January 24, 2021
ON THE UP: BIG TECH LED BY APPLE
Momentum for Big Tech is skyrocketing and Apple is leading the way.
Moonshots always come after crises because they bring out the hope in us… that’s why we literally went to the moon after the Cold War. They come when everything feels out of control and you need to create your own velocity and momentum.
Nothing reinvigorates momentum quite like a moonshot, the more audacious the better. But in recent years, Big Tech has been making as much noise as a lunar sound wave. It’s been quiet. Tech is ubiquitous. And we’re bored. We need inspiration and hope.
It’s been a minute since even Apple made our jaws drop. The momentum for iPhones, Apple Watches and iPads has been stagnant — all just variations of themselves, annoying us with a lack of game changing features that just fill up our landfills. After iPhone 6, who’s counting and who knows the difference.
Apple is experiencing a surge in momentum, breaking record sales, and finally getting back to their moonshot mission of “Think Different” as they step back in the spotlight: smart glasses. 5G enabled devices. Landmark App store regulations… Even an Apple Car!
We’ve seen other players try their hand at these, but they’ve all fallen flat, failing to position their tech with the “Gee Whiz” that gives consumers a real reason to care. Apple isn’t just a leader at creating bicycles for the mind — it’s also a master of branding, consumer adoption and FOMO. We will drink their kool-aid because they’re pros at making it work seamlessly + integrating across their ecosystem. They make the stuff we can’t live without.
Big Tech has had mass for decades. Lately, this sector has been lacking the velocity required for shiny new things to truly take off. As we enter the momentum decade, brands like Apple are transforming to lead Big Tech again with the velocity needed to launch us into the future.
Apple is currently rebounding from a record low MFactor of 65 to a high of 85 by hitting on all 5 drivers of momentum.
DISRUPTION: Big Tech uniting over social media censorship + bans.
If the past few months have shown us anything, it’s that social media has the power to make hate speech and disinformation go viral as quickly as memes about Bernie Sanders or cute photos of a cat.
The conversation about censorship and Big Tech is erupting as Silicon Valley giants flex their policy muscles. This all came to a head after banning former President Donald Trump from Twitter and Facebook and removing social media platform Parler from the Google and Apple app stores.
Twitter and Facebook putting its foot down after a long and controversial battle with President Trump was no surprise. It is the stance of Apple and Google that is causing a massive disruption and shift in the conversation surrounding censorship as they ban free speech social network app Parlor from their app stores.
Apple has long been a master of disruption (successes like the iMac G3 in 1998 and of course the first iPhone) but has taken few stances politically on their App Store. Back in 2018 they removed InfoWars from Apple’s App Store, the only other notable disruption in addition to the stance the company took against the most recent ban of Parler.
This approach by Tech’s Big 5 marks a momentous occasion where social media giants and mobile app providers have taken a collective stance on a singularly focused topic.
INNOVATION: The master of FOMO, Apple is innovating on the failed tech glasses of the past to bring us Apple Glasses.
In classic Apple fashion, they’ve stayed remarkably quiet while submitting patents (ranging from pupil expanding technology to augmented and virtual reality). They are strategically playing into the game, generating hype and momentum that surged to a high of 14 this month as consumers get excited about technology that could change the way we see the world.
You’re probably asking yourself, “Why is this any different? What will make Apple Glasses actually take off?” We’re so glad you asked.
Apple has strategically taken a “watch and learn” approach to do what others have tried to do, but do it better.
- Google: soon after launching Google Glass in 2014, they realized B2C wasn’t taking off and pivoted to a niche B2B strategy where the glasses helped optimize work productivity. Apple will find a way to succeed in making their glasses B2C.
- Snapchat: Snap Glasses only integrated with the Snapchat app and only took pictures. Patents suggest Apple Glasses will integrate with all your Apple devices into a singular lens, making it easy for you to keep track of everything in one convenient place: your vision plane. And they are said to provide value in a variety of ways beyond photos.
- Our hypothesis: for Apple Glasses to take off, they’ll need to align themselves with a clear B2C use-case. Reading glasses help us read. Sunglasses prevent us from squinting. Blue light glasses protect our eyes from screen damage. What benefit will these glasses provide us and when will we wear them?
POLARIZATION: The great debate on Big Tech’s power
The social media speech wars are shifting from breakups of social media companies to the implications of private power of technology companies and their sway of public interest and opinion.
Now that Democrats have taken control of Congress and the White House, many believe Amazon and Apple are positioned to be the next subjects of antitrust lawsuits similar to that filed by federal and state agencies in 2020.
- Amazon: critics point out that nearly 40 cents of every dollar spent online in the U.S. last year went to Amazon — more of the online retail market than competitors like Walmart and eBay.
- Apple: Scrutiny lies within Apple’s control of the online marketplace for mobile app for Apple devices. Apple charges upwards of 30% on app downloads and purchases made within apps.
While tech companies may be facing antitrust scrutiny for their size and market power, antitrust lawsuits aren’t focused on monopolies to produce less diverse speech. There are few answers to what the government may be able to control regarding online speech.
STICKINESS: Apple’s “show don’t tell approach” to branding 5G is helping to unlock the future of 5G.
We’ve all heard about 5G. What’s most sticky about it right now are the conspiracy theories and memes… and the latest 5G-equipped iPhone. But does anyone really understand what 5G does?
- Momentum for 5G surged from a low of 30 to a high of 56 in late March when conspiracy theories linked 5G to COVID-19. Then it dropped back down to 30 and has hovered there since August.
- Telecom companies hyped its arrival and touted vague benefits for the last year, but no one provider has yet to “brand” 5G in a consumer-facing, digestible way. They’ve failed to educate consumers on the tangible benefits or provide a clear vision for 5G’s future.
Then the iPhone 12 arrived in October (5G’s momentum got a temporary spike to 40). Now consumers are adopting 5G because they want the latest iPhone.
Apple is helping to drive the future of 5G because consumer adoption is integral to unlocking 5G’s potential.
- Cellular providers need sufficient consumer adoption to justify building out their 5G networks.
- Once they expand their networks, the vision CES 2021 shared can become a reality. The powers of 5G lay far beyond just cellular connection as 5G looks to solve cost challenges in cities, increase sustainability and provide the network necessary for powering massive societal shifts like automated trucking.
SOCIAL IMPACT: Apple’s promise towards sustainability and social impact is not without controversy.
… Yet another reason why Apple is such a master of cultural relevance.
Their recent decision to ship their latest iPhones without wall chargers or lighting earpods in the box is one of the most strategic moves they’ve made recently. Some consumers were furious as they expected to be getting the necessary accessories like in the past.
Apple deems the customer complaints worth it because the removal of these accessories strategically allows for a smaller retail box meaning around 70% more units can fit on a shipping pallet thus reducing carbon emissions. Overall, Apple believes this will cut over 2 million metric tons of carbon emissions per year, which is like removing 450,000 cars from the road each year.
This is thoughtful both in terms of environmental impact and business strategy. By framing these decisions within a sustainability lens, Apple is able to move past most consumers without them realizing the very clear benefits from a business standpoint. Apple will of course be spending less on shipping, less on packaging and less on parts and development of these accessories.
THE DOWN: the iPhone 12
…That’s why they are hyping everything else. More likely that their record breaking quarter was driven by demand for computers & iPads than iPhones.