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Cringely looks at Apple's iPod shuffle

updated 10:30 am EDT, Fri May 21, 2004

Cringely on iPod shuffle

Robert Cringely in his column for PBS. "Apple is essentially getting out of the business of making its own products... Why would they take someone used to producing products like the G5 workstation and turn his attention to little music players? It's hardly a comparable challenge... I think it comes down to a combination of structural changes in the industry and Apple trying harder to cut costs, which really means raising profit margins."

by MacNN Staff

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KidRed
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Joined: Mar 2001

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05/21, 10:56am | report spam | close Reply |
confused..

Apple is making a division within itself to better focus on iPods. How does that translate that Apple is getting out of making it's own products?

eddd
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Joined: Dec 2001

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05/21, 11:06am | report spam | close Reply |
why oh why

I honestly can't understand why people continue to give this guy column space. At least in regard to Apple, he has consistently been plain wrong and uninformed. His articles are poorly researched flights of fancy. Guess that's all it takes to be a mainstream columnist these days.

dennis
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Joined: Aug 2001

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05/21, 11:32am | report spam | close Reply |
Interesting

Hey, I really like Robert Cringely.

I can imagine his theory panning out, but I don't think it is being planned that way. For one thing, why would Apple be putting so much time and money into the retail stores if they are planning a Mac phase-out? They're going to fill those stores with iPods (which can be purchased many other places) and Windows software?

JLL
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Joined: Apr 1999

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05/21, 11:37am | report spam | close Reply |
Re: confused..

By saying that Apple is getting out of making its own products, he means that Apple is getting out of manufacturing their own products at their own plants.

Try and read the article:

"The company just had yet another big layoff at its Sacramento manufacturing plant. In an effort to further lower costs, Apple is essentially getting out of the business of making its own products."

wesukmk
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Joined: May 2004

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05/21, 11:38am | report spam | close Reply |
Re: why oh why

"I honestly can't understand why people continue to give this guy column space"

It may be because he was one of the original employees of Apple and knows companies like Apple and MS inside-out.

hybrid
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Joined: Apr 2004

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05/21, 11:49am | report spam | close Reply |
Huh?

Apple has been getting out of the manufacturing business (like almost every other North American-based electronics company) for at least the last 10 years. No new news here.

The iPod "division" is more of an internal re-org than spinning it off into a separate company � la Newton.

I don't see what the big deal is.

eddd
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05/21, 12:22pm | report spam | close Reply |
okay

Okay, perhaps he was there at the beginning of Apple Computer (I say "perhaps" because the name Robert Cringley is a well-known psuedonym), but so what? That was 25 years ago. Do you hear Woz or Gassee going on about Apple's future? This guy is a columnist and a technology commentator - no more.

His article is just a re-hash of familiar, tired themes: Apple needs to change their business plan to compete. Apple needs to dump the hardware biz and just sell the OS. Apple needs to switch to Intel. Steve Jobs is a jerk. Apple's CPU manufacturer can't keep up the pace (of course, in a new twist, he also mentions that their chip manufacturer may become their own toughest competition in the CPU space - bizarre).

We've heard it all countless times. He's just taking the latest moves by Apple and trimming the old Apple boilerplate to fit. Honestly, to derive all that from a re-appointment (I'm not sure I'dd call it a reorganization) at Apple? Why shouldn't Rubenstein watch over iPod development? It's clearly an important role for an important device. Rubenstein is a manager more than an engineer or designer.

The real story is about how Apple provides secure employment for lazy journalists. But that's not news, either.

testudo
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05/21, 12:32pm | report spam | close Reply |
Re: confused

By saying that Apple is getting out of making its own products, he means that Apple is getting out of manufacturing their own products at their own plants.

Yeah, but their laptops are made (and have been made for some time) in Taiwan. Same with the iMacs, if I remember correctly (probably because that's where all the flat screens are or something).

Usually companies dump their manufacturing and contract to outside sources because it saves them money, and analysts like that kind of thing. Then down the line, they'll dump their contractors and start doing stuff in-house, so they can have more control over it. Then sometime after that, they'll dump their internal manufacturing and hire outside contractors. Then they'll...oh, you get the idea, its just another cyclical thing companies do.

How come this guy never writes about Gateway going under (or does he, but because the only time I read about his lame writing is here, when he posts some anti-Mac c***)?

dtrots007
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05/21, 12:38pm | report spam | close Reply |
Legal

Just a thought,

A new division for protection. Lawsuits due to batteries, the Apple Corps Beatles lawsuit, etc. iPod stuff won't affect the rest of Apple's operations.

Squirrel_Monkey
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Joined: May 2004

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05/21, 12:41pm | report spam | close Reply |
For all we know...

