One of the top 2018 predictions has come true. Not impeachment or the fall of Bitcoin, but the rise of Apple to a market valuation of $1 trillion. We even predicted it a few months ago. Now that the tech giant is at the top of the mountain, where can the company potentially go from here and what does the financial landscape look like with other companies hoping to surpass them?
In the 1996 episode of The Simpsons, “Homerpalooza,” there’s a scene that offers some surprising insight on the state of Apple during that year.
Fast-forward to 2018, and the fact that this couldn’t happen (at least not for the foreseeable future). However, in the mid-to-late 1990s, Apple was on the brink of bankruptcy – and apparent obscurity, hence the Simpsons gag – before Steve Jobs returned and changed the company’s direction.
Does this year mark the beginning of a new era for Apple? Not exactly. Nobody has been doubting Apple’s potential for success. It’s become a long-running gag that the public would buy any Apple-related product regardless of direction or choices. This includes changes to the iPhone like completely removing the headphone jack, forcing an entire U2 album on owners, and slowing the performance of older models. At this point, it seems that the company can do no wrong and only an improbable chain of catastrophic failures could turn that around.
Apple’s place at the $1 trillion-plus position might seem like a lonely spot, but it wasn’t for long. Jeff Bezos’ Amazon quickly closed the gap just a little over one month later by also reaching $1 trillion.
But Amazon isn’t content with playing second fiddle and are pushing harder than ever to overtake Apple in company valuation. The company recently reached another peak of their own on Prime Day in July, garnering the highest number of signups for its subscription services, which include streaming and merch sales. However, it could be the online retailer’s more questionable practices that earn the company the most profit.
Those one-day deliveries are a godsend when you’re in a rush, but have you considered what it takes for speedy shipment? According to an undercover journalist who posed as an Amazon warehouse worker, employees were forced to either urinate in bottles or skip bathroom breaks altogether for fear of it affecting their efficiency. Sick days are viewed by bosses in the same way as bathroom breaks and a survey showed 55% of employees have exhibited some form of depression.
Employees work under tremendous pressure to meet tight deadlines and tasks set by their bosses who, very likely, received deadlines of their own from higher and higher up the chain until reaching Bezos himself. Of course, Apple isn’t free from this sort of scrutiny. Not too long ago, it was associated with Chinese sweatshop-style factories linked to several suicides.
Now with the $1 trillion valuation in the rear-view mirror, both Apple and Amazon are exploring new areas of financial growth to fast-track them to a possible $2 trillion. But of the two companies, Apple is the one exploring new venues.
Apple sees its future in the creation of film and TV content. The company is to be “spending at least $1 billion on content this year, signing up the likes of J.J. Abrams, the Reese Witherspoon/Jennifer Aniston team, Kristen Wiig, Drake, and various other big names for TV shows.” With two of the biggest financial moves of the year being movie-related (AT&T’s acquisition of Time Warner and Disney buying 21st Century Fox), this foray into film may be a wise move for the tech giant.
Apple faced many struggles, overcoming hurdles before hitting the stride that took the company to this monumental accomplishment. And at this point, Apple would have to remove the iPhone’s screens entirely to return to a point where only Homer Simpson remembers the company.
Alex Correa | Staff Writer