Horace Dediu, at Asymco, has been posting some beautifully shrewd observations on the pattern of Apple’s growth and the failure of Wall Street and the investment community to get a handle on it. Why have the professional investment analysts so consistently undershot Apple’s record of profit and sales growth in the last 6 years? Why are they in fact getting worse at making predictions about Apple? Horace’s suggestion is that they have not been paying attention to a pattern of exponential growth. They have plotted straight lines and ignored the non-linear trends:
But would forecasting exponential growth be considered reasonable? Clearly not since it’s never been consensus. But disruptive companies do follow non-linear growth. In fact, every company that has gone from being small to being big (which is to say all large companies) went through non-linear growth phases. The “natural” shape of growth is exponential.
The failure is therefore not of reason but of failing to use a model that assumes acceleration of sales. I believe that institutional financial advisors are conditioned (or coerced) into assuming that nothing unreasonable ever happens. That seems like a completely flawed foundation to stand on. On Being Reasonable: Asymco
This is not only a problem on Wall Street. Apple’s competitors and non-competitors have also failed to assess the strength and continuing growth of technology platform which does not meet conventional expectations. Computer manufacturing competitors, mobile phone competitors, software competitors and media companies have all failed to assess and measure the direction and the power of Apple’s growth. They have failed to spot its disruptive potential. Even when it is already very apparent: on the back of the iPod, the iPhone and the iPad, Apple has been growing like a train for 10 years: exponentially. Apple is now showing, and may well show us all for the next three, four, five ….. years that a very large company can continue to grow exponentially.
Apple may continue to grow at its furious exponential pace for several more years yet, and the iPad product range and its potential derivatives will be a key plank in that growth. This is something that Wall Street and the media giants who have most to benefit from the development of tablet culture have both failed to twig. Jeff Bewkes, Chairman of Time Warner, was quoted on this a couple of weeks ago by the Financial Times:
Leaning back in his chair, he dismisses the idea that digital distributors such as Apple and Amazon threaten Time Warner’s business model, arguing that their platforms are useless without its content.
“What power do they have over us? They have to have us on their devices,” he says. Consumers can find Time Warner brands from CNN to People magazine on iPads and iPhones without the iTunes store’s controversial subscription service, he notes.
Time Inc is the only large US magazine owner not to sell subscriptions through Apple, and Mr Bewkes is withering about others who accept its terms. Publishers are allowing their subscribers to become “subscribers to Apple Corporation. I’d question where that’s headed,” he says. (2 December, Financial Times)
The problem and the opportunity that Bewkes is here dismissing is that of exponential growth. Exponential growth ends when it reaches its limits. The environmental constraints kick in: e.g. when the lilly fills the pond, when the iPad/tablet device has largely replaced the desktop and laptop PC market (if that happens). As he surveys the horizons of technological change, Bewkes may be missing a disruptive shift, the possibility that Apple’s continued domination of the media consumption platform will overturn the certainties of an earlier era. There may not be an alternative to doing a deal with Apple, and yes Time Warner’s subscribers will become Apple’s subscribers. Figure out a way of keeping these magazine purchasers as Time Warner’s subscribers also. That is the appropriate competitive response. The opportunity that Time Warner’s magazines are already missing, through a late start, is that of growing subscriptions exponentially within the Apple eco-system. If you are too late for the party, you risk missing it altogether; and exponential parties are the best parties to be at.
Along with this, you can use colorful lightings to decorate it.
A new year is not only a time to get our lives in order, but also our homes.
Humans – Invent says you can see it in Salanave’s hands too.
Let the Tally Ho Inn serve you a fabulous meal on their
peaceful deck while you enjoy the warmth of the outdoor fireplace.
The fabric chairs are less expensive than the wooden office chairs
or the leather office chairs. To cap this off, Bechan has
left us with some great tips like this:.