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Even in this conservative industry, the latest technologies can make a huge impact.
By Lal Karsanbhai, Executive President, Automation Solutions, Emerson for IndustryWeek | Apr 16, 2019
As long as people have existed, we’ve needed to harness energy to live: fire to warm ourselves and cook food, gas to generate clean electricity. Energy is a traditional industry with roots that stretch as far back as human history. Yet even in this conservative industry, the latest technologies can make a huge impact.
Organizations that embrace digital transformation can see measurable benefits in critical industry focus areas: safety, reliability, production, emissions and overall performance. But there is always the underlying question: How do you get started?
The good news? The optimal digital strategy is different from company to company, meaning there is no single right path. The bad news? Digital transformation does not have one consistent playbook. This can be confusing for businesses trying to capitalize on the promise of the Industrial Internet of Things (IIoT). A recent Emerson survey of industry leaders responsible for digital transformation initiatives found that 90 percent felt that a clear and actionable roadmap was critical for success, yet only 20 percent of respondents said they had a vision and roadmap.
Even as companies work to find their way in the new digital transformation landscape, a few definitive trends are emerging:
1. Software will remain the backbone of making data actionable. It has long been an industry staple, but advanced software solutions are making it possible for companies to safely test new approaches to optimize productivity and efficiency without any risk to operations. Take power generation, for instance – a critical industry with no margin for error. Through “digital twin” technology, power companies can simulate a live plant that allows them to test proposed changes without impacting the actual operations. Software advances like digital twin have the potential to help the industry find game-changing improvements.
2. Cybersecurity is non-negotiable, but its implementation depends on its environment. Not everything needs to go to the cloud. There are many opportunities for remote monitoring of systems and other data analytics in the cloud, but knowing which applications are best suited for on-premise (or edge computing) versus the cloud will be key for businesses. Different cybersecurity protections are required for each, and understanding what makes the most sense will help guide many digital implementation programs. Secure remote monitoring has created a new business model that brings significant performance and financial benefits, through predictive analytics that detect maintenance problems in oil fields, refineries and chemical plants before they occur – leading to millions of dollars saved annually.
3. A clear business case and scalability are the name of the game. Sweeping initiatives won’t work; companies need solutions that account for where they are and where they want to go. Digital transformation programs must have a clear business case. Implementing technology and hoping for a return will not deliver the significant impact that’s possible.
4. Information technology (IT) and operational technology (OT) need to be on the same side of the table. IT and OT can too often speak different languages even as they develop and implement programs for the same company. Successful transformation will happen only when IT and OT come together with an integrated approach to technologies and work together to implement and optimize. We are seeing movement in this direction, as some companies are organizing integrated teams to drive digital transformation and encourage the collaboration of these complementary skillsets.
5. Technology should empower – not replace – the workforce of the future. The rise of automation is bringing with it trepidation that robots will eliminate manufacturing jobs. Done well, the influx of automation will instead evolve current manufacturing jobs. Yes, automation may replace repetitive tasks-related jobs, but it will also require new data analytics and interpretation skills that rely on science, technology, engineering and math (STEM) knowledge. Technology and automation are complementary job creators.
Empowering the future workforce comes down to meeting and supporting people where they are. This includes upskilling the current workforce, making the industrial sectors attractive to students planning their careers, and instilling a passion for math and science with young learners beginning their educational journey.
Digital transformation has the potential to change the energy industry for the better—and give companies that embrace it competitive advantage.
Gaggles of delivery R2D2’s scurrying down suburban streets? It sounds like a technological nightmare worse than an e-scooter infestation. But the concept of robot messengers got a major boost recently when FedEx announced plans to start testing such a service this summer, and for smart cities, it may not be such a crazy idea after all.
There are already several pilot robo-delivery projects running in the U.S.
Nuro, for example, recently announced it’s moving on from Arizona and expanding its delivery partnership with grocery giant Kroger to four Houston zip codes. Nuro’s vehicle is more of autonomous compact car than a rolling robot, but so far people seem happy to pay the roughly $6 for the self-driving silver surfer (probably because they don’t have to tip the car).
The 7,000-pound gorilla in retail, Amazon, is reportedly testing a sidewalk-crawling delivery bot in Seattle. The project looks like a more practical service for suburbs — especially compared to drones, which are restricted or outright banned in many urban areas.
Most recently, FedEx has announced that it plans to begin testing its own autonomous delivery robot in Memphis, Tennessee. And while there are other delivery bot tests underway in addition to the ones mentioned, the entrance by the preeminent delivery service in the U.S. into the self-driving space represents something of a milestone.
