Friday, November 23, 2007

Paul meets with Papa Peter

So ever since the fight with Troy and Paul's unofficial designation as honorary Mayor of Cupertino, Team Munster agreed to leave him out west for the time being. He's holed up in one of those executive hotels where you pay by the week. For the info we've been getting, it's easily worth it.

So yesterday Paul is out at one of Cupertino's local drinking establishments for Thanksgiving since he's got no family out that way. Well, who do you suppose walks in but Oppenheimer! Paul writes:

Gene, this is almost too good to be true and I hope you're sitting down. Definitely do NOT read this email on your iPhone while driving.

Peter sees me and sits down to congratulate me on the whole "kicking Troy's ass" thing and orders a round of martinis for us. Well, several rounds later I start asking him about the deferred revenue and the whole growth story and he tells me that he and Steve have been intentionally holding back Apple's growth.

Gene, I hope you're still reading this, cause you read it right. Basically boss, both the iPhone and Leopard could have been out as much as a year sooner than they were. That's not saying they were ready production-wise mind you. What I'm saying is that Steve has laid out a ten year plan for Apple and has the entire thing orchestrated for steady, controlled growth. It's mind boggling to hear Peter talk about it Gene...well and a little hard to follow cause he was pretty plastered. 

Basically it boils down to this: they were worried that if they allowed the innovation folks to run at their own pace, the growth story would be over too soon. So everything is being done in a very exacting way, from new product releases to store openings to new iPhone agreements. Everything Gene, for the next decade. It's all figured out already.

Somewhere around the fourth or fifth round he said to me, "Paul, if you think the iPhone is mind-blowing, imagine a half dozen products that make the iPhone look like Pong. Remember Pong? That's what is going on here Paul. But if we release everything too fast, people will hardly know what to do with it all. So we're going nice and easy so everyone can grasp where we are going, and we can keep growing the earnings.... and keep the story moving."

I said to him "so you mean something like the iPhone with 3G is already figured out?" He says "Paul, what the hell do you think Steve took out of his pocket at Macworld?!?!?! What do you think he's been using all these months? And that's just one example. If we let this thing go at the pace our engineers are on, consumers would probably just freak out and stop buying altogether. Customers are already holding back their purchases because they think the next version of whatever is just around the corner. They have no idea, Paul. We've got so much stuff in the wings. And we've got to keep such a tight lid on everything. This stuff could drive a man to drinking."

That's where I lost him boss. Got a pretty good bump on his head when he passed out too. Gene, I think we're going to need to consider finding me a condo out here.

Yours truly, Mayor Paul

1 comment:

Anonymous said...

Paul is getting some great inside stategic info! This is a concept known as "planned obsolesence" "Planned obsolesence" is the decision on the part of a manufacturer to produce a consumer product that will become obsolete and/or non-functional in a defined time frame. Planned obsolescence has potential benefits for a producer in that it means a consumer cannot just purchase a product once that will last indefinitely - the life of the product's usefulness or functionality is fixed, so that at some point the consumer must purchase again, whether returning to the original manufacturer for a newer model, or buying from the competition. It also has potential benefits for consumers, because they are not forced to spend extra for an over-engineered product, thus becoming unable to afford a more technologically advanced product, with greater functionality, in the future. For an industry, it stimulates demand in the marketplace by ensuring a customer must come back into a buying mode sooner than had the product been built to last longer or indefinitely."

In the case of Microsoft, planned obsolesence is driving the customer to now purchase from the competition . . . they aren't able to produce a product which supersedes Windows, so the customer base is migrating to Apple's Leopard.

More about planning to make products obsolete