If I were Apple CEO Steve Jobs for one year… (AAPL)

By: ispeculatornew
Date posted: 12.24.2010 (5:00 am) | Write a Comment  (19 Comments)

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With the holidays around the corner, we decided to do a mini series about a few of the tech stocks that we follow all year long. We are the first ones to judge and critic how these companies are run but as they say, it’s always much easier to critic it then actually run a company. So we decided to go ahead and write a series about what we would do with these companies. Hoping you will enjoy the series:

Dec 20    If I were Google CEO Eric Schmidt for one year…
Dec 21    If I were Yahoo CEO Carol Bartz for one year…
Dec 22    If I were AOL CEO Tim Armstrong for one year…
Dec 23    If I were Facebook founder Mark Zuckerberg for one year…
Dec 24    If I were Apple CEO Steve Jobs for one year…
Dec 27    If I were Ebay CEO John Donahoe for one year…
Dec 28    If I were Amazon CEO … for one year…

Management in the past few years

Taking over Apple would be a very big challenge. No CEO is seen as more instrumental to his company’s success than Steve Jobs is to Apple. Since his return to the company, Steve Jobs has led countless product launches that have helped Apple take over what seemed unthinkable just 5 years ago, the top technology company in the world in terms of market cap. Apple is dominant in all kinds of products from the Ipod to the Ipad but it’s future now seems tied to the Iphone as Apple battles both Research in Motion (RIMM) and Google (GOOG). As mobile devices gain importance, being the dominant player has allowed Apple to be a major force to be reckoned with.

General Vision

-Make Apple products the leading edge in terms of design, technology and overall experience.

Initiatives/Priorities I would get started on

Offer the Iphone & Ipad on other carriers : As good as Steve Jobs has been about delivering a solid product, this is a MAJOR flaw that needs to be fixed quickly. I would be curious to know what kind of market share Android would have had the Iphone been available on other carriers from the start. Google might need to give up some of its control but right now, having it only on AT&T, a carrier that is very unpopular seems like a big mistake. From my first day in, getting it on Verizon and at least one or two others would be my top priority. This would give me access to more users and also hurt Android powered handsets.

Buy Netflix: Some rumors were discussed a few weeks ago and I even wrote about it.  Buying Netflix is certainly a bit of a gamble because of its high valuation but it makes sense in so many ways for Apple. First off, one of the battles that Apple has been waging for its Ipod/Ipad/Iphone line in Itunes has been buying content. Netflix has an incredible number of deals for content which could instantly help Apple. Another priority for Apple has been gaining access to the living room through Apple TV. What better way to do that than get access to the #1 movie/tv streaming and rental service? It makes sense in many ways.

Live Satellite radio & tv: Sirius might not be for everyone but I’m convinced that adding it to the Iphone would be a major improvement for many users. Apple could get a cut of the profits and revenues generated by Apple users and Sirius would instantly get access to millions of new users. A win win for everyone involved in my opinion. I’m shocked this has not happened already. To be fair, users can get Sirius radio through an App but I think a deeper alliance between the two companies (such as pre-installing Sirius on all devices with a trial period) would make a lot more sense.

Create a messaging system: This could be used by all Apple device users, would be a “chat system” that could also support sending files such as photos & videos but also include video chat and other features.

Payment systems: Apple is big enough to become a “standard”. Many countries now have a lot of transactions go through their phones and Apple should lead such an initiative in the US.

Flash Support: I understand that the reason why flash is not supported is because its a challenge to not crash devices and keep the user experience solid. But making enemies is not a good idea, take your ego out of the way. Also, apart from the carriers issue, lack of Flash support is the big reason why users are not buying an Iphone. There’s no sense in doing it. Instead, work with Adobe to make it more stable and let users know when Flash creates issues/crashes on their device.

Any thoughts or ideas?

I would love to hear your thoughts or ideas regarding all of these initiatives!

Disclosure: I am long Apple (AAPL)

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  1. Comment by stefn — December 24, 2010 @ 11:48 am

    Love the payment system idea. Nothing Apple (and Google) like better than wrecking current business models. Imagine what this could do to take down Visa?

  2. Comment by David McElroy — December 24, 2010 @ 12:28 pm

    I don’t know whether the writer is ill-informed or just has bizarrely bad judgement, but this article represents the kind of ignorant, short-term thinking that most companies use. It’s AVOIDING this insanity that has allowed Apple to go from death’s door 13 years ago to the point of power and profit where it finds itself today.