Hitting the streets sidewalks
FedEx isn’t talking about autonomous vans and trucks — at least not yet. And the challenges facing even mainly on-the-sidewalk robots are legion. Weather, uneven terrain, traffic, poor cellular network coverage, and humans behaving badly are just a few of the headaches facing programmers. However, FedEx’s partners and its own delivery infrastructure imply that it may be uniquely positioned to overcome those obstacles.
The delivery bots, for example, are designed in partnership with Dean Kamen’s DEKA Development & Research Corp. Kamen is best known for developing the Segway and the iBot Personal Mobility Device, a wheelchair that can climb stairs. The latter demonstrates that DEKA’s engineering skills will probably be able to help FedEx surmount some of the navigation issues for door-to-door delivery. Indeed, the fully electric FedEx SameDay Bot is based on the iBot, with some additional technology that makes it autonomous, including lidar, radar, and video cameras to assist in navigation.
According to Kamen, the SameDay bot can run at about 10 miles per hour, “which won’t disturb pedestrians.” Kamen made the remarks during a presentation to announce the new partnership. The inventor said the SameDay Bot’s speed limiter means it won’t cause the kinds of problems associated with cyclists and messengers who hop onto sidewalks — but it will still be able to handle round trips of up to eight miles relatively quickly.
The road ahead
FedEx plans to work with retailers including AutoZone, Lowe’s, Pizza Hut, Target, Walgreens, and Walmart to perform, as its robot’s name implies, same-day door-to-door deliveries. Customers can open the bot using a smartphone app, or have it opened by a remote operator. Those operators will also control the bots should the machines encounter situations they don’t recognize.
“It’s a way they could take on Amazon,” Gary Goralnick, a shopping center developer, told Digital Trends regarding self-driving technology. Goralnick said integrating online ordering and same-day delivery, for example, has helped brick and mortar retailers turn the corner and compete against Internet-only outlets.
Still, others note that such self-driving solutions beg for an infrastructure solution.
“You have to redesign the city before you layer in the technology,” Duncan Davidson, a technology investor with Bullpen Capital, told Digital Trends. Davidson pointed to examples such as e-scooters causing problems in Los Angeles and Uber cars causing additional congestion in New York City as ways in which technology can wreak havoc in cities — unless it’s supported by the right infrastructure changes.
None of these robo-delivery services will work unless consumers embrace the concept
Autonomous cars and delivery vehicles, for example, may need their own dedicated lanes. Making such changes could improve safety and help reduce traffic. And there are many ways in which same-day delivery in underserved areas could help home-bound individuals who suffer from chronic illnesses or other restrictions that prevent them from getting outside.
Indeed, Hyundai has a program called Elevate to develop an autonomous vehicle that can navigate rough terrain and even climb stairs to reach customers. And Dean Kamen’s iBot was originally designed to help people such as disabled veterans get around on their own. (The partnership with FedEx should help make the iBots more affordable for those who need them, according to Kamen.)
Ultimately, none of these robo-delivery services will work unless consumers embrace the concept. As long as they steer clear of scary robots, like Boston Dynamics’ headless Spot Mini, and focus on friendly delivery devices that look like R2D2, it may just work out.
Alums share memories as Apple marks another anniversary. Spoiler: Bill Gates had a bigger role in Apple’s success than he may know.
By Shara Tibken, Senior Reporter for CNET News | April 1, 2019 5:00 AM PDT
Editors’ note: This article originally ran April 1, 2016, for Apple’s 40th anniversary.
Whether Apple was actually started by two guys in a California garage may be debatable, but what’s certain is that the pioneering computer maker turned consumer electronics juggernaut has come a long way.
Forty-three years after Steve Jobs and Steve Wozniak set out to turn computers into a tool that anyone could use, Apple has become one of the most valuable brands in the world, with some of the most successful products ever made.
Apple has shaped countless industries, from computing to music, and its former employees have gone on to innovate and create new tech industries around everything from enterprise software to smart thermostats.
At its heart, Apple has always been about creating elegant, easy-to-use products we never even knew we wanted.
“It was love at first sight when I first encountered the Apple II at the inaugural West Coast Computer Faire in April 1977,” said Andy Hertzfeld, one of the original members of the Macintosh team who designed the system’s software. “I continue to be thrilled by new Apple products to this day.”
Other former Apple executives and partners shared their favorite memories of the company and Jobs, who was, to many people, the driving force behind its success. They include former finance execs Debi Coleman and Susan Barnes, ex-Apple designer Clement Mok, technical visionary Alan Kay, chief evangelist Guy Kawasaki, and Jobs’ marketing mentor, Regis McKenna.
Here’s what they had to say.
90 hours a week and loving it
Apple’s first success came from the Apple II computer, and it tried to follow that up with the Lisa. But early Apple became better known for another computer, the Macintosh. The Mac started as a research project in the late ’70s with only four employees before becoming Jobs’ pet project by January 1981.
