“Without pointlessly debating specifics, it does seem after historical perspective that closed, proprietary systems ultimately give way to freer platforms.”
It’s not clear. With music players Apple is effortlessly holding on to great market share. With phones carrier lockin hurt Apple but that’s starting to change. In the pad space it looks like Apple will continue to do very well. Mac sales continue to pick up despite a somewhat limited range of hardware options.
I’m all for competition as it will spur Apple on to even better products, but I’m not at all worried about Apples prospects. Apple is on an amazing run, and it’s mind boggling that its market cap is exceeded only by Exxon.
Historically, has competition inspired Apple? I am not a techie but just observing what has been going on it seems to me that Apple has pretty much been going their own way until that little hiccup with Skully giving in to "conventional wisdom" and selling their operating system to other hardware builders (Power Computing). Other than that, they have been the leaders with the others scrambling to catch up with the new ideas.
Others made portable music players but the iPod invigorated and revolutionized the market. Was there a smart phone before the iPhone? I really don't know but it doesn't matter because, again, Apple caused a real stir in the market place and that market took off with Apple in the lead. The same with the much ridiculed iPad when it was introduced. Did competition cause that or was it vision and leadership? As well as I recall, that particular market, the netbook or tablet, had been abandoned. Once again, Apple reinvigorated it and now it has become a phenomenon of its own.
I expect to see even more innovation from Apple because I think the have the future planned and are introducing it one step at a time. Competition is not likely to affect that.
Apple has never been sensitive to price so price competition won't affect them either. They build a better product, an integrated system, and provide a great user experience. People seem willing to pay for that. They are the most profitable company in the market. In market capitalization the are second only to Exxon Mobile, ahead of GE, Proctor and Gamble, Kraft Foods, etc. They have always seemed immune to competition and I don't expect that to change.
If I might jump into it, there's also the "good enough vs. highest quality" and "cheap enough vs. higher price" philosophy. No company is 100% either way, BUT each tends towards one end of the spectrum in each philosophy. With computers, comparing a $399 Windows box to a $999 minimum price Apple full computer, many decide the $399 box is "good enough." With the music players, Apple positioned an entry level player that was "cheap enough" that there wasn't a price point below it that other manufacturers could leverage. Other manufacturers also haven't been able to tap exterior sources of revenue to subsidize other music players as they could with PCs (adware on the PC.) With the tablets, the competitors were caught flat footed, as they were with the music players and smart phones. It's coming up on a year, and there still aren't any viable competitors.
BTW, side note: When Balmer came out with the HP Slate at a show a week before the iPad announcement, and the game he demonstrated was "Frogger," it was clear that Microsoft and others had again been caught flat footed. That year to grab market share and refine the product before other companies have even produced a viable clone is very valuable.
Apple has also become much better at making products that are "cheap enough." With the iPods, there's not enough pricing space below it for a company to make a product that is "good enough" and has enough price differentiation to grab market share. At this time, the iPad is apparently in the same category. By the time the touch screen, memory, processors, case and batteries are manufactured, it looks like $500 is about the floor for a product that does the job and is robust enough to be bounced around as much as a tablet computer will be.