    I’m not going to take the time to explain the problems with each individual item here, but I’ll at least point out that anyone who doesn’t understand why Apple is taking the stance it has with Flash doesn’t understand the long-term implications of the struggle. Apple is taking a very minor short-term hit in order to control platform development in the long run, enabling differentiation that wouldn’t be likely if Flash became ubiquitous on mobile devices. There are also serious technical problems with Flash, but long-term platform control is the key. Also, the idea of buying Netflix is incredibly stupid, but it makes sense to people who only look at spreadsheets instead of understanding marketing and the ecosystem of platforms.

    Apple shareholders are very, very lucky that you’re not running their company for a day, much less a year.

  3. Comment by brockway — December 24, 2010 @ 12:34 pm

    1) Agree. iPhone should have been available on other carriers a lot sooner.The exclusive agreement with AT&T was too long, but you have to look at in context of when the agreement was made. No other carrier was giving phone makers so much freedom and control that Apple was able to get with the iPhone and one of the main reasons they got that was because of the exclusive agreement to be on AT&T for this many years. But this is an eternity in cell phone years and it should have been for a shorter time.

    2) Buying Netflix would have some advantages. Mostly keeping someone else from buying it and also getting a better position with the content providers, who seem to be not-so-willing to work out good deals with Apple. On the other hand, it’s a much larger company than Apple normally acquires and could create problems. I would say Apple is better off not purchasing it. There are other ways that they can get a better foothold in the living room.

    3) Don’t bother with live radio. There is enough online radio content available. Live TV might be nice.

    4) Messaging system? They have Facetime. making that available everywhere and not just in WIFI areas is a must, but comes down to the cell providers capabilities. iChat on the Mac is great. Adding some of those features to Facetime would be nice.

    5) Payment system? Good idea. Apple should lead the way with that.

    6) Flash Support. It didn’t think that was such a big deal, but not having Flash does make the user experience a little incomplete. There must be something that they could work out.

  4. Comment by Mark Bossert — December 24, 2010 @ 2:55 pm

    Agree wholeheartedly with David McElroy – very glad you are not running Apple mate. Cock-a-maimy thinking on every point offered.
    Apple is on many other carriers and will be in the US. As pointed out by brockway, the deal with ATT set a precedent of wresting control from carriers that was a huge breakthru.
    Buying Netflix would cancel all the Netflix content deals… so what other tech advantages does Netflix have???
    Sat radio is as dead as terrestrial radio… yeesh.
    They have 2 messaging systems already, Facetime and iChat – are you even a mac user?
    NFC Payments are in the works – why would Apple get into an area where they currently have no expertise and no built-in advantage? Probably better to enable micro payments and let the payment processors duke it out for the shrinking profits.
    Flash? seriously? Adobe has been Apple’s enemy for a decade – Ego would be Jobs buying them, killing the crap and extending the decent products they still have… which would take what… a quarters cash?

  5. Comment by Patrick — December 24, 2010 @ 3:56 pm

    You have completely misunderstood why Apple is where it is today. Here’s what the person who is Steve Jobs for a year should do:
    1. Insist that Apple make beautiful products.

    2. Say no to any idea, like all of the ones from the author’s article above, that do not contribute to making beautiful products.

    3. Fire people who do not want to help build beautiful products. For example, the author of the above article.

  6. Comment by Coffee — December 24, 2010 @ 6:49 pm

    Regarding buying Netflix, there’s a simplistic American notion that whoever is the biggest IS the standard. If that were true, Apple would be history and Microsoft would run it all.

    Apple has become the standard in so many things because they best ‘the standard’ and end them. MP3 players existed, but Apple bested and created a real market for them.

    I’m a newbie Netflix user and although I like it enough, it’s not AMAZING. It’s instead an idea which I hope Apple can best with their new server farm. I think the point of AppleTV is to establish an Netflix using base… only to offer something new when Apple is ready. Bait/switch. This may also be why getting Hulu will probably not be necessary for Apple.

    The only thing missing from that list is more affordable Macs. Apple HATES doing this but I think they need to find ways to drop prices.

    The first should be extended warranty. Apple should give all Macs three years of warranty and limited calling WITH purchase. If you want to talk your head off to support after three months, charge for THAT and that only.