There was a lot of competition between the Apple II, Lisa and Mac teams. For one off-site retreat, the Mac group, which flew the pirate flag over its offices, had gray hoodies printed up. They read: “90 hours a week. And loving it,” in a red and black font, recalled Coleman, who joined Apple in 1981 as finance controller for the Mac.
Every member of the Mac team, about 100 people at that time, got the hoodie. It was a hit. (See the photo, courtesy of Mok, at the top of this story.)
“Within a week of coming back [from the retreat], the Lisa group had a shirt that said ‘Working 70 hours a week. And shipping product,'” Coleman said. “A week later, the Apple II group, which was making all the money hand over fist, had a shirt that said, ‘Working 50 hours a week. And making profits.”
“Who knew it was going to cause a reaction across the entire campus?” Coleman added.
She became head of Mac manufacturing in 1984 and was one of the highest-ranking women in the tech industry. She took over the role of Apple chief financial officer in 1986. At a November reunion of some women on the Mac team, Coleman attributed a big part of Apple’s success to Jobs, saying he made people at Apple believe they could change the world.
Look and feel like The Beatles
As he was getting ready to launch the Mac, Jobs wanted the computer “to look and feel like The Beatles. Not the late Beatles, but the early Beatles,” remembered Mok, a designer hired by Apple to work on branding for the Mac launch. “Tom Hughes [the creative director on the Mac team] and myself scratched our heads. What the hell is that?”
They decided it meant there was a certain rawness to the Mac, but with a sense of passion and artistry. “It’s an artistic expression of technology,” said Mok, who joined Apple in 1982. “This product has been crafted.”
(They were so successful in giving Apple a Beatles feel that Apple Corps, the company that owned the rights to the Beatles music, sued the Cupertino, California, company for trademark infringement. The two sides had a long-running legal tussle, but ultimately reached a settlement in 2007 and in 2012 sorted out ownership of the logo.)
Mok became co-manager of Apple Creative Services in 1985 and served as creative director for corporate and the education market. He’s one of the people responsible for the iconic imagery of Apple in its marketing and packaging, including the squiggly line drawings gracing early Mac promotional materials.
But one aspect of the Mac, that squiggly line design, didn’t feel as much like The Beatles to Mok as it felt like Joni Mitchell. Jobs wanted to mimic the logo for the now-defunct Ciao Restaurant in San Francisco’s Financial District.
“I tried but couldn’t for the life of me put it together,” Mok recalled. Apple ended up hiring the man who created the Ciao logo in the first place, John Casado. What came from the team is what’s known as the Macintosh Picasso logo. Some branding elements from the first Mac live on today, including the minimalist white packaging used for Apple’s devices.
Find a way
Early Apple employees, most in their 20s and 30s, were given big responsibilities.
“Steve used to have a saying, ‘We hire smart people to tell us what to do, not hire them to tell them what to do,'” said Susan Barnes, who joined Apple in 1981 as financial controller of the Mac division.
She worked closely with Coleman in her early days at Apple and ended up reporting directly to Jobs for a decade. Barnes co-founded NeXT Computer with Jobs in 1985 and became its CFO.
At one point in early 1985 while still at Apple, Jobs called Coleman and Barnes on a Friday night and said he wanted to buy a chunk of Adobe Systems. Apple and Adobe were closely linked in their early history, with the two working together to develop desktop publishing technology.
“It’s something we really needed in the Mac days,” Barnes said of Adobe’s software and fonts. “Laser printing is something that really made the Mac take off.”
Barnes and Coleman went to the law library late at night, trying to figure out how to buy a stake of another company. “How do we do this?” Barnes said. “This is usually what you ask senior management. And we were like, ‘Oh, we are senior management.’ It sort of hit you.”
Apple ended up investing $2.5 million for a 19.99 percent stake in Adobe in early 1985. In 1989, it sold the stake, which had been diluted to about 16 percent, for $84 million.
“When you’re in corporations later, it’s so easy to hide behind, ‘Let me check with that person,'” Barnes said. At Apple, it was “No, it’s you. Let’s just do it. Find a way and don’t be afraid of the consequences.”
Jobs recruited John Sculley in the early 1980s to help him grow Apple as a company. Sculley was CEO of Pepsi and helped it overtake Coca-Cola as the top beverage maker. Jobs famously convinced Sculley to take the CEO role at Apple in 1983 by asking if he wanted to “sell sugar water for the rest of his life” or if he wanted to “come with me and change the world.” Sculley, who was close with Jobs before ousting him in 1985, served as Apple’s CEO for a decade until being forced out himself.
