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May 28, 2017

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Apple's fashionably examined woes neither new, nor good

Long before pessimism over Apple Inc.'s prospects became fashionable, at a time soon after the California-based company scored a historic patent court victory over Samsung in the U.S. and saw its stock price reach ever heavenward, The China Post, in this column, raised doubts over the midterm future of the technology giant.

Long before the iOS map fiasco, The Post questioned Apple's ability to successfully execute its social media and cloud strategies, pointing out recent flops such as Ping (once Apple's answer to Facebook) and Mobileme (a now-discontinued predecessor to the iCloud, which also fails to live up to the hype).

Now the company that has been probably the most talked-about and successful of the past decade has seen its first quarter of flat growth in years. Its share price is down over 10 percent and its foothold in the smartphone market is quickly eroding. All of a sudden media outlets are writing off the company with the same ardor and speed they once idolized it.

For Apple, the sense of deja vu must be unshakable. After all, it is not the first time the company launched a product that virtually created a brand new electronics category, mightily profited from doing so in both financial and reputational senses, and then saw itself cornered by competitors who quickly learned to build similar products at a wider price range and with more open ecosystems.

The last time that happened, things ended badly for Apple. The company saw its share of the PC market eaten away by cheap and more flexible computers running Microsoft's operation systems. For years it had only a niche (and negligible) presence in the PC market that it practically created.

Now Apple is once again facing competitors offering wide price choices and devices powered by Google's open-source Android OS. Once again its products are seen as the costly standard bearer that might not appeal to the majority of maiden users who are not as inclined to pay as much for their smart devices as hard-core electronics users, and this latter group already has its smart devices.

This time, the odds against Apple are actually bigger. Its competitors have not only learned to build the smart-products introduced by Apple but also learned the value of innovation by watching its example. Apple's last decade of breakneck growth, fueled by a constant flood of innovations, has given its competitors the licenses to be creative and to take risks. The best examples of this trend are Samsung's voice-and-gesture-controlled TVs and Nokia's wireless charging smartphones.

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