In the early days of the browser wars, Microsoft CEO and co-founder Bill Gates infamously is credited with instructing executives to ‘cut-off the breathing’ of upstart Netscape. Could long-time rival Apple be following Microsoft’s advice when it comes to another nascent computing technology, tablets? After slamming Android-based tablets as “bizarre” and their second-generation as vaporware, Apple quietly signed a $3.9 billion deal to ensure a smooth flow of components to its products.
Apple Chief Operating Officer Tim Cook, filling in for CEO Steve Jobs while on medical leave, described a 2005 $1 billion deal to ensure flash memory for its iPods, iPhones and other memory-intensive devices, as “an absolutely fantastic use” of its growing cash bankroll. The Cupertino, Calif. company has been criticized for letting $59.7 billion in cash accumulate without either making investments or rewarding investors with stock dividends. Tuesday, Cook said Apple had made another deal with suppliers of unspecified strategic components.
Just which components Cook had in mind is unknown, the Apple executive only saying the parts were something “I don’t want our competition knowing.” However, there are hints. Apple finance chief Peter Oppenheimer said the company could have sold more than the reported 16.2 million iPhones if there had been more devices available. Cook also predicted demand will be “huge” for the Verizon iPhone expected in early February.
Much speculation has centered on two hardware changes effecting both the iPhone and the iPad. First, a high-resolution Retina Display is predicted for the iPad 2, the successor of the iPad. Another component could relate to the chip replacing the current A4 processor, which Apple designed for its products.
Might this be how tech companies compete in the future? After developing the most bleeding-edge products, ensuring your supply chain could become a companies competitive edge. If so, Apple has taken the next step in its battle against Android – not on retail shelves, but the factory floor.
