TIM COOK, stepping in for his boss Steve Jobs for the third time in seven years, faces the challenge of keeping up Apple’s product development and girding the iPhone and iPad maker for rivalry with Google.
Cook (50), Apple’s operations guru, took charge this week after Jobs, who has been receiving treatment for cancer and a liver transplant, said he was taking another medical leave. In an e-mail to employees, Jobs said he would remain chief executive officer and be involved in major strategic decisions, yet didn’t say when he might return.
As chief operating officer, Cook runs day-to-day operations. When he stepped in for six months in 2009 during Jobs’s transplant leave, Apple shares climbed 70 per cent. While Jobs (55) sets the creative vision for Apple’s products, Cook’s oversight includes sales, manufacturing and distribution. He can ably take over again, said Peter Misek, analyst at Jefferies Co. “He’s a star, just a different kind of star from Steve,” said Misek. “He’s arguably one of the best supply chain managers in the world.”
Jobs’ health has been deteriorating in recent weeks, according to a person who knows the Apple founder and didn’t want to be identified. Messages left for several of Apple’s six outside directors weren’t returned.
While Apple hasn’t publicly named Cook as successor to Jobs, he is the heir apparent, said Avi Greengart, research director of consumer devices at Current Analysis, a market research firm. He said while Apple will continue to succeed in its markets, he questions how it will fare finding new directions without Jobs.
“Jobs has an almost magical ability to see markets that are small and niche, and to understand what it would take to make them big businesses,” Greengart said. “Steve Jobs is the one and only Steve Jobs.”
Cook is taking charge of a company that has more than doubled to $321 billion in market capitalisation since he last took over for Jobs. The expansion was fuelled by the iPhone mobile device, which almost doubled its sales in the fiscal year ended in September, and the iPad tablet computer, which went on sale in April.
On Tuesday night, Apple reported much better than expected revenue, on the back of strong pre-Christmas sales of its devices. Profit for the first quarter of its financial year was $6 billion, up 78 per cent from a year ago, while revenue rose 71 per cent to $26.7 billion.
“Tim Cook can obviously operate,” said Michael Yoshikami, chief investment strategist at YCMNet Advisors. “The question is: can he be a visionary?”
Apple also now faces a formidable competitor – smartphones based on Google’s Android operating system. Android has become a top-seller in the US, according to ComScore, accounting for 26 per cent of the smartphone market in November, compared with 25 per cent for the iPhone.
The company is playing catch-up to Google in mobile advertising. Google was expected to grab 59 per cent of the US mobile-ad market last year, while Apple may have finished with less than 10 per cent, research firm IDC said last month. The two companies also compete in software that puts internet content on TV.
Cook consumes energy bars to take him through marathon meetings that run late into the night. Born in Mobile, Alabama, Cook earned an engineering degree from Auburn University in his home state and a masters of business administration from Duke University. Apple hired him in 1998 to help catch up with the efficiency of rivals Dell and Hewlett-Packard.
He has proven himself as a strong operations executive and can rely, in the short term at least, on Apple’s pipeline of products.
Cook got compensation of $59.1 million in Apple’s fiscal 2010, including a bonus of $5 million and $52.3 million in stock awards. – (Washington Post-Bloomberg)
