May 16, 2012
Forget Television, These Are The Big Industries Apple Could Dominate Next
By Seth Fiegerman
Apple has a track record of dominating or disrupting major markets.
Think PCs. Portable media players. Digital music. Smartphones. Tablets.
Many have speculated in recent months that Apple will attempt to do the same to the television-set business with the launch of its much-rumored iTV. Even with that talk, some have suggested Apple should walk away from the fiercely competitive, low-margin business. And maybe it will.
But there are still several other big industries the company has the potential to dominate with new or existing products if it chooses to.
No, we're not expecting Apple to come out with a four-door coupe anytime soon (although that would be kind of awesome.) Rather, there's potential for Apple to build on the way that modern vehicles already cater to iPod and iPhone owners.
"I think smart vehicles are going to end up with a tablet-like feature built in," said Tim Bajarin, president of Creative Strategies. "It won't be a tablet per se, but it will be a screen that will be tied to the product in the market."
Bajarin suggests a couple possible ways this might work. The first, and certainly the simplest, is that car makers might have a cradle in the vehicle to connect to a separate tablet—probably an iPad, since that makes up most of today's market.
Alternatively, Apple might be willing to create a custom-made tablet for specific car companies that could be built into the dashboard. And if Apple doesn't, its competitors will certainly want to, as a way to nudge into a market Apple dominates.
Bajarin has no doubt that tablets will be incorporated into cars. It's just a matter of when and whether Apple actively gets involved, which he thinks it will.
"From Apple's standpoint, they want more outlets for their ecosystem, and this would be another screen tied to their ecosystem—it just happens to be in a car," Bajarin said.
It turns out that the medical industry is full of Apple fanboys. Manhattan Research, a healthcare market research firm, recently surveyed more than 3,000 practicing physicians and found that 62% use of iPads for professional purposes, twice the percentage who did in a similar survey the year before. Some doctors use it to look up clinical drug information, others use it as a diagnostic tool or to remotely monitor patients.
What is truly remarkable though is that iPad adoption has happened on a doctor-by-doctor basis, rather than being spurred on by the hospital itself. But according to Manhattan Research, medical institutions are now considering adopting tablet devices on a wider scale, giving Apple an opportunity to solidify its hold on a fledgling market.
"These institutions are quite happy to start with the iPad because doctors already have it themselves and are familiar with it," said Monique Levy, VP of research at Manhattan Research, who has consulted with many in the industry.
That said, she expects this will depend on whether and how much Apple cooperates in helping hospitals work through issues with adapting the iPad for corporate use. Features it will have to add: bolstering data security and supporting multiple user accounts. "There's a limited window where Apple can jump in and dominate before hospitals start looking to other devices."
Apple has already disrupted the gaming industry with apps, but as one analyst points out, the company hasn't even begun to invest resources in the industry yet.
"Apple has not taken its video-game efforts as seriously as other companies like Sony or Microsoft," said Jesse Divnich, an analyst with Electronic Entertainment Design and Research, noting that Apple has no dedicated video-game hardware. "They've really left it up to developers and consumers to shape the experience."
Divnich personally has doubts about whether Apple will change this strategy anytime soon, but if the company does choose to invest in a gaming console or other gaming hardware (as some have speculated), he says it could have a significant impact on the industry.
"If Apple chose to, they could be disruptive in any entertainment vertical," Divnich said. "Loyalty [in the gaming market] is shifting away from the brand or the hardware to the service, and Apple has obviously done a good job of branding its service. People already know how to use and navigate iTunes, and that's something very powerful.*
At least one report has suggested that Apple has the potential to make a mint in the banking industry, but it seems unlikely we'll see the company launch an iBank.
However, there is another way Apple may come to dominate our money. And that's in payments. It already has 250 million credit cards on file, with which users currently buy songs, videos, and apps.
Mark Moskowitz, an analyst with JP Morgan, released a research note earlier this month predicting that Apple would take on Google and come out with its own mobile payment platform in the near future, which he dubbed iPay. "With this platform, we theorize that Apple users ultimately could pay for goods and services using NFC technology embedded in their iPhone or iPad and tied to an Apple account," he wrote in the note, provided to Business Insider.
This is the time for Apple to make its entrance into the industry. A separate report from the Aite Group predicts that the mobile payment industry will explode in the coming years, processing some $200 billion in mobile payments by 2015. The last thing Apple probably wants is to leave all of that to Google.
Return to In the News