Tim Cook: Apple's challenge isn't innovation, it's where to focus its energy

Right at the end of Apple's Q1 2014 earnings call, CEO Tim Cook was brought onto that topic; innovation. It's a word often thrown around, sometimes incorrectly, and we all know at Phil Schiller thinks about Apple's ability to innovate. While Wall Street might believe Apple has lost its ability to innovate, Cook, and everyone at Apple looks on it a different way:

Innovation is deeply embedded in everyone here. So much of the world is filled with complex products. We have zero issue coming up with things we want to do, disrupt in a major way. The challenge is always to focus on the very few that deserves all of our energy. Always done that, and we'll continue to do that.

Focus is key. It's all too easy to look upon Apple to blow us away, to come out with a game changing product in the same way the iPod, iPhone and iPad all have. Is the word innovation thrown around too much? Probably, but it doesn't mean it isn't important to Apple, and something that each and every member of the team there is working their collective asses off on.

So what do you think? Wall Street never pleased, or have we been spoiled in the past by Apple to the point we're left expecting more?

Richard Devine

Senior Editor at iMore, part time racing driver, full time British guy

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There are 35 comments. Add yours.

Rene Ritchie says:

I love this. It costs them short term but pays off in the long run, at least so far. As a company, they're just not set up for broad.

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Gary Compson says:

I totally agree with you. One of the key principles that Steve Jobs brought back to Apple was focus. Focus on a slimmer product range, and core underlying technologies. No matter how big the company is, was or could be, it just isn't the kind of company that likes to throw shit at the wall to see what sticks. (Pardon my turn-of-phrase). Sometimes we get bored waiting for the next 'big thing'. We already have so much, and there will be so much more, whether from Apple or any company that wants to push us forward, and does it by playing the long game.

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iDisturbia says:

"No matter how big the company is, was or could be, it just isn't the kind of company that likes to throw shit at the wall to see what sticks."

Well Said! Well Said!

Like google paid a few billion dollars to buy a thermostat company or another with a few thousands lousy patents but zero useful phones for consumers ... or some make creepy robots!

Wall Street calls that innovation, for sure!

Now ... somebody tell this to those idiots of Wall Streets .... then again, the innovation of wall street was 2008 ~ 2009 biggest recession .... and some morons like those in The Wolf of Wall Street!

richard451 says:

You applaud the same morons when they talk up Apple, and then slap them down when they think Apple should be doing better. Can't have it both ways.

Of course, this is the company that used it's billions to buy a patent troll company in 2013. Now that's innovation!

iDisturbia says:

Talking to me?!! Oh ok ... Let's forgive google morons who thought it was just a little game bidding on those same patents ... Oh ok let's pay a few billion dollars more and buy Motorola and their patents then! Now googlers can sue the universe! And, Wall Street good for nothing fatties love us too no matter how shitty our business runs!

Peace! :)

Brady KEITH says:

"innovate" or "focus" on an iWatch and a new Apple TV, please.

SteveW928 says:

Yea, the Apple TV could use a bit of love for sure, but if either that or, God help us, the iWatch is 'the next big thing' I'll pronounce Apple dead and start looking for another platform, giving myself a lot of time to transition (after nearly 25 years as an Apple fan). (Or, if for some odd reason, the iWatch WOULD actually be a hit, I'll pronounce society dead, and start looking for a cabin in the woods.)

I think Rene hit it above. The problem isn't Apple, but Wall Street day-traders. They don't have a collective ounce of long-term between them. It's just too bad Apple is mixed up in the public markets, actually. Luckily, they have a LOT of cash and will probably mostly ignore Wall Street as much as possible.

Brady KEITH says:

lol...a cabin in the woods. despite the intelligence of your post (I appreciate the intelligence of it, sincerely), I stand by my request for focus on a watch. no other manufacturer has "nailed it", and Apple "nails" tech. hence, I think it would be a hit.