    Apple should also find a way to break the $799 frontier, both with laptops and iMacs.

    Yes, I know, in a way, they’ve already done that with iPad, but there are people who simply can’t afford to be Mac users because of the numbers of heads in their house.

    I know Apple shudders at the idea of releasing OS X for PC, but I wonder if there’s a way to do that which would make mucho profit and prevent OS system piracy. If yes, I can’t imagine why Apple wouldn’t want $199 a box to flip cheaper PCs into Macs. They could grant it to only extremely specific PCs to, as in ‘that Dell’ and ‘only this Sony’ and so forth.

    I know purists will flip their poops reading that, but I tell you there are a zillion sales Apple loses for every 50 they get. We all know it.

  7. Comment by pablor — December 24, 2010 @ 7:17 pm

    “Intelligent Speculator” is an oxymoron.

  8. Comment by AdamC — December 24, 2010 @ 10:16 pm

    I bet you would love your 3 year old to watch porn via Flash on the iPhone.

  9. Comment by Wodster — December 25, 2010 @ 5:32 am

    1) Jobs has many times explained why he went with AT&T. It was because one the revolutions of the iPhone was that it would be a device-centric system, rather than a carrier-centric system. This allowed the user to do things like listen to voice mail in any order they chose, not only one after the other, as was the way it worked back then. Now that the iPhone has been a tremendous hit with AT&T, and the model has changed, Apple can negotiate similar terms with other carriers like Verizon, so it is all working out well indeed

    2) Acquiring Netflix might be a good strategic tactic, but would not be the way Apple prefers to accomplish their goals. All that would do is give them existing deals with the studios, and they would prefer to make them on their own, as they have been doing with their iTunes download model well before Netflix has had success with their streaming model. However, I think the new data farm in North Carolina will likely give Netflix some serious competition in that direction

    3) agree with others that improved internet radio would be a good thing, but not that Sirius has anything proprietary that Apple needs to purchase. I don’t see that they own anything unique, or have access to exclusive content that can’t be acquired directly with content providers. This could also bring the crazy deals with overpaid people like Howard Stern down to reasonable levels!

    4) Facetime is a growing technology, have yet to see how far it can spread, once it comes out of beta for Macs and also becomes available for PC’s

    5) Payment system is already totally integrated into iTunes, and soon the App store for desktop software. In App-purchases, doing things like use iPhones for metro payments are also coming into play as well

    6) David McElroy totally explains why Jobs has been fighting a single company being in control of such an important basic technology as embedded video, and that Adobe has done an inadequate job of making it appropriately efficient for mobile devices. Better for Apple to take a short-term hit and lose some sales now, if it results in a better technology for everyone tomorrow, with open-source HTML5. Just like they did when they eliminated floppy disk drives from Macs years ago, we complained that it was an inconvenience at the time, but it helped wean everyone off dated technology, and moved the industry forward, now no one is crying that they miss having floppy disks!

  10. Comment by R. Conrad — December 25, 2010 @ 9:26 am

    No Flash is what makes me nuts w iPad and iPhone. I have to hope the strategic advantage is worth my daily frustration.

  11. Comment by Robert Anderson — December 25, 2010 @ 4:56 pm

    The author of this article is thinking tactically, at best. And, as others have pointed out, not necessarily all that clearly. Thinking strategically, there is one and only one thing that Steve Jobs needs to be doing right now:

    1. FIND AN HEIR-APPARENT: Steve is a brilliant leader, but to create the legacy in Apple that it (and he) deserves, it needs to become immortal. Steve is smart enough to see this. He needs to find and (gently) to “debut” his successor.

    This is the only super-strategic item on the agenda. As for the strategies, both Steve and his immediate minions can do a fine job with that.

  12. Comment by Wodster — December 26, 2010 @ 3:27 am

    R. Conrad:

    I haven’t tried it myself, don’t have much need for it, but I wonder if the Skyfire app might help you until the day arrives that HTML5 will be dominant tech for imbedded video. It seems to work not by actually playing Flash videos on iPhone/iPad, but by converting them online first to H264:


  13. Comment by IS — December 26, 2010 @ 1:42 pm

    So many great comments, thanks for all the feedback… here are some thoughts!

    @stefn – I think Visa is scared both by that possibility but also by Paypal.

    @David McElroy – I don’t think any of the things I suggested are “short term”. Flash is gradually being allowed in certain apps so I guess it might happen over time.

