Apple Inc

Apple was created by Steve Jobs and Steve Wozniak in a California garage in 1976. The initial force behind the first Mac’s creation was that Jobs wanted to create a computer that was simple to use. Before IBMs entry into the market in 1981 Apple enjoyed being an industry leader. From 1981 to 1985 Apple found it difficult to compete in the PC market due to the fact that the alternative systems being produced were easy to replicate and relied on other vendors for resources. The Macintosh at that time although trendy and technologically advanced, was not able to be integrated with others operating systems and third parties due to licensing restraints from the company.

Over the next 10 years under the lead of various individuals the Mac was re-positioned as a useful tool in desktop publishing and education. The entry into this new market segment allowed the company to recapture an impressive share in the market and become the most profitable PC company in the world by 1990 (Yoffie & Kim, 2011). Apple was able to command premium prices for their products due to loyal customers; however they also realized the need for an upgraded operating system that would be able to compete with Microsoft in order to keep customers happy. In 2007 Steve Jobs was asked to rejoin the company as a consultant. Jobs realized that in order to be an industry leader in the market, Apple would need to be an innovator rather than just following the market lead; they would have to stand up and be different from the other competitors.

The Changing Market

The PC industry market was lead by four major vendors; Hewlett-Packard, Dell, Acer and Lenovo. Together these companies captured 55% of the market and they were able to maintain competition due to standardization of products and a manufacturing shift to more cost effective areas such as China and Taiwan (Yoffie & Kim, p5, 2011). Customers were becoming more discriminating as well in regards to price, design, ease of use, service...