...Uncle Steve and Big Blue are already talking about using the Cell in future Macs.

The article does not bother me. Commentators and journalists and wish Apple into becoming Microsoft until they run out of pixie dust, but it will never happen. As long as Uncle Steve is at the helm, Apple will provide nothing short of the "full package" in their computers and devices.

I often wonder if the Next Big Thing for Apple to do is to "slim down" Mac OS X into a "palmtop edition" for later iPods or Apple palmtops. Maybe not.

eddd
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05/21, 12:52pm | report spam | close Reply |
one more thing...

I can't stand how some people think that they can just muse on a topic without doing any real research (i.e., hard work) and come up with profound thoughts that are worth putting in print (or on the web). Sure, we all do that in forums and the like, but this guy gets paid for it. That irks me, possibly because it's becoming so widespread, and possibly because Apple is so often the target.

Read some of his other columns. Ask yourself what real insight or information he has to offer. There's nothing there but rambling, insignificant, vapid pablum.

Sorry for the 3-part rant. I'm waiting for a video to process.

dthree
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05/21, 12:57pm | report spam | close Reply |
ha

"His article is just a re-hash of familiar, tired themes:"
This is one of the few journalists that rehashes familiar, tired themes about the industry.

"Apple needs to change their business plan to compete. Apple needs to dump the hardware biz and just sell the OS."
He doesn't say the need to do this, but that that could be the logical extrapolation of the current events if mac sales continue to be weak.

"Apple needs to switch to Intel."
Again, he doesn't say they NEED to do this, but that if they are pillaging the mac sector for cash, this would be the most profitable way to shut it down: switch to intel, gather the cash as everyone upgrades then stop making mac hardware.

"Steve Jobs is a jerk."
I'll take his word for this over the thousands of other journalists who never worked for him.

"Apple's CPU manufacturer can't keep up the pace"
Now your just making s*** up. The article doesn't say this anywhere

"(of course, in a new twist, he also mentions that their chip manufacturer may become their own toughest competition in the CPU space - bizarre)"
Is it bizarre to entertain the notion that something like this is possible? It sure isn't "rehashing a familiar tired theme".

I sure don't understand the anti-bob sentiment. He is far from anti-mac, and knows a lot more about the industry than all of us idiots.

macbarry
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Joined: Aug 2002

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05/21, 01:17pm | report spam | close Reply |
Always

there will probably be an Apple computer for many years to come. Even though their market share is only 2% of all boxes sold - so what? That's still a big bunch of computers - why would Apple seek to just throw that away?

I agree with another poster - I think the reorganization of Apple and creation of the iPod division is to allow management focus on the product and protect the rest of the company from lawsuits... Speaking of lawsuits what about the Beatle's Apple vs Apple Computer suit? I look for an agreement to happen and soon iTunes will be hosting the entire Beatles collection:-)

dennis
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05/21, 01:53pm | report spam | close Reply |
re: Ha

Thanks, dthree, you saved me a few minutes of typing. I think folks around here are so used to reading Enderle and other uninformed armchair CEOs that they're always ready to pounce. Cringely isn't saying what Apple *should* do, he's saying what they *could* do, and he makes that plain at the end of the article.

paulc
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Joined: Aug 2000

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05/21, 02:48pm | report spam | close Reply |
Think about this...

there's still an awful lot of engineering left to be done on the computers to make them all they could be, but the Pud? Really not much to do there... besides, all the engineering was done out of house.

Seems clear that moving Job's good buddy Tevanian to the Pud division is a way of making sure he has a job for the next 5+ years... something which may very well not be happening in the "Mac" division, as there is a TON more work needed in the Mac division.

ender
Junior Member

Joined: Mar 1999

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05/21, 03:00pm | report spam | close Reply |
Re

I don't harbor the distast for Cringely that others apparently have, but I must say this article is one of his more preposterous ramblings. Just one of the many errors in his reasoning is claiming that the iTMS is a revenue stream to rely on. Apple has claimed, and pretty much every analyst agrees, that Apple doesn't make any money, or very little, selling music. It's all about selling iPods. This blows his whole theory of dumping "sell once" computers in favor of "sell once but continue to reap revenue from selling music". Why do journalist continue, time and time again, to conveniently ignore this fact whenever they feel like playing armchair-CEO with Apple?

bfalchuk
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Joined: Jul 2003

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05/21, 03:33pm | report spam | close Reply |
Not quite

OK, first, Newton was never spun off, it was shut down. Claris was spun off as FileMaker. I don't totally get where Cringley was going saying "as Apple did with Claris, before changing their mind." They didn't change their mind, they really did make it a division, and then spun it off. Granted, it's pretty much a wholly owned subsidiary, but it was spun off.

