Why Apple is underestimated so insanely always

iMore ^ | Wednesday, Jan 28, 2015 | By Rene Ritchie

[Swordmaker]

Last year, the level of stupidity surrounding Apple was best exemplified by Haunted Empire, the calamitously bad book that tried to make the "Tim Cook's company is doomed" meme mainstream. Yesterday, Apple announced the most profitable quarter in the history of the business world — of which the other four companies in the top five are oil magnates. So, beyond market manipulation and negative attention seeking, what makes otherwise rational, intelligent analysts and journalists experience such a continued, collective blindspot when it comes to Apple's prospects?

Ben Thompson, writing for Stratechery:

It's difficult to overstate just how absurd this is, but here's my best attempt: last quarter Apple's revenue was downright decimated by the strengthening U.S. dollar; currency fluctuations reduced Apple's revenue by 5% – a cool $3.73 billion dollars. That, though, is more than Google made in profit last quarter ($2.83 billion). Apple lost more money to currency fluctuations than Google makes in a quarter. And yet it's Google that is feared, and Apple that is feared for.

Ben chalks the endless underestimations up to bad assumptions — that markets are monolithic, that consumers care more about specs and price than they do experience, and that when Apple says all they want to do is make great products, it's not given credence.

Tim Cook from our Q1 2015 transcript:

Apple's mission is to make the greatest products on earth and enrich the lives of others. Through the success of iOS, we have provided hundreds of millions of people with powerful personal technology that is simple and fun to use. Our customers are using Apple products to transform education, discover new ideas for business, and express their creativity in ways that no one could have imagined when we sold the first iPhone less than eight years ago.

It's amazing to watch, and it reminds us that people and great ideas are the reasons we make the things we make.

That the same people can be wrong about the same thing so completely always — and that people continue to publish and link to their wrongness — is what the rest of us have a hard time understanding.

"Okay, Apple made some money this quarter, but next quarter they'll fail."

"Okay, Apple made some more money this quarter, but now next quarter they really have to fail."

I experienced it again yesterday. After reporting on Apple's quarter, I was told it was just a temporary blip — pent up demand for bigger phones that, now exhausted, would leave Apple to "once again" plummet in the market.

It seems insane, but it's really not that dissimilar to a certain kind of gambling mentality. Some people see Apple as betting on the same thing quarter after quarter, year after year, and they figure Apple's luck just has to run out. The more Apple wins, the more they believe the odds stack against Apple, and the more likely they think it is the company has to lose — and soon. Every time Apple wins, they not only expect the loss to be inevitable next time, they want it to be.

The problem is, Apple isn't betting. They're investing.

The company is lining themselves up — rather conservatively — behind a very few product categories at a time, and with a strategy they've proven for decades. And like I wrote yesterday, while many continue to misunderstand or ignore the "make great products" strategy, Apple is doubling down on it.

[cynwoody]

Did the author write that headline? Sounds like a tweener talking...

He had to get a certain word in ... Google can help.

[Morpheus2009]

Why?

I am not a hardcore apple fan and possess a ipod touch instead of an iphone, but I can think of these 5 reasons:

1) Because their products are User-Friendly
2) Because you are insured for their products
3) Because their products don’t come in so many different options (when it comes to options, less is more)
4) Because iTunes, which corresponds with the iPhone works on every operating.
5) Because you can ask for free instructions on how to use the product at the Apple Store before buying it from the store staff who experiment on them all the time.

[Swordmaker]

I am not a hardcore apple fan and possess a ipod touch instead of an iphone, but I can think of these 5 reasons:,p> Those are five good reasons, Morpheus. . . good try. There are a lot more, as well. #2, not so much. But I have taken a client to Apple's Genius Bar with a two-and-half-year out of warranty MacBook Pro that four years old, which was doing some mighty weird things that I could not figure out. They took it to the back and came back about 45 minutes later and said, "We are sorry, but the logic board and LCD screen have gone bad, and are unrepairable."

As my client was starting to ask how much a new MacBook Pro was going to cost him, the Genius interrupted him saying, "Hey, don't worry. We are gonna replace it. Give us a few more minutes to copy everything we can off your old drive. . . " Ten minutes later he walked out the door with a BRAND NEW MacBook Pro with a new warranty, about four times the HD capacity, and twice the RAM. No Charge. THAT, my freepfriend is customer service.

[Morpheus2009]

I count the warrantee policy as insurance, so I think we actually agree about #2. My experience with getting my iPod touch fixed was a good one as well. Showed them the pregnant battery pack problem inside the iPod touch, and they took care of it.