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Apple, Steve Jobs, and The CE Market Posted: May 11, 2004 Samuel Alunni, Principal, Sterling Research Partners |
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There is nothing inherently wrong in your analysis of Steve Jobs and Apple's move into the CE market. The one outstanding point left untouched, however, is this: Just how big can Apple expect to get in this marketplace. To put this in context, it's important to remember that the U.S. consumer electronics market was abandoned by the U.S. Government in the 1950's, because of its belief that "security trumps commerce". The opinion then was that Japanese dumping -- and the subsequent destruction of U.S. consumer electronic manufacturers -- was acceptable if it helped create a robust Japanese economy that would act as a bulwark in the containment of Communism. Today, nearly $1T is spend on consumer electric products, most of it going to Asia, and -- as I understand it -- there are now CE related technologies used by the U.S. military that cannot be manufactured here. Until the U.S. government recognizes the long-term strategic threat posed by the loss of its CE industries, companies like Apple will remain small time players in the overall market, desperately trying to stay ahead of Japanese manufacturers with niche market innovations.
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