Celebrity Hires

[Morgan]

The Beats acquisition by Apple has gotten me thinking about "celebrity hires". Celebrity's or near celebrity's that are hired by companies for various reasons.

 

With Dre and Iovine coming to Apple and Angela Ahrendts (Burberry) already there it makes me wonder what kind of value can they add? Obviously they are a brand name that can be useful in the correct context, but Apple needs basically no help branding. What benefit do these people provide to Apple that Apple isn't not capable of doing itself? Is Cook trying to surround himself with "cool" people?

 

What can Ahrendts do to Apple retail locations to make them better? If I remember correctly Apple stores have some of the highest sales per square foot anywhere. What can she do to improve this?

 

Dre and Iovine. Presumably they were acquhired to lead up the streaming service. People say Iovine will be able to use his connections and sway to put together deals with record labels for the service. What can Dre bring? A younger image? He's not particularly young. Wouldn't it have been better (and probably cheaper) to build a streaming service themselves and hire them to promote it? Why is Apple making these changes? This combined with a the departure of a number of long-time execs, I think, will change Apple.

 

Will these three new celebrity hires be able to function well at Apple? Presumably they all have huge egos are very used to calling the shots. Apple seems to have a strong leader, but Cook is not as strong and all powerful as Jobs was. Can Cook control them? Or will different camps emerge and slow the company over the coming years as infighting potentially increases? Apple hasn't put out a significant new product since the iPad in 2010. Just upgrades on the same stuff. Will the iWatch or iTV be as big as previous products? Maybe, but I'm sort of skeptical.

 

I am a huge Apple fanboy, but some of the actions the company has taken in the last few years have made me wonder if the company is going to do much significant innovation. I hope they do because I love my Apple products.

[Liberty]

What do they bring? Um, they're really good at what they do?

 

Ahrendts -> Experience quickly building a huge high-end retail operation around the world, but especially Asia, where Apple needs to do more. Also experience doing luxury retail online well, which isn't easy because you have fewer ways to differentiate and make it upscale. There's tons she could do to improve Apple retail. In fact, that's not a part of the company that has been doing as well as it could in past years IMO, mostly because of the revolving door of retail leaders probably. They've been way too slow at opening new stores in Asia and the presentation online and offline could use a refresh (like iOS 7 did to iOS).

 

Iovine and Dre -> Tons of contacts in the music and film/TV biz, which definitely helps a lot in these industries. And if the killer feature of Beats compared to other streaming services is curation, getting access to the best people to do that (through contacts) helps, and getting cooperation from artists for exclusives and such will matters. They got freaking Trent Reznor to run part of the show!

 

But I think that Ahrendts was hired purely because of her skills and track record. I don't really see her as a 'celebrity'. And Iovine and Dre might be famous (I guess It's hard to make hundreds of millions in the arts and not be a celebrity), but they've also proved their talent as entrepreneurs and dealmakers many times over. They're there because they built a business that seems very fast-growing and very high-margin and well positioned for the music streaming-wave (and Iovine could be very useful to get more content for Apple TV), not because Cook is star-struck.

 

In the Iovine interview I posted in the AAPL thread, he says something like: "In the same way that culture companies always get the tech wrong, tech companies will get the culture wrong." Well, Apple has always been more in touch with the arts and other 'soft' aspects of products than most, and this is just a continuation of that, IMO. It's a real competitive advantage when so many other tech companies are tone deaf to a lot of that stuff..

 

I have no doubt that Cook can control these people. Has he ever done anything that makes you think he couldn't? He fired Scott Forestall, the guy who was supposed to be the next Steve Jobs according to some, and he's resisted a lot of external pressure to do all kinds of things and hurry things out before they are ready, etc...

 

Apple hasn't put out a significant new product since the iPad in 2010

 

So they're about on schedule, maybe a bit ahead, right? Look at the timing of the iPod, iPhone, and iPad...

 

They don't have a quota of new categories to enter every decade. Making arguably the best, and certainly the most profitable phones, tablets, laptops, and desktops is already pretty good... I'm sure they'll do more soon, but they won't release stuff before it's ready. There's no real lasting glory gained by rushing to be first (Galaxy Gear anyone?). You can release software as beta and fix it later, but not hardware, and Apple is never first anyway.