Cook visited BMW premises last year, allegedly there has been at least another visit from an Apple delegation since then.
- seiji 11y agoin terms of car manufacturers, I think there are a lot who do luxury better than Apple. What does that even mean? Are you from the future?
- untog 11y agoApple has a brand. I can imagine that brand applied to a car.
- kevinchen 11y agoI think that sounds like a good idea, but in practice it's not a product you'd want. Motorola used to be at the cutting edge of phones (e.g. Razr) but when Apple slapped their software onto a Motorola phone, it was a terrible product (Rokr).
- SEJeff 11y agoYou know, the same can be said for Tesla, which has a massive headstart in disrupting the car market. The main difference, is that Apple has much MUCH deeper pockets to draw from.
- bwilliams18 11y agoI'm still confused as to why Apple hasn't considered purchasing Tesla.
- freehunter 11y agoMaybe they have and Elon won't sell.
- robszumski 11y agoI'm sure this must have come up, but the two companies have pretty different manufacturing styles, and integrating them could kill the momentum needed to pull this off. Unless Apple is willing to use Tesla's US operations for version 1 and re-evaluate after that.
- SEJeff 11y agoMy take would be that Musk simply wouldn't sell. We know that they have spoken, and that Apple is an investor in the Gigafactory, so regardless, they'll be paying Tesla for iDevice batteries in the long run. Competing against them on a car is a really interesting play though. Not sure what to make of it just yet.
- ZeroGravitas 11y agoFor a long time I thought the Apple va Android rivalry was invented by the two companies so that all the press would be about them, rather than Microsoft being given the default position as the incumbent. I think I was overestimating them, but once again think that's a feasible strategy, Tesla vs Apple fanbois arguing on the internet could be the best thing to ever happen to all-electric vehicles, and leave petrol and hybrid cars looking archaic, rather than the current paradigm where its Tesla vs the old industry.
- TheOtherHobbes 11y agoI don't think Tim Cook can create the tech. Tim Cook can't even keep apps made with hacked versions of Xcode out of the app store. He can't keep obvious, infuriating bugs out of iOS or OS X. (I found a few within hours of downloading the public release.) A self-driving car would be - to mix a metaphor - a legal minefield, and would demand a level of corporate and personal responsibility and reliability that only a handful of organisations, most in med or aerospace, have ever been able to approach. As a project it's almost literally a moon shot, and a very risky one because industrial car making is a difficult industry with problematic tooling, logistics, and distribution, and very high capital costs. I think Musk is in with a better chance, because he's a careful, thoughtful, engineer. At Apple, engineering has always had trailed slightly behind branding and design, and the gap seems to be widening. That doesn't bode well, because a project like this needs world-leading engineering before everything else. Design and marketing are worthless if the product isn't seven or eight-nines reliable and better than human.
- seiji 11y agoReminder: companies aren't just the CEO. As a project it's almost literally a moon shot, Not even close. Tesla exists. They built a new car infrastructure from nothing. Apple can steal their senior engineers all day long. if the product isn't seven or eight-nines reliable and better than human. People are influenced by style and sex appeal, not so much data sheets. Nobody even knows how much memory ships in Apple iOS devices; it's not a performance game—it's a mindshare game.
- euyyn 11y agoBut he's not talking about the performance of the car, rather its reliability. And an unreliable car is flagged as such pretty soon.
- blazespin 11y agoI agree, I have concern about Apple's technical chops. That being said, they are masters of the aquihire. Also - you have to separate electric car versus self driving car. I think electric car is pretty easy to do (relatively speaking), but I don't think it's a particularly exciting business to get into. Way too low margin and you're fighting against an establishment that will getting into the electric car biz as well. And I agree with comments above, that they all probably do better than Apple. Whereas self driving cars, done right, will be extremely high margin. It will revolutionize the world and change everything - much like the PC and Smartphone did. I think self driving cars have the potential to be iPhone versus Android all over again. Apple does the high end luxury market, and Google does the race to bottom, solution for the proletariat market.