SteveW928 says:

Thanks. I guess my question, then, is: If they do make a watch, and 'nail it,' what do you think that means?
I mean, I just can't see myself wanting a watch anymore unless the watch could do everything the phone/iPod can do. My iPod is my watch, and it does a lot more than a tiny screen will (and it feels cramped enough). We're talking about an even bigger iPhone screen now.
I just don't really get the whole category of smart-watch (and I'm the geek who had one of those casio calculator, address book watches years ago). The only way it makes sense to me, is for someone who wanted an iPod touch type device that was extremely limited and had no use for a phone... and thought wearing it might be nicer than carrying it. But how many of those people are there? I'm already odd in having an iPod and a separate cell phone (which I do to avoid the outrageous phone plan rates).

Connor Mason says:

I don't get it. They can easily finance anything they can dream of. Let's just hope that at least a few of these things they're focusing on are new product categories. Apple TV looks to be neglected, but it has great potential, so my guess is they're focusing on something based off of it. The concept of wearables is out there too.

If Tim Cook means that Apple is only focusing on iOS and OSX, I'm not seeing the amazing results of recent output.

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lvavila says:

Shooda stopped at your first sentence... "I don't get it".

Connor Mason says:

Why is that? It doesn't make sense. They've got some of the smartest people in the world and they can't figure out how to handle multiple projects?

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lvavila says:

I mean zero disrespect even if my words don't come across so. Apple does not exists to push out new products and get you and I all excited. 1) They are a business to be a business to stay in business. New innovations all the time is not good business. 2) you said it, they have some of the smartest people in the world so maybe their focus and "choice" not to refresh existing products adding bloat and cost without customer/business payoff makes sense. 3) who says Apple is not working on a watch or sex recording glasses? They just don't release ANYTHING until they feel its ready. Unlike Guugel.

DrBrad says:

2014 = new product category. Period. Apple can not go on the way they have for the last 2-3 years. People are clamor ing for something new. We want proof that a post-Steve Jobs Apple can still give us the kind of groundbreaking innovations that Apple has moved mountains with.

Tim knows this. Investors know this. The public knows this. God help Apple if 2014 isn't a groundbreaking year.

I didn't say it was FAIR. I'm just saying this is perception and perception is reality.

lvavila says:

Jack-in -the-box put chilies in their burgers. Thats new. Go get some.... Oh oh, Windows has swipie tiles..... ta-da..enjoy!

ericesque says:

God help Apple if they under deliver by pushing out said new product too early. Forget needing a home run, Cook will be crucified if his first at bat isn't a grand slam. Apple, as a business, is doing just fine. It's against their culture to let outsiders influence their products. That's why they're Apple. New markets will be entered when the product is ready and not a day sooner.

That said, I REALLY REALLY want to see them rock the world again this year :D

lvavila says:

Thank you sir. Well said.... and rock me anytime! :)

asuperstarr says:

I think we have been spoiled by Apple. I think Steve Jobs set the tone and now we are wanting more. I also believe the blogs play apart in this with all the rumors reporting that lead us to believe some of these can be true. I like a few new innovation, but I like when the software can do more and make my life easy. I wish they would do more with the Siri feature.

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zdn1042 says:

Well said.
I also like the fact that when Apple releases a new product, it's something that would be a game-changer and they know that it would be something that can enhance our lifestyle/experiences.

rockerchick says:

Yup and I think that people keep forgetting that there were long gaps between the times that St. Steven P. Jobs rocked our collective worlds with new/disruptive products.

SteveW928 says:

Bingo! I don't think most people have enough attention span anymore to figure that out, especially Wall Street.

digitaldeath187 says:

Get real.. when Steve died! So did apples innovation!!!

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brooklyndon2911 says:

Apple will do what Apple wants to do. And that's what I like most about them.

Obsidian71 says:

Innovation means nothing unless its impact can be quantified. I don't sit around waiting for Apple to deliver my hopes and dreams. I'm constantly assessing where in my life technology can make it better. I've personally decided that wearables are not the answer.

Social Networking is very important to me but it's appearing that Facebook is not the answer. If i'm gonna bet what will become the next disruptor it will be the home and that's a huge but potentially lucrative market.

mimllr says:

I'm also in the boat that the home is the next area of our lives to be disrupted. I was surprised that Google purchased Nest before Apple did, but I feel Apple has the resources to produce something better. If they can tie home control into the iOS and OSX platforms the way they've done everything else, I think we're about to see some insanely awesome products. The question is what they will be, the price point, and how that will affect the mainstream consumer.

