We're witnessing an interesting transformation of Apple. For most of its life, Apple has been content to capture less than 5% of the market for its products. When I worked there, we used to compare ourselves to BMW or Volvo - great brands with little market share but fiercely loyal customers.
But now Apple has huge success with the iPod and iTunes (two products - by the way - that we never envisaged to do for the company what they are currently doing) and suddenly they are the market share leader in MP3 players and digital music. That success leads everyone to expects Apple to be a huge hit in any market it puts its sights on - especially mobile phones and a market ten times bigger than music. But that's not in Apple's DNA. Those expectations put tremendous pressure on the company to innovate at a faster rate and to focus more on market share than it ever has before. That explains the rapid price drop on the iPhone. The strategy seems to be working for now, but is it sustainable?
Funny thing is, most people identify with Apple as the underdog - and most (Apple and their loyal customers) like it that way. Would your perception of the company change if you woke up tomorrow and Apple was the undisputed leader in music, movies, mobile and computers? Stay tuned...
