Apple

Overview

Apple Inc. was founded in 1976 by Steven Wozniak and Steve Jobs. The company offers Personal Computer Hardware, Software and other non-computer product. Apple managed its business largely on a geographic basis, its primary geographic segments are North America and South America, Europe, Africa, the Middle East, and Japan.

• In 1979-1983 the top executives had major difficulties working with each other which resulted to Steve Jobs resignation in the company

• In 1996 Apple Inc. decided to acquire NeXT, the company Steve Jobs had founded upon his resignation and in addition they will also get the service of Steve Jobs again

• In 1997 Apple begin selling its product directly to consumers over the web and by phone

• Since 2002, Apple had determined that the digital electronics market was converging with the computer market and that consumers would begin to demand more synchronization and harmony between the two

• In 2007 the first version of iPhone was released

• Net Sales from 2003-2007 has an increase trending (See Exhibit 1 and Exhibit 2)

Porter's 5 Forces Analysis for Apple Inc. Products

• Current Rivalry (Very Intense). Apple faces stiff competition on their counterpart companies

• Potential New Entrants (Low): In this type of industry possible new entrants would be reluctant because it needs big amount of investment to form a new one; however, some well-funded competitors made significant investments to enter the digital media distribution channel

• Bargaining Power of Suppliers (Low): There are few suppliers when comes to Operating Systems and microprocessors but in terms of memory chips , keyboards and disk drives suppliers can adjust their pricing and quality to make their product attractive to costumers.

• Bargaining Power of Consumers (High): Switching cost are low. This situation puts the buyer power in a strong position that can only be countered by Apple with strong product differentiation

• Threat of Substitute Products (Very High). Since Apple is offering premium pricing on their products, there is a strong threat on substitute products.

(See Exhibit 3 for Porter's 5 forces Analysis)

Company Mission

The Company mission is to bring to its customers around the world compelling new products and solutions with superior ease-of-use, seamless integration, and innovative industrial design.

Most of the actions Apple had taken over its history were consistent with its underlying philosophy on innovation. Apple leverages its ability, through the design and development of its own operating system, hardware, and many software applications and technologies.

Internal / External Analysis

Strengths

• Attractive Designs, Easy to use, user friendly

• Strong Brand Name and Quality Products

• Strong, reliable eco-system (OS)

• Product integrations