In the fall of 1983, Sculley, Jobs, other Apple executives and two members of the Chiat/Day advertising firm — Lee Clow and Steve Hayden — were brainstorming about the Mac launch campaign. Business Week had run a cover story that week saying, “The winner is IBM.”
“We hadn’t even come out with the Mac, so we were all a little bit down in the dumps,” Sculley said. “What can we do that will stop the world and get people to pay attention to the fact the game wasn’t over? It hadn’t even started yet.”
The group started talking about the big things that would happen in 1984, and the obvious reference to George Orwell’s dystopian novel, “1984,” came up. They debated, thinking that many marketers might play off the “1984” reference. But they hoped to get the leap by coming out with something in January — perfect timing with the Super Bowl.
“If we do something absolutely heart-stopping on the launch in January, then we’ll preempt it, and nobody else will want to use it because it will look like they’ve stolen the idea,” Sculley said.
The Chiat/Day executives had a week to come up with a campaign like “no one had ever seen before.” The 60-second “1984” commercial they created turned out to be one of the most celebrated ads of all time.
But Apple’s board hated it. “At the end of the 60-second commercial, there was dead silence in the room,” Sculley said. “Two directors put their heads on the table. Then they turned to me and said, ‘You’re not going to run that, are you?’ I said, ‘Absolutely. It’s the best commercial I’ve ever seen.'”
The commercial cost $500,000 to produce, which was about five to 10 times the normal expense, Sculley said. And Apple paid $1 million for 2 minutes of airtime during the Super Bowl. The board told Chiat/Day to sell the time, but they could only offload 1-minute, so the commercial ran.
“We ended up getting $45 million of estimated free advertising because the networks kept running it over and over in its full length,” Sculley said. “It turned out to be an amazing start for the Macintosh.”
Apple is a religion
Apple knew the first Mac wouldn’t succeed unless there was software for it. Getting developers to write software for the computer fell to Guy Kawasaki, who joined Apple in 1983 as the Mac’s first chief evangelist.
“It was easy to get people to begin writing software because we were breaking new ground for the marketing of computers and opening a new market for computers,” he said. “We provided a good alternative to the IBM PC and … developers could write software they always dreamed about writing.”
But it wasn’t easy to get developers to actually finish writing their software. They were working with an immature platform and dealing with the Mac’s new graphical user interface.
Kawasaki avoided Jobs as much as he could because Jobs “scared the shit” out of him. One day, Jobs came to Kawasaki’s cubicle to introduce him to someone and to ask Kawasaki what he thought of a company. “I say, ‘It’s mediocre, and the product is crap,'” Kawasaki said. “At the end of my diatribe, he says, ‘This is the CEO of the company.'”
“I passed the Steve Jobs test,” Kawasaki added. “Probably he knew the company was crap. If I had said it was great, it could have been my last day at Apple.”
Kawasaki ended up leaving Apple in 1987 to start his own company. He returned as an Apple Fellow in 1995, “when Apple was supposed to die.”
“The very fact they brought me back was because the cult was dying,” Kawasaki said. Getting people excited about Apple again “wasn’t easy, but it also wasn’t impossible.”
“There’s a core of people who never lost faith in Apple,” Kawasaki said. “Apple is a religion.”
Bill Gates to the rescue
When Jobs left Apple in 1985, he started NeXT, a new computer company focused on workstations for universities, financial institutions and other businesses. While the computer didn’t sell well (PCs running Microsoft Windows were the most popular at the time), NeXT had very interesting software.
“Steve called me and he said, ‘Hey, I’m starting this new company. It’s an amazing computer for education,'” said Tom Suiter, who served as Apple’s first director of Creative Services and helped launch the Mac in 1984. He left Apple after Jobs’ departure in 1985 but kept in touch with Apple’s co-founder over the years. That included the time Jobs was setting up NeXT.
Suiter remembers his conversation with Jobs about naming the new company.
“I said, ‘Congrats, it’s great. What are you going to call it?’
Jobs said: ‘Two.’
I said: ‘What do you mean?’
Jobs said: ‘It’s my second company.’
I said: ‘Everybody’s going to go, what happened to one?’
Jobs said: ‘That’s exactly why I’m talking to you. I need some help.’
I said, ‘Let me think about it.'”
That weekend, Suiter flew to Seattle to attend a CD-ROM conference hosted by Microsoft and keynoted by co-founder Bill Gates. “I could not believe how many times he was using ‘next’ in such a positive way. I counted them up and said ‘next’ would be a cool name for a company.”
When Suiter got home on Sunday, he called Jobs and said he had the perfect name for his new company.
“He goes, ‘Hey, what is it?’
I said, ‘It’s NeXT.’ There was like this silence.
Then he said,’ I love it!’
The rest is history … The irony is it actually came from the mouth of Bill Gates to help Steve.”
