Tim Cook took the reigns as the chief executive of Apple following Steve’s passing in 2011, but is he suited for the responsibility of leading the consumer technology giant into the future? Should Tim Cook be fired? Don’t understate the man; he has confidence in the brand and its products, and so do I.
Apple’s release of the iPhone 5 in September 2012 was on par with my expectations. But its weekend release with 3 million units shipped disappointed investors, driving the $AAPL stock price away from its all-time high of 705. The correction dragged $AAPL down to a share price of 385. Coupled with the nearly 50% drop in share price is the inevitable question being posed by many: should Tim Cook be fired? As he is the highest paid CEO in the world, it’s a fair question.
Pundits will argue that Tim Cook’s departure from Apple, as the outcome of a perceived failure to innovate, is imminent. They must have forgotten how notoriously secretive Apple is and how that approach has boded well for them since the introduction of the iPhone. While traders wallow in fear of Apple’s next product not meeting the demands of the market, thousands of the world’s brightest engineers work behind closed doors to bring to fruition milestones in mobile technology conceived years ago by leading visionaries, undoubtedly including the ideas of the late Steve Jobs. All the while, Apple benefits from their customers’ insatiable appetite for rumors and leaks. It’s free advertising, and Apple is happy to ride the hype.
But what if Apple, under the direction of Tim Cook, really has stopped innovating? This to me seems incredibly unlikely. In July of last year, Apple bought biometric technology company AuthenTec. Don’t let the bears fool you; this acquisition was not an effort to one-up Google and Microsoft on screen unlocking, it was to provide on-demand authentication for payments made via the iPhone.
That’s right, mobile payments. Apple’s next revolutionary and highly disruptive offering.
The prospect of Apple facilitating mobile payments has been rumored for years, with the Wall Street Journal at one point saying that the proximity payment technology near-field communication (NFC) would soon be introduced. (Interestingly, we’re unable to find their original article!) Many smartphones already come equipped with NFC, offering consumers the option of paying with services such as Google Wallet at a limited number of brick and mortar points of sale. Google Wallet, while promising, has not taken off.
Suddenly, Apple’s delay in bringing NFC and mobile payments to the market doesn’t seem so dire. But what does Apple stand to gain from NFC, and further, can it save Tim Cook’s career?
I became bearish on $AAPL with the release of the iPhone 4S. I thought that it was a trivial upgrade and that competitors could easily advance beyond Apple in the mobile arena within a year’s time. I was wrong. Unsurprisingly, the handset sold in great numbers and $AAPL rallied. I was however very bullish on $AAPL with their release of the iPhone 5 (wrong again) which was met with lower than expected launch weekend sales triggering a correction to 385.
Regardless of the features that the iPhone 5S will debut to the market, I believe that the best possible outcome will be the introduction of NFC and mobile payments. Considering where shares of $AAPL stand now at 445, color me bullish. Still think Tim Cook should be fired? Count on Tim Cook to keep his job, at least until 2021.