Download - A is for iCar
Apple has too much money. I believe that our best creativity comes from constraint. When we’ve accumulated more than enough of any resource, two things happen:
1)We get more cautious. (We have more to lose.)
2)We have a harder time making decisions. (When we can do anything, it’s hard to know which things to do.)
How much is too much?
See, Apple exists to change the world.
Because the ones who are crazy enough to think that they can change the world, are the ones who do.
- Steve Jobs (1955-2011)
That’s Apple’s DNA.
This was never “just another PC.”
Nor was this.
This was never “just another MP4 player.”
This was never “just another phone.”
This was never “just another tablet.”
What’s behind the rumors?
It sure feels like there’s something here…
Reports
emerged this
week… an
electric car…
Apple’s plans
are unclear
and
unconfirmed
… a few
hundred
people to
work…
And now
there is
speculation
that the
company
is working
on a car…
surely be
designed in
the famous
studio where
Ive and his
colleagues
work.
Autos have
become the latest
obsession for
Silicon Valley,
with Apple
assigning about
200 people to
work on an
electric vehicle
technology…
Investors have long dreamed of Apple acquiring Tesla Motors, given the disruptive characteristics and cultural similarities between the two companies.
Apple designs. Apple is the greatest product design and business design* company in industrial history.
*This part tends to be forgotten in all our excitement about the toys, but it is the real reason Apple continually surprises the skeptics.
Apple makes manufacturing happen. A huge part of Apple’s success is the company’s ability to effectively outsource high-quality manufacturing.
Apple kicks ‘supply chain’. Nobody is better than Apple at integrating every step of the industrial process, from beginning to end. Apple delivers exactly what it says it is going to deliver exactly when it says it will.
Apple markets. No company has ever established the cult-like connection with customers that Apple has. Calling what Apple does “marketing” is like calling the Pacific Ocean a ‘big puddle.’
Laaaa! Laaaa!
Apple makes markets. Speaking of oceans, Apple excels at finding blue oceans* that other companies – other industries, actually – seem to miss. *Blue Ocean is the business-speak term for an untapped new growth opportunity.
The auto guys seem clueless.
“If there were a rumor that Mercedes planned to start building smartphones, then Apple would not be sleepless at night. And the same applies to me.”
- Dieter Zetsche, Chairman Daimler AG *and former CEO Daimler-Chrysler. (And who just lost his head of North
American R&D to… Apple.)
“We take steel, raw steel, and turn it into car. They have no idea what they're getting into if they get into that.”
-Dan Akerson, former CEO
General Motors
“Absolutely silly.”
- Praveen Narayanan, automotive research
manager at Frost & Sullivan
The auto guys are right, but in the wrong way.
Detroit says, “Cars are about bending metal & that's hard.”
Sure, but that assumes a 100 year old business model.
A better way to think outside that iron box is to ask a few questions…
Q: What is the Amazon of taxis? A: Uber Q: What is the iTunes of commuting? A: Zip car Don't ask, ‘How heavy is iron?’ Ask, ‘What is purpose of a car?’
If the purpose of a car is to get me from A-to-B with convenience, comfort and style, then car ownership is the business to disrupt. I suspect that’s the business Apple is thinking about. (Yes, as a car-guy, I totally get that I need to own. But I used to say that about movies and music too.)
This rings a bell. “There's no chance that the iPhone is going to get any significant market share. No chance.”
- Steve Ballmer, 2007
“It’s a nice reader, but there’s nothing on the iPad I look at and say, ‘Oh, I wish Microsoft had done it.”
- Bill Gates, 2010
Here’s a word: Tesla.
Okay, it won’t be profitable until 2020, but come on, Detroit – take a hint!
• A Silicon Valley start-up.
• No previous auto manufacturing experience.
• Breakthrough technology.
• All electric. • Beautiful design. • People with
money want it.
A rectangle with round corners. “Well, circles and ovals are good, but how about drawing rectangles with rounded corners? Rectangles with rounded corners are everywhere!”
- Steve Jobs
“The project is codenamed ‘Titan,’ and it ‘resembles a minivan.’”
- The Wall Street Journal, Feb 13, 2015
I predict the Titan will be a cubic, 4-door minivan with lots of glass.
I think Titan will look like…
Dan Roam
With typical Apple polish, this elemental design could be beautiful.
It’s an iPhone on wheels!
Dan Roam
It’s a simple riff on this successful theme:
Why not? They are all rounded cubes – and are the bestselling cars among hipsters…
The key will be the business model. Those who know technology know that the products Apple makes aren’t really the key to their success.
What has been more critical is Apple’s ability to use their products to redefine entire businesses.
Whether music and movie licensing and distribution, the creation of the app universe, or redefining publishing, Apple makes most of its money by making those new markets.
Apple products create new industries. This thing changed graphic design, which in turn changed printing, which changed publishing, which in time created a new industry called “interaction design.”
This thing changed album-oriented music by offering on-demand singles, which changed how music is produced, which changed how music is licensed, which changed how music is sold.
This thing changed software development by offering an online app market, which changed how software is created, which changed how tech companies attract investors, which changed how capital flows in the tech sector.
I’d expect the same thing from iCar.
When the Detroit CEOs and experts say, “Cars are about bending iron and that’s hard,” they’re right.
But they miss the point.
Apple isn’t interested in bending iron;
Apple is interested in distorting reality.
2020 vision required.
What AirBnb is doing to Marriott.
What will Apple’s iCar do to Detroit, Stuttgart, and Toyota City?
What Uber is doing to Yellow.
What Amazon did to Borders.
What iTunes did to Tower Records.
What Starbucks did to every café in the world.
Dan Roam is a car nut, a computer nut, and a design nut. He also writes picture books for businesspeople.
www.danroam.com
Sources • Bloomberg Business, Nov. 25, 2014. “Apple Tops
700 Billion…” by Tim Higgins, Joseph Ciolli, Callie Bost
• The New Yorker, Feb. 23, 2015. “The Shape of Things to Come.” by Ian Parker.
• The New Yorker online, Feb. 24, 2015. “Could Jony Ive Pull off and Apple Car?” by John Cassidy.
• Business Insider, Aug 4, 2014. “Tim Cook Will Have to Prove Himself…” by Steve Kovach.
• The Economist, Feb. 21, 2015. “Upsetting the Apple Car.”
• Marketplace Radio, Feb. 20, 2015. “Will Apple Put the Pedal to the Metal?” by Nova Safo
• Bloomberg Business, Feb 18, 2015. “Apple Hairball?...” by Tim Higgins
• Medium.com, Feb. 18, 2015. “Apple will buy Tesla…” by Jason Calacanis (@jason)