Apple's Curse of Success

Oddly enough, time, it's own success, the inescapable logic of public company valuation and the firm's ability to churn out products it can convince people they have to own, are going to cause Apple problems, despite the launch of version four of its iPhone, the iAd network or the iPad.

Apple likely will execute well enough on all those fronts. Still, as it keeps getting bigger, friction is going to increase. The simple fact for any large company is that growth is hard to sustain because of the law of large numbers: Apple simply has to climb a bigger wall every quarter as its market capitalization and sales revenue grows, quarter over quarter.

Also, as every equity analyst has said, or thought, Steve Jobs, a singularly important executive in the technology business, will not live forever. No matter how capable his successors, he has proven to be an unusually effective chief executive, not for his management prowess but for his driving vision. Most companies produce products. Apple creates emotional needs.

So Apple will start to become the victim of its own success. No company can create an endless string of hit products quarter-after-quarter and year-after-year, though it is hard to argue with what Apple has achieved since 2001. The iPod began the streak.

But then Apple discovered iTunes was something more than a distribution system for music, leading to the App Store and the mobile apps trend. The iPhone arguably changed not only mobile phone design but the business ecosystem. The iPad might be the start of another wholly-new mass market. And Apple seems destined to be a player in mobile advertising as well.

Keep in mind that Apple shares were selling for about $8 in 2001. They are up around $250 or so today.

Nor will even these challenges prevent Apple from bidding to be among the dominant firms of the coming mobile computing era. It has a shot at such success. But success, for a firm that is getting to be as large as Apple, increasingly gets difficult, no matter how visionary it is.

The targets keep getting bigger. And, at some point, reversion to the mean will occur. Some future executive will start to worry about the numbers too much, become shy about destroying existing product lines in favor of new and untested product lines. Apple will lose that "magical" quality Jobs talks about so much.

Will Apple Get 48% of All U.S. Mobile Advertising by End of 2010?

Apple CEO Steve Jobs predicts the Apple iAd network will get 48 percent of spending on mobile advertising in the United States from July through December of 2010.

That's a stunning prediction, given that total U.S. mobile advertising for 2010 is estimated to be about $593 million. Apple has about six months to get that done, starting from zero. Well, not zero.

Apple says it already has gotten commitments for about $60 milliion from  Nissan, Citi, Unilever, AT&T, Chanel, GE, Liberty Mutual, State Farm, Geico, Campbells, Sears, JC Penny, Target, Best Buy, Direct TV, TBS, and Disney.

Apple iPhone 4: All that Metal Includes the Antenna

Which means signal reception is going to be affected by the way the user holds the device, though possibly less so than in the older design.

That's a lot of metal, with fairly good spatial dispersion for the antenna element. So in a weak signal area, reception might improve, for voice, when the speakerphone is activated and the user is "hands free."

Apple Demo Crashes: 570 Wi-Fi Networks Live in the Room

Sign of the times: Apple demo crashes. Attendees told to shut everything off. Why? "There are 570 Wi-Fi base stations operating in this room...That’s why our demo crashed.”

But the iPad updates are pretty amazing. About two million iPads were sold in the first 59 days (one every 3 seconds).

Some 35 million apps have been downloaded, about 17 per iPad.

Five of six biggest book publishers say the share of iPad e-books is 22 percent of all ebook sales in the first eight weeks.

There’s now more than 225,000 applications in the App Store and there have been five billion downloads.

About 15,000 apps are submitted every week, and 95 percent are approved in seven days.

AT&T Appears to Allow Some iPhone 3GS Users to Upgrade to iPhone 4 Without ETF

AT&T says it has adjusted eligibility requirements for at least some iPhone owners, allowing them to upgrade to the version 4 model without being slammed with an early termination penalty.

It is not clear to me that "every" iPhone customer will be able to do so. One of the iPhones on my account was replaced in November 2009 and it still appears that the upgrade date remains November 2011.

With some exceptions such as this, it appears AT&T wants to avoid negative reaction from most iPhone users who have gotten their 3GS devices and have had them a year or so.

Last year, AT&T likewise allowed some, perhaps most, iPhone 3G users to upgrade to the newer iPhone 3G S at the same discounted price as new subscribers. The move followed customer criticism about having to pay a $200 fee to upgrade to the iPhone 3G S before their two-year contract was over. Now AT&T is getting ahead of the crowd to make sure recent customers will see the same heavily-subsidized iPhone pricing as new and out-of-contract users.

iPad Gets 22% of E-Book Reader Market in Several Months on Market

Steve Jobs says Apple's iPad already has gotten 22 percent market share of e-book readers. Not too shabby for a product that allows users to read e-books as a feature, not as the primary device function.

Is Microsoft About to Fall Behind in Tablets AND Mobile Phones?

Goldman Sachs analysts caution that Microsoft is at risk of falling behind the iPad in the same way that the company fell behind the iPhone.

"Given iPad’s success, tablet PCs dominate many investor conversations, as it has created the potential of a fourth consumption device (PC, phone, TV and now tablet)," writes Goldman Sachs analyst Sarah Friar.

Microsoft seems to believe the tablet is simply another form factor for the PC. Apple perhaps doesn't agree, and maybe doesn't have to worry about which view is correct. If all Apple can do is make the absolute-best tablet PC, then it wins. If it uncovers the fourth media device, and executes, it also wins, and maybe wins even bigger.

But it is hard to see how Apple can lose, at this point. The bigger question is whether anybody else can win, and if they can, how big they can win.

As Ballmer shrugs off the iPad, Microsoft risks another late start: