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Comment by planetguy | Hacker News Reader

Cargo-cultism. Apple was doing both those things back in 1998 when they were going broke, and they could have just as easily gone broke doing 'em.

There are many ways to run a successful company. Some of 'em involve in-house engineering and a focus on quality, while others involve outsourcing all your engineering and focusing on cheap crap (see also: Wal-Mart, nearly as profitable as Apple).

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Yeah, like Steve Jobs making sure the NeXT factory looked pretty by painting the robots is an example of silliness because NeXT failed. Yet if Apple showed that off in a product video today, it would be held up as attention to detail.

NeXT didn't really fail. They had a reasonably profitable exit by being bought by a large tech company, and subsequently basically took over the acquiring company and drove it to become incredibly successful.

But of course the popular image of NeXT is that it failed, so your point still stands entirely.

And perhaps most importantly, while it was an independent company, NeXT was operating under a very restrictive non-compete agreement that forced them to go after only low-volume segments.

I hadn't heard about that, do you have any links to more info? It sounds interesting.

NeXT's acquisition valuation was far below the valuations it accepted investment at years before. I'm pretty sure it was a net loss for its investors, if not directly that certainly on an opportunity cost basis.

From what I've read about the olden days, it was actually viewed as attention to detail then.

Sun also did this and ran themselves into the ground.

They lacked insight into what was happening with their business model. Apple has shown incredible foresight in this regard.

They were still doing in-house engineering, but in Jobs' biography it's repeatedly mentioned that Sculley changed the focus from product quality to profit and that caused the downturn in their business.

Obviously, not a completely objective source, but it's not necessarily true that they were doing exactly the same things in 1998.

I agree with you, but Walmart definitely does not outsource the part of their business that separates them from the other cheap import retailers.

Not disagreeing with the bulk of your comment, but...

In the December quarter alone Apple generated 85% of Walmart's most recent annual profit. And most likely for Christmas 2012 it'll exceed 100%.

Or put another way, if Apple hits their numbers for this year, they'll do about 200% over the profit that Walmart does (annually).

I only point this out because it's staggering.

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