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era. Initially, however, Apple introduced the iPod as a closed system that worked only with the Macintosh and iTunes music warehouse and did not support non-Apple music formats or software applications. It was as if Microsoft produced Windows and then built Office but did not allow other software companies to build Windows-compatible applications. Eventually, under pressure, Apple opened up the iPod software (but not the hardware) to play some other music formats, but not those from Microsoft or Real. Apple also uses proprietary digital rights management (DRM) technology on the iPod and the i Tunes store, creating problems with potential ecosystem partners as well as customers. (To its credit, though, Apple did introduce an iPod in 2002 compatible with Windows and then a Windows version of i Tunes in 2003.)

Then we have the iPhone— probably the most exciting electronics product to hit the market since the Macintosh. This “smartphone” —a cell phone with many of the capabilities of a digital media player as well as a Web-enabled handheld computer—also boasts a remarkable user interface driven mainly by touch and virtual keyboard technology. But the original iPhone would not run applications not built by Apple, and it would not operate on cell phone networks not approved by Apple (initially only AT&T in the U.S., but later Deut-che Telekom/T-Mobile in Germany, Telefonica/O2 in the U.K., and Orange in France). Fortunately for consumers, hackers around the world found ways to unlock the phone and add applications. A black market also developed for “hacked” devices. This market pressure persuaded Apple that its great new product was becoming a platform and needed to be more open to outside applications. In March 2008, Jobs also announced that Apple would license Microsoft’s email technology to enable the iPhone to connect to corporate email servers. But Apple has yet to allow consumers to use the iPhone on any service network they choose.

If Steve Jobs and the rest of the Apple team had thought to make “great platforms” first and “great products” second, then it is possible that most PC, digital media, and smartphone users

Despite faster
recent growth than
microsoft, apple
relies too much on
the fleeting nature of
“hit” products.

today would be using Apple products. Despite faster recent growth than Microsoft, Apple relies too much on the fleeting nature of “hit” products. Apple still is just half the size of Microsoft in revenues and much less profitable. Apple won the battle for digital media players but that product, like PDAs, is likely to disappear in favor of smartphones. Apple may yet win the smartphone battle but still trails RIM’s BlackBerry and Symbian/Nokia smartphones by a wide margin. We shall see how the market plays out, as Nokia, Samsung, and other firms introduce products that look and feel similar to the iPhone.

Which leads me to the puzzle alluded to in the title for this column: Is it possible for a company with Apple’s creativity, foresight, and independence to think “great platform” first and still produce “truly great” products? Based on Sony’s experience with VCRs, or Microsoft’s with MS-DOS and Windows, it is clear that platform companies must work with industry players and be willing to make technical and design compromises, as Nokia has done with the Symbian consortium. Jobs and other Apple managers have been acutely aware of the product versus platform challenge and have preferred not to follow an open platform strategy. But customers have eventually pressured Apple to open its products and it has done so without losing too much distinctiveness. This evolution suggests that Jobs and Apple could have pursued product and platform leadership simultaneously. Just a thought about what might have been.

Michael Cusumano ( [e-mail]) is a professor at the MI T Sloan School of Management and author of The Business of Software, Free Press/Simon and Schuster, 2004.