Tim Cook: “Of course, I'm going to change things.”

6/30/2012 6:09:48 PM

Tim Cook had perhaps his first big test at the 10th annual All Things Digital Conference (DX). Sure, he presided as CEO over the press conference last October when the iPhone 4S was unveiled, but Steve Jobs died one day later.

The company was still very much under Jobs’ influence despite his officially stepping down as CEO. Cook’s interview during the DX was a big test for him, as well as a preview of the 2012 Worldwide Developers Conference.

Description: Tim Cook

Throughout the interview, Cook wasn’t shy about admitting to his feelings for Jobs and showing that, while he is very much in control, Jobs’ influence will continue on. With a broken voice, Cook started that the day Jobs died was the saddest day of his life. Throughout this time, though, he learned that “the joy is in the journey.” He seemed to learn as much professionally as personally. “Life is fragile; tomorrow isn’t guaranteed, so give today your all.”

As much as we have heard that Jobs could be difficult to work with, he was never too big to admit when he was wrong. Cook found it to be a courageous thing for Jobs to be able to admit to such things. In fact, Cook called Jobs’ ability to change his mind 180 degrees an “art”.

From Jobs, Cook learned that focus is the key in both products and in personal life. It’s important to do a few things great, and cast everything else off, as it’s better to have the best product, than to have a product that is good or very good. He spoke of the “unique culture of excellence” at Apple and promised that as CEO he would not witness or permit the change of that standard. Instead of focusing on the past, he will focus on the next thing.

Description: Tim Cook and Steve Jobs (right)

Tim Cook and Steve Jobs (right)

Yet, Jobs didn’t want everyone sitting around and continuing to see him as the leader of the company long after he was gone. He related a story to Cook of being around Disney when Walt died. Every time a decision needed to be made or something needed to be done, everyone sat around asking “What would Walt do?” Jobs didn’t want the same for Apple. He didn’t want them sitting around asking, “What would Steve do?”

As far as his role now, Cook doesn’t believe it is to replace Jobs, noting that there will never be another Steve Jobs. He sees himself as just a great CEO of Apple, and he relishes every moment of it, referring to his job as his oxygen. The curator role at Apple moves among different people. Cook reveals that it’s always been that way. It’s a myth that Jobs did it all. He believes that Jobs’ legacy will be in the standard of people he brought into the company, believing that’s what makes it what it is.

This brings up the question of how Cook himself was brought in. Jobs had hired an executive search firm, and they found Cook. They kept calling him and did not give up. He eventually gave in and flew out to California one weekend, as he was so busy he didn’t have time to do it during the week. What he saw when visiting the company was a strategy of taking the company to a place where no one else was. Within just five minutes of talking to Jobs, Cook wanted in. Apple is the only company he ever saw where angry customers would call up and yell, and yell loudy, but still come back. Compaq customers just moved on to Dell, and Dell customers to IBM. The brands didn’t have the same following.

And because of that, Cook isn’t worried about changing things up a little bit. He knows that he has the freedom to do that, having been granted that by Jobs himself. He explained, “Of course I’m going to change things.”

Description: “Of course I’m going to change things.”

“Of course I’m going to change things.”

We already saw the start of that last year when Cook announced a matching gift program, then earlier this year a dividend and share buyback program. Jobs was aware of the matching gift program and was completely in agreement with it. Apple has a lot of money, so Cook thinks they should share it. There aren’t too many people who could argue with that. Going beyond that, his focus is on social change and supplier accountability.

Yet the overall goal of Apple isn’t to make revenue. Instead it’s to build great products. Cook sees the focus as being on innovation, just where it’s always been. This is how the company has built itself up. There are over seventy million customers with iPhones because of that focus on being the best and not just selling the most. The iPod introduced people who had never been Mac fans to Apple, bringing developers in as well. Yet they are in no way close to being in the beginning phase.

This, of course, brings up the obvious question of what’s on the horizon for Apple. Cook couldn’t tip anyone off as to what’s coming in the future, even a few days into the future of the WWDC, but did share a few thoughts on some of the existing product and some of the rumored products, as well as competitors’ products.

Apple invented the iPad, but did not invent the tablet market. It was already there. Cook does not see the tablet as something that will replace computers and believes they are instead extending the purchasing cycle, as consumers will buy tablets in the interim years between buying computers. Yet, there are things you can do with a table that you can’t do with a PC, and that’s what has created the market.

Description: Apple CEO Tim Cook introduces the new iPad, 2012

Apple CEO Tim Cook introduces the new iPad, 2012

As far as the converged design coming out from other companies, Cook doesn’t see that as something that will work well, and does not believe it will become a “kick ass product.” If the tablet and PC are forced together in a product, he doesn’t believe either will works as well as they do separately.

Looking at the iPhone, Cooked stated that the iPhone is the best mobile phone on the market, and he sees all the momentum in the industry being between the iPhone and Android. In his opinion, Android’s problems rest in the lack of developers to focus as Apple has done. Again, their goal is to be the best, and not in how many models they have. He sees the amount of different models of Android phones as leading to them having a lesser product. The Apple process is more simple, one phone, one store, one operating system, etc.

This brought up two questions, why is there only one model of iPhone and not a cheaper version, and why does the iPod have multiple models. Cook did not rule out a cheaper iPhone at some point in the future, which leads to the question of the availability of a cheaper, smaller iPad in the very near future. He doesn’t feel the iPod Shuffle was born out of looking for a smaller, lesser-priced product; he just sees it as a great product overall.

The talk turned to the television products, both Apple TV, and the upcoming television, without them ever mentioning it per se. he stated at the start of the discussion that they weren’t a hobby company, and if a product didn’t find success, they move on. The 1080p high-definition capability of Apple TV has now doubled the sales of the product so far this year. Obviously, it’s not a product that will require them to move on. They’re sticking with it.

Cook also spoke about developing a television product without actually saying that’s what he was talking about. When developing a new product, they look to see if they can control key technology, if they can do it ahead of others, and if they can create a product that they themselves would want to own. He was asked why they don’t look into streaming content. He compared it to what happened to the music industry. He doesn’t want content owners getting ripped off by people stealing content the ways they were with music. Putting that aside, he doesn’t think Apple has to own a content business. He believes they should instead create a relationship with those who could provide them that content.

Description: the relationship of Apple and Facebook

The relationship of Apple and Facebook

This brings up the relationship of Apple and Facebook. Cook believes the relationship is very solid and hinted that there could be more between the companies in the near future. While it’s very solid, he mentioned that they don’t have Facebook integration yet, as they now have with Twitter, so perhaps that’s something that’s currently in negotiation. Regarding Ping, Cook said they don’t need to own a social business, but he thinks they should be social. They tried going somewhere with Ping, but the customers voted that Apple didn’t seem to put enough effort into it.

When asked why the company doesn’t move all of its production to China, Cook responded that they decided there were things they could do better than anyone else, negating the need to send it out. They make as much as they can in the United States. Right now on the back of the iPhone, they could put the words, “Several Parts from the U.S.,” and it would be a valid statement.

Developers are a very important part of the overall process. Prior to 2007, no one knew what apps were. However, it would now take a football stadium to hold all of the people making apps. He sees that as being a significant difference over what you see with the PC market where development doesn’t seem to be as important.

But the sharing of ideas continues to be a sore point with Cook. He views the current patent situation as “a pain in the ass,” and it’s clearly a topic he is quite passionate about. He is unwilling to let Apple’s hard work be copied by other companies. He compares what he sees happening as starting a painting and having someone else finish it and sticking their name on it. He doesn’t want Apple to be the developer for the rest of the world.

Description: Apple CEO Tim Cook touring an iPhone production line at a Foxconn plant in China

Apple CEO Tim Cook touring an iPhone production line at a Foxconn plant in China

The interviewers wanted to pin Cook down by saying that sipping off goes both ways. They pointed to the face that Apple gets used just as much as they sue other companies. Cook sees it as being different, though, saying that Apple gets used over standard-essential patents, and that makes him view the patent system as in disrepair. As an example, he pointed at 3G technology. You can’t design a product without 3G, so he doesn’t see that as a product companies should be able to get an injunction on. He stated that Apple has never sued over stands-essential patents they own. Beyond that, he refused to discuss other companies and what they were doing.

Operational efforts and product design are Apple strengths, and Cook sees the company displaying a level of care he just doesn’t see other places. He stated that if people are going to rip them off blindly, he hopes it’s in their social accountability. That’s definitely an area where Jobs didn’t seem to place a lot of focus. It was just never as much of a goal for him as it seems to be with Cook.

This goes back to Cook’s statement of changing things. Of course he’s going to; it’s his company now. Yet, he still seems to be keeping Jobs as much of a part of the company as he can. He’s gone but not forgotten, and still figures into the decisions. No one is sitting around asking what Steve would do, but they are taking the company in the direction he started.

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