Apple Finds a Niche Catering To Big Business With Its iPad
Nick Wingfield | November 16, 2011
Walt Disney president and chief executive officer Bob Iger, left, was appointed as a director to Apple on Tuesday to shore up its board after the death of Apple co-founder Steve Jobs. Apple also picked Arthur D. Levinson, the chairman of Genentech who has been on the Apple board since 2000, to become its nonexecutive chairman. (Reuters Photo/Danny Molosho) Related articles
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San Francisco. Steven P. Jobs never cared much for selling Apple products to big businesses.
The late Apple chief executive so disliked the process of catering to the needs of business, rather than those of consumers, that he called chief information officers in corporations “orifices” at a conference in 2005. “There are 500 men and women in the Fortune 500 — CIOs — that you have to go through,” Jobs said then.
A funny thing happened, though, in the last few years. Big companies started buying Apple products — a lot of them — for their employees. The iPad and iPhone have given the Apple symbol a presence in workplaces that Apple never enjoyed when it was strictly focused on selling Macintosh computers.
While corporate technology buyers say Apple does not try to hide the fact that consumers are still its top priority, they note that the company has gotten easier to work with in recent years, adding features to its devices that make them more palatable to business. It also doesn’t hurt that Apple’s new chief executive, Timothy D. Cook, is known to be far more at ease meeting with the CIOs Jobs once so memorably disparaged.
“What they’ve done in the past few years is really started thinking in a deeper way what the enterprise needs,” said Rich Adduci, chief information officer of Boston Scientific, a medical device manufacturer that has distributed about 3,000 iPads to its field sales people and expects to buy 1,500 more by the end of the year.
Apple, which declined to comment for this article, has begun to drop hints that it sees the corporate market as a big growth opportunity. During recent earnings calls with Wall Street analysts, Apple executives have boasted about the portion of Fortune 500 companies testing or deploying iPads and iPhones — 92 percent and 93 percent, respectively, Apple said last month.
‘’You never heard those stats before,” said Gene Munster, an analyst at Piper Jaffray. “The reason why is they struggled for decades, and finally they have a story to tell in the enterprise.”
Among the big customers Apple has won recently is home improvement retailer Lowe’s, which said it bought about 42,000 iPhones to be used by employees on store floors. Instead of having to find a computer, the employees can use the devices in store aisles to check inventory, pull up how-to videos and help customers estimate costs for painting, flooring and other projects.
The iPad, in some cases, is proving to be an attractive substitute for laptops in situations where portability and speedy access to information matters. Technicians for Siemens Energy, for example, routinely have to scale 300-foot towers to service wind turbines, sometimes in blistering heat in places like West Texas. Some of the technicians have been using laptops to read manuals and run through checklists when they’re doing this work, but the devices are too bulky and take too long to boot up, said Tim Holt, chief executive of Service Renewables for Siemens Energy.
Now the company is outfitting its wind service technicians with iPads, which are light, start instantly and have cameras that let workers send pictures to a technical support department if they need help troubleshooting an issue. About 350 technicians have the device already; within five years, about 5,000 should have it, Holt said.
Information technology departments, though, may find working with Apple a challenge. Historically among IT managers, Macs were largely shunned as too expensive, and the company was viewed as not serious about making the computers blend well in corporate environments.
Holt said there was pushback initially from the central IT department of Siemens in Germany about the prospect of using iPads as part of its technology arsenal.
Also, though Apple’s secrecy about where its products are headed may help it make a big marketing splash in the consumer market, corporate IT departments like to know more so they can budget for big new technology investments.
One factor working in Apple’s favor is so-called consumerization, a broader trend in which companies become more responsive to consumer technologies like social media. Schofield said he had just gotten used to Apple’s way of doing business. “They’re not an enterprise company and they’re up front about that,” he said.
For many years, the view that Apple did not care about serving businesses was reinforced by the outspoken Jobs, who died of cancer in October. On the rare occasions when Jobs did meet with corporate customers, Apple executives often braced themselves for the awkward moments that occurred because of Jobs’ tendency to speak his mind, according to two people who used to work in business sales at Apple and declined to be named to avoid inciting their former employer.
The former Apple employees said Cook, who was Apple’s chief operating officer before becoming chief executive officer, met more frequently with corporate customers and seemed to appreciate their needs, even if he did not deviate from Jobs’ views about making consumers the priority when making Apple products. “Tim was always very good with customers,” one of those employees said.
Apple ended up adding a number of business-friendly features — like better support for Microsoft Exchange, a common email system inside companies — to a later software update for the iPhone.
The New York Times
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