Apple is Not a Software Company
Marco Arment, the founder of Instapaper and former tech lead at Tumblr recently wrote that there really isn’t much of a market for tablets, just for iPads. I have no bone to pick with his main point, he’s right about that. But part of his analysis is way off base (the bold emphasis is mine):
And, like they’ve done so far with Android, the hardware manufacturers will continue to attempt to make their own user-facing applications and front-end interfaces, but these usually suck. (Other people may describe “suck” with kinder, apologist adjectives like “getting better” and “not bad”.)
These manufacturers aren’t software companies: they’re hardware companies that write software out of necessity. Apple is a software company that makes hardware out of necessity. The software side of a modern computing platform is far more difficult and expensive to create and maintain than the hardware. Anyone can cobble together the same processors, DRAM, flash, and radios as Apple, put them into a plastic case, and run a commodity OS on them with slight front-end customizations. But not everyone can create an entire software platform.
Apple is absolutely not a software company that makes hardware out of necessity. That sells Jonathan Ives and his team of brilliant industrial engineers short. Creating innovative hardware is still very hard. Copying Apple’s hardware is easier, but still difficult; it takes a few tries to get right.
I can see where Marco is going with this, he wants to paint a simple picture of two types of companies, hardware and software companies. He wants to put Apple, Google and Microsoft into the software category and all the other tablet makers that use Windows and Android such as HP, Dell and the Asian manufacturers into the hardware category. He then wants to say good software is really hard and good hardware is really easy, so the tablet manufacturers that aren’t software companies are stuck. Apple makes their own hardware so it works fantastically well with their software, but the hardware companies are forever disadvantaged because they can’t make software that will will work fantastically well with their hardware.
This is just not an accurate picture though, Apple is not a hardware company dabbling in software or a software company dabbling in hardware. Apple is the last of a breed of something we used to have a lot of, a systems company. Systems companies create systems composed of hardware and software.
I’m not sure how old Marco is, but I’m guessing he’s a bit younger than me because I can remember a time when the computing landscape was dominated by systems companies: IBM (z/OS, RS/6000 and AIX, PS/2 and OS/2), DEC (VMS), HP (HP 3000, HP-UX), SUN (SPARC and SunOS/Solaris), Silicon Graphics (IRIX), Apple (Mac), Be (BeOS and Be Machine).
In a classic disruptive move, Microsoft and it’s flock of PC OEM’s (Dell, Gateway, Acer, etc.) killed off the systems companies one by one, either outright, or by forcing them to abandon their systems (HP, IBM except for the mainframe) in favor of becoming a Windows OEM. Apple is the only one that survived as a systems company at a time that didn’t favor the systems companies; hardware compatibility was king and hardware innovation was static (More’s Law was driving all the innovation).
Now that Moore’s Law is breaking down and innovation in hardware form factors and interfaces is back on the top of everyone’s agenda, it’s a great time to be a systems company again. Apple is outperforming their technology peers, and we all want iPad systems, not some hardware devices running Android or Windows software.
