The Big 5 Year in Review: Apple, Google, Microsoft, Amazon, and Facebook

Hello New York Times readers,

I have made the Apple portion of this subscription-only Daily Update free for those of you visiting from Farhad Manjoo’s column.

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I actually intended for most of this daily update to just be commentary and analysis, without the usual excerpts. But this piece by Nilay Patel at the Verge, entitled 2015: Apple’s Year in Beta, is really good and a great jumping-off point:

The Gizmodo headline last week was blunt, in the way that the best Giz headlines are blunt: Everything Apple Introduced This Year Kinda Sucked. It’s worth reading; it is surprisingly easy to make the argument that everything on Apple’s huge list of new products and features this year sucked a little bit.

But that’s not actually true. All of Apple’s products this year were just fine. You could settle yourself totally within the Apple ecosystem and use Apple Music and Apple News on your iPhone while taking Live Photos and you would be just fine. You wouldn’t have the best time, but you wouldn’t have the worst one, either. It would just be fine…

I would go so far as to say every new Apple product or feature released in 2015 was essentially in beta. Apple released a lot of big new platforms that, by themselves, weren’t nearly complete. Apple needed — expected, really — its vast army of dedicated and passionate third-party developers to come up with killer apps for things like the Apple Watch and iPad Pro. And when it wasn’t releasing new platforms, Apple was adding new features to existing platforms like iOS in an attempt to create sticky new user behaviors which would reinforce their dominant status in the market — new features that all need far more time to develop into those powerful lock-in mechanisms.

It may not seem like it, but Patel’s piece is fundamentally optimistic. I occasionally cite what I consider one of John Gruber’s best-ever pieces (which, much to his chagrin I’m sure, is not on Daring Fireball), entitled This is How Apple Rolls, that I think nails what Patel is driving at:

Apple has released many new products over the last decade. Only a handful have been the start of a new platform. The rest were iterations. The designers and engineers at Apple aren’t magicians; they’re artisans. They achieve spectacular results one year at a time. Rather than expanding the scope of a new product, hoping to impress, they pare it back, leaving a solid foundation upon which to build. In 2001, you couldn’t look at Mac OS X or the original iPod and foresee what they’d become in 2010. But you can look at Snow Leopard and the iPod nanos of today and see what they once were. Apple got the fundamentals right.

I’m not sure I’m as much of an optimist as Patel (presuming I understood him correctly). And while I think Gruber was spot-on when he wrote that in 2010, I certainly am curious what a 2015 version would read-like. There are two big concerns I have about Apple at the end of 2015:

  1. Contra Gruber’s piece, too many of Apple’s new products have too many features that don’t work well all the time. It’s the inverse of what made Apple unique previously, and much more in line with how most tech companies operate.
  2. The fundamentals at the core of many of Apple’s new products aren’t as strong as they could be not because Apple is necessarily incompetent, but rather because they involve skills and technology that Apple is simply not good at. Specifically, Siri and services

Number one, in isolation, would certainly be concerning, but manageable: slow down the pace, focus on polish, and get back to the sort of iteration that Apple excels at. It’s number two that is the real issue: technology moves in cycles, from devices to services and back again. To be sure, these are long cycles, spanning half-decades or more, but to the degree that you can trust a mere 40 years of history, it does seem inevitable that, for the next several years, it is services that will matter more than the devices on which they run on.

And, by extension, that means Apple is at a disadvantage: the skills to make great products are orthogonal to the skills needed to create great services. That’s not a fault of Apple’s! If anything, it is the company’s dedication to creating great products — the quality that is most to be admired about the company — that is their Achilles heel when it comes to services, and I for one am glad they make that trade-off. After all, we still need devices to consume said services.

Indeed, that’s why I wrote just a couple of months ago to Stop Doubting the iPhone; Apple’s existing businesses are as strong as they have ever been, difficult year-over-year comps notwithstanding. In other words, my pessimism, such as it exists, is subtle (and, I think, gets at the difference between what I’m trying to accomplish versus, say, a stock analyst): Apples short to medium term future looks better than it ever has, thanks to the seeds that were planted years if not decades ago. What, though, of the seeds that are being planted today?

(Note: No product captures the tension between Apple’s product skill and service shortcomings more than the Apple Watch, and I think my review does a good job explaining that).

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The Stratechery 2015 Year in Review

The top five most read posts, big ideas, company-specific posts, posts about media, and Daily Updates of 2015.

Slack Follow-up, The WeChat Platform, Uber and Facebook Messenger

More on Slack’s platform opportunity, which can be compared to what WeChat has already accomplished in China. That said, the fact way that China is truly mobile-first means that it’s likely that no one — including Facebook Messenger — will fully imitate WeChat’s model.