INDIVIDUAL

ASSIGMENT
Name: Nguyễn Ngọc Minh Châu
Student ID: HS150227
Class: IB1602
Lesson: International Business Strategy (IBS301m)
Lecturer: Cung Thị Ánh Ngọc
Table of contents
A.Export
B.Apple
I, Overview of Apple

1. What is export?
2. Which benefit can a country gain thanks to its export activities?

II, Business results

III, Entry mode

1. Investment Entry Modes

a, Strategic Alliences of Apple Inc. and Microsoft
b, Strategic Alliences of Apple Inc. and Motorola Co
c, Strategic Alliences of Apple Inc. and Google
d, Another Strategic Alliences
2. Export Entry Modes
a, Direct export
b, Indirect export
IV, The problems Apple has faced in the last 3 years
1. Covid pandemic
2. Trade conflict between the United States and China
2.1 Apple's reliance on China for income
2.2 Made in China Supply Chain
V, Solutions to improve business situation
C, Reference
A. Export
Exporting is the cross-border movement of products made in the domestic market, or
occasionally in a third country, to fill orders from other countries. These shipments can be
delivered straight to the end user, or they can be delivered to a distributor or wholesaler. The
actions in the export entry technique are directly tied to production, unlike the contract and
investment methods. As a result, depending on the number and types of intermediaries,
exports are classified as direct or indirect exports.
Exporting commodities is a global trade activity. Each country's socioeconomic progress is
heavily influenced by its export of goods. Export activities play a big role in how developed a
country's social production is. Exporting can boost foreign exchange profits, balance of
payments, budget revenue, technical innovation, economic structure, job creation, and living
standards.
Benefits of exporting to a country:
 Export generates capital for import, accumulates and develops manufacturing, and aids
the country's development and modernisation.
 Enhance people's lives by creating jobs.
o Create capital for the importation of important consumer items, meet people's
living and consumption demands, and improve employees' material and
spiritual lives.
 Export helps to restructure the economy and fosters the development of new products.
o Exporting allows for the expansion of consumption markets, allowing for the
development and stabilization of production.
o Exporting generates ideal conditions for the growth of other sectors.
 Production technology and equipment innovation.
 The foundation for the country's overseas economic relations to grow and prosper.
o Export promotion helps to improve international collaboration with other
nations, as well as our country's position and role in the international arena...,
export and export manufacturing industries encourage loan funds, investment,
and international transportation expansion.
It is possible to argue that exports not only serve as a stimulus for economic development, but
also as an internal element that directly contributes to the resolution of problems within the
economy when combined with import activities. capital, labor, technology, consumption
sources, marketplaces, and so forth. Strong export orientation is one of the most significant
aims in external economic development, and it is viewed as a critical issue for the country's
economic development and industrialisation. Take advantage of possibilities, utilize current
science and technology, and reduce the gap in development levels between the United States
and other countries throughout the world. Experience reveals that when a country promotes
exports at any time, its economy grows rapidly.
B. Apple
I. Overview of Apple
Apple Inc is an abbreviated version of Apple Corporation. Apple Inc., headquartered in
Cupertino, California, is an American technology company. Apple Computer Inc., then Apple
Inc., was founded on April 1, 1976. Apple Inc created, produced, and sold consumer devices and
web services in the early years of 2007. The Apple I was the business's first product. It was a
processor and memory-equipped motherboard. To suit the needs of consumers, the company has
added a slew of innovative and cutting-edge technology items. Apple will have 511 Apple Store
locations worldwide by 2021, including 270 in the United States. Apple is one of the world's
largest technology companies today. Steve Wozniak, Steve Jobs, and Ronald Wayne are the
three founders of Apple.
The corporation has had seven CEOs in its more than 40-year history. Steve Jobs and Tim Cook,
however, are the only two CEOs who have made a lasting impression with their achievements.
They are the individuals who have contributed greatly to Apple's current market position.
Apple's products include:
1. The following are some of the company's excellent product lines:
Apple Macintosh computer, iPod portable music player (2001), iTunes music player,
iPhone (2007), iPad (2010), Macbook, smart Apple Watch (2014-2015), AirPods
wireless headset, AirPods Max headset, and HomePod smart speaker.
2. Apple’s software:
The macOS and iOS operating systems, as well as the iTunes media player, Safari
web browser, and iLife and iWork creativity and productivity, are all part of Apple's
consumer software. iTunes Store, iOS App Store, Mac App Store, Apple Music, and
iCloud are examples of online services.
3. Apple logo
4. Apple in today’s market
According to Interband's Best Global Brands 2021 rating, Apple is the most valuable
brand in the world, with an estimated worth of almost 408 million USD. Amazon and
Microsoft are ranked second and third, respectively. Apple has been the most
valuable technology company in the United States for the past nine years.
Interbrand ranks the world's most valuable brands based on three factors: financial
performance, influence on purchase decisions, and brand strength.
 Best Global Brands 2021 – Source: Interbrand [1]
In 2021, Apple's brand worth have grown by 26%, outpacing the top five other technology
brands in the globe (2 percent faster growth for Amazon, 6 percent for Samsung, 7 percent for
Samsung). Microsoft is only 1% behind Google in terms of market share.)
Apple has established its brand on Apple's 7 guiding principles to become the world's most
valuable brand for many years in a row:
"Great Products": Apple's purpose isn't to become a billion-dollar firm, nor is it to make a profit
or increase its stock price. Apple has long maintained that its mission is to provide users with
fantastic products and services. Apple devotes its whole resources and capabilities to developing
the finest products and services possible. When Apple creates amazing products that suit the
needs of customers, huge revenue and profit will be the natural conclusion.
"Simple, not complex" is Apple's motto, and the company strives towards it through focusing on
innovation. Apple recognizes that none of us can excel at everything, so it focuses on what it
does best.
"Ecosystem" refers to the entire set of hardware, software, and services. All Apple products are
intimately linked, and when the devices are used together, they form a cohesive system. They are
constantly striving to provide their clients with the finest possible experience. Apple has always
insisted on owning and controlling the technology behind any product it develops.
"Excellence" - They are consistently excellent in some areas. Apple is only interested in
participating in product markets, which are the stages in which it can make the most impact. A
large portion of Apple's business is conducted outside of the United States. Rather than owning
suppliers or attempting to obtain control, Apple collaborates closely with its partners. Because
everyone of Apple's suppliers is an expert in their industry and does a better job than Apple
would if they did everything themselves.
"Say No" - Apple has a policy of "saying no" to tens of thousands of proposals. Because they
want to concentrate on some of the areas in which they excel and on those that they believe are
significant and meaningful to their company.
"Collaboration" — Apple promotes cross-functional collaboration throughout the company.
Apple will be able to innovate in ways that other companies will not be able to.
"Accept errors" - Apple refuses to accept anything until it achieves "excellence."
Apple is a name that is no longer unfamiliar to people all over the world. Customers will always
trust and use Apple's ecosystem of products, since Mac users will also use iPod, iPhone, iPad,
and Apple Watch.
On October 25, 2021, Apple unveiled the iPhone 13, a fresh design with additional features, as
part of the latest iPhone product line. All smartphone firms, large and small, are affected by the
Covid-19 epidemic, including Apple. Apple's sales have plummeted in most areas as a result of
the pandemic.
According to the Market Share table for the top 5 Smartphone Brands by Production in the third
and fourth quarters of 2021. The launch of the iPhone 13 in Q3 was also a significant stride
forward, resulting in higher Q4 sales than in Q3. risen to almost 23%, putting it in first place
among the Top 5 Smartphone Brands.

