Apple in the post-Jobs era: Five hits and misses
Apple's just now entering its second year without co-founder Steve Jobs. CNET rounds down five hits and five misses during 2012.
This week marks the beginning of Apple's next financial year. It's also the first full calendar year of Apple without Steve Jobs. The technology icon passed away a year ago today.
Now's as good a time as any to take a quick look back at some of the highlights and lowlights for Apple at a time when onlookers are paying close attention to just about every detail -- something that certainly hasn't changed.
Hits
New iPhone breaks sales records
Despite some finding Apple's annual iPhone update to be underwhelming, the device got off to a record start. On its opening weekend, the company sold more than 5 million iPhones at its stores and through its carrier partners. Those numbers were preceded by the fact that Apple sold more than 2 million of the devices in the first 24 hours of pre-sale, twice the preorder numbers from last year's model.
Apple will provide the first eight days worth of iPhone sales, plus the rest of the quarter leading up to September 29, when it announces its fourth-quarter earnings on October 25.
A big win against Samsung in court
Apple sued Samsung last April, claiming the company was ripping off its product designs and infringing on a number of patents with its smartphones and tablets. Samsung sued back and the two have gone head to head in courts in the U.S. and around the world.
The big U.S. trial, which kicked off last month, ended up almost entirely in Apple's favor. A jury decided Samsung should pay Apple $1.05 billion in damages. Samsung also faces potential sales bans on some of its products, something that will be decided later this year.
The two companies are set to go back to court in the U.S. over a slew of new products and patent claims in 2014. But for now, Apple has been the big winner.
For the entire fiscal year, Apple's stock has been on a tear, starting out just under $400 and closing off around $667 -- touching past $700 along the way. Wall Street firms like Goldman Sachs, Sterne Agee, and Bernstein Research expect that price to keep moving up, hitting $800 in the next 12 months.
Dividend + Stock buyback
For years, one question Apple could not escape during calls with analysts was what the company planned to do with all its cash. That became a very reasonable question when Apple surpassed $100 billion in cash and other securities, a sum that regularly began to be calculated into lists of things -- including countries -- Apple could buy.
When asked what the plans were to do with all that money, Cook said the company was putting a mix of it into research and development, retail stores, the supply chain, and other pieces of the Apple infrastructure. Yet the balance was still growing faster than Apple could spend it.
In March, Apple changed its tune. The company announced plans to initiate a quarterly dividend of $2.65 a share beginning with its just-wrapped-up fourth quarter. It also announced plans to spend $10 billion over three years to buy back stock.
The show has always been a good indicator of excitement for building on Apple's platforms, and has grown in step with the popularity of iOS devices like the iPhone and iPad. Apple hasn't announced any plans to try and hold a separate show, or expand the venue. In the meantime, selling out so fast seems like a pretty good problem to have.
Misses
iOS Maps 2.0 Apple completely revamped its mapping software with iOS 6, with the aim of replacing Google as the built-in maps provider. The thing is, the company didn't tell anyone it would be doing that until four months before a release to the general public.
The result was an application that users have complained is rife with errors and inaccuracies. Worse yet, not as good as the app that came before it. Several reports have also suggested that the backroom dealing on the way to the app left Google flat-footed when it came to creating its own replacement.
The company made the rare move of swallowing its pride and admitting that the software "fell short," adding that it was "doing everything we can" to improve the software. In the meantime, unhappy users have been on the lookout for third-party apps to fill the gap, and are waiting for Google to even acknowledge that it's got a replacement app on the way.
The upward curve of Apple's retail growth appeared to level off and perhaps to be in trouble with reports in August that the company was cutting hours and laying off employees at some of its stores. Fingers immediately began pointing back to John Browett, who took over Apple's retail operations earlier in the year.
A conversation from Browett to store management, relayed by the Wall Street Journal had the executive saying the company "messed up" with a new scheduling plan for the company's retail stores, and that it was reverting to the old one. A follow-up report two weeks later from blog ifoAppleStore claimed there were still a number of scale backs at retail stores, including the removal of training areas and less in-store workshops in favor of more floor area for accessories.
