Here is an excerpt from an extended interview of Tim Cook by Sam Grobart for Bloomberg Businessweek. As Grobart explains, “For this week’s cover story on Apple (AAPL) and its future, I spent some time with Tim Cook, who said far more than was ever going to make it into the story. Or even the outtakes from the story. So for even more Tim Cook, here’s the transcript of the entire interview, edited only for clarity.”
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To set the scene: We met late on a Thursday morning, two days after Cook stood onstage at Apple’s Town Hall auditorium in Cupertino, Calif. We sat in a not-huge conference room adjacent to Cook’s office. Cook entered, wearing a navy polo shirt and dark trousers.
Here’s something about Cook that may tell you something: Some executives, when you go to interview them, kind of walk into the room, say “Hi,” and look to you to get things going. Not Cook. He strides in with a warm smile and firm handshake and immediately starts asking questions: What did you think of Tuesday’s event? Tell me what you think about the new phones—have you had a chance to use them?
That’s why this interview starts somewhat abruptly: We had already been kibitzing a bit before we actually “began” the interview. Anyway, enough of my ramblings. Here’s the conversation:
Grobart: You’ve said that iOS 7 is not change for change’s sake. Tell me more about that.
Cook: Some people see innovation as change, but we have never really seen it like that. It’s making things better. iOS 7 is a great example of that. It’s significantly better than 6 or any of those that came before it, and obviously significantly better than the other OS out there.
Grobart: Brand X. What do these new products represent for Apple at this point? What do they say about the company?
Cook: We’re a product company, and so the products show the values of a company. They speak to innovation. They speak to caring about every detail. They’re a reminder of how incredibly important experience is, so when you begin to use 7 or you begin to use the fingerprint sensor here … every detail has been thought through. The experience is an “Aha” moment.
You know, the first time that you buy something with your finger, it’s pretty profound. It’s one thing to use it as security. This is really cool, and a lot of people will love it, because they open their phone multiple times a day. But the buying is even a more startling experience, in a way.
I think these products scream Apple. You’ve got really forward-looking technology [in the iPhone 5S]. You have color [with the iPhone 5C], and when you feel it, it’s not just that it’s color. When you hold this, it’s just perfect in your hand. It feels like it was made for your hand. It wasn’t an afterthought, and every detail has been thought through, from the buttons to the way that the plastic is to the edge here (shows off the plastic-enclosure’s edge). In other phones, you would see the plastic coming up here.
And somebody thought through the wallpaper. Wouldn’t it be great if it was like you were putting on your shirt and your pants, and they actually matched or made some sense with each other? You know? Technology companies don’t think of those things, or, usual technology companies don’t think of those things. Nobody worries about buttons and finishes. Nobody really worries about the experience, and we do. We’re really proud that we do.
Grobart: Why not just sell the old iPhone 5, as you’ve done in the past? Why create a new phone with the 5C?
Cook: The business became huge. The market became huge. The customers’ desires grew. You know, people want different things. We wanted to make the phone more accessible. For us it’s all about products, and so we don’t look at things and say, “I will never sell a phone below that.” We don’t look at it like that. We say, “Let’s think about a great product that we’re doing.” If that great product can be sold for less, then we sell it for less.
You can look at iPod in this way and see it started out with a product at that time we were calling iPod. It later became called the Classic, right? But we began to fill this out. It wasn’t a price-point-driven thing. It wasn’t, “We need to come up with something for $99. Let’s figure out how to do that.” It was about a great product and a great experience. And [one iPod model] might be different than the other one, because it might serve a different customer. It might serve a different desire. It might provide a different experience, but it’s still a great product at
We were able to do that over time, and the result—not the objective, but the result—was that we span price points from $49 to $400. With iPhone, we just entered the business in 2007—not that long ago. It became clear to us that we could come up with a great product that appealed to a different consumer and had the benefit of costing less, so we could make it more accessible, and therefore grow the number of people that we could serve. That’s the reason.
I know there is a lot of focus on “Is the price low enough?” I think a couple of things about that: One, it’s a really great product, and that’s the most important thing to us. The next is we’ve had amazing success with iPhone 4, amazing success, in a lot of the markets that people are focused on, but also in a lot of markets that might surprise people that we’re having success with iPhone 4. IPhone 4 is still a great product.
Well, we’re not selling iPhone 4, but we’re now selling the iPhone 4S, and the 4S is free in many places. In the subsidized markets, it’s an even more attractive price than the 5C. And so now the great thing is we’ve grown our capability to do two phones, and when you’ve done one before, that’s a big change. And the side effect of that is we now have three different form factors that we’re selling: the 4S, the 5C, and the 5S, and there are a lot of people that we can serve and that can have an iPhone experience.
All three of those are fantastic experiences. You know, they’re all different—but they’re all fantastic. So they’re all experiences that we’re really proud of, and we’re proud to have our logo on the back. So that’s the reason.
We never had an objective to sell a low-cost phone. Our primary objective is to sell a great phone and provide a great experience, and we figured out a way to do it at a lower cost. Therefore, we can pass that on. And we figured out a way to sell 4S at substantially less than we were selling it for before, and we’re passing it on. So we think there will be a lot more people in our tent, and we can really serve a lot more people. And that feels good.
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To read the complete article, please click here.
Sam Grobart is a senior writer for Bloomberg Businessweek. You can follow him on Twitter @samgrobart.
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