Market share of Top Five smartphone brands by Production, 3Q2021- 4Q2021

25.0%
23.2%
21.2%
20.0% 19.4%

15.9% 15.7%
15.0% 13.9% 13.7%
12.7%
10.5%
9.8%
10.0%

5.0%

0.0%
Samsung Apple OPPO Xiaomi Vivo
3Q21 4Q21

Figure 1 – Market share of Top Five Smartphone brands by production 3Q2021- 4Q2021 – Source [2]

II, Business Results

 Global revenue of Apple from 2018 to 2021 ( in billion U.S dollars)
400
365.82
350

300
265.6 274.52
260.17
250

200

150

100

50

0
2018 2019 2020 2021

Fingure 2: Global revenue of Apple 2018-2021 – Source [3]

Products and services ferormance
The following table shows revenue ( net sales) by category for 2021, 2020 and 2019 (dollar in
billions):
2021 Change 2020 Change 2019
Net sales by category
iPhone $ 191.973 39% $ 137.781 (3%) $ 142.381
Mac 35.190 23% 28.622 11% 25.740
iPad 31.862 34% 23.724 11% 21.280
Wearables, Home and Accessories 38.367 25% 30.620 25% 24.291
Services 68.425 27% 53.768 16% 46.291
Total net sales $ 365.817 33% $ 274.515 6% $ 260.174
Table 1: Net sales (revenue) of products and services ferormance 2019-2021 – Source [4]

