The Rotting Apple

OK, I admit it... I was one of the first people to buy an iPod Shuffle, and one of the first people to buy an iPhone.

The Shuffle was great; I think it lasted close to four years before it finally died and I had to buy something new. The iPhone was not so great, but I blame that on the bad AT&T service (I couldn't get decent reception anywhere). However, the iPhone is probably the best text messaging tool available, and when I called up to cancel my contract, AT&T offered me 50 minutes of talk time and 200 text messages for only $25 a month. So I kept the iPhone, even though one speaker is broken and it simply didn't live up to all its hype.

I think the title of this post does a good job describing Apple's current business cycle. When they first came out with the iPhone and iPod, the company was like a blooming apple tree. Apple products became status symbols, every college kid had to have the newest iPod and the latest iPhone. iTunes was also an amazing products; it single-handedly struck a blow to online file sharing and successfully monetized downloadable music.

Today, thanks to the recession, things are much different. The iPhone isn't seen as the latest and greatest cell phone; all the "cool kids" now have Blackberries. IPods are still seen as a way of saying "I have a lot of disposable income", which is exactly what you don't want to say when the country is in the middle of a recession. As for iTunes, it's beginning to face some serious competition, especially from Amazon.com's excellent MP3 service. To be honest with you, I buy all of my music from Amazon, and only use iTunes for the free iTunes university downloads.

I really don't see much of a future for Apple. I loved my old Shuffle, but I decided to buy a Sansa MP3 player instead of another iPod Shuffle. It cost 25% less and it included more features, like a voice recorder and an FM radio. I've been completely happy with Sansa MP3 player, which makes me wonder if I'll ever go back to buying Apple products.

I suspect there are a lot of consumers like me... people who bought Apple products for the status, but are now making their purchases based on price and quality. I'm just not sure if Apple will be able to compete with high quality, low-cost products like the Sansa MP3 player. I suspect Apple's music business is slowly rotting away... But I will say this, new trees only grow from the seeds in a rotten apple. Good Luck Apple.