Following Record Q2 Earnings, Apple Turns to Partnerships to Bolster Enterprise Ambitions

by Kathryn Nassberg | 05/01/2015

This week, Apple made headlines with record earnings in Q2, mostly on the back of iPhone 6 sales, while iPad sales continue to slip. In an effort to maintain the tablet’s relevance, Apple is redoubling its efforts in the enterprise, where the iPad has gained considerable traction. To that, CEO Tim Cook announced that Apple is working with an increased number of partners to expand its reach into the enterprise and change how people work. The partnership goes well beyond IBM to include app developers like Box, bigtincan, Docusign, ServiceMax, Revel, MicroStrategy and Workato to expand Apple’s reach well into the enterprise ecosystem. While OEMs partnering with ISVs is not new within the enterprise – we have only to look to both BlackBerry and Samsung’s teaming up with SAP as a counterexample – it nevertheless represents a continuation of Cook’s vision to firmly plant Apple in the enterprise. With Windows 10 looming on the horizon, growing Surface 3 and Surface 3 Pro sales and a stagnating market for consumer tablets, the pressure for Apple to establish itself as not only a viable competitor, but the competitor to beat in an increasingly competitive market.

Consumer devices still hold considerable influence

While iPad sales have stalled in the consumer market, their influence continues to grow within the enterprise, as a growing number of companies are looking to mobilize their workforce. SVP and CFO Luca Maestri cited a survey in Monday’s earning call in which 77% of corporate buyers looking to buy tablets within the next six months plan to purchase iPads. VDC estimates that in 2013, nearly 6 million devices were deployed into enterprise and government applications, accounting for nearly half the market of consumer grade tablets in the enterprise – a number that is sure to grow. The power of the brand and the familiarity of the user interface have made the tablet nearly the de facto choice for non-rugged deployments in the enterprise. In a world in which “tablet” and “iPad” are synonymous for many, particularly in an enterprise purchasing position, Apple’s potential is enormous. The groundwork Cook laid in opening up Apple and iOS to outside partnerships in previous year, particularly in making a decisive break with the company’s Jobsian roots in partnering with IBM for enterprise solutions, is providing a strong foundation upon which Apple can build.

In the land of enterprise mobility, user experience is king

However, to be successful in the enterprise, Apple needs to ensure the strength of its partnerships and its app ecosystem. Tuesday’s headlines of dozens of American Airlines flights being grounded due to an enterprise iPad app glitch is a glaring reminder as to the vulnerabilities that abound in the push to mobilize. Even when the stakes are not quite as high, there need nevertheless remains to ensure an integrated experience that functions in conjunction with robust security. While Apple is partnering with major ISVs, many smaller, best of breed names on the list will have the opportunity to bring their capabilities to the forefront on a much larger stage. Companies like bigtincan are looking to bring seamless functionality to the forefront, particularly in working with Apple’s Handoff technology to enable users to work with content across all form factors, as well as using other iOS features like TouchID and the ability to add external content from iOS8 enabled apps. Meanwhile, ISV Workato is partnering with Apple to provide an even deeper level of app integration that enables end users to enable workflows across applications without the need to app-swap. By opening itself up to such a broad spectrum of partners, Apple could shore up its position even further in the enterprise space, especially if it can provide the user experience enterprise consumers have come to expect through their personal devices.

Partnerships are bringing enterprise to all platforms

While much of the enterprise attention is focused on the iPad, given its commercial potential despite the rapid maturation of the form factor, another enterprise foothold could be the newly launched Apple Watch. Although much of the media attention has been dedicated to consumer adoption rates and applications, VDC has already looked at the potential for the wearable to pave the way for smartwatches to become a more integral part of enterprise mobility. Regardless of form factor, though, Apple has nurtured a healthy ecosystem of third-party applications and peripheral devices that are empowering enterprise across industry verticals that solidify the company’s capabilities beyond personal consumption. Moving forward, however, one concern Apple will need to address is the breadth of its services beyond its partnership with IBM, particularly as companies like Samsung have moved to expand its enterprise presence through a comprehensive services solution. The challenge now that it has donned the mantle of enterprise competitor will be to ensure that Apple can bring these partnerships to fruition and gain the necessary traction to successfully compete against the likes of Microsoft and Samsung in a world where services, user experience, and seamless integration are paramount. 


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