Competition and the Elastic Enterprise: The Advantage of Elastic Strategy and Strategic Options Thinking – The Case of Apple TV

We think a key ingredient of sustainable future business success is an elastic strategy with a strong strategic options portfolio.  There’s a classic example of that out there right now – Apple TV.

In Walter Isaacson’s celebrated biography, Steve Jobs, he quotes Steve Jobs as saying, “I’d like to create an integrated television set that is completely easy to use…  It would be seamlessly synced with all of your devices and with iCloud.”  But what got the world talking was, “It will have the simplest user interface you could imagine. I finally cracked it.”

Among all the products that Apple is pursuing it still has time for television.

Going further into TV would involve a major multi-pronged strategy.  It’s about capitalizing on the competitive advantages that Apple has developed and has as an elastic enterprise.  Let’s take a closer look.

Here are seven benefits of an expanded Apple TV strategy:

  1. Attracts new customers.
  2. Provides an offering that capitalizes on changing or unmet customer needs rather than incremental or reactive innovations from traditional competitors in the television industry.
  3. Delights customers and enhances Apple’s global brand with offerings that caters to global communities not yet served (e.g. soccer) and source and sponsor original global content, expanding sports offerings, one of the brightest content categories in TV.
  4. Gives Apple another, or better, device and an expanded outlet for Apple products and services.
  5. Expands and enhances the Apple business ecosystem.  New inventions, new products and new attractions makes existing Apple business ecosystem partners happy, attracts new partners, and further expands the global footprint.
  6. Provides opportunities for Apple’s existing business ecosystem partners including app developers to innovate and generate revenue – reinforcing the attractiveness and vibrancy of the Apple business ecosystem.  And consider Apple’s existing relationship with Disney.
  7. From a strategy perspective it’s a radical adjacency move, like Apple’s previous moves into music, movies, software, and publishing.  It drives needed innovation into the TV industry and content.  An expanded Apple TV move could blow the industry open– similar to what happened to the cellular phone industry in 2007.

A TV move also adds new functionality to the existing Apple business platform:

  1. iTunes needs new content constantly to keep the value proposition fresh.  The current set of iTunes and Apple TV offerings focus on stored content, that is, content that has been previously created or delivered.  It has some realtime content, radio, NBA League Pass, NHL GameCenter Live, but obviously more could be added in many other categories.  An expanded TV adds the prospect of a dynamic realtime component to the Apple platform. And realtime content collects revenue during the event and post-event.
  2. A move into television will require Apple to enhance the existing iTunes-App Store business platform above and beyond its current functionality.  Radical adjacency opportunities apply to the business platform too.  With realtime extensions to the business platform, Apple could become a conduit for other forms of content including private content such as fee-based educational offerings, conferences, seminars etc.  Or perhaps linking to Apple’s rumored textbook and digital publishing initiative.
  3. It leverages other Apple business platform investments iAd, iCloud, Siri, FaceTime, Apple TV, gestures and so on.

What does this tell us?

Elastic strategy, strategic options portfolio – unprecedented capacity for radical adjacency.

Result – Apple style success.

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