Apple could be a bigger player in the enterprise, but chasing CIOs around could be damaging to its operating model.
In a talk arguing that Google and Apple were disruptive to Microsoft in corporate IT, Gartner analysts Tom Austin and David Mitchell Smith commented on the company’s corporate ambitions.
With Steve Jobs’ passing, a few of us expect Apple to be more aggressive about the enterprise.
Jason Perlow recently outlined the case for Apple focusing more on corporate sales. Indeed, Apple CEO Tim Cook is an IBM alum and mentions the enterprise frequently on earnings conference calls. In fact, Cook is just about the only one that talks about Apple’s enterprise gains via consumerization.
Also see: Apple in the enterprise: The road forward
“It’s not that Apple doesn’t care about the enterprise, but the enterprise doesn’t drive product development,” said Smith. “It let’s consumerization happen and then does limited tweaks for the enterprise as long as it doesn’t affect product design.”
You can go through years of earnings call transcripts and find Cook mentioning the enterprise regularly once the iPhone launched. However, I’ve been told that Jobs chose to look the other way about budding enterprise sales—who can argue with profits falling out of the sky. Jobs tolerated small enterprise focused projects—say the B2B App Store and swat teams looking to poach verticals from RIM—but saw corporate customers as a distraction.
It’s a distraction that may pay off though. The room here in Orlando was packed for a presentation about the prospects of Google and Apple as vendors. For our purposes, we’re focusing on Apple here. A separate post looks at Google.
See: Google Apps for business: 0.5 percent of Google’s revenue, says Gartner
Smith and Austin called Apple’s approach passive aggressive. There’s a good reason for Apple’s approach though—targeting the enterprise is expensive. They said in their presentation:
Apple’s operating expense (OpEx) numbers explain their passive aggressive approach to enterprise business. Enterprise direct selling and enterprise-specific requirements would severely distort that model. Apple wants enterprise business, but not at the type of price paid (in R&D and SG&A) by enterprise providers. Apple’s vertical integration allows it not only to reduce cost of goods but also to exploit new technologies more quickly than competitors who are not as vertically integrated.
This is where consumerization gets so interesting for Apple. the company may not have to focus on selling to corporations because its customers will bring devices into the workplace anyway. In many respects, Apple fans are the enterprise sales team. And they happen to work for free.
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