Apple

To all who thought the iPhone was the greatest achievement in the '00s, I think you are somewhat wrong. Instead, I believe it is Apple's App Store that deserves a majority of the credit. The App Store is the platform that really enabled the iPhone to shine, and, without it, the world might be very different.

ABI Research is predicting that 5 billion smart phone applications will be downloaded worldwide by 2014. To compare, there were 2.3 billion mobile applications in 2009. This means that in 4-years time, mobile application downloads will be double what they are today.

That's a pretty big leap.

With that, you would have to assume that smart phone sales would possibly double as well.

If data and voice pricing for mobile phone providers grew more affordable in the near future, I could see this number growing even faster.

But let's get back to Apple's App Store, the platform that really kicked this into high gear.

The App Store is the platform that allows developers to create applications for the iPhone (iPod Touch and iPad too). Without it, the iPhone would be nothing more than a pretty looking phone. With it, however, the iPhone becomes the device that opens the door to a rich, social, interactive, and engaging experience — it opens the door for users to do things on their phones that were once thought meaningless or impossible.

Granted, the App Store is also a centralized place for application management and distribution, and that can sometimes cause problems. Specifically, it creates a gatekeeper, and if you don't play by the rules, you could get kicked out of this ecosystem. Some applications and developers have been mistreated, and that isn't fair.

This is why other ecosystems are being created. Google now has its own marketplace — Google Apps Marketplace — that enables developers to freely create, manage, distribute, and charge for their applications, without the interference from a gatekeeper.

But what about Windows Mobile and BlackBerry? Weren't they the ones that kicked off the mobile application craze? Well, there is no doubt that other companies did this before Apple. There were already mobile application marketplaces and devices that utilized applications. However, they were not nearly as successful as Apple's App Store.

So, Apple and the App Store, in particular, has to receive the credit for propelling these technologies forward.

Apple has not only pushed mobile technology forward, but it pushed our interests in mobile technology forward as well. As a result, hardware manufacturers, software developers, mobile technologies, and consumers are all benefiting from their efforts. And, depending on how Apple's iPad fares, that 5 billion number could be a gross underestimate.

It's no secret that Apple is one of the few hottest companies in the world right now. Their products are praised around the globe, and they are declared as a leader in design and innovation.

So it makes sense that some smart financial folks on Wall Street have Apple pegged to do some serious damage in China, and I think they could dominate. However, I think they must be careful about how they do this, as expanding too fast could be dangerous.

That said, China is a gold mine for Apple; this is true for all companies. The country is developing quickly and dripping with opportunity, and if a brand isn't present in China, its future is certainly questionable (yup, we're talking about Google).

That brings us back to Apple.

There is a distinct correlation between Apple stores and Apple market share. Over the past seven years, Apple has opened over 120 stores, and, with that, their market share grew by several percentage points.

This correlation is even more apparent in Western Europe, where over 30 stores were opened and market share grew from 1.5% to 5% within a few years. While appearing insignificant, these numbers huge in terms of growth — this is why we have Apple constantly breaking new all-time highs on Wall Street.

Good for Europe and America, but how many stores should Apple plan for China? Well, I believe Apple should open 12 additional stores: one for each of China's largest cities to serve as a test of market interest. That would add up to 100,000,000 potential consumers in those 12 cities alone — that is around a third of the entire U.S. population. Apple would then have a pretty decent idea of where to expand next.

It should be noted, however, that Apple already has two stores in China: one in Beijing and one in Shanghai. Furthermore, the company has plans to open 25 stores throughout China within the next two years.

Unfortunately, I think that is a mistake. I would have been much happier if they cut that number in half, and the reason is that there are many uncertainties about the Chinese and American economies (both of which rely on each other so heavily). The threat of an economic failure is still apparent, and political struggles are growing in both countries as well.

With that in mind, if Apple turns out to be a hit, it could have a dramatic impact on the competition.

For example, Microsoft is already heavily embedded in China, yet Microsoft operates at a loss with in the country. The reasoning for this is that Microsoft has been unable to adapt to Chinese consumer and enterprise behavior.

Apple, on the other hand, is a much smaller company with a more distinct focus — consumer electronics, mobile, and computer technology — and with those specific niches, Apple can better target their products for Chinese consumption. This could allow Apple to build up in China slowly, and eventually expand with better a much better understanding of Chinese culture.

Either way, Apple has a golden opportunity here. China is the market that every company in the world wants to be invested in, and I think it is time for Apple to make its presence felt. That said, Apple should tread lightly at first, as the Chinese market is a tricky place — American companies are struggling to adjust. But if Apple properly adapts, it could make the Apple investors very happy and very rich.

Plenty of discussion about the iPad has been going on lately, but the bigger story here is that magazines and newspapers are investing time and resources to develop digital versions of their publications for Apple's tablet computer. The hope is that this will revitalize interest in their publications. But at what price?

This is, perhaps, a huge deal. This could really be the beginning of a new way for magazines and newspapers to generate money; however, it could also prove to these publications that people want their content for free and are completely satisfied with Web-based versions.

Either way, the next few months are going to be crucial for the print industry, which is exploring unknown territories in the hope of generating money with newer media formats while replacing older failing formats.

But the price of these digital versions of publications might be a barrier to entry.

The average price for a magazine or newspaper subscription can vary, buut how about some examples. The Wall Street Journal is $29 per month. Men's Health is around $4.99 per issue. Not bad, right?

To compare, the iPad version of the Wall Street Journal will be $18 per month while Men's Health will cost the same as iPad's version.

That isn't as cheap as many had hoped.

Let's consider for a moment that we wanted five magazine subscriptions. Let's assume each magazine subscription for the iPad will cost us around $8 on average for a month's worth of content. That could easily add up to $40 a month or $480 per year. Ouch!

Is $480 per year for five magazine subscriptions worth it (again, nothing this is only hypothetical)? To some people, sure it will be. But to others, it doesn't make any sense considering that anyone could fire up a browser window and view this content for free.

I pay around $20 a month for a Netflix subscription that allows me to watch as many movies as I want. So, where is the value with iPad's digital magazine subscriptions?

Let me make something clear though: I don't have a problem with magazines or newspapers making money. No problem at all. But these publishers must realize that the cost of their content must be considered with the cost of other publications. If these publishers invest a lot of time and resources into creating these digital magazines, it will certainly require plenty of subscriptions, but an increased price, however, might mean less overall subscriptions.

Sure, people will pay to be able to experience these cool magazine features with live video integrated, but I believe the appeal will quickly wear off.

Yet I assume that supply and demand will work these things out on their own. But I, for one, will not be having any of it. Apart from the fact that I am waiting for the 2nd generation of the iPad before I even consider purchasing it, I believe that the investment required is far greater than the price of the iPad itself.

The iPad is supposedly selling very well from pre-orders: Around 150,000 people have estimated to take the plunge. Guess what though? I'm not one of them. I am not going to pre-order the Apple iPad, and I am not changing that. There is simple and logical reasoning behind this as well, but most are ignorant to the facts.

So let me begin by explaining why I wouldn't pre-order the Apple iPad, even if I was willing to in the first place.

First off, the iPad is a first-generation device. And like most first-generation devices, it is bound to have issues. I can't recall a single product launch that has gone flawlessly, and it takes several iterations of a product to get it right — there are bound to be complaints and, quite possibly, serious issues with the iPad. Sure, that isn't the risk-taking, edge-of-your-seat mentality that most technology enthusiasts share, but I am certainly an exception to that.

After all, isn't this thing merely a jumbo-sized iPod Touch? Sure, it will have new capabilities — it will have applications better designed to handle the large screen. But at the end of the day, it is still an iPod Touch on steroids, and there isn't much that is revolutionary about this. No one better dare attempt to tell it differently. People make this thing out to be the greatest thing since sliced bread, but we have already had this device for the past few years — the iPod Touch. Who knew?

The next issue I have with the iPad is the price. So it might be drastically cheaper than we all expected, but that still doesn't automatically make it a worthwhile purchase. What we have here is a gadget that most people will be unwilling to take out of their house. What value is that in a world where gadgets are designed with portability in mind? Seriously? If you have an e-reader, an iPhone, or even an iPod Touch, there is little reason, if any, to buy this thing.

Also, with the Lenovo Ideapad U1 Hyrbid coming out — where you can get a laptop and a slate in one package — I'm not quite sure that the Apple iPad will be the most worthwhile product in the tablet category. The Microsoft Courier is really looking special as well. Why does Apple get the favoritism? Well, of course we know why, but it only proves consumers are less intelligent than I would have hoped.

Beyond that, the most important reason that I am not pre-ordering it is because pre-ordering is stupid! It doesn't matter what the product is!

Why is someone going to slap down the big bucks for an unknown product that they have never touched, never experienced, and never read a single review about? What is the logic behind this? Are people afraid that if they don't pre-order now that they won't ever have an iPad to purchase? It's ridiculous! Who cares if you don't have one in your hands on the third of April? I can assure you that they will have plenty in stock in following month, if not in April.

So why not wait until other people get their hands on it and see what the overall consensus is? It costs you nothing, and it gives you the satisfaction of knowing you waited for a great product that you will use.

While the Apple crowd will probably look down on their fellow Appletons who go this route, I would applaud it. It is both the right and the smart thing to do.

When it comes to customer service, few companies get it right. For some reason, companies invest little in customer service to reduce pricing of their products, but these companies rarely realize that customer service is part of what we pay for, and some companies do it better than others. But Apple does it best.

Consumer Reports has released the numbers of a survey of over 7,000 computer subscribers that measures customer satisfaction, and the results are not the least bit shocking: Apple trumps all others in tech support satisfaction.

Apple is continuing the trend of solid customer service, and year after year the company scored excellently in providing solutions, quick phone wait times, helpful phone services, and accessible online support. This year is no exception.

Unfortunately, Apple's competition didn't fare as well. Falling behind in the ratings are Lenovo, Toshiba, Dell, HP/Compaq, and Acer/Gateway/eMachines — listed from best to worst in tech support satisfaction (see graph for specifics).

Of course, there might be a slight bit of favoritism by the consumer reports subscribers, but with the one experience I had with Apple support — even out of warranty — they sent me a replacement power brick for my Macbook that was damaged from overheating within two or three days. As a result, I can't doubt the numbers for a minute.

While tech support and customer service isn't the sole determining factor of a company's success, it can't hurt. Companies like Apple, Lenovo, and Toshiba are obviously on the right track, but the rest might want to take a page from the tech support elite. Future sales from consumers of tomorrow might rely on the customer service experiences of today.

Are we prepared for the tech industry to be rocked again? Well, Apple is ready to take the stage with the approaching release of their highly regarded iPad. Both Wi-Fi and 3G-enabled models will begin shipping in April, but anyone can throw down cash in March to secure their pre-orders.