Apple's CEO Tim Cook answers "iPhone", "Past Fail", "Apple's Future"

Tim Cook, Apple's CEO,The Washington PostIn the long interview, I answer about what I want to be as CEO of Apple, the smartphone market in the future, the current state of asking for iPhone, past major failures and Apple's next step.

Tim Cook, the interview: Running Apple 'is sort of a lonely job' | The Washington Post
http://www.washingtonpost.com/sf/business/wp/2016/08/13/2016/08/13/tim-cook-the-interview-running-apple-is-sort-of-a-lonely-job/

Q:
You once said "I do not want to become a well-known traditional CEO." What does this mean?

Cook:
We believe that traditional CEOs are separated from customers. Many retail CEOs do not truly interact with consumers. Also, the traditional CEO seems to believe that their work is in the balance sheet, income statement, etc. Of course these are important, but I do not think that is the only important thing.

The CEO has an incredible responsibility for the employees of the company. It is also responsible for the communities and countries to which the company belongs, as well as for the entire ecosystem of the company, such as those who develop products and assemble them. In this regard, I may have a different way of thinking than the traditional CEO. I know that there is criticism. If you are interested in returning long-term shareholders, everything I gave you is really important.


Q:
IPhone sales exceeded 1 billion units. The iPhone, which occupied approximately 44% of Apple's sales at the time of CEO in 2011, is now nearly two-thirds. How does Apple migrate from the business tied to the iPhone?

Cook:
It is a secret matter, but it is not a special problem. In terms of consumer electronics products, do you know anything else that people will change over the long term? I do not think there is another choice.

Q:
What do you mean?

Cook:
The worldwide sales volume of PC is about 275 million units, and this number is decreasing. The world market for smartphones is 1.4 billion. As time goes by, I am convinced that everyone in the world will have a smartphone. Of course it will take some time before, and not everyone has an iPhone. However, in terms of consumer electronics, smartphones are the biggest market on Earth. My home has a TV. A happy family has more than one TV. However, one TV does not have one TV, and it will not be so.

Please look at the technology making up today's smartphone. Look at the technology that will dominate in the future of smartphones. Like artificial intelligence (AI) for example. AI makes smartphone even more indispensable. AI will be a better assistant than it is now. You may not be able to go out without a smartphone already, but in the future it will lead to more smartphones.

Q:
Apple's cash on hand is as much as $ 231.5 billion (about 23.4 trillion yen). For people asking "What is the technology that Apple will change the world next?" Do you say that there is no other thing like a smartphone?

Cook:
Technology is an industry where new and beautiful technology appears like every week. Everyone said that this is the incredible event we were seeking when netbooks appeared, and in fact it looks like a PDA. Technology is full of such wonderful things.

It does not mean that "we do not have to do anything". I only say that smartphones are still in an incredible product category. That's not the case in this quarter, but throughout the year, and over the years. So, I do not want you to think that wonderful days passed away.

Q:
However, some analysts say so.

Cook:
I do not mind. To be honest, they said the same thing about Apple in 2001. I also said it in 2005. In 2007 "This is a stupid iPhone, who also dreams of this?" They said in 2010 that Apple has peaked. If we achieve sales of $ 60 billion (about 6.6 trillion yen) in 2011, we can not "grow any further". In the end, Apple's sales last year is $ 230 billion (about 23 trillion 200 billion yen). Certainly, sales will fall this year. You know that it does not grow in all the years. I heard this opinion sparingly. So, I will not argue about it. Because it is a classic idea that in many ways it can not become even bigger because it is huge.

Q:
Do you feel frustrated due to "the impatience of investors?"

Cook:
We welcome all investors. However, we are trying to clarify that we make decisions based on a long-term perspective. If you look at the way you have been doing in the past 5 years, I think that our shareholder return rate is over 100%. This is a pretty good figure. And I think most people who own Apple stock at the moment will be satisfied.


Q:
Everyone wants to know something next. About cars and TV. I talked about artificial intelligence and augmented reality. How do you embody these great ideas with a huge organization?

Cook:
A wonderful person embodies a wonderful idea. I believe that a small team will be a huge monolith. The product team is a horizontal relationship. Both the hardware team and the software team collaborate. We do not have divisions. We are considering doing what business school does not do other large companies do not do. Other large companies will divide the company into smaller departments. Each department carries out marketing, communication and operation for each.

If you keep thinking about what customers are asking us for, we will be back to a seamless user experience. I would like to resume any work that everyone is working on the iPhone at any time. I also want to transfer the work environment to Mac. And it is desirable that they are completely seamless. The only way to guarantee this is to do things at once instead of every department. This means that the top of the company should be cooperative.

Q:
Looking back, are there any mistakes you had to learn?

Cook:
Map (application) failedwas. Although it is now an application that seems to be proud. We had the honesty to admit himself that this was not the best condition and had the courage to choose another way. That is important. This is the only way the organization learns. Failure of a traditional large enterprise is not to admit its mistakes. In that respect, it is a double failure. The pride and ego of most large companies are so big that they can not say "they are wrong."

In the case of exchanging gears for something else, we think that the earlier the better, the better. If you are honest, people will benefit from doubt. If I am stuck in a misty haze and continue mistakes, I think that I will definitely lose the trust of employees and customers.

Q:
Other than that?

Cook:
I made a wrong selection for retailer (formerly Dixons' John Bulwett). This was obviously a mess. I'm not saying anything bad about him. He was culturally incompatible with Apple. Listening to him, I gave the final decision but it was wrong. We quickly recognized the situation and made changes quickly. I am proud of that decision.

It's like a lonely job. As the saying goes, CEO's work is lonely in many ways. I am not seeking sympathy. We have to recognize that there are everyone invisible blind spots. The blind spot will change. In addition to putting truly wonderful people around, we must put people to inspire you and bring out the best.

Q:
In the most recent quarter, sales have declined by 33% in the huge market of China. Companies that have grown in low-cost markets like Huawei are beginning to enter the premium smartphone market (like the iPhone). Let's talk about China. How threatening do you feel about regulations of competitors and China?

Cook:
Apple makes investment decisions based on a long-term perspective. We do business report every 90 days, but because it is a rule, we are not managing the company from a short-term perspective. In the long run, China is an incredible market. It is not only a point of view of demand and potential profit, but also in terms of a treasure trove of talent. There are more than 1.5 million iOS application developers in China. It has increased by 112% in comparison with the same period last year, and it has increased by more than 50% in the quarter when viewed in the span of two years.


Q:
What do you think about virtual reality?

Cook:
Augmented reality (AR) is very interesting and I believe it is one of core technologies. So, yes. That's what we are doing a lot behind the curtain we are talking about (laugh)

Q:
There are lots of reports about Apple cars, attracting attention that seems like an open secret. Why do not say anything about cars?

Cook:
We can not answer questions about something that has not been announced (lol)

Q:
Regarding the Apple car, constant attention has gathered. Is there something you do not want to share about the details?

Cook:
We have always watched people appreciate surprises. In daily life, surprises are still not enough.