Apple Becomes a “They” Company

There is this concept of "we companies" and "they companies". I don’t know where it comes from.  If you do, I’d love to know.

Anyway, "We" companies are built by and for a community of users. Everything (including profits) flows from this core value of serving the users.  We companies and their profitability are incredibly sustainable.

"They" companies are traditional companies that seek to optimize profitability at the expense of everything else. These businsses are not sustainable and they tend to overreach and ultimately end up in a long and steady decline.

Microsoft is the poster child for a "they" company.

Craigs List is the poster child for a "we" company.

Apple used to be a "we" company.  I love Apple as I’ve blogged about many times.  I still do.  But Apple is not a "we" company any more.

Apple survived the WinTel dominance in the PC business by becoming a "we" company.  It focused on its base of devoted users and gave them better and better products.  It created a community of users who are incredibly passionate about the company’s products. It became the anti-Microsoft.  And it has benefited greatly from that market position in recent years.

But in the past couple months, Apple has made some very "they" company decisions.  Here are a couple notable ones.

– Apple is suing bloggers who are "outing" the confidential product plans and release dates for new Apple products.  Clearly Apple has the legal right to go after these bloggers who are getting their information from sources inside the company who have almost certainly violated confidentiality agreements.  But this makes no sense to me.  Apple’s most passionate users have always engaged in speculation about new products.  It’s part of the culture of the Apple user base.  It’s been going on for years.  To crack down on it now, and particularly on bloggers who are part of its community, is a really bad idea. They’ll win the battle and lose the war with this one.

– Apple is trying to charge iPod accesory manufacturers a 10% tax in exchange for a "Made for iPod" logo on their product. Probably the coolest thing about iPod is that it’s become a platform, a standard, around which a whole industry is blooming.  Instead of letting that entrepreneurial energy flow back to iPod, Apple wants cash. My gut tells me its a bad business strategy because it will cause the makers of these accesories to desire to work with Apple’s competitors in an attempt to reduce the amount of market dominance that Apple has in the portable music player market.  And its a very "they" company move on top of that.

Its an incredible temptation when you are managing a company that’s hitting on all cylinders to overreach, to push for more, more, more.  But its the wrong temptation.  Unfortunately, Apple is making that mistake.  There’s time to recognize it and change.  But somehow, I doubt they will.