Master this deck with 21 terms through effective study methods.
Generated from uploaded pdf
The estimated development cost of Apple's mobile phone in 2015 was around $150 million.
At the time of Apple's entry into the mobile phone industry, the dominant players were Nokia, Motorola, and Samsung, which collectively held roughly 60% market share.
Apple faced challenges such as a highly competitive market dominated by established brands, short product life cycles averaging six to nine months, and a lack of experience in sophisticated technologies like radio technology.
Steve Jobs created a razor-and-blade business model in reverse, where the variable element (songs) served as a loss leader for the profit-driving durable good (iPod).
Competitors to iTunes included online music stores such as Amazon.com, Napster, and Walmart.com, which offered individual song downloads at competitive or discounted prices.
Streaming services like Spotify and Pandora challenged iTunes by offering personalized radio stations and unlimited access to music catalogs, allowing users to create playlists and stream music without purchasing individual songs.
Qualcomm was significant in the smartphone supply chain as it controlled CDMA (3G) and LTE (4G) protocols, earning royalties on almost every CDMA and LTE phone sold globally.
ARM Holding played a crucial role in the smartphone CPU market by providing the core design for the majority of smartphone CPUs, licensing its design for about 1% of the sales.
Microsoft's total revenues showed a consistent increase from $36,835 million in 2004 to $86,833 million in 2014, indicating strong growth over the decade.
Microsoft's gross margin percentage in 2014 was 69.0%.
Apple's entry into the smartphone market reflected its strategy of innovation and integration, leveraging its existing ecosystem of products and services to create a compelling offering.
Short product life cycles in the mobile phone industry implied that companies needed to innovate rapidly and frequently release new models to stay competitive, leading to increased R&D costs and marketing efforts.
The smartphone market was considered risky for Apple due to the established competition, rapid technological advancements, and the company's limited experience in mobile telecommunications.
The rise of online music streaming significantly impacted traditional music sales by shifting consumer preferences towards subscription models and away from purchasing individual songs or albums.
In 2010, Microsoft's total revenues were $62,484 million, with a net income of $18,760 million and a gross margin of 80.2%.
After Apple's entry, the competitive landscape of the smartphone market evolved with increased innovation, the emergence of new players, and a shift towards more integrated and user-friendly devices.
Apple employed strategies such as focusing on design, user experience, and ecosystem integration, as well as leveraging its brand loyalty to differentiate its products in the mobile market.
The structurally different supplier base in smartphones compared to PCs meant that companies had to navigate different relationships and dependencies, particularly with key suppliers like Qualcomm and ARM.
The iPod was significant in Apple's overall business model as it served as a gateway product that drove sales of iTunes and established Apple's presence in the digital music market.
Apple's approach to product development differed from its competitors by emphasizing secrecy, a focus on design and user experience, and a commitment to integrating hardware and software.
In the years leading up to 2014, Microsoft faced financial challenges such as increasing competition, the need for innovation in its product offerings, and pressures on its traditional software sales.