Apple Inc. in 2010 Harvard Case Solution & Analysis

Competitive position sustainability (Pc’s, Mp3 players and Smart phones)

Mp3 players

Apple iTunes and iPod falls in this category. IPodswere basically mp3 player devices that were launched in the year 2001. It can be considered as the real icon for the new digital age because it isquite friendly to use and possesses exceptional features to fulfil the needs of the new generation specifically.It was priced at $399 and own a capacity of string around 1000 songs. As of year 2010 statistics, Apple was successful in getting the share of more than 70% U.S Mp3 player market. Moreover the introduction of iTunes raised the expectations of the Apple’s entire management in a real optimistic manner because this was the first legal website which allowed users to buy an individual song as per their requirements. This wonderful product was introduced back in the year 2003. The cost for downloading a song is around $0.99 at the iTunes website.

Threat of Entry in this category is quite low because it is really difficult for any company to offer such premium product quality supported by an online paid music store. This paid content of $0.99 don’t give a massive profit to Apple because $0.70 is paid to the music labels and around $0.20 is paid to credit card companies. The actual idea which helps the Apple to generate revenue is the presence of the gigantic number of customers in the iTunesstores. This helps Apple earn exceptional revenue by selling the music players which force people to visit the iTunes store as well.Moreover the “Digital rights management” (DRM), prevents the iTunesproducts from the piracy issues. Although this restricts the user to play these tunes in many devices which eventually motivates the other user to buy their own product. Moreover, Apple somehow owns the first mover advantage which helps them to come up with regular innovations in this particular category.  The stylish design of the product and diversified range of products at iTunes stores will help to sustain its competitive advantage in this regard.  Moreover the competitors like Amazon.com, Walmart.com and Napster grab the advantage of this DRM system and became the toughest competitors for Apple. These Mp3 products might not be examined on the basis of the technical aspects, but it may bejudgedasa style accessory.

Smartphones

At the initial time when Apple was planning to penetrate in the mobile phone segment of the world, it was looking quiet tough for them because the industry was dominated by the established brands like Samsung, Nokia and Motorolawhich hadan accumulated market share of around 60%. The Apple smartphone, formally known as the iPhonepossesses an add-on function which cannot be found in the other brands. Since the iPhonepossesses an exceptional quality and features so there the company charge a really high price as compare to the competitors.  Other companies were having a price bracket of around $300 to $400 and Apple charged a price of around $562.Moreover, one of the best parts of the Apple is that their majority of the customers are brand loyal and ready to pay high prices for the new upcoming Apple products, specifically for the smartphones. Additionally the Apple spent around $150 million in research & development by taking the two and a half year for introducing the iPhone in the market.  The most extraordinary feature associated with the iPhone is the Apple’s store which allows the access of around 185,000 apps to the user which is a gigantic figure as compare to the android who possesses only 30,000 apps. Without any doubt it can be said that the smartphone industry is flourishing in a real fast manner and side by side the expectations of customers is reaching to the new heights on a regular basis. Apple, so far has done an exceptional job in meeting the customers’ expectations and its future in this regard looksquitebright.

Personal Computer (PC)

Maintaining the sustainable competitive advantage might be a difficult task for Apple because industry has already been dominated by Dell. The margin on the computers were getting lower for the manufactures which was creating some big issues. The buyers of personal computers fall into five different categories.

  • Home
  • Small-Medium sized business
  • Corporate
  • Education
  • Government

Home based consumers possess the biggest segment of the personal computer, nearly 50%.  Moreover the industry analyst predicts that the industry analyst projected that $1.5billion was spent by the Microsoft to come up with the windows 7and spent a massive amount of another $1 billion on marketing purposes. Microsoft’s, Windows 7 has been the fastest selling operating systems in the entire history, creating additional issues for Apple to maintain the competitive advantage in this regard as well...............................

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