Sunday05 February 2023

Foxconn Working to Remove Apple Dependency; Looks To Life After Apple

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14621rotten apple

With all of the articles talking about life after the PC we were surprised to hear that Foxconn is looking at life after Apple. Apple is an interesting company with a rocky history their two founder Steve Jobs and Steve Wozniak were both very talented at what they did and that combination managed to help the fledgling consumer PC market take off. However it was not that long before both of the founders were no longer with the company and it was being run by a business man instead of anyone with vision or personality. That business man tried to embark on a legal campaign to kill off rival Microsoft with not only failed, but also came close to bankrupting Apple.

Fortunately for Apple Steve Jobs returned and saved the company. He was able to turn things around by a combination of amazing marketing, establishing a solid mythology around their products and leadership as well as intentionally adding a new sense of style to the computer systems they launched. Apple banked on the fact that many of Apple’s customers were creative types that wanted form and function. Steve Jobs with his ability to improve on the designs and concepts he saw seems well suited to this role. Once the iPod and iPhone came out Apple’s success seemed written in stone it seemed as if there was nothing they could do wrong and even managed to patent concepts, ideas, UIs and more despite prior art and the obviousness of many of these functions.

Unfortunately Steve Jobs passed and the leadership of the company dropped back to another business man in the form of Tim Cook. Since Cook has taken the reigns full time Apple has fallen from their high station and we have seen a drop in their stocks and also their sales. Because of this their orders to manufacturing partner Foxconn have shrunk. The reduction in orders helped to give Foxconn a 19% drop in revenue for Q1 2013. This has put Foxconn is an unusual position as they find their number one partner slowing down.

To combat this Foxconn appears to be branching out on their own and instead of waiting for orders they are pushing their custom made products to their clients. This new push has also been joined by a return to manufacturing their own internal devices. At one time Foxconn was a big player in the PC market and made products for companies like Leadtek as well as having their own prominent consumer line. As they ramped up with Apple this product line and business has shrunk and now you hardly ever hear about Foxconn motherboard or GPUs. Do not think that this means Foxconn will start pushing their PC component lines again. Instead it is much more likely that Foxconn will branch out into consumer electronics devices of the sort they already make for others.

Foxconn has already released a TV using panels from Sharp (Foxconn invested about $800 Million into Sharp). They could be working to turn this into their own line of TVs or just prove to others that they can build them for them (including the rumored iTV). No matter what the end state is for the Foxconn TV it is clear that Foxconn, the company that once boasted that Apple would destroy all of the other smartphone manufacturers, realizes that they cannot depend on Apple for their future and are taking steps to remove that dependency. They may also be taking a hard look at what Apple did to another one-time partner and thinking they would be better off if they could stand on their own.

Meanwhile Apple is still losing momentum as the consumer move to products that are bringing newer technologies and features instead of minor refreshes. Apple is still working to recapture its mystique and momentum, but it might just be too late for them to ever climb back to the top.

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Last modified on Tuesday, 07 May 2013 15:06

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