Suiter never told Jobs his inspiration for the NeXT name. “It probably would have diluted the brilliance of what the name was,” he said, laughing.
Microsoft didn’t just unwittingly help out Apple. It also invested $150 million in the company in the summer of 1997 to keep Apple afloat as it was close to going out of business. As part of the deal, Apple made Microsoft’s then-underdog Internet Explorer the default browser for the Mac. And Gates agreed to develop future versions of Microsoft Office and development tools for the Mac — an arrangement that helped Apple win over customers tied to Microsoft’s software.
Jobs hired Suiter again in 1998, while Suiter was at Silicon Valley advertising agency CKS Group, to lead marketing communications for all Apple products, including the launch of the iMac.
Inventing the future
In the 1970s, Alan Kay, one of the fathers of computing, worked at Xerox PARC, the Palo Alto, California-based research group that inspired the Mac user interface and other early Apple products. Kay joined Apple in 1984, a few months after the Mac was unveiled.
Kay famously said “the best way to predict the future is to invent it.”
He remembers Jobs’ ouster by Apple’s board of directors and the company’s struggle to recover:
“It is not easy to summarize ‘what could have beens’ and ‘what should have beens’ because Steve both had some vision and was also seriously nutty along a number of lines. He and I were friends despite this — as much as he could have a friend.
“A few years later I was contacted by some long-standing colleagues in computer graphics — who were then at Lucasfilm, and wanted to get out. I drove up to NeXT and briefed Steve on these folks, and then I took Steve up to Marin County to meet the people who became Pixar. The funding of Pixar and hanging in with the serious talent they had was almost certainly Steve’s finest period.”
Kay, however, has been critical of Apple’s reinvention after Jobs returned to Apple in 1997.
“The return of Steve to Apple and his transformation of the company into one mainly aimed at consumer marketing, was only successful from a business standpoint. The ideals that Apple had in the early ’80s about ‘wheels for the mind’ were now long gone …
“I talked with Steve off and on since then until his death, and he would periodically send me stuff for my opinion, invite me to product openings, etc.
“I would periodically try to get him back to being ‘centrally serious’ about education, etc. I once tried to get him to remember what he had said to John Sculley to get him away from Pepsi (‘Do you want to sell sugar water all your life, or do you want to change the world?’) — the point being that Steve’s largest preoccupation after coming back was to get Apple to be a success primarily by selling ‘sugar water’ to consumers!”
Funny how things turn out
When Jobs and Wozniak were starting Apple, they knew they needed savvy marketing and public relations help to launch the world’s first personal computer. They liked Intel’s campaigns so asked the chipmaker who was doing work for it. Intel told them it was Regis McKenna.
That began a relationship between Jobs and McKenna that lasted from 1976 until Jobs’ death in 2011. McKenna’s firm, Regis McKenna Inc., helped launch the Mac in 1984. Though the formal relationship between the firm and Apple ended in the early 1990s, McKenna stayed close with Jobs and spoke with him about once a month for the duration of the Apple co-founder’s life.
That included the period after Jobs’ return to Apple. Jobs rejoined Apple in February 1997 after the company bought NeXT for $429 million and he was asked to serve as a consultant to then-CEO Gil Amelio. Less than five months later, Jobs convinced the board to fire Amelio and name him interim CEO.
“He went from when he had no position on the board and was not an adviser and ended up taking over the company,” said McKenna. “Those people, Amelio and others, quite frankly, didn’t know what hit them.”
Jobs didn’t stay interim CEO for long. But he faced a daunting task. “Apple was in horrible shape,” McKenna said. Jobs “wasn’t sure he could fix it. People don’t realize it took several years for him to get it off the ground. It didn’t just happen.”
Jobs ultimately turned Apple around by dramatically cutting the company’s product line and introducing one hit product after another — the colorful iMac computers, then the iPod music player, iTunes Store, iPhone and iPad.
“They cut out 50 percent or 60 percent of the products being developed,” McKenna said.
“Steve calls me up. … They were just about to launch their online store, just about to launch iTunes … He was all excited. He said, ‘I think these products we have coming are pretty good.’ He didn’t say great. He was a little bit skeptical until the first iMacs, the colorful ones, took off like crazy.”
Most people involved with Apple’s early years never expected it to grow as big as it is today, Jobs among them. After he returned to Apple and it was successful and growing, “one of the things he said was, ‘Funny how things turn out.'” McKenna said.
“He was just reminiscent. It surprised him. He didn’t expect these things…Up until a product was successful, he always questioned if it was good enough. He never felt, when he launched a product, [that it was good enough] but he would sell it as if it were. In fact, he always felt there could be more or better [features]. His comment of ‘funny how things turn out’ was a sort of comment by him that it all surprised him.”
Concentrate on industrial design
Apple’s colorful iMac line, and Jobs’ close relationship with designer Jony Ive, helped the company recover from near-death. Tim Bajarin, a longtime industry analyst focused on Apple, remembers what Jobs vowed to do to save his company when he first returned to Apple.
“When Steve came back to Apple, I met with him the second day he came back,” said Bajarin, who began following Apple in 1981 for the firm Creative Strategies. “I asked, ‘How are you going to save Apple?’ The first thing he said was, ‘I’m going to go back and take care of the core needs of our customers — engineering and graphics designers. I’m going to go back and make sure we take care of those customers.’ The next generation of the Mac was more powerful and had more support for that particular group.
“Then he told me — at the time what I thought was one of the craziest things I’d heard — that ‘I’m going to concentrate on industrial design.’ I remember walking away and saying, ‘How in the world is industrial design going to save Apple?’ As you know, it ended up being a core tenet of Apple’s success. A year later, Apple introduced the candy colored, all-in-one Apple iMacs.”
Ive became the lead designer behind Apple’s most important products, including the iPhone. Cook named him chief design officer a year ago. Bajarin, meanwhile, continues to follow Apple for Creative Strategies.
Will anyone show up?
Ron Johnson, the company’s onetime retail chief, said one of his most notable memories at Apple was the opening of the first Apple Store in McLean, Virginia. He remembered the moment exactly: May 19, 2001, at 10 a.m.
Johnson helped dream up the concept of the stores’ bright, simple look with long wooden tables holding a handful of Apple devices that people could test. The design was a departure from the typical stores, with aisles and aisles of shelves filled with products. Apple’s retail approach has since been copied by others, including Microsoft.
Thirty minutes before the first store opened, Johnson got a call from Jobs, who asked how many people were in line outside. Johnson told him there were about 50 customers. Unhappy with the low turnout, Jobs said they should’ve marketed the opening — the company sent out an email and press release but hadn’t done any advertising. Johnson assured Jobs folks would show up.
By the time the store opened, there were 1,500 people in line.
“It went from 50 people to 1,500 in a 30-minute period of time,” Johnson said. “It was really fun.”
Now with over 500 Apple Stores worldwide, Apple’s stores have become hubs for fans to camp out, often waiting in long lines for the newest gadgets to go on sale. While many other retailers are closing locations amid weak store traffic, Apple Stores bring in the highest sales per square foot of any retail locations in the US, according to eMarketer.
Johnson said Jobs sought to create retail stores “so we can market innovation face-to-face” with customers. Johnson saw that mission in full effect when he witnessed the iPhone launch in 2007. He was among a huge crowd at the company’s iconic Fifth Avenue store in Manhattan.
“It really showed Steve’s genius at its peak,” Johnson said. “It was the marriage of an incredible product strategy with the ability to communicate with an unparalleled customer experience.”
That ‘aha moment’
What impact has Apple had on society? You can see it when an 8-year-old boy swipes at a microwave screen, puzzled that nothing happens. You can’t really fault him. After all, we all instinctively use our fingers and gestures to control our phones and computers, so why not other gadgets with big screens?
That child’s uncle, AT&T Vice Chairman Ralph de la Vega, can trace our reliance on our fingers back to the first time Jobs showed him the iPhone, which he calls his “aha moment.” He was one of the first people to see the device and had to sign a nondisclosure agreement, vowing not to tell anyone about the phone including the CEO and board of AT&T — or his wife.
De la Vega’s first question when seeing the iPhone was “Where’s the stylus?”
“[The iPhone] dramatically changed how users interfaced with the device,” de la Vega said. “It really highlights how it changes the expectations of people.”
While there had been touchscreens before the iPhone, Apple was the first to show the benefits of ditching a stylus, a move that had a massive impact on the tech industry. Without Apple, we might all still be mashing physical buttons.
“Apple accelerated the pace so dramatically it changed everything,” de la Vega said.
AT&T became the first wireless carrier to sell the iPhone, something that helped the carrier attract millions of customers. And the iPhone has helped Apple become the biggest company on the planet.
On to the next 40.
CNET’s Roger Cheng and Ben Fox Rubin contributed to this report.
This story was part of CNET’s coverage of the 40th anniversary of Apple’s founding. For more stories in this package, click here.
By Matthew DeBord, Senior Correspondent, Transportation for Business Insider Mar 30, 2019
The first few decades of technology innovation have been characterized by rapid growth and quick profits based on low headcounts and low capital outlays.
The next few decades will require much larger headcounts and massively larger amounts of money.
If you have doubts, just look at Tesla and Elon Musk.
Tesla is 15 years old, and despite its considerable struggles and internal and external dramas, Elon Musk’s electric carmaker remains a Silicon Valley darling and is widely admired in the traditional auto industry.
None of that means the company is getting better at its core function, which is building cars. Tesla has improved drastically on this front, but compared to other automakers, it’s gone from what I would say is an “F” to managing a “C.”
That’s because large-scale manufacturing is difficult. Musk knows this and often points to Tesla’s aspirations to reinvent the process as the thing that will ensure the company’s legacy.
But what Elon knows is largely ignored by Tesla’s most enthusiastic supporters, and it’s now broken free and appears to be moving menacingly toward Uber and Lyft as those high-expectation startups IPO.
The basic issue is one of scale combined with speed. I’ll give you an example, drawn from a company I know pretty well. Business Insider started out with a few guys in a borrowed loading dock in New York City, hammering out blog posts on tech and the markets in 2009. Ten years later, BI is the biggest business news site in the world, with far-flung global offices. We were acquired by Axel Springer, a German media conglomerate, in 2015, for about $450 million, and since then our growth has been impressive by any measure.
But our central New York operation fits on two office floors in lower Manhattan, and while we employ a large number of journalists relative to many other digital media sites, we’re pretty far from Tesla’s headcount of around 40,000. A classic example is Instagram, which was bought by Facebook in 2012 for $1 billion, when the photo-sharing app had 13 employees.
The problem is getting worse
Uber and Lyft have some structural similarities — the tech side can be run by a relatively small number of high-value software engineers and managers — but the “on the ground” part of the business requires a staggeringly expensive army of human drivers, as well as capital investment in cars, which are a depreciating asset. If I were to transfer this model to BI, we’d all be creating the publication as we do now, writing a number of stories every day — then printing them all and distributing the results by hand. Our business plan would be worse than the one it’s replacing, daily newspapers.
I could go on. Apple is having a tough time figuring out what it’s next awesome product will be. The Apple Watch has a done OK, but it’s no iPhone. The much-discussed Apple Car project has reportedly changed from an actual car into a self-driving software project; meanwhile Alphabet’s Waymo has spent a decade on the problem and is just now getting self-driving cars on the road in a commercial application.
You get the point. The low-hanging, scale-fast-and-cheap fruit has been picked. The internet of things is evolving in herky-jerky fashion. So investors have turned to transportation, largely because everybody needs to get around and because the auto industry is worth trillions worldwide but tends to innovate rather slowly.
Tesla’s ongoing struggles with the real world
Tesla was ahead of the curve on this trend by a decade, but Silicon Valley is ignoring the carmaker’s struggles. The lesson ought to be that the best way to make (or lose) a fortune in the auto industry is to start with one (Elon Musk basically lost the millions he initially invested in Tesla after he and his partners sold PayPal to eBay, but he was able to reverse the death spiral later in 2008, and the company has grown massively since).
The basic math of the car business is that it demands a gigantic amount of capital to generate an immense level of cash flow, out of which you try to achieve profit margins that could run above 10%. Cash balances don’t rise to Apple or Google levels, but before the tech economy’s economics became the standard, people used to worry about what Ford, for instance, would do when it piled up tens of billions in cash on its balance sheet. Even now, Ford has enough cash to ride out several short, cyclical recessions.
Back to Uber and Lyft. Their balance sheets also enjoy lots of revenue coming in, but the businesses quickly convert a growing topline into a ruinous bottom line because there’s an insatiable need for more drivers. That end of the business isn’t rightsized for anything but the most robust, densely urban environments; an Uber driver outside a place like New York or San Francisco probably can’t get enough rides to think of the job as more than a short-term gig or a stopgap wage.
Driverless cars might remedy this flaw, and that’s why General Motors’ Cruise and Waymo are pushing in that direction. For Tesla, the solution is automated manufacturing, but that’s never going to eliminate 100% of the labor headcount. And thus far, the company’s efforts to roboticize its assembly lines have met the same fate as the industry’s earlier experiments. In fact, Tesla had to build a quickie assembly line under a tent last year to make its production targets — a line that wouldn’t have looked unfamiliar to Henry Ford.
Even Amazon isn’t exempt
If I’m feeling especially grumpy, the only tech company that’s using the old model (think: Facebook and Google) and looking pretty solid is the brutally competitive Amazon. This is a company that’s good at experimenting with innovations that don’t reinvent the wheel but gain traction (Echo speakers are no Sonos, but Alexa is winning) and whose buy-everything-from-us strategy has won over consumers in droves. Resistance is futile, as I discovered recently when I needed to buy a tuxedo for an eight-year-old on a few days’ notice.