- seiji 11y agothey are by far the most skillful at AI. I'd submit they are the best at getting people to believe they are the best, but are they _actually_ the best? Assumes facts not in evidence.
- euyyn 11y agoWhat services backed by A.I. would contend with Google's?
- bengali3 11y agoTesla tried to snag Ive.. Apple retained him... I have to believe (car guy) Ive gets what he wants at Apple? edit: Which would hurt the stock (ie Cook's #1 goal) more in the short term? Announcing a car in 2019 or announcing Ive leaving in 2015? I'm thinking was part of an earlier deal to keep Ive.
- interlocutor 11y agoJony Ive was "promoted" to Chief Design Officer a while ago. I say "promoted" with quotes because many people believe he was moved to a position where he can do less damage. Jony is no longer in control of Industrial Design or User Interface Design at Apple. Those disciplines now have new heads: Richard Howarth and Alan Dye and they don't report to Ive. So to answer to your question, Jony leaving Apple will have zero impact.
- calvin_c 11y agoI think there is a public image component to Ive as well. The image of Jobs' era at Apple is Ive and him running the show. As great as Tim Cook is doing in the CEO position, Ive is still seen by many as the remaining influence of Jobs. Regardless of his day to day responsibilities having him at Apple in some design role allows them to keep that perception. If he were to leave I think it will have a very negative impact on stock.
- Caprinicus 11y agoWhat damage did they think Ive was going to do?
- interlocutor 11y agoGood question, Caprinicus. The answer is, the kind of damage Jony has done since Steve Jobs' passing. Let's consider Jony's performance on software design first. This is what some prominent people have said about iOS 7: The Verge wrote in their review: "iOS 7 isn't harder to use, just less obvious. That's a momentous change: iOS used to be so obvious." In iOS 7 basic usability features such as making buttons look like buttons are now stuffed under Accessibility options. About this, Tumblr co-founder Marco Arment wrote: "If iOS 8 can’t remove any of these options, it's a design failure." (And iOS 8 hasn't.) Michael Heilemann, Interface Director at Squarespace wrote, "when I look at [iOS 7 beta] I see anti-patterns and basic mistakes that should have been caught on the whiteboard before anyone even began thinking about coding it." And famed blogger John Gruber said this about iOS 7: "my guess is that [Steve Jobs] would not have supported this direction." And what about Jony's other responsibility in the last few years, industrial design? The iPod, iPhone, iPad, MacBook Air and other Apple products are all amazingly well designed and breathtakingly beautiful. But these products weren't designed by Jony Ive all by himself. He designed them under Steve Jobs's guidance and direction. Steve was the tastemaker. Apple's post-Steve products are nowhere near as well-designed. Consider iPhone 5c, for example. The colors are horrid, and when you add those Crocs-like cases it looks more like a Fisher-Price toy than like a device an executive would want to be seen holding. Then they released some ads for the 5c, and I kid you not, one of the ads had sounds of bleating farm animals. (It was titled "Every color has a story", published on tumblr.) That the 5c didn't do well in the market shouldn't surprise anyone.
- jkestner 11y agoI had similar thoughts, but there's still plenty of low-hanging fruit for Apple to snap up human-driven car marketshare even if it isn't a growing market. By the time they might plateau, they'll have experience under their belt as they adjust to a fleet model. And Apple is not purely consumer-oriented, of course. If they can work with IBM, they can work with any company that wants a fleet.
- sandworm101 11y ago>This seems like a weird market for Apple to be pursuing because they’re such a consumer oriented company, but it seems likely that the future of transportation will be less oriented around individual car ownership. Apple is a company that wants to make money. They'd go into turkey farming if they thought they could make more money there than in phones. If individual ownership is on the out (it isn't imho and that is a totally separate question from driverless tech) then apple wants to be the company that owns/leases/copyrights/patents the cars, the software and absolutely everything else. Dominance of specific markets is apple's game. There is a synergy between apple's customer base and driveless tech. Apple owners are generally early adopters with cash to spend on fashion items. As with any new tech, the first few iterations of any driverless car scheme will be short-lived and expensive. Apple knows that its fashion-chasing users will be all over these things. Requiring "drivers" to control cars via iPhones would just be gravy.
