Unlike the others on here - the Axios argument does make sense.
Essentially, the trade war related instability has made it's hardware story much more precarious (just like for any other consumer or enterprise hardware vendor), so some sort of a software story is needed to help cushion margins.
The issue is, aside from the App Store, Apple traditionally never had a strong software story. If Apple does not build some sort of a software story (which at this point is AI), it's harder to justify it's current valuation and it's "FAANG" status.
It's also undeniable that a LLM Chatbot player WILL make the foray into make their own bespoke hardware in order to target the consumer market, and the "chatbot as an oracle" UX does have strong traction amongst non-technical personas.
RIM, Sony, and Nokia were also on top of the world in 2007-09, but quickly saw their fortunes turn around as Apple's App Store+Hardware Design+Gated Ecosystem story helped provide some polish and a UX that the others failed to provide.
Essentially, if Apple didn't bungle Siri, they wouldn't be in the current situation today, and Apple is facing significant risks due to supply chain instability. Some diversification is needed.
> It's also undeniable that a LLM Chatbot player WILL make the foray into make their own bespoke hardware in order to target the consumer market, and the "chatbot as an oracle" UX does have strong traction amongst non-technical personas.
I am sure that there are going to be a bunch of these and almost all of them will suck, and if apple tried to make one now, it would also suck. Apple didn't invent the mobile phone, or the laptop, or the mp3 player, etc. They'll let someone else figure out if there is a market for it and then they'll refine it.
> They'll let someone else figure out if there is a market for it and then they'll refine it.
The same was said about Nokia, RIM, Sony, and Microsoft, yet they failed. The current iteration of leadership at Apple doesn't have a strong history of successfully launching monetizable software plays other than the App Store, and that is a fairly distinct muscle.
More critically for Apple and the target personas who read Axios, Apple will not be able to justify it's current P/E ratio, because it's growth story has become difficult and it's margins are weaker now. That is why Apple is "turning" into a loser.
> Apple didn't invent the mobile phone, or the laptop, or the mp3 player, etc
Apple in the 2000s also didn't have a PE ratio in the 30s, which gave it more breathing room as it's product was it's products, not it's stock. Apple became a victim of it's success, as it is now treated as a blue chip - and by blue chip standards it is one of the less diversified ones (similar to Tesla imo)
Essentially, the trade war related instability has made it's hardware story much more precarious (just like for any other consumer or enterprise hardware vendor), so some sort of a software story is needed to help cushion margins.
The issue is, aside from the App Store, Apple traditionally never had a strong software story. If Apple does not build some sort of a software story (which at this point is AI), it's harder to justify it's current valuation and it's "FAANG" status.
It's also undeniable that a LLM Chatbot player WILL make the foray into make their own bespoke hardware in order to target the consumer market, and the "chatbot as an oracle" UX does have strong traction amongst non-technical personas.
RIM, Sony, and Nokia were also on top of the world in 2007-09, but quickly saw their fortunes turn around as Apple's App Store+Hardware Design+Gated Ecosystem story helped provide some polish and a UX that the others failed to provide.
Essentially, if Apple didn't bungle Siri, they wouldn't be in the current situation today, and Apple is facing significant risks due to supply chain instability. Some diversification is needed.