EPEAT withdrawal, reverse course
In June, Apple quietly ended its participation with Electronic Product Environmental Assessment Tool group, which rates electronics for their greenness. In a statement, Apple said its products were still made to meet the Energy Star 5.2 guidelines and that it posts extensive information about its environmental efforts on its Web site.
Many consumers were miffed though. If Apple's products were so green, why not use a major, third-party group's rating system as well? After weeks of pressure, Apple made the rare move of reversing course and saying the move was a "mistake."
Siri
Siri, which turned one year old yesterday, was introduced as the headlining feature of the iPhone 4S and can now be found on Apple's latest iPad and iPod touch. The voice assistant was promised as a robotic tool that did not require any special directions to use and would get better over time. Users, however, found it clunky, and Apple's claims overreaching.
A lawsuit filed five months after the feature debuted called Apple's advertising for Siri "false and deceptive." In real world use, the software simply was not understanding basic queries, the complaint said. A similar assessment came from analyst firm Bernstein Research. In a note last week, the group said Siri was "woefully inadequate," especially when compared with Google's own offering.
"Siri is woefully inadequate on several fronts, including its availability, its natural language interpretation and its ability to properly answer more than simple queries," the firm said. "We compared Siri's search capabilities vs. Google's for 18 different queries, and generally found Siri to be good at defined searches in select areas (i.e., ones that are location based), but that it struggled with more abstract or ambiguous searches (like "Jaguar" or "Taj Mahal's Greatest Hit.")"
A software update as part of iOS 6, released just a few weeks ago, added several new features, including movie times, restaurant information, and sports scores.
Apple made a name for itself not only with its products, but in advertising them too. From its famous 1984 commercial, all the way to the "Get a Mac" series with actors John Hodgeman and Justin Long, Apple's TV spots were known for being snappy and memorable.
Enter what were referred to as Apple's "boy genius" ads, spots featuring a young male Apple tech support guy in the wild, helping the helpless with their technology, and sometimes life problems. Critics said the ads hit all the wrong notes, making Apple's customers appear bumbling, mixed with mean-spirited knocks at competitors. More importantly, there was the underlying message that there could be problems for Apple users, even if there was ever-present help.
The ads, which debuted during the summer Olympics, disappeared from television less than two weeks after their debut. The company went one step further, wiping them off the Web a few weeks after that. Apple has since gone back to its tried and true product-focused advertisements for its latest iPhone, tapping celebrities for narration and showing off features. Some have already called the ads boring, which is better than insulting, right?
The jury's still out
China
The worth mentioning, but hard to categorize item is China, a long-running part of Apple's resurgence that will no doubt continue to be a hot button topic for years to come.
Months after becoming Apple's CEO, a series of reports from The New York Timeslambasted the manufacturing side of Apple's business, something near and dear to Cook. While Apple's chief operating officer, Cook is credited with utilizing overseas manufacturers to very quickly produce massive amounts of computers, iPods, and now iPhones and iPads.
The reports, which weren't the first to be critical on the matter, lambasted Apple for poor labor and safety issues in its supplier facilities, as well as for using cutthroat business practices that prohibited those manufacturers from making improvements. In its own annual supplier report, Apple said it found issues with working hours and compliance with environmental standards.
Cook responded to the situation inside a leaked memo to its employees, saying the company cared about "every worker in our worldwide supply chain," and that "any suggestion that we don't care is patently false and offensive to us." Cook then made a public appearance at a technology conference put on by Goldman Sachs to reiterate those claims, followed by a trip to China, where he was photographed next to workers on the shop floor of Foxconn, donning some of the same protective clothing.
Concerns about overseas manufacturing, and Apple's involvement persist. A report from the Students and Scholars Against Corporate Misbehavior last month said that those in a key Foxconn factory in China that produces iPhones still faced "deplorably harsh working conditions," among other violations of Chinese law. Foxconn said the report did not represent the 192,000 employees who worked at the facility. Just three days later, 2,000 workers at a Foxconn factory in a different part of the country erupted in a riot, reportedly over a spat between a worker and a guard. The plant, which employs 79,000 employees was closed and reopened a day later.