    @brockway – I actually agree that it was a good move initially to use AT&T exclusively…but I think it’s now time to change that policy. I do also see what you mean about Netflix but still think Apple is so much bigger that it would overrule any Netflix influence.

    @Patrick – So that is what you would propose to shareholders… make beautiful products? I agree with the principle but we need to be more specific. Which products exactly? What should be changed?

    @Coffee – Never implied that Netflix was amazing.. but it is a very efficient way of making its way into the living rooms of millions more users.

    @pablor – don’t agree but I guess it depends on how you define “speculator”:)

    @AdamC – Not sure what’s the link? There are plenty of html5 porn videos already available on the Iphone…?

    @Wodster – Just to clarify, yes I do think going with AT&T was brilliant to start off, but I also think it’s time to move to more carriers.

    @Robert Anderson – Yes that should have been on my list, very important one. But if you were CEO.. that would be your only plan?

  14. Comment by Doctor Stock — December 26, 2010 @ 10:08 pm

    No flash is my biggest complaint… buying Netflix isn’t a bad idea, but do they really need them?

  15. […] If I were Apple CEO Steve Jobs for one year… (AAPL) […]

  16. Comment by Patrick — December 27, 2010 @ 8:21 am

    It’s Patrick again, replying to your reply to my “make beautiful products” post. Thanks for your reply, it helped me see what you’re getting at.

    Yes, that’s exactly what I would do (tell the shareholders my plan is to “create beautiful products”) – but only if I were Steve Jobs. Jobs has earned a great deal of latitude on what direction he takes Apple. His primary concern is making beautiful products and “making a dent in the universe”. The shareholders are secondary at best in his world.

    His approach has its ups and downs, but the last 10 to 15 years have been almost all up.

    It’s amazing to me that you (IS) are so incredibly focused on the tactical analyst minutia that you appear to be unable to see the big picture strategy, or even admit that it exists.

    Apple has an amazingly simple product lineup: about six product groups (desktop PC, laptop PC, iPods, iPhones, iPads, iTunes, and “other”) and very few model within each group. Apple has a very flat management structure and extremely small but focused R&D. Everything you’ve suggested will destroy that model.

    As an aside, I believe the next Apple CEO will do what you suggest – not the specifics, but MBA/analyst based things: “brand extension” and “leveraging capabilities” and “efficiently utilize our capital”. He’ll create a market research team, will buy a few big companies, will expand the models and options available (“matte screens – you want ’em, we got ’em”), will get into markets without beautiful products (“let’s slap the Apple brand on some printers”). At that point Apple will be dead. Successful for a while, but dead.

  17. Comment by IS — December 27, 2010 @ 8:37 am

    @Patrick – Thanks for the added details, very appreciated. Just to give you a context, I am an Apple user, have an Ipod touch and an Ipad and the fact that they are “beautiful products” is probably the #1 reason why I do have them.

    That being said, every few years, Steve Jobs has been expanding the line of products. It’s been done carefully and while keeping what makes Apple the great company that it is in my opinion.

    Honestly, I think offering the Iphone on other carriers or adding flash capabilities could easily done without making the products any less beautiful, don’t you?

    Buying Netflix is probably the one initiative that would be a bigger threat but I don’t feel like the others would do that. Would love to hear your point of view though.

  18. […] had suggested offering the Iphone on Verizon (and other carriers) in my post about being Apple CEO Steve Jobs for a year and was surprised that there would be arguments about that specific point. But there were. The main […]

  19. […] The truth is that no company has as much of its value dependent on its founder. HP (HPQ) suffered a big loss last year when Mark Huard was ousted from the company but it doesn’t even come close to Apple’s situation. If $25 billion is wiped out because Steve Jobs will not be running day to day operations for some time, imagine if he could not help at all, was seriously ill or even worse? It’s easy to imagine the stock continuing to drop much much lower if things got worse. Why? There are so many different reasons but Jobs is seen as the force behind the return from the dead of Apple over a decade ago as he led the force that saw the different Ipod models, the Iphone, new Mac lines and the recently launched Ipad. All of these products have been wildly successful but also have been seen as extensions of Jobs’ innovative mind and his vision of the market not for what it is but for what it can be. Is he the only person capable of running day to day operations? No, of course not. And many, including myself have said what they would do if they were CEO for some time. […]

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