Why the IBM-Apple Marriage Actually Works
- By Shudeep Chandrasekhar
When Apple (AAPL) and IBM (IBM) announced their partnership two years ago a lot of people were surprised because Apple has always stayed focused on consumers like you and me, not so much on enterprise customers.
It was a huge shift for the Cupertino, California, giant to push its devices into the enterprise market, but the company partnered with IBM in July 2014 to sell iPhones and iPads with industry-specific apps to business customers under the MobileFirst banner.
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Apple's iconic CEO Steve Jobs long shunned business customers as the requirements for devices for personal use and business use are totally different.
"I went with (former Intel [INTC] CEO Paul) Otellini to meet with Jobs and his lieutenants. We go into this meeting and say, 'Steve, let's work together to make your Macs better for enterprise customers.' Jobs looks at us and says, 'Why would I do anything for that orifice called the CIO?'" said VMware (VMW) CEO Pat Gelsinger. "At Intel we're aghast; two-thirds of our business is that orifice called the CIO. He went on to say, 'I'm going to build devices that are irresistible for consumers, and CIOs will just have to deal with it.'" - Computerdealernews
One can easily understand why Jobs was so against the move. He wanted to build devices for consumers and keep making them radically better. The enterprise segment has completely different parameters for its usage, and besides, BlackBerry is just one such example of why concentrating on that segment can totally backfire on you.
But with the IBM partnership came the risk that this would finally happen. However, the good news for Apple fans is that the company hasn't shown signs of tweaking its design language to address the needs of a business user. The entire move seems to be based on building applications that can serve different industries. It is not an inherent shift in Apple's core values of serving the individual customer's needs above all else.
So far they've developed more than 100 apps that are business oriented, giving Apple the benefit of selling to more than 2,000 enterprise-level companies and giving IBM in excess of half a billion dollars.
But that's not all. Early this year IBM became the first cloud service provider to allow development in Swift, the programming language Apple uses for all its operating systems including macOS, iOS, watchOS and tvOS. To Apple's credit, it cleverly open-sourced the language to enable enhancements that would eventually benefit users within its ecosystem of products and services.
To be honest, I was initially apprehensive about the direction of Apple's efforts with IBM. With the former being primarily focused on the consumer market and the latter being an enterprise-oriented behemoth, what would become of this "marriage"? Since then my fears have been put to rest, and both companies have decided that the software route would be the best one to take.
This way, Apple taps into IBM's width and depth of reach within the enterprise segment, and IBM gets the benefit of partnering with an iconic brand with which it formerly had nothing in common.
Disclosure: I have no positions in any of the stocks mentioned above and no intention to initiate a position in the next 72 hours.
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This article first appeared on GuruFocus.
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