Like many other people, I thoroughly enjoyed my colleague Ian Parker’s Profile of Sir Jonathan Ive, the chief designer at Apple. If you haven’t read the piece yet, I’d advise you to find a comfortable spot and consume all sixteen thousand and five hundred words. With a stock-market valuation of close to three quarters of a trillion dollars, Apple is the world’s most valuable company. And, since the death of Steve Jobs, in 2011, Ive, the man who oversaw the design of the iMac, iPod, iPhone, and iPad, has been Apple’s most iconic employee.
This state of affairs seems unlikely to change anytime soon. In April, Apple will release its smart watch, which is one of Ive’s pet projects. (Ian writes that Jeff Williams, Apple’s senior vice-president for operations, called the watch “more purely Ive’s than previous company products.”) And now there is speculation that the company is working on a car, which, should it ever come to fruition, will surely be designed in the famous industrial-design studio where Ive and his colleagues work. The car, in particular, poses some interesting questions about whether Ive and Apple can adapt the methods that have made them so successful to another type of industry.
Ian’s article portrays Ive as an ordinary man with an extraordinary gift for design. He grew up in Chingford, an unfashionable London suburb where David Beckham was also raised. At Newcastle Polytechnic, where Ive studied in the nineteen-eighties, he won not one but two national design competitions. He was a prodigy, in other words. But in an era when companies like Apple can have their pick of talent from all over the globe, talent isn’t always enough to succeed. You also need a serious work ethic, and some luck.
Ive had both. Since childhood, he told Ian, he’s been “consumed with work.” Even today, he works around the clock. In one meeting with Ian, he was so tired that he could hardly keep his eyes open. The first bit of luck that changed Ive’s life was meeting Robert Brunner, a designer from California who joined Apple in 1989. A bit of bad news helped, too. Working in London in the early nineties, Ive helped design a new pedestal sink for a British company, which was rejected, reportedly because it would have been too expensive to make. Shortly after that, he emigrated to California.
Ive’s great fortune was to be at the right place—Apple—at the right time. When Jobs returned to the company, in 1996, the Web was in its infancy and so was mobile computing, but this was soon to change. Silicon Valley, long the innovative hub of the computer industry, was about to become an important part of the consumer-products industry—an industry in which an aesthete like Ive could have a big impact. Jobs, who had a keen appreciation for product design, recognized Ive’s talent and liberated it from Apple’s engineers and moneymen. (More luck: Jobs also sounded out at least one other prominent designer, Richard Sapper, about joining Apple, but Sapper didn’t take the bait.) The result was one of the greatest product trifectas in corporate history: iPod, iPhone, iPad.
These days, Ive flies around the world in a Gulfstream GV that Jobs once owned. He drives an Aston Martin and a Bentley. For someone whose job involves promoting a form of commodity fetishism, that’s hardly surprising. The larger point, though, is that, like many of his celebrity pals (Chris Martin, Bono, J. J. Abrams), Ive works in a winner-takes-all economy where the rewards for coming first, rather than second or third, are enormous. Apple’s vast profits—$39.5 billion in 2014—partially disguise the fact that it operates in a manufacturing industry whose products are rapidly commoditized, and in which only market leaders make much of a return on their investments. Apple can charge higher prices than its competitors because it has a reputation, which Ive helped to create, for superior quality and superior design. If that reputation were to be tarnished, Apple’s profit margins would quickly fall.
Which brings us back to the Apple Watch and the Apple car. With these, Ive and Apple are entering terrain that is new to them, but also familiar. It is new in that Apple hasn’t built watches or cars before, and familiar in that, like cell phones and tablets, watches and cars are commodities that can be obtained relatively cheaply by most consumers, but that are also manufactured and marketed as luxury goods.
The upper end of market is likely where Ive and Tim Cook, Apple’s chief executive, intend to pitch their tents. The company has said that its cheapest wrist piece, the Apple Watch Sport, will retail for $349, while analysts reckon that the high-end Apple Watch Edition, which includes gold framing, could cost up to ten thousand dollars. An Apple car is at a much earlier stage of development. Recently, the company has been hiring battery designers and other technical staff. However, it’s probably safe to assume that if and when an Apple car appears, it will be pitched more at customers of BMW and Mercedes than of Ford and General Motors.
One of the age-old verities of the business world is to stick to your knitting: companies that expand outside their areas of expertise often fail. Will that happen to Ive and his colleagues? With the Apple Watch, probably not. Because it is another nicely packaged mobile computing and communications device, it’s instantly recognizable as an Apple product, which means that Apple fans will want one. Unlike the iPod and the iPad, however, the Apple Watch doesn’t appear to offer any great advance in utility or functionality, so the market for it may turn out to be smaller than the company hopes. But who really knows? Not I.
Driverless electric cars, if that’s what Apple is aiming to build, are a different product category entirely. Not because cars are innately low-margin products. (In a piece at Vox, Matthew Yglesias disposes of that argument.) Rather, it is because they emerge from a vast and complicated ecosystem that is largely unfamiliar to Ive and Cook. Apple’s business involves designing nifty computer products and getting Asian companies to manufacture them using cheap labor. In the auto industry, contract manufacturing barely exists. The industry is vertically integrated, heavily unionized, and heavily regulated. If Apple wants to sell cars, it would have to build its own factories, like Tesla, or partner with an existing manufacturer. The same goes for Google. (This week’s issue of the Economist has a good piece about this.) And that would involve huge complications.
Doubtless, Ive and the other talented folks who work in Apple’s design shop could come up with an interesting and elegant vehicle design: I, for one, would like to see it. But iCars on the roads in large numbers? If Ive and Cook pull that one off, they will be outdoing even their mentor, Jobs, who, for all his vision and entrepreneurial skills, spent his entire working life in Silicon Valley, a world he knew intimately. I can’t see the iCar succeeding. Indeed, I have some sympathy for those who interpret the very mention of it as evidence of the formation of another tech bubble. But if Apple is serious, it will be fun to see Ive and his colleagues give it a try.
