Steve Jobs Turns Conference Call into Trash-a-thon
After a company beats its quarterly revenue estimates by more than $1 billion, most CEOs would not rush to the phones to trash the competition. Then again, Apple CEO Steve Jobs is not your usual corporate mogul.
On the occasion of the company's first $20 billion quarter, Jobs made a rare - and memorable - appearance on Apple's quarterly earnings conference call, calling out competitors by name, mocking their technological cred - and most defiantly, defending Apple's decades-long decision to stick with proprietary hardware and software designs.
"Open systems don't always win," Jobs said, adding that "open versus closed is just a smokescreen"put forward by some vendors "to hide what is best for the customer."
On the occasion of what otherwise was a celebratory coda, Jobs offered a full-throated defense against critics who argue that Apple's proprietary strategy faces long-term strategic challenges. Earlier today in an interview with the New York Times, Harvard Business School Professor David B. Yoffie suggested that the Android operating system would enjoy several advantages because of Google's open approach compared to Apple's tighter control of its devices. "There is much more rapid innovation taking place in an open environment," Yoffie said.
No doubt that quote was on Jobs' mind when he sat down for his conference call cameo.
"We see tremendous value in having Apple, rather than our customers, be the systems integrator," according to Jobs. He underscored that "integrated will trump fragmented every time."
During the course of a disquisition on the benefits of Apple's "integrated approach" to platform development,to users and developers, Jobs devoted a major portion of his speaking time to making invidious comparisons between Apple and what he presented as the fragmentation that prevails in the Android world.
"Google loves to characterize Android as open and (Apple's) iOS as closed," Jobs said, adding that he found the description to be "disingenuous."
Recently, analysts have reported fast-growing sales of Android devices, which are projected to outstrip Apple in the smartphone market by next year. But Jobs dismissed those projections as lacking statistical rigor. "Unfortunately there is no solid data on how many android handsets are shipped each quarter," according to Jobs.
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But this was not just dump on Google day. Jobs also took a few jabs at Research in Motion - "RIM has a high mountain to climb"- as well as dismissing the looming challenge posed by myriad developers of tablet computing devices. ("We think the current crop of 7 inch tablets will be DOA," he predicted.)
Only the most churlish of nitpickers would point out that management isn't hitting on 100% of its proverbial cylinders. But seeing as Apple now occupies the pinnacle of the tech pantheon, a slight shortfall in iPad sales during the September quarter was as surprising as it was disappointing. So disappointing, in fact, that investors sent Apple down 7% in after-hours trading. Obviously, no stock goes up in a straight line forever and Apple's shares have moved from around $240 in the late summer to a 52 week high of $319.
The problem with the iPad numbers had to do with available inventory. Apple sold almost 4.2 million units in the quarter, accounting for some $2.8 billion in revenue. CFO Peter Oppenheimer, who said more units would be available during the current quarter, nonetheless expressed satisfaction with the iPad's sales performance, adding that it was generating "great enthusiasm" - including among enterprise customers.
Just to make sure nobody on the call missed the point, Jobs predicted that the iPad would "clearly" take share from notebook computers.
"I think the iPad proves it's not a question of if; it's a question of when," he said. "The more time that passes, the more I'm convinced we've got a tiger by the tail."