My only quip with the article is that Cringley is not really a business person at all, yet he purports to understand the strategic business motives of such moves. I really do appreciate his commentary, and his PBS special, but he's a bit out of his league here. Divisions are a normal way of doing business when you have a massive product that doesn't exactly fit into any existing grouping. I work for a Fortune 100 company, and we had this happen with our international unit. We could have continued to mix it into 2 of our other divisions, or we could legitimize it, allow it to have it's own structure and support network, and truly thrive. It was really held back in its old incarnation, but it is now a $3.5 billion dollar division, and contributes soundly to our bottom line.

As a business person, I truly appreciated the reorg. It's hard to have a $1 BN product/line (iPod + iTMS = almost a billion), and keep it sort of mixed into the apps division and sort of in the Mac division. To truly feel the full force of such a product, one needs to bring it into its own right.

Also, it's not fair to assume the iPod is any easier to deal with than a G5. I would tend to think this is the case, but we don't know that for certain.

jasonbw
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05/21, 04:30pm | report spam | close Reply |
a bit of a stretch

another poster on another board found a good quote, apparently jobs himself once said that the reason for making divisions is that they are easier to shut down when the time comes.

The problem is, this week's cringely thinks that its the mac division thats eventually likely to be shut down. If that was the case, i'd say that they should have spun off mac hardware.

testudo
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05/21, 05:04pm | report spam | close Reply |
Re: Not quite

OK, first, Newton was never spun off, it was shut down. Claris was spun off as FileMaker. I don't totally get where Cringley was going saying "as Apple did with Claris, before changing their mind." They didn't change their mind, they really did make it a division, and then spun it off. Granted, it's pretty much a wholly owned subsidiary, but it was spun off.

Ah, but you have to look at the whole history. Claris was part of Apple (spitting out MacWrite, MacDraw, etc), then spun-off as a wholly owned subsidary type thing. These people spit out ClarisWorks, Claris Emailer, etc. At some point, Apple decided to bring them back into the fold, so Claris became part of Apple again. Except for Filemaker, which they spun off (again!), this time as Filemaker, Inc. When Apple brought back Claris, they killed most of what they were working on (including, basically, ClarisWorks - there hasn't been a decent update to that since v4 or 5 - mostly just fluff, OS X compatibility, and some bug fixes). So off went the best mail client for the Mac, Emailer, to the trash heap.

So they basically changed their minds, although being different CEOs doing this, its really hard to say they changed their minds.

hayesk
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05/21, 05:17pm | report spam | close Reply |
Re: Not Quite

Newton was spun off shortly before it was axed completely.

dthree
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Joined: Apr 1999

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05/21, 05:24pm | report spam | close Reply |
dayam, people

"Seems clear that moving Job's good buddy Tevanian to the Pud division"

More fiction. Who said this? Doesn't make any sense why they would move former NeXT VP and current CTO of software to the iPod division.

Only name mentioned moving to iPod is Jon Rubenstien.

iKenny
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05/21, 05:29pm | report spam | close Reply |
What needs to be done

At this point, Apple certainly can't axe the Mac. I think what Cringely is saying is that the Mac can stay around for as long as it wants, but if it becomes an anchor to the rest of the company, aka if they stop making a profit, there isn't enough to warrant its continuation. Right now, it makes a profit, so keep it around.

What Apple really needs to do now is market the Mac like crazy. They've got the iPod ball rolling. Sure ads are great for the iPod, but word of mouth is greater. Show Mac OS X on TV; what else is the eye candy for? How about a series of "What if..." ads, like ad #28 could be "What if you could plug in a video camera, click once, and see your grandmother in Tallahassee drinking her coffee. Now. With Mac OS X, you can." Then show a whole lot of screenshots of iChat AV and people using it. Say how it works on any Mac. Typical Apple style. These things get noticed; no one really loves Windows, they need to take advantage of that.

bradpaton
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05/21, 07:12pm | report spam | close Reply |
Not 1, 100

A subtle, but important, clarification is that Apple did not predict 1 million song downloads and get 70, their target was 100 million song downloads. This was discussed in decent length during the ITMS anniversary hoopla.

Captain Mutant
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05/21, 07:40pm | report spam | close Reply |
You're both wrong

Sorry bradpaton, you're both wrong: Apple's original estimate (when iTMS was first launched) was 1 million songs in the first 6 months.