- blazespin 11y ago> They'd go into turkey farming if they thought they could make more money there than in phones. They'd return all their cash to their investors before they did that.
- abalone 11y agoYou're misunderstanding Apple's strategy. There's a good argument we hit "peak PC" several years ago, and yet the Mac business has been steadily growing.
- petra 11y agoFirst ,even if individual car ownership would be dead , Apple can still sell premium car subscriptions offering some social status. Second, Apple could lead the half-automated cars market(using Siri, see my comment down) and use it as a base of cars that would build Apple some self-driving brand, could be upgraded to full self driving gradually, or could be used to collect data to train full self driving.
- Sven7 11y agoAuto is a marketing game. The words used to sell the same BMW in the West are different, from the words used to sell it in Asia. And Apple, all said an done is the worlds best marketing company. Cant wait for Jony Ive's superficial bullshit to go where its never gone before.
- MattRogish 11y agoSo, here's my take on the Uber-ification of cars: 1) Cars have a useful lifespan far longer than the car loan payment. This will continue to favor private car ownership until the maintenance and upkeep costs outweigh the marginal cost of calling an Uber (or whatever we'll have in the future). I'm not sure when that point will hit, or if it ever will. Electric cars are very low maintenance (battery packs are expensive, but that is fixable). 2) Cars have a significant delta between the high end and low end. You can easily see several hundred-thousand dollar cars driving on urban streets. They're a status/luxury symbol, and aspirational for a large number of people. 3) Cars-on-demand will, for some people, never replace the comfort of having a vehicle waiting for them in their garage/driveway. For the same reason hot desk-ing never caught on, it's nice to have a "home" where you can leave your usual creature comforts when on the road. I don't currently have a car (or car commute), but if I did, I can imagine it being a bit discomforting to have an unusual set of surroundings, lack of creature comforts (my gum in the cupholder, tissues in the center console, my phone already hooked up to bluetooth, etc.). 4) Busses, even if self-driving, are not going to replace dedicated vehicles (see the group shuttles from airports as to why). It feels like the car as a status and convenience symbol is here to stay for the foreseeable future (certainly our lifetimes). And making cars for upper-middle/upper class folks is very profitable. Sure, Apple wouldn't make a $5000 car no more than they'd make a $50 mobile. But a $40k-100k car? I think they could hit that one out of the park.
- blazespin 11y agoGarage / driveway? What's that? Hum. Clearly you don't live in a densely populated city, where, you know .. the vast % of the population does and is migrating to. I think if you lived in a condo, and there was always a queue of Apple luxury vehicles waiting at the bottom of the elevator, you'd be good to go. The reason this hasn't taken off before is because people are bad drivers. Borrowed cars get very roughly treated. Also, try parking in a big city. It's insane. Much better to just get dropped off.
- emp 11y agoI think there will always be a place for individual car ownership, mainly because of morons. I am a member of a car coop which has 400 or so cars in its pool. When it was a lot smaller it was great. Most people were the kind who do things differently. The cars were left clean with seats returned to normal positions. Now that the coop has grown, I find partly emptied soda cups in the cup holders, seats left in cargo configurations, dirt tracked in with no effort to clean up, dogs in allergen free cars, etc. Masses ruin special things - they are not part of the initial culture. Also costs have risen to the point where I am dusting off my almost 20 year old car (which incidentally feels just as current as the newer coop cars, except for the electric ones which feel like I am driving in the future).
- erikpukinskis 11y agoYou're basically saying "I've seen it fail so it's impossible" which seems shortsighted to me. Do you really believe soda cans and dirt are an insurmountable problem for car sharing?