Time was when a “cellular phone” was that monstrous talkbox Gordon Gekko held to his ear as walked down the beach and sung Bud Fox the sunrise’s praises. “I wish you could see this, Bud,” he’d murmured in that smug, matter-of-fact tone that had made him millions, as if hemorrhaging thousands of dollars a year to get a choppy wireless signal out in the Hamptons was something to brag about.
Then again, in 1985 getting a cell signal anywhere was something to brag about.
Maybe Mr. Gekko was on to something when he pronounced greed good. After all, hasn’t it been greed for connectedness, for instant gratification, that’s driven people big and small over the past twenty years to demand progressively more useful, reliable wireless devices? Hasn’t it been greed for market share and reputation that’s driven phone manufacturers and network providers to comply? Hasn’t it been plain old greed for those outsize, next-big-thing kind of profits that’s driven investors to funnel big bucks into the likes of Verizon, AT T; (once lost, now found), Motorola, Samsung and so on?
Duh. It’s also not news to point out that corporations and in some cases industries as a whole tend to follow a certain predictable arc over the course of their lives–not unlike human beings, in fact, and there’s been books written on the subject which I’d be out of my depth to discuss. Generally someone bright comes up with a brilliant idea (or vice versa, who am I to say), gets some friends and investors to turn it into something that can make them a lot of money, hires some techs, starts getting a little taste of that high life, floats an IPO, starts making some serious cash, hires a bunch more techs and some others to fill the place out, looks to expand and diversify, maybe buys up some talent and a smaller competitor or two…and then before it’s clear what’s happened there’s customers complaining about stuff left and right, regulators poking through the books, younger and nimbler outfits looking to move in on market share and day traders shorting their pants off because this house is burning down, down, down. Happens all the time.
Not that this trajectory is always terminal. Microsoft, for example, has been poking along just fine for the past few years, doing its thing and making decent money at it. No one would argue that it’s going away anytime soon. Then again, no one would argue that that inscrutable spark behind its breathtaking rise during the 90s–already we forget that Mr. Gates was once the world’s wealthiest man–still exists in pure form. Microsoft, like many other market-share leaders, found itself at some point maybe ten years ago resting on its laurels, content to ride along on the considerable inertia it had created for itself.
I mention Microsoft because lately it’s been beaten at its own game by a rival it once made a sport of laughing off. Apple’s earnings–not to mention its stock price–have rocketed skyward on the back of a forward-looking corporate strategy built not just on innovation but on the cult of innovation, a stylish branding strategy other tech players are belatedly trying to adopt. It’s tough to put a finger on, and at times it can seem unfair. Research In Motion’s Blackberry beat Apple’s iPhone to the market by months, after all, and yet the iPhone was hailed as the smartphone to emulate going forward. (The various Blackberry models, especially earlier iterations, do have significant shortcomings. So do iPhones, though, and given Blackberrys’ more competitive pricing it’s difficult to understand the reputational gap.)
We’ve been hearing a lot recently about the dubious in-call performance of the iPhone 4G relative to other devices, especially in light of Apple’s (and AT T;’s, to a lesser extent, although the forensic folks have by now pretty conclusively determined that whatever fault exists lies with Apple’s hardware, not its network of choice) insistent claims of iPhone superiority. In short, the 4G seems to drop many more calls than other smartphones. Apple’s response, though shaky at first, has allayed most concerns. But the whole situation has gotten some astute industry observers–including Farhad Manjoo of Slate and Kevin Kelleher of The Big Money, whose articles I’ll post below–thinking about the responsibility that accrues to success.
So what happens to–and what should we expect from–a company that finds itself hawking a product that is becoming increasingly indispensable? How do the rules change for the consumer? For watchdogs and regulators? How do we trade its stock? And most importantly, what can we learn about the broader market–the nature of supply, demand, and consumer choice? We’ll get into that tomorrow.
And while no one will mistake me for a talented filmmaker, I must give credit where credit’s due. Quotations and spirit of the first part of this article are lifted from the 1987 film Wall Street, written by Stanley Weiser amp; Oliver Stone and directed by Oliver Stone.