It wasn't advertised at the time, but it was a figure quoted to the record execs (It was disclosed later on when iTMS pulverised that estimate in the first or few weeks).

apodaca
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05/21, 07:55pm | report spam | close Reply |
RE: Not 1, 100

The above person quite right in that Apple did set public expectations on iTMS downloads at 100 million. But Cringely's reference was to Apple's original estimates given to the record industry.

I see Apple raising their estimates as a way to almost downplay market performance of the iTMS, for as of many of you have stated, the iPod is the actual breadwinner in the iTMS+iPod combination. My hope is that prices for downloads actually decrease in price over time. I would love to see the media's recent commentary regarding price increases prove to be only FUD. Perhaps that is a bit optimistic given that margins are so razor thin that the recording industry would have to decrease THEIR prices. Not one piece of evidence has been brought forth indicating THAT ever happening.

apodaca
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05/21, 07:58pm | report spam | close Reply |
oops

beaten to the punch by The Captain. Suppose that's to be expected leaving my post, beckoned by the sounds of the popsicle vendor. :)

LouZer
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05/22, 12:48am | report spam | close Reply |
Re: what needs to be done

How about a series of "What if..." ads, like ad #28 could be "What if you could plug in a video camera, click once, and see your grandmother in Tallahassee drinking her coffee. Now. With Mac OS X, you can."

It doesn't matter what they do. People here will hate the ads. h***, the switcher ads basically came out to explain how easy it was to hook up your digital camera and save christmas, and all people did was talk about who was stoned and who sounded like a truck backing up (beep, beep, beep).

If they do an ad with eye-candy, they'll get laughed at by the windows users who'll say its just a pretty, but useless computer. And you can't be technical, because that will bore viewers to tears (and basically make them feel like idiots for not knowing what something means).

I mean, Apple comes out with the G5, a wicked fast computer, and they do an ad to get people's attention (the exploding computer room), and everyone slams it because it doesn't tell people something (oh, right, like saying "With an Apple G5, you can run those gaussian blurs in photoshop 7 three times faster than on a PC". )

Everyone crows about MS's advertising, or Dells. But they don't tell you anything. MS has flying people and office workers in slow-mo giving high fives because they use office Xp, like that actually happens. Dell just comes out and basically says "We sell computers!". Oh, they did have that Dell dude, who was extremely popular. But if Apple came out with the same dude, touting macs, you'd revile him and say apple still doesn't get it.

All I get is that the Macnn forums seems to be filled with a bunch of marketing 'geniuses' who apparently run advertising firms and large fortune-500 companies and knows exactly what apple's doing wrong. Well, could you pass along your personal info, so we can kick steve and his cronies out next april and put people in charge who know what they're doing...

Talleyman
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05/22, 12:06pm | report spam | close Reply |
Ummm...read, then comment

I really don't think this is an apple death threat column. He's saying IF this reorg doesn't pan, then it MAY come to pass that the Mac as we know it goes away, but then port OSX to the Cell processor or some other hardeware.

The article is very speculative. Didn't say Steve's a jerk, However if you read/listen to The Second Coming of Steve Jobs you learn he IS A MAJOR JERK that happens to be a visionary also.

Read kids, then comment. No cliff notes style.

tman

jeepandmacfan
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05/23, 09:11am | report spam | close Reply |
What articel did you read

Cringely isn't saying the Mac is dead, he's saying Apple might stop selling and designing their own designed hardware, and just jump on the Intel platform, and let other companies sell the hardware. That is to say, if you want a Mac in 2012, you'd call Dell and order one. Apple would only make and sell software. No one can denie the profitablity of the Mircosoft business model, and that is what Cringely thinks Apple might be gearing them selve up to do. Software is more Pofitable than Hardware. Do you know that Microsoft makes more money on each computer Dell sells than Dell does?

bradpaton
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05/23, 10:39pm | report spam | close Reply |
100 indeed

Google is a good thing indeed to verify and/or debunk.

bradpaton
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05/23, 10:42pm | report spam | close Reply |
Ooops

the link got wiped out somehow, but here is the CNN article I was referencing from April 29, 2004:
www.cnn.com/2004/TECH/internet/04/29/music.apple.reut/

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Cringely looks at Apple's iPod shuffle

updated 10:30 am EDT, Fri May 21, 2004

Cringely on iPod shuffle

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confused..

why oh why

Interesting

Re: confused..

Re: why oh why

Huh?

okay

Re: confused

Legal

For all we know...

one more thing...

ha

Always

re: Ha

Think about this...

Re

Not quite

a bit of a stretch

Re: Not quite

Re: Not Quite

dayam, people

What needs to be done

Not 1, 100

You're both wrong

RE: Not 1, 100

oops

Re: what needs to be done

Ummm...read, then comment

What articel did you read

100 indeed

Ooops

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