So, Apple peered over the edge into the great black abyss that is automotive manufacturing and may be having second thoughts. The latest word is that Apple may be shifting their focus to a more complementary software target. Hmm, where did I hear that predicted before?
This shouldn’t be a surprise to anyone. Listening to Tim Cook in a recent interview, he outlined some of his criteria for deciding in which direction Apple should go. An Apple Car doesn’t fit that bill.
As much as Apple doesn’t want to get bogged down with the quality control of spring tension on accelerator pedals, automotive companies don’t want to be dealing with maintaining complex software controls.
Even if Apple doesn’t jump into automotive with both feet and launch the Apple car. They do seem destined for Automotive. Apple is to operating systems as Goodyear is to tires or Corning is to glass. Automotive companies have got to be coming to the realization soon, if they haven’t already, that it would be cheaper and less hassle to modify an existing OS to fit their needs than it is to build one from scratch and maintain it.
But many companies have to learn this the hard way. Back in the early days of my career as a manufacturing analyst in the mid-nineties, it wasn’t uncommon for medium to large sized companies to design and maintain their own IBM AS400 software applications. We all had pie in the sky dreams of getting a competitive advantage through better software. But we all found out the same thing, keeping a stable of programmers to write and maintain software is super expensive. It was way cheaper to go with SAP or Oracle and modify an existing platform to fit your needs. The SAPs of the world could afford an army of programmers since they could spread the cost over all their clients.
Eventually the automotive companies will come to their senses and see that they don’t really want to become software companies. Automotive is a cutthroat business with small margins and whoever can make a partnership with an Apple, Google, or Microsoft first will have a competitive advantage.
As much as Apple doesn’t want to get bogged down with the quality control of spring tension on accelerator pedals, automotive companies don’t want to be dealing with maintaining complex software controls.
Even if Apple doesn’t jump into automotive with both feet and launch the Apple car. They do seem destined for Automotive. Apple is to operating systems as Goodyear is to tires or Corning is to glass. Automotive companies have got to be coming to the realization soon, if they haven’t already, that it would be cheaper and less hassle to modify an existing OS to fit their needs than it is to build one from scratch and maintain it.
But many companies have to learn this the hard way. Back in the early days of my career as a manufacturing analyst in the mid-nineties, it wasn’t uncommon for medium to large sized companies to design and maintain their own IBM AS400 software applications. We all had pie in the sky dreams of getting a competitive advantage through better software. But we all found out the same thing, keeping a stable of programmers to write and maintain software is super expensive. It was way cheaper to go with SAP or Oracle and modify an existing platform to fit your needs. The SAPs of the world could afford an army of programmers since they could spread the cost over all their clients.
Eventually the automotive companies will come to their senses and see that they don’t really want to become software companies. Automotive is a cutthroat business with small margins and whoever can make a partnership with an Apple, Google, or Microsoft first will have a competitive advantage.
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