Segment operating performance

The Company manages its business primarily on a geographic basis. The Company’s reportable
segments consist of the Americas, Europe, Greater China, Japan and Rest of Asia Pacific.
o Americas includes both North and South America.
o Europe includes European countries, as well as India, the Middle East and Africa.
o Greater China includes China mainland, Hong Kong and Taiwan.
o Rest of Asia Pacific includes Australia and those Asian countries not included in
the Company’s other reportable segments.
 2021 Change 2020 Change 2019
Net sales by reportable segment
Americas $ 153.306 23% $ 124.556 7% $ 116.914
Europe 89.307 30% 68.640 14% 60.288
Greater China 68.366 70% 40.308 (8%) 43.678
Japan 28.482 33% 21.418 -% 21.678
Rest of Asia Pacific 26.356 35% 19.593 10% 17.788
Total net sales $ 365.817 33% $ 274.515 6% $ 260.174
Table 2: Net sales of segment operating performance 2019-2021 – Source [5]
In 2019:
Apple's sales was $260.174 billion, a decrease of 2.04% from the previous year. Apple's overall
net income for 2019 is $55.256 billion dollars, down 7.18 percent from 2018. In 2019, Apple's
iPhone sales were $142.381 billion dollars, accounting for roughly 55% of the company's total
income. Apple made $46.291 billion in services sales in 2019 (about 18 percent of the company's
total revenue). In 2019, Apple's remaining Mac, iPad, Wearables, Home, and Accessories sales
amounted for roughly 27% of the company's total revenue. The trade war between China and
Apple resulted in a revenue drop for Apple in 2019. Apple's business status in 2019 has been
substantially impacted by this.
In 2020:
Apple's revenue increased by nearly 6% year over year, totaling $274.515 billion. In 2020, net
income climbed by 3.9 percent over the previous year, totaling $57.411 billion. In 2020, iPhone
sales fell 3% from the previous year, totaling $137.781 billion (accounting for about 50 percent
of total revenue). Sales of product lines such as iPad and Mac climbed by around 11% in 2020
compared to 2019. When compared to 2019, the Wearables, Home, and Accessories product
lines climbed by 25% in 2020. Products and services increased by around 16 percent to $53.768
billion dollars.
Apple organizes its business by market segmentation. Apple's sales in the Americas area increase
by around 7% in 2020 when compared to 2019. The European market is quite dynamic in terms
of sales. In comparison to the previous year, sales climbed by around 14%. It is now emerging as
a possible new sales area. In Rest of Asia Pacific, sales in this area are expected to increase by
10% by 2020. Greater China, which includes mainland China, Hong Kong, and Taiwan. This is a
market with a lot of potential. Because sales in this area fell for two years in a row, in 2020 and
2019. The reason for this is that this segment has a lot of low-cost domestic competitors. There
was no change in sales in Japan, with sales remaining unchanged.
In 2021:
In comparison to 2020, revenue in 2021 will increase by roughly 33%, hitting $365.817 billion.
In 2021, net income was $94.68 billion, up 64.92 percent over 2020. If iPhone sales fell in 2020,
they increased by around 39% in 2021, bringing in $ 191.973 billion in total revenue. Wearables,
Home, and Accessories product lines began to show signs of consistent growth in 2021, after
showing signals of steady growth in the previous two years. Other product lines, such as iPad,
Mac, and Serivices, continue to grow consistently at 34%, 23%, and 27%, respectively.
The market in the Americas incresed by 23% by 2021. The European market, as previously
stated, is one that is always changing. In comparison to 2020, revenue in this industry rise by
around 30% in 2021. If revenue in the Greater China market falls by 8% in 2020, revenue rise by
70% in 2021, compared to just 8% in 2020. The markets in Japan and the Rest of Asia Pacific
are both rising at a rate of 33% and 35%, respectively.
Conclude:
It is fair to say that Apple Inc, the technology behemoth, is raking in spectacular profits. Apple's
financial results for 2021 were exceptional. Year over year, all product and geographic groups
increased by at least 23%. There are even geographic parts that have grown by 70%. In terms of
the iPhone product, it has performed admirably thus far. Across all geographic divisions, product
expanded by double digits. This resulted in a significant increase in the company's profitability.
Existing iPads and Macs are exploding in popularity. One thing is certain: in the 2020-2021
period, Apple gained tremendously from the remote learning and working trend in geographical
regions. This pattern has resulted in revenue increase across the board. iPhone, iPad, Mac,
Wearables, Home, Accessories, and Services are among them.
Expenditure on research and development

Apple Inc's expenditure on research and development from fiscal year 2018
to 2021 (in billion of Dollars)
25
21.91

20 18.75
16.22
15 14.24

11.58

10

0
2017 2018 2019 2020 2021

Figure 3: Apple expenditure on research and development 2018-2021 – Source [6]

One of Apple's distinguishing brand characteristics is its unique designs. Apple has consistently
raised its research & development spending in order to create this unique asset. In 2021, Apple
spent a record $21.91 billion on R&D, up approximately $3 billion from the previous year. Over
the years, the company's large research and development expenditure has resulted in a slew of
popular products, including the iPhone, iPad, Mac, and iPod.

III, Entry modes

1. Investment Entry Modes
Market penetration is defined as an institutional arrangement aimed at delivering a
company's products, technology, people, or other resources to markets outside of its
home country. There are a variety of entry methods, which are split into three categories:
export entry modes, contractual entry modes, and investment entry modes.

1.1 Strategic Alliences of Apple Inc. and Microsoft

 Basis of alliance formation:
In 1997 thousands of good employees resign and left Apple in just a few years,
causing a significant dilemma for the company. Apple lost 1.5 billion dollars in
less than a year. Apple and Microsoft have been competitors in the computer
sector for the past 20 years, but Apple has teamed up with Microsoft to better the
situation. During this difficult period, Microsoft sees its partnership with Apple as
a sort of investment and assistance to a potential consumer. Because while Apple
makes a lot of money off of PCs, Microsoft makes a lot of money off of the
software and browser contracts it has with Apple.

 Apple - Microsoft alliance content:

Steve Jobs announced an alliance Apple with Microsoft at the Macintosh
computer users and software developers convention in Boston in 1997: a $150
million investment to buy shares of the company, and the two sides had reached
an agreement. For a period of five years, a patent license deal has been reached.
As a result, he was able to peacefully resolve Apple's historical problems with
Microsoft.
The following are the specifics of the alliance:
o Microsoft's Office suite, Internet Explorer, and a few Microsoft products
are now available for Apple's Macintosh platform.
o The Internet Explorer browser was integrated into the Mac OS, and it was
made the default browser in future operating system versions.
o The two companies have come to an understanding on how to employ
patent licensing in their products. As a result, the two businesses will be
able to collaborate more closely on cutting-edge Mac technology.
o Apple and Microsoft planned to work together on technology to ensure
Java and other programming languages are compatible between
computers.
o Microsoft will spend $150 million in non-voting Apple stock to strengthen
its partnership with the company.
 Benefits from alliances:
a, Apple:
o Having 150 million dollars in additional funding from the sale of shares to
Microsoft to fund future ambitions, such as the release of the Power Mac
G3 and Power Book G3 in November 1997. As well as the Apple Store,
which has been a huge success.
o Apple regards Microsoft as a strategic partner and a powerful software
company that owns major customer-facing products like the Microsoft
Office suite and the Internet Explorer browser, which are widely used on
PCs. The strategic partnership with Microsoft will help Apple improve the
appearance and functions of its PC devices, boosting the company's
competitive position in the personal computer market.
o At the time, forming a partnership with a business like Microsoft would be
a positive indication, as it would improve the public's and customers'
perceptions of Apple, and so contribute to Apple's recovery. Currently,
there is a lot of talk regarding Apple.
 b, Microsoft:
o When Microsoft purchased $150 million worth of shares at a price of
around $6, $7 per share, the share price soared dramatically, resulting in a
significant profit for Microsoft [7].
o The partnership with Apple is intended to save a potential consumer, and
it is a plan that will be implemented in the near future. When Apple's sales
rise again, Microsoft will, of course, profit more from license deals with
Apple, and Apple might eventually become a major customer for
integrated software. Microsoft tools, for example.
o Microsoft can also enter into niche sectors thanks to this strategic
collaboration. Apple, for example, introduced the iMac in 1998 to appeal
to the mid- and low-end customer segments at a fair price. These iMacs
are also compatible with Microsoft's Windows operating systems and
apps.
 Common interests:
o At the time, Alliance was a reasonable combination of Microsoft software
with Apple hardware, giving customers the most comprehensive products
in terms of quality and pricing, as well as more options such as Power
Mac, Power Book, and iMac.
o Increased market rivalry improves product quality and gives consumers
more options.
 The result of the alliance
It can be seen that the strategic alliance with Microsoft at that time brought many
benefits to Apple. In fact, in 1997, Apple's financial situation was so bad that Dell
CEO and founder Michael Dell, one of Microsoft's biggest partners, had to say, if
he were Jobs, he "closed the company and returned the money to the
shareholders". The fact that Microsoft invested a relatively large amount of
capital in Apple along with the introduction of popular software and browsers
favored by consumers into Apple's models such as Power Mac G3, Power Book
G3,... for Apple unexpected success.
 Figure 4: Revenue and Net income of Apple 1990 – 2009 Source: [8]
In 1998, Apple made a great comeback and debuted new products, allowing the
company's sales to soar past all forecasts. We can see how this strategic
collaboration saved Apple from bankruptcy and ushered in the most powerful
turnaround in the company's history.
 Factors for success:
o Understanding partners: Apple saw Microsoft as a well-known company
with a significant influence on public opinion and customers at the time.
And they obviously regard the advantages that Microsoft provides to
Apple as being greater than the advantages that Apple provides to
Microsoft.

o Know Yourself: A leadership team led by CEO Steve Jobs - he

understands how to take full advantage of the alliance's strength to ensure
the company's sustained success during this moment. Between 1997 and
1999, When Apple delivered the correct product for its customers, group
leaders had spotted the direction for their company's products.

o Efforts on both sides to form alliances: broad agreement on the use of

patent licensing for both sides' products; technology cooperation to assure
Java or other language interoperability between computers. other
programming languages,etc. As a result, throughout the collaboration
between the two companies, a mutually advantageous and solid
relationship was formed.

1.2 Strategic Alliences of Apple Inc. and Motorola Co

 Basis of alliance formation:
a, Motorola:
Behind the success of products like the Razr V3, it substantially increased
its market share and income, passing Samsung to become the world's
second largest mobile market share (17.7%) after Nokia. 33.5% With the
goal of rising to a higher position where it will be feasible to offer
products that are distinctive in terms of design and functions, as well as
build on the company's achievements with the Razr V3. When it came to
incorporating the music player function into the phone, Rork E1 was born
with the intention to impress the music-loving public with its unique
characteristics. Since then, it has made a fair profit, which has served as a
motivator for the company's next product to achieve even greater heights.
 Market share smartphone 2004-2011
45
40 37.8 38.6
36.4
34.8
35 32.5
30.5
30 28.9

25 23.8
21.1
19.5
20 17.7 17.6 17.7
15.4 16.3
14.3
13.4
15 12.7 11.8
10.1
10 8.7
8.4
6.7 6.3 6.8 7.1
4.8 4.9
5 2.4 2.3
0
2004 2005 2006 2007 2008 2009 2010 2011

Nokia Motorola Samsung LG

Figure 5: Market share smartphone 2004-2011 - Source: [9]

b, Apple:
Apple's CEO, Steve Jobs, came up with the notion of creating its own "iPod
phone" device. However, this will necessitate a significant investment in
research and development as well as the manufacturing of mobile phone
products. According to figures from 2005, Apple controls 80% of the MP3
device market and 75% of online music sales [10]. The implementation of
alliance agreements with Motorla is a pilot project that will save money,
create a new breakthrough in the mobile phone market, and win market share.
This partnership is about more than just technology transfer; it's also about
brand collaboration.
Recognize market demands that many other rivals have yet to address. Both
organizations are well-versed in their connection, and they are aware of each
other's benefits and weaknesses in order to attain the same goal: market share,
profit, and brand recognition, among other things.

 Apple – Motorola Co alliance content:

Motorola and Apple announced their latest collaboration in December 2004 to
integrate technology to build "2 in 1" mobile phone products. Motorola and
Apple struck a pact in July 2005 to fulfill the growing demand for digital
music on mobile phones with a variety of new music capabilities. For
Motorola phones, Apple created a smaller version of the integrated iTunes
software.
The Rokr E1 product
was unveiled to the
public on September 7,
 2005, during an Apple event in San Francisco, California. Users can also
scroll playlists, select music, and provide play commands with the Rokr E1.
You can store songs on a microSD card with a maximum capacity of 512MB,
which is roughly 100 songs. The product's first iteration is silver and white in
color, with a 3-dimensional dimensions of 108x46x21 mm and a weight of
roughly 110g. The machine has a big TFT display with 262,000 colors and a
resolution of 176x220 pixels.
The transfer of technology between two organizations that are regarded giants
in the information technology industry . Apple has moved to experiment when
integrating music playback function when downloading songs based on
iTunes software via personal computer in a mobile advantage in hardware
quality and brand name in the market like Motