Tim Cook: Apple is not a hardware company

[Rogifan]

In his interview with Goldman Sachs twice Tim Cook said Apple wasn't a hardware company and points out how much revenue they made off of software and services last year. Of course there's always been a debate over whether Apple is a hardware or software company with some arguing its neither, that its a platform or product company. It got me wondering though what Cook really meant by this statement. In 2012 when Cook was asked about content he said Apple's business model is not making money off content but from selling devices. Seems to me emphasizing that Apple is not a hardware company is a subtle shift in messaging. Granted, I don't think Apple ever referred to themselves as a hardware company but I don't remember them in the past going out of their way to say they weren't.

Was this Cook's way of saying "we're not Samsung" without mentioning Samsung by name? Or perhaps a shift in the business model to counter the selling hardware at cost model of other companies?

 

[roadbloc]

Shame the quality of their software has been going to total **** in the past few years. I'd be touting hardware as the main selling point, not the datedness of iOS, the mess that OS X is and how all of their once excellent software is being dumbed down and left bug ridden.

That said, the quality of their hardware, especially in Macs has decreased as well in my opinion.

 

[thejadedmonkey]

All you have to do is look at iOS 6.1 to realize they're not a software company either.

Question: Are they even a company?

 

[quagmire]

How can Cook base his argument of Apple not being a hardware company by pointing out the money made from software when the software only accounts for 3% of Apple's revenue in Q1 of 2013? Ninety percent of Apple's revenue came from iPhone, Mac, iPad, and iPod sales......

Cook, you're a hardware company. The software helps to sell the hardware.

 

[rhett7660]

Maybe it could be that he is thinking they also make software to go with the hardware, not just the hardware. Make the hardware and software where as some companies make only the hardware and use a third party company to make the software or they configure third party software to work with their hardware.

Just taking a guess here. But that is what it sounds to me and I think the OP probably nailed it on the head by not wanting to mention Samsung flat out.

 

[Rogifan]

How can Cook base his argument of Apple not being a hardware company by pointing out the money made from software when the software only accounts for 3% of Apple's revenue in Q1 of 2013? Ninety percent of Apple's revenue came from iPhone, Mac, iPad, and iPod sales......

Cook, you're a hardware company. The software helps to sell the hardware.

Could it be that they're going to look for that number to grow in the future, especially with Google and Amazon flooding the market with cheap hardware? I don't get how the cheap hardware model works when content and apps aren't that expensive but both Google and Amazon stock are at or near 52 week highs so clearly Wall Street doesn't have and issue with it.

----------

Maybe it could be that he is thinking they also make software to go with the hardware, not just the hardware. Make the hardware and software where as some companies make only the hardware and use a third party company to make the software or they configure third party software to work with their hardware.

Just taking a guess here. But that is what it sounds to me and I think the OP probably nailed it on the head by not wanting to mention Samsung flat out.

I really hope the next couple years Apple really works on getting their ****** together on software and services. Tim Cook asking Jony Ive to get involved in software seems like he's serious about it. Yet there are plenty of areas where we don't see noticeable improvements - especially Siri and maps. And the gawd awful podcast app seems to just be left for dead. That app has received horrible reviews. How hard could it be to fix?

 

[phoenixsan]

We have to look....

in two facts, one "subtle" another huge:

1-The subtle one is the shifting from Apple Computer to Apple, Inc. Sounds like no more a computer only company, more like a platform developer/maker

2-The huge: I had years reading how the revenue comes to Apple. No more from Macs, in any form, so....

Maybe not a hardware company, but as I and another people had said, a platform maker (hardware plus software plus gadgets)

iOS integration in the OS: I dont like it
Gadgets/iToys: Not so fond of all of them

 

[Rogifan]

in two facts, one "subtle" another huge:

1-The subtle one is the shifting from Apple Computer to Apple, Inc. Sounds like no more a computer only company, more like a platform developer/maker

2-The huge: I had years reading how the revenue comes to Apple. No more from Macs, in any form, so....

Maybe not a hardware company, but as I and another people had said, a platform maker (hardware plus software plus gadgets)

iOS integration in the OS: I dont like it
Gadgets/iToys: Not so fond of all of them

iPhone, iPads and iPods aren't hardware? And since when are smartphones and tablets gadgets?

 

[jav6454]

Was this Cook's way of saying "we're not Samsung" without mentioning Samsung by name? Or perhaps a shift in the business model to counter the selling hardware at cost model of other companies?

Apple IS is hardware company, no matter what Cook says. It was founded with hardware in mind and it is HARDWARE that drives sales. They just happen to make the software for that hardware as well.

Read: Mac 128k

 

[phoenixsan]

For me....

no, not encompass my traditional concept of hardware.Sorry if my point of view is limited. And we can argue ad infinitum, but for me, these things are gadgets. And I am entitled to an opinion...period

 

[tkermit]

Apple IS is hardware company, no matter what Cook says. It was founded with hardware in mind and it is HARDWARE that drives sales. They just happen to make the software for that hardware as well.

I've always looked at them as a software company that makes great hardware so that the software can really shine. The Alan Kay quote that Jobs used to bring up says it all: "People who are really serious about software should make their own hardware." – Even Microsoft seems to agree nowadays.

Personally, I'd much rather use OS X on different hardware that isn't made by Apple, than another OS running on Apple-made hardware.

 

[Rogifan]

Personally, I'd much rather use OS X on different hardware that isn't made by Apple, than another OS running on Apple-made hardware.

Why is that?

 

[GermanyChris]

Flexibility.

It's the reason people build hackintoshes, the HW is pretty but limiting. It was fine when there were valid reasons like PowerPC and Mac's were objectively better in many metrics. Now they are very attractive PC's with great branding and not a whole lot more.

 

[AQUADock]

That said, the quality of their hardware, especially in Macs has decreased as well in my opinion.

In what what way exactly? I feel the opposite, the powerbooks for example although were very nice laptops would seriously deform from a small drop, not so much with the unibodys.

 

[ravenvii]

Shame the quality of their software has been going to total **** in the past few years. I'd be touting hardware as the main selling point, not the datedness of iOS, the mess that OS X is and how all of their once excellent software is being dumbed down and left bug ridden.

That said, the quality of their hardware, especially in Macs has decreased as well in my opinion.

I disagree. With one exception.

The hardware quality decreasing? Going from the aluminum MacBook Pros to the unibody MacBooks has increased the quality of the hardware considerably. The quality of the iPhone has increased -- the 4 was better quality than the 3G, the 5 was better quality than the 4, etc. Not to mention the design of the iPad mini easily trumping the design of the iPad 3rd Gen. Yes, they might have some ******** 'gates, but remember the flaking paint? The almost-moldable Aluminum PowerBooks? Etc, etc, etc? Needless to say I completely disagree with you on the hardware front.

Software, however, is more of a checkered picture. With OS X, I largely disagree with you. Mountain Lion has been one of the most bug-free OSes I've ever used. Stable, fast and smooth on my aging 2008 iMac. Yes, there's some design approaches I disagree with -- the new saving paradigm is retarded, though they've toned that **** down a lot between Mountain Lion and Lion -- but by and large, Mountain Lion is fantastic, and I can't wait to see what they come up with in OS X 10.9.

iOS on the other hand... I 100% agree is a complete mess. iOS 6 was a disaster, and continues to be as evidenced by all those bugs cropping up. I'd say they need a "clean-up" release like Snow Leopard and Mountain Lion was, but unfortunately they can't afford that -- iOS 6 should've been the clean-up release, but they screwed the pooch on that one. If iOS 7 continues to disappoint, I'm leaving for greener pastures.

 

[maflynn]

It used to be that the software apple produced, i.e., iTunes was used to drive hardware sales, e.g., iPods.

I'm disappointed in seeing Cook's words because I'm still waiting for iLife, iWork, and Aperture updates. Its been literally years since apple released an upgrade to those applications.

 

[AQUADock]

I disagree. With one exception.

The hardware quality decreasing? Going from the aluminum MacBook Pros to the unibody MacBooks has increased the quality of the hardware considerably. The quality of the iPhone has increased -- the 4 was better quality than the 3G, the 5 was better quality than the 4, etc. Not to mention the design of the iPad mini easily trumping the design of the iPad 3rd Gen. Yes, they might have some ******** 'gates, but remember the flaking paint? The almost-moldable Aluminum PowerBooks? Etc, etc, etc? Needless to say I completely disagree with you on the hardware front.

Software, however, is more of a checkered picture. With OS X, I largely disagree with you. Mountain Lion has been one of the most bug-free OSes I've ever used. Stable, fast and smooth on my aging 2008 iMac. Yes, there's some design approaches I disagree with -- the new saving paradigm is retarded, though they've toned that **** down a lot between Mountain Lion and Lion -- but by and large, Mountain Lion is fantastic, and I can't wait to see what they come up with in OS X 10.9.

iOS on the other hand... I 100% agree is a complete mess. iOS 6 was a disaster, and continues to be as evidenced by all those bugs cropping up. I'd say they need a "clean-up" release like Snow Leopard and Mountain Lion was, but unfortunately they can't afford that -- iOS 6 should've been the clean-up release, but they screwed the pooch on that one. If iOS 7 continues to disappoint, I'm leaving for greener pastures.

I agree with everything you said, hopefully iOS 7 will not disappoint now that Ive is in charge.

 

[tkermit]

Why is that?

I'm just saying, if I was forced to choose between either OS X or Apple hardware, i'd aways pick the machine with OS X, regardless of how nice the Apple hardware might be. Simply because OS X, and software in general, is first and foremost what attracts me about Apple. To me, there is nothing remotely equivalent to it out there, whereas any piece of Apple hardware I feel like I'd be able to replace with something of roughly equal quality nowadays.

 

[Squilly]

Oh really....? Th iPhone is Apple's largest money maker...

 

[roadbloc]

In what what way exactly? I feel the opposite, the powerbooks for example although were very nice laptops would seriously deform from a small drop, not so much with the unibodys.

My iMac G4, iMac 5,1 and PowerBook G4 are still screaming. My MacBook 6,1 and iMac 11,3 have both pegged it, the Macbook literally fell to pieces when I dropped my bag one day (it was inside) and my iMac just stopped working.

Not the most factual of evidence, but from experience, I feel the more recent mac models are no where near as durable as they used to be. My iMac and PowerBook G4 have been through wars.

 

[smoledman]

Oh really....? Th iPhone is Apple's largest money maker...

Because of iOS.

 

[Rogifan]

Because of iOS.

Because the best apps are iOS.

 

[JoeG4]

He's right. Apple isn't a hardware company anymore, they're an ecosystem company!

Today we celebrate the first glorious anniversary of the iPhone!
We have created for the first time in all history a walled garden of pure ideology, where each worker may bloom, secure from the pests of any contradictory true thoughts.
Our unification of apps is more powerful a weapon than any fleet or army on earth.
We are one people, with one iPhone, one model, one ecosystem!
Our enemies shall talk themselves to death and we will bury them with their own fragmentation.
We shall prevail!

Before you get mad I think it'll all be fine lol

 

[LethalWolfe]

Ideologically I don't think Apple is a hardware company (or 'just' a hardware company) but from a basic business perspective they are. Jobs always wanted to create a great user experience and control all aspects of it and for that you have get people to buy your hardware. People buying iDevices and Macs is what keeps the lights on in Cupertino.

 

[MacsRgr8]

Seems obvious to me:
Apple has never been only a hardware or only a software company.

Apple's vision is to deliver the whole experience: So, that is hardware and software and services.

And it seems to work fine. Even though many around these boards nowadays bash everything Apple does.