By Juan Pablo Vazquez Sampere
Apple is the poster child for creating and sustaining disruption. Back in 2007, when it launched the iPhone, Apple took functions available on few other mobile devices and made them accessible to millions of consumers. Subsequent iPhone generations expanded and enriched those functions.
Consider the App Store’s health apps. They enable you to monitor your health in ways that otherwise would be too costly or time-consuming—a functionality that makes them very valuable. Such an inroad into another industry—in this case, health care—is called a “new market disruption.”
Apple has led new market disruptions in many other industries, and the message was powerful for consumers: Buy the latest iPhone because every version will pay off—you will save money and time in several areas of your life.
After Steve Jobs’s death came the iPhone 6—a game changer for Apple, but not in a good way. The phone’s screen size was the model’s major difference from the iPhone 5. But screen size is simply a feature that other competitors already offer. It does nothing to disrupt other industries. The phone’s larger screen was a valued feature for consumers but much less costly for Apple to produce and launch, which helps explain the iPhone 6’s record earnings.
But the longer-term picture isn’t so rosy. Apple is getting plenty of competition at the low end of the market from Samsung, Xiaomi and many other smartphone-makers.
Apple’s shift away from leading the industry doesn’t bode well for the iPhone’s future. In these situations, the incumbent almost always fails—and one of the early signs of distress is an inability to make sense of the competitive environment. As Apple CEO Tim Cook said recently, “We’re seeing extreme conditions, unlike anything we’ve experienced before, just about everywhere we look.”
Just because Apple has stopped disrupting other industries with iPhones doesn’t mean that there are no more industries to disrupt. I believe that smartphones still have plenty of room to disrupt, to the great benefit of their users—which is precisely why I’d love to have the old Apple back.
Juan Pablo Vazquez Sampere is a professor of business administration at IE Business School in Madrid.