Apple is having an interesting pandemic. Sure, the company is delivering record results, largely driven by its profit-printing services division. At the same time, that division is at the center of most of the current criticisms facing Apple. All of that puts Apple in a complicated position.
It's complicated because while Apple's financial performance is as strong as it has ever been, its reputation--and in turn, its brand--is taking some hits. From antitrust hearings before Congress, to disputes with developers over App Store rules, to a knock-down, drag-out fight with Epic Games over Fortnite, there has been a lot of talk lately that Apple's recent behavior is eerily similar to the way Microsoft behaved back in the mid-1990's.
For Microsoft, that led to a massive antitrust fight with the U.S. Department of Justice that damaged its brand for at least a decade. It isn't hard to see why people might make the connection.
Still, I think that's wrong. I don't think Apple is anything like Microsoft was, and I'm not sure there's any honest way to make that argument. Despite being the most valuable company on earth, Apple doesn't actually have a dominant share of any market, other than over making its own devices and software.
I think Microsoft is the wrong analogy entirely because Apple isn't becoming Microsoft. Unfortunately, however, it's even worse. Apple is becoming Facebook.
Hear me out. Yes, I know Apple has been around much longer than Facebook. Obviously, the former was started before the latter's founder was even born.
But, for most of those years, Apple had a singular focus on the user experience in a way that few other companies did, or even understood. The result was a uniquely loyal following among tech companies. Of course, doing the right thing for users had a tangible benefit to Apple, which is why it's today worth $2 trillion.
Now, however, the line Apple draws in the spirit of protecting its users' experience is starting to look a little blurry. It's starting to be hard to even tell the difference between where it draws that line, and its own bottom line.
Even more troubling, however, is how the company has responded, in many cases. Take the way Apple responded to Basecamp's complaint over the rejection of its Hey email app.
Apple's email was clear to point out how that it felt Basecamp has long been a free-rider on the success of the iPhone, without contributing anything. That's because Basecamp doesn't allow in-app subscriptions, so there was nothing on which Apple could collect a commission.
In a statement, the company said:
We understand that Basecamp has developed a number of apps and many subsequent versions for the App Store for many years, and that the App Store has distributed millions of these apps to iOS users. These apps do not offer in-app purchase -- and, consequently, have not contributed any revenue to the App Store over the last eight years.
We'll come back to this in a moment, because it's exactly the reason Apple is becoming Facebook. First, let's look at what that comparison really means.
It's only fair to say that Mark Zuckerberg deserves credit for figuring out maybe the greatest business model in the history of the world. I mean that sincerely. Set aside the fact that I'm not a fan of how Facebook monetizes people's personal information, there's no question that it's extraordinarily good at it. From a pure profit standpoint, it's genius.
The bigger problem for Facebook, however, is that while its profit machine leads to all sorts of problems, it genuinely believes that it's doing the right thing. It justifies all sorts of issues--from how it hands privacy, to incendiary content, to fake news, and election interference-- as incidental to its mission of helping the world connect.
I've long argued that the biggest problem facing Facebook isn't any of those individual issues, but instead, is the fact that Zuckerberg is a true believer. He sees Facebook through the lens of what he believes it is, and is functionally incapable of seeing it as the world sees it. That disconnect explains the company's inability to make real changes that seem obvious to almost every outsider. Facebook simply can't see itself as anything other than the idealistic version it believes it already is.
This, unfortunately, is exactly the problem Apple faces today. Apple isn't even necessarily wrong. Take its battle with Epic, for example. Apple, on Friday, revoked Epic Games's developer certificate, which it had previously promised it would if the maker of Fortnite didn't remove its own in-app-purchase system that it added in clear violation of the App Store rules.
I don't have any sympathy for Epic. As a judge said, the problem is entirely of Epic's own making. Still, the episode highlights the bigger problem, which is that Apple appears to be unable to see itself as anything other than virtuous. That's a dangerous place to be because when you believe you doing the right thing for the right reason, you close yourself off the possibility that you might just be hurting both your customers and your brand. In that way, Apple might not be wrong, but that doesn't make it right.
I wrote as much last month, and I'll conclude with my earlier thought, which is that Apple's overarching principle here should be to do what's right for its users. Not just what it thinks is right, but what is actually right for the overall experience.
That's literally what made Apple the largest, most profitable, and most valuable company in the world. That obsessive focus on the user is what made people love Apple in the first place. Now, its obsessive focus on being right means it's becoming a lot less like Apple, and lot more like Facebook.