SteveW928 says:

The room to innovate in home and building in general is HUGE, but I'm not sure any particular company could revolutionize it that much, as the industry itself is the problem. It's designed to stifle innovation (sometimes that's a good thing... i.e. building codes to maintain minimal safety, but often it just keeps mediocre practices in place for a long time.)

The Nest is easy... pull a few wires and plug it on. Controlling the rest of HVAC to actually gain substantial efficiency is a whole other thing. Sure, add some automated modules between wall-sockets and devices could do a bit, but it's like that saying, 'lipstick on a pig.' And, as much faith as I have in Apple, I doubt we'll see the Apple iHome (a whole house made by Apple, which is about what it would take).

Narrator Jack says:

I cared about Steve's opinions about tech. I'd like to care about Tim's.

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SteveW928 says:

If the ability to innovate and do great things it tech didn't run deeper than Steve, we're all in trouble. What I'm more worried about is Steve's ability to say 'no' and 'do it again' being missing. So, if anything, I'd guess we'll see the 'game changers' mixed amongst more duds (like iWatches?).

lbaxter says:

Three things Apple does well (and pretty consistently): 1. Make a well-built product that is stylish and durable, 2. Put such attention to detail into that product that no minor thing is left untouched, and 3. Get the markets, fans, and critics all in a uproar when the rumors that the next device can shoot lasers while singing Carmen and processing quantum physics equations fall short.

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cardfan says:

Any new category has to be based on itunes accounts and iOS. Watches qualify as more of a hobby than anything Apple has ever done. This whole category is immaterial.

TV's also stick out as an oddball. They're far from annual purchases and not mainstream priced (not one you'd want from Apple). The Apple TV (box) still has the most potential here but Apple has to focus on it. With it's pricing though, it'll never be more than a supplement to the ecosystem.

The challenge isn't to make the two above work for them. It's to expand on what they have and keep building foundations for future categories which may or may not be the two above. It's this focus on few products that has risk for Apple though even if they're able to focus all their energy on these few products. It's still called putting all your eggs in one basket. Business people want to diversify this. Auditors would make note of this situation when a huge percentage of your profits is tied up in one product, or you rely on a key supplier, etc.

SteveW928 says:

"Watches qualify as more of a hobby than anything Apple has ever done. This whole category is immaterial."

Shhhh! People haven't recovered from their CES buzz yet. They won't figure that out until the not-next-big-thing next year (it was 3D TVs the year before).

My bet.... we don't know what the 'next big thing' is yet, until someone tries it and it takes off. Most of us probably won't recognize it, even after Apple or someone else initially introduces it. That's how it was with iPods and iPhones. It took a couple of years before most people really understood the game-changing nature of them.

dalyapp says:

Cook is right. Where do you put your focus? Apple made a better music player, smartphone, and tablet, but they certainly didn't invent those things. They took a category that was lacking, put their focus on it, and made a great product. For all the whining I hear about Apple not innovating, I hear few if any suggestions on where to innovate next. What category is lacking, besides TV which he all know is a very hard nut to crack due to forces out of Apples control?

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XENGS says:

The thing is they don't innovate. All they've been doing lately is improve. Back when they started, they TRULY innovated. They made NEW technology; The original Mac, was pretty much the first* computer to have a GUI... Years later, they made the iPhone, which, unlike others, had this capacitive touch screen and easy to use GUI. Now all they do is equip a 3-year old iPhone with a slightly better chip, a fingerprint sensor, and make money. Is that innovation? I wouldn't call it innovation, that's for sure.

jrod986 says:

Apple TV needs some focus. That thing is so outdated that my Xbox loads stuff faster and matches it in available services. Thankfully, a kind soul gifted me a Roku 3 for Christmas.

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Ipheuria says:

All I want to know is why do people listen to Wall St. ? Why would anyone think they would know anything about tech innovation? I'm not going to ask my mechanic if he thinks the baker is doing a good job on my cake.