That said, Amazon doesn’t have a perfect track record (remember the Fire phone?), and it’s starting to get into stuff like airplanes and electric pickup trucks (it invested in startup Rivian not too long ago), so we’ll have to see if the great aggregator of online consumption can make it in the world of large, complicated machines.
If Tesla’s experience is a guide, the ride is gonna be rough. Another example, from my own life. I’m writing this story at home at 9 a.m. on a Thursday, using a high-speed internet connection and Insider’s content-management system. I’ll file it, photos and all, entirely digitally, all from the comfort of my home. The story could be good to go in less than half an hour.
In the 1990s, before the web, when I wrote stories at home, I had to save the file to a 3.5-inch disk and take it myself to the publication that would later turn it into a print product. The writing part consumed about the same amount of time as it does now, but the logistics around delivering the end result added hours. And of course there was still a lot of work for other people to do once my job was done. You don’t even want to know what it was like when everything was written on typewriters and publications were assembled without digital tools (the appearance of a daily broadsheet, in those days, was something of a miracle).
Welcome to the Era of Slow Scaling
What Tesla has been trying and failing to do is reverse-engineering some more speed into the production of the automobile — to make the physical car more like virtual software. They have been somewhat successful at this, believe it or not (over-the-air software, updates, for example, that can fix things like braking dynamics). But attempting to crack the code of the moving assembly line has been much more difficult.
Many of the future opportunities that Silicon Valley wants to attack are like this: the so-called disruption can take hold and gain investment, but it doesn’t scale fast enough toward profitability. Tesla is exhibit A: In 15 years, the company grew dramatically, but it’s only made money in three quarters since 2010.
Two-decade timeframes aren’t going fly on Sand Hill Road. Even isolated success stories — GM bought Cruise for around $1-billion all-in when Cruise has about 15 staffers, and the company is now valued at $14.5 billion — come with staggering ongoing costs. Cruise’s future investment prospects, for example, come in part from GM’s possession of a multi-billion-dollar factory in Michigan where it builds the EVs that Cruiser operates.
How many venture capitalists want to invest in companies that require a few billion in long-term investment right out the gate?
We’re going to find out because this is what’s coming: the Era of Slow Scaling. And if anybody wants a comprehensive tutorial on how it will go down, there’s no better person to pay attention to than Elon Musk.
Major 5G network deployments are expected by 2020, and the technology will create opportunities across many industries, according to CB Insights.
Highly-anticipated major 5G networks are expected to be deployed by 2020, and will transform a number of industries due to the technology’s ability to provide wider network coverage, more stable internet connections, and faster data transfer speeds, according to a recent report from CB Insights.
5G will also enable the rise in the number of Internet of Things (IoT) devices, along with the amount of data they generate, the report noted.
While 5G sets the stage for new opportunities across many fields, it also will bring disruption to those industries, the report said.
CB Insights identified the 20 industries that 5G will impact the most. Here are the top 10:
5G is poised to help manufacturing production operations become more flexible and efficient, while also improving safety and lowering maintenance costs.
2. Energy and utilities
Critical infrastructure like energy and utilities will benefit from 5G technologies, which could create more innovative solutions in energy production, transmission, distribution, and usage, as well as the next wave of smart grid features and efficiency.
Farmers worldwide are using IoT technology to optimize agricultural processes including water management, fertigation, livestock safety, and crop monitoring, the report noted. 5G could enable real-time data collection, allowing farmers to monitor, track, and automate agricultural systems to increase profitability, efficiency, and safety.
More than 100 million Americans made a purchase on their smartphone in 2018, the report noted, and the move to mobile shopping is largely due to the rise of 4G/LTE. The faster speeds 5G will bring will enable new retail experiences like virtual reality (VR) dressing rooms.
5. Financial services
5G will accelerated the digitization of financial institutions, including from internal operations to customer service, the report said. Increased security and speed will allow users to increasingly make transactions instantly on their devices, and make remote tellers a possibility.
6. Media and entertainment
5G will bring about new opportunities in mobile media, mobile advertising, home broadband, and TV, as well as interactive technologies like VR and augmented reality (AR).
In the healthcare industry, 5G could increase efficiencies and revenue, helping health systems create faster, more efficient networks to keep up with the large amounts of data involved. The technology could also enable the use of remote monitoring devices to improve health outcomes.
Transportation systems ranging from public buses to private logistic fleets will gain increased visibility and control thanks to 5G, the report said. 5G will allow improved vehicle-to-vehicle communications, enabling more self-driving car testing. These networks will also help cities gain access to more data around their transportation systems.
The future of AR and VR depends on reliable 5G networks, according to the report. These technologies require a less expensive, wider network with lower latency to continue developing and reaching widespread adoption, as they require massive amounts of data processing.
5G will help insurance agents make more effective decisions, as they will have access to more accurate data, the report said.