There's a blessing in being a company as loved as Apple, but there's also a curse. When you're both that large and that innovative, the market expects you to continue being innovative and your investors expect you to continue growing.
At some point, however, markets simply get saturated. No matter how cool your next mobile device is, you just can't sell enough of them--or raise their price enough--to sustain your growth. Sure, there are ways you can extend product lines (small phones and supersized ones), create new business models (such as the App Store), and even shame your customers into buying new stuff (what, you have an iPhone but no Apple Watch?). However, all of these strategies have their limits. Especially as smartphone sales start to plateau.
The only option left is to get into a different market altogether. And hopefully, one that will eclipse your current success.
As unlikely as that may seem, don't forget that Apple is now primarily a mobile device company and not a computer company. That was also a shift nobody would have predicted. Clearly, they have some expertise and a track record in outdoing themselves.
Which is why a recent disclosure seems to confirm something that has long been rumored.
A One-Way Ticket
It all started when Xiaolang Zhang, a two-year Apple employee, was suspected by Apple of taking company secrets. Zhang had access to the inner workings of Apple's very secretive autonomous car division, code named Titan.
Zhang had been terminated from Apple and there were concerns about some of his activities. All of this culminated on July 7, when, according to a detailed article in the Washington Post, he was arrested by federal agents after buying a one-way ticket to Beijing.
The story about Zheng and the allegations against him are fascinating in themselves. However, what is much more interesting is that in court documents filed by Apple, it's disclosed that of Apple's 135,000 employees, 5,000 are working on the autonomous vehicle project, with 2,700 of these employees dedicated to it full time.
This makes Apple one of, if not the, largest player in the autonomous vehicle market. Waymo, for example, has 680 employees listed on LinkedIn.
Why is Apple betting so heavily on AVs?
First, because it understands the potential for a technological shift in transportation that's even more dramatic than that which the iPhone effected on mobile devices.
AVs will at least double the number of vehicle hours driven in the U.S. alone by 2035, and quadruple them by 2050. See my prior Inc. article on this.
Second, because Apple wants to own the platform that captures your behaviors. As Chris Nicholson, CEO of Skymind, a company which focuses on leading edge machine learning and also develops software for autonomous vehicles, said to me when I interviewed him for my latest book, Revealing the Invisible:
"A lot of people don't realize autonomous vehicles are basically going to be a smartphone that we live in for hours every day. We're literally inside of it. It's an app we can't escape.
"When we get into that smartphone and it starts rolling, we're sending it the highest and most powerful signal of intent that any human can. It's much more powerful than going on a website when you're browsing. That's what anybody building a recommendation system wants. They want a signal of intent. When you say, 'I'm getting into a car now and I'm going in this direction and at this time of day,' [that's a] huge signal [of] intent.
"There's a possibility here to make much better recommendations and surface alternatives for people in their lives. At the same time, because it's a smartphone we live inside, the sensors will be able to collect much more data about us. There could be webcams trained on our faces. Microphones trained on our voices. Rather than just clicking on a website, we're giving the signal of intent with our direction and we're also showing it our whole analog expression, 'Is your face angry or content? What is your voice saying? Who else is in the car?' We're actually digitizing much more of reality, and by doing so, we'll be able to read more subtle signals which gets into the collection of behavioral data. The cars are going to be data gathering mechanisms par excellence."
I love Chris's description of an AV as a smartphone you step into. With this sort of "phygital" (a mashup of physical and digital behaviors) insight into our behaviors, the AV is uniquely positioned to be a central player in leveraging our digital behaviors. But it also does something else, which has been an ongoing debate in our transition to a digital world. Namely, it counters the increasing trend toward the sci-fi vision of a Wall-E-like culture where humanity is relegated to a chair-bound existence and all their needs are met by robots who replace their need for mobility. Granted, you could spend all of your time sitting in your car as easily as you could on a Lay-Z-Boy in your living room, but your La-Z-Boy doesn't take you anyplace.
So, will Apple pull it off? I certainly wouldn't bet against them. Better than virtually any other company, they have illustrated what it takes to not just sustain innovation and success but, more importantly, to continue growing out of your past success.
It's hard to change the world just to have to change it again. The only thing that's certain is that if you don't, somebody else will. But that's the blessing and the curse of innovation.