A review of Apple’s efforts to entrench itself in its ecosystem

When we look at Apple and its business, it’s inevitable that we’ll be looking at its ecosystem. When you evaluate your products and compare them to your competitors, you have to consider everything that goes into an Apple device. An iPhone isn’t just a phone . It comes with an App Store, manufacturer’s accessories, and a host of other products and services from other companies in addition to your own. It’s been the same for a long time with the Mac and now with the iPad. It was undoubtedly one of the reasons that catapulted the iPod to fame.

The value of the ecosystem to the user increases the more he or she is involved. But it also increases his commitment by digging a “hole” that forces him to be increasingly dependent on the company. In short: Apple’s ecosystem creates loyalty . Either voluntarily or forcibly. That’s why in this post we’re going to review Apple’s efforts to become more and more entrenched in its ecosystem. Some times it has done it with more success than others, but the overall balance tells us that they have built one of the most powerful and profitable in the world.

If a competitor wants to take over Apple’s customers, they will have to deal not only with the product but also with all the value provided by Apple’s ecosystem. Some customers will be more committed than others , but this is the list of the “mini-ecosystems” that the Californian company currently has:

  • App Store. The cornerstone of Apple’s current ecosystem because it unites the company’s efforts with those of thousands of other developers. And we users are in the middle, giving this industry that barely reaches 6 years of age a cumulative turnover of $15 billion through December 2013. A market whose growth is constantly accelerating.
  • iTunes and Beats. iTunes played a major role in Apple’s resurgence with its iPods and laid the groundwork for the App Store, but it’s not going through its prime right now. The decline in music production and the drop in sales is one of the motivations for the acquisition of Beats. Funny fact: for the first time, Apple would have an app on Windows Phone and Android similar to when it released iTunes for Windows. Does it make sense to have a subscription service on competing platforms? Apple thinks so.
  • Accessories. Of all the smartphones and tablets on the market, the iPhone and iPad have the best and most complete catalogue of third-party accessories. From the typical speakers, chargers, car adapters, cases, covers and protectors to give and give away to microscopes, headphones and photo lenses as Olloclip. Many of these accessories are exclusive. They’re so important, they already have their own section on the Apple Online Store.
  • CarPlay. The simplest example of customer retention capacity is found in CarPlay. Imagine buying a car with this system for your iPhone. When it’s time for mobile renewal, which phone do you think you’ll want or feel almost obliged to buy?
  • Ping and social networks. It may seem that this company never screws up, but the truth is that its failures are numerous. For example, the attempt to have a social network around music with Ping was one of the most resounding. Better to integrate with Twitter, Facebook and others than to try with one of our own.
  • MobileMe and the iCloud switch. MobileMe failed, yes, but thanks to this screw-up, we now have iCloud. A cloud that, with its limitations and imperfections, now has iWork, where you can access and edit documents from any browser on any operating system.
  • FaceTime and iMessage. If I had to choose two services that I don’t think Apple would ever do multi-platform, it’s these two. Their use depends on your contacts having them and using them, too, it’s true. But making them multiplatform doesn’t make sense in a world dominated by Whatsapp and dozens of smaller alternatives. BlackBerry made its messaging system multiplatform and that hasn’t saved it from bankruptcy.

And these are the legs that would complement the picture painted by Apple in the future:

  • Smart Home. We started with the rumor leaked from the Financial Times about Apple’s alleged smart home. The idea behind it would be to have an advanced home automation system that is unique to Apple. Integration with iOS devices would be the foundation on which to build the house of the future as conceived by Apple. While competitors like Google are taking over Nest and others like Samsung seem to be serious about concrete proposals, there is not a single official word from Apple about it. Will we have news at this Monday’s WWDC?
  • Mobile payments. Although it’s still smoke, Apple has given weight to this rumour with some statements by Tim Cook himself calling it a “major area of interest”. Having more than 800 million iTunes accounts makes Apple the company with the most active credit cards in the world. If we join Touch ID as a way to authenticate payments and the rumor of NFC on the next iPhone, we have a piece of the ecosystem that would incorporate merchants, banks and credit card intermediaries like Visa or MasterCard. Of course, the mobile payment puzzle is far from solved.
  • Healthbook and the quantified self. Much has been said about the possibility of Apple entering this field. Again, the leaks of the supposed Healthbook interface and its integration with iOS in addition to the elusive iWatch would extend Apple’s tentacles into our health. They tested the waters with the M7 chip on the iPhone 5s last year, which is very typical of Apple.
  • Siri’s opening. Much has been said about it, but the truth is that after its release on iOS 5 with the iPhone 4s, Siri is still exclusive to Apple, its system and its apps. What if developers could count on this assistant for their projects?
  • WWDC 2014, del 2 al 6 de junio.

    Maps and routes in public transport. The controversy over Apple’s maps replacing the Google maps that had been standard until then had a negative impact in the short term but in the long term it is improving the options for users. Although much work remains to be done, the developers have a more sophisticated solution while maintaining the possibility of using Google’s. It is said that at the WWDC this Monday we will see progress in the integration of public transport routes.

This is an overview of the most important components of Apple’s ecosystem. I am convinced that WWDC 2014 will be a bet for the reinforcement and creation of more legs around Cupertino’s company business. If you think I left something in the inkwell or you miss something, you can share it in the comments.

A review of Apple’s efforts to entrench itself in its ecosystem
A review of Apple’s efforts to entrench itself in its ecosystem

At Apple

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