Report: Apple boosted by corporate customers as consumer demand falters

Apple co-founder Steve Jobs sneered at corporate customers, but with iPhone sales dropping and the company’s revenue slipping, business clients have become a key base for the Cupertino firm.

Jobs in 2008 demonstrated his contempt for the corporate buyer, referring in a meeting with Intel officials to the position of chief information officer. “Why would I do anything for that orifice called the CIO?” Jobs said, according to Computer Dealer News.

Now, however, Apple is increasingly reliant on big-business customers, who occupy a crucial role now that the firm’s phone sales have been slowing down. Last year’s $25 billion in sales of equipment and services to companies and other large customers represented only about 11 percent of total revenue, but also reflected a 40 percent jump over the previous year, compared with 28 percent revenue growth overall for the company, according to The New York Times.

“Sales of high-end iPads to business customers in particular have been strong,” the paper reported. “Nearly half of all iPads are now bought by corporations and governments. Companies are turning to Apple’s products for their tight-knit hardware and software, advanced security features and intuitive interfaces.

“Aiding Apple’s corporate sales has been a concern that phones and tablets running Google’s Android software, which are generally cheaper and popular with consumers, have lagged in the security technology and the standardization that companies want.”

The company’s iPhones and iPads “have become the preferred mobile computing devices for corporations, as industries from insurers to airlines aim to ditch bulky PCs and give their employees the ability to do their jobs from anywhere using smartphones or tablets,” the paper reported.

And Apple CEO Tim Cook takes a different view of the corporate customer than Jobs. The firm started taking “enterprise” buyers more seriously when people began using their iPhones and iPads at work, Cook told a conference in September, according to Bloomberg. “When the world was bifurcated between consumer and enterprise, we focused on the consumer,” Cook said. “But now if you want a smartphone, you don’t say, ‘I want an enterprise smartphone.’

“Enterprise is a huge opportunity for us.”

Photo illustration: An iPhone held up in front of the Apple logo. (AFP/Getty Images)

 

Tags: , , , , , ,

 

Share this Post



 
 
 
  • fstein

    Back in 2008, enterprise IT had a “just say no to Apple” policy. Now, with BYOD, IT has to support Macs, iPads and iPhones. Apple wisely partnered with IBM who have been selling support and ‘solutions’ usually on a per user basis. The IT department simply passes IBM’s bill to each department (plus their internal mark-up).

    Users get the devices they want. IT takes no risk. Apple’s devices are more secure and manageable. Cisco and SAP joined the party more recently. Apple, IBM, Cisco, SAP, and end users all win.

    • TrickyDickie

      “more secure and manageable”

      Lol!

      • Matt Perkins

        iOS devices are proven more secure and easier to use than Android devices. You can be an Android fanboy all you want but the facts are facts. Security Researches all agree iPhones are more secure than Android devices. Hackers all agree iPhones are harder to hack into than Android devices and even Consumer Reports says iPhones offer the best out of box experience compared to Android. So not sure why you’re laughing unless it’s at your own ignorance.

    • William Haynes

      IBM now sells and makes apps for the SURFACE tablets too.

      • fstein

        No doubt. Windows and it’s variants must be supported too.

  • AAPL.To.Break.$95.Soon.>:-)

    How long has it been since Steve Jobs passed away? Do people really think Apple is going to follow his way of doing business forever. Times change and the business has to change with it. When Steve was alive Android didn’t have 85% market share like it does now. All that’s left is poor countries with poorly-paid consumers only wanting to buy the cheapest piece of smartphone they can get their hands on. Apple had better find some other customers willing to pay for their products no matter where they come from. Apple should try as hard as possible to woo the enterprise and maybe the company will eventually lose that doomed reputation. Heck, no one is saying Microsoft or Tesla is doomed, so why should Apple be considered doomed. It would be nice if Apple could take over where BlackBerry used to be. Wall Street once worshipped RIM for having a lock on the enterprise.

    • TrickyDickie

      “why should Apple be considered doomed?”
      Because even the fanboys are starting to wake up to their marketing tactics lol

    • CelestialTerrestrial

      Tim did manage to get IBM and Cisco to promote Apple products in the Enterprise. IBM is now a reseller of Apple products. IBM is a Authorized Service Provider for Apple in the Enterprise. IBM is also a large and growing customer and case study as an Apple customer. Check out the JMAF conference presentation from last year, it’s a pretty good video to watch what IBM did last year and what benefits they are seeing.

      I think the old CIO mentality has been changing over the years and Apple’s benefitting. It sure doesn’t hurt that Tim is an ex-IBM and ex-Compaq manager with a degree in Industrial Design and an MBA. As brilliant as Jobs was, he really never understood the business world and that’s partly his own fault. He was too busy with the consumer and education space, he forgot who spends the most in IT. plus, IBM had the control and pushing PCs along with every PC clone mfg. So Microsoft benefitted by slapping their OS on anyone’s hardware. The problem is that it’s just flat out more costly to manage from an IT perspective and they forced their users to use Microsoft based OS, and then the employees bought PCs for the home because that’s all they knew. The iPhone really turned a lot of PC users over to Apple, and the Mac business has been increasing since.

      I think if everyone that has an iPhone were to use Macs, then Mac market share would reach 18% global market, which isn’t too shabby, they currently have only 7 to 8% global.

      The thing that people STILL can’t wrap their heads around is that if you add up the Net Profits of Microsoft, Google, Samsung, HP Inc., Dell, Lenovo, Acer and ASUS (All of Apple’s biggest competitors for desktops/laptops, smartphones and tablets), Apple makes as much as they do COMBINED. Apparently Apple’s business model works, and these others don’t. Apple only works on a 40% Gross Margin and retains a 20% Net Profit.

      For those idiots that think that Apple’s products are overpriced… I have one thing to say. NO, Apple’s products are not overpriced. It’s their competitors that are selling their products too cheaply, not managing their inventory/product offering well and they don’t have a strong efficient retail store model that works. If you look at Dell, HP, Lenovo, etc. they just make too damn many products and what happens is they overspend R&D, Support, and most importantly Inventory and they end up discounting them because they not only confuse the customer, but they can’t sell everything they make. It’s called TOO many SKU’s, TOO much inventory, TOO much discounting, and that’s TOO many TOO’s. Going after market share is the DUMBEST thing to do if you go after business that’s not profitable. A big number (customers) multiplied by zero (no profits) is still zero profits. That’s why IBM, Compaq and others got out of the PC industry and sold their businesses to someone dumber than they were.

      When people say that Android has the biggest market share. Well, yes and no. If you look at the smartphone business of products sold under the MSRP of $400, Apple has no market share, but if you look at the $400+ market, Apple has a pretty damn good market share. It’s just that the there are more people buying the sub-$400 smartphones and those don’t make any profit. They have those Freedom phones for $10, how can anyone make a phone for $10 and make an actual profit? I think the Chinese government has to subsidize a lot of these China based smartphone mfg. that lose money on selling smartphones, but for how long can they do that? I’m surprised there isn’t more fallout in the Android world in terms of Android mfg going out of business.

 
 
css.php