A number of articles -- notably
this one from Don Reisinger of Arstechnica -- have recently suggested that Apple could gain significant OS market share by licensing to third-party suppliers. That idea probably gives Steve Jobs nightmares. Here are 5 reasons why Apple should not do it.
Reason 1. Apple is a successful hardware company. Yes, it is also a software company, and its users do go on about its ease-of-use and cleverness. But most of Apple's hardcore customer base is as much in love with the look and feel of the product as the software on it. And this is where their profit base lies.
Reason 2. Apple is not a strong enough software company to compete with everyone. The software world is hugely competitive, with the really big players, Microsoft, Google, and to some extent Adobe, locked in battle. Mac's only potential killer app is the OS, which may be threatened in the foreseeable future by a combination of e.g. Ubuntu and Chrome (see Reason 5). Competing with everybody – Adobe (Flash, Macromedia etc.), Google (iGoogle, Google Apps, Chrome, Android etc.), Sun (OpenOffice etc.), Mozilla (Firefox etc.), not to mention MS itself, is not a viable option. Partnership is the word.
Reason 3. Apple can't beat Microsoft. The reason Microsoft can maintain sufficient stamina on all these fronts (Office, IE, SQLServer, .net, Silverlight...) is vast revenues from licensing for consumer and business OSs. Not only is Windows on the majority of PCs shipped, but the Office suite, too. That also gives Microsoft a lot of leverage in the market, and a lot of power over distributors and partners. When Michael Dell said he was keen on
getting the Mac OS on Dell PCs, was he thinking about really big increases in sales, or just enough to pressurize Microsoft into a better deal? He is not, after all, known as a friend to Apple.
Reason 4. Been there, done that, nearly went out of business. Apple tried it in the mid-90's with Power Computing, Motorola and others. Where Microsoft has cash, Mac has huge brand loyalty, and that it what kept the company afloat. Buying a cloned Mac looked like getting a second-rate product, and in a way that was true (not always, though -- some of the Macs of the time were fairly poor). Certainly, Mac users are likely to think of a Mac clone as second rate, which will put pressure on the price -- and users who are bargain-hunting are not likely to appreciate the Mac's smaller and more expensive range of available software. But the big danger is that it dilutes the brand.
Reason 5. Apple can play the same niche in different market segments. Apple customers are consciously buying a premium product with a cool design. Long-term, Android could power a far larger market share than iPhone apps. And a stylish, user-friendly laptop running Ubuntu -- perhaps with Chrome offering great ease of use and
finally delivering the promise of Google Apps -- could significantly affect sales of MacBooks. But the niche, and the hard core of Mac fans will remain, because of the styling, the "vision", and the sense of exclusivity. If anything it is probably better to think of Mac as an electronic communication and lifestyle company, as clearly implied in the "Your Life, To Go” tag. Getting embroiled in software wars detracts from this message.
Perhaps the best way to summarize the argument is to say that Apple's whole strategy has been built around being the "better alternative". They have almost written the book on how to be a successful number two in the marketplace -- take a developing market, work in stealth to provide features that the other manufacturers aren’t quite delivering, go in high with undeniably cool products and then build market share. As long as networkable consumer products exist, Apple should be able to find these niches. But not as a software company.
