Industry analysts are the only ones these days who stay up late waiting for new Apple releases. For the most part, the launch conference tagged "It's showtime" held in the early hours of March 26 disappointed most Apple fans, even if not for the first time.

By the time live broadcast of the discussion ended, it was nearly 3 am. Viewing it on screen, fans in China could hardly embrace the atmosphere at the event; once their screens were turned off, the enthusiasm faded fast.

The entire conference contained nothing on hardware. In retrospect, the signs could already be seen. One week before the release event, Apple's official website quietly updated several hardware products including the iPad series, iMac and AirPods.

Just as its tagline "It's showtime" suggests, the release event has been a landmark in the history of Apple. In the 'jargon' of the Chinese tech world, Apple is breaking boundaries.

1

A brief retrospect of Apple's history reveals three phases in its development. The first centered on desktop computers, with the iMac at its core. The second was with mobile handheld devices, iPhone clearly its star product. Now, with Cook at the helm, the flagship is heading out to open seas – no longer limiting its focus to hardware-based services, but developing products that cater to user demand.

And then there was subscription-based content.

Apple has always been a leader in software in Silicon Valley. However, the majority of its products and services has been built to work with hardware also developed by the company, thus creating a closed ecosystem completely dominated by Apple. The "Apple tax" immediately comes to mind; even Spotify had to resort to the legal system.

Filmmaker Steven Spielberg waves while arriving on stage to speak during an Apple special event at the Steve Jobs Theater in Cupertino, California, U.S., on Monday, March 25, 2019. (Photo by David Paul Morris/Bloomberg)

Foresight might be telling us that the till-now invincible Apple ecosystem will slowly but surely start to crumble following this conference. The appearance of many 'stars' at the conference is a metaphor.

The ruin has been brought by Captain Cook. Cook has repeatedly stressed that Apple will put the needs of its users at the heart of its business, needs that are satisfied, in fact, by the large number of suppliers in Apple's subscription service. Just as in video content, games or finance, only the "big players" come equipped with core products and service capabilities.

Apple is gravitating towards an open ecosystem in which it will play the role of 'middleman' to connect customers and service providers.

Clearly, in some areas, Apple is already testing the waters. For example, Apple has announced it will invest US$1 billion annually in video content production. Rumor has it that each episode of its TV series Amazing Stories (to be produced in cooperation with Spielberg) will cost $5 million USD to produce.

2

In the tech world, Apple is thriving and a large number of service providers still depend on its ecosystem for their survival. However, when crossing into a new industry, even a mighty giant like Apple must show "due respect". In business, so-called "cooperation" is no more than an exchange of interests. Fashion and New York Times in media, Goldman Sachs and Mastercard in the world of finance, Disney, Warner and Universal in Hollywood… all play the role of big shots in their respective industries. In moving over into their worlds, Apple can no longer act like an emperor bringing along a bunch of lesser allies to build a new kingdom, as it used to.

We wouldn't feel sorry for Apple, though. This is business as usual in fact, just as it should be. It was only the dogged determination of Steve Jobs that shaped Apple's past idiosyncrasies.

But now, Cook is slowly reshaping Apple into a regular commercial institution.

At the China Development Forum held last week in Beijing, Cook thanked China for opening the door. His original words: "One of the key elements of partnership is openness and trust. Being open to working together, open to new ideas, open to new solutions."

In order to illustrate the importance of openness and cooperation, Cook also cleverly quoted the words of China's top leader: "The fire burns higher if more people bring wood to it."

3

To China's mobile industry, Apple may have set a bad example.

Many bosses, having read the reports of Apple's event handed to them by staff, may experience their own eureka moments: "In the future, we have to do like Apple," forget about hardware, go for subscription, finance, games – that will bring profit faster than selling mobile phones.

They are good at this.

Maybe in the future, when we buy a new mobile phone, it will be integrated with more software and services, and you will "by accident" press a button to subscribe to some monthly or yearly plan. These shrewd businessmen will design more elements to entice, particularly, two key groups of people – innocent and highly curious youth, and inexperienced senior citizens.

People like Xiaomi founder Lei Jun, when presenting a product release, focus on showing off dazzling hardware data. Soon, words like 'subscription', 'services' and 'consumption' will be taking up more space in their PPTs.

At a time when smartphone shipment growth has slowed, Apple has given Chinese students a lesson. The move to service-based subscriptions is a big trend in the industry. But will Chinese smartphone companies be too quickly lured by profits in jumping on the bandwagon of an as-yet immature and untested ecosystem?

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This article was edited by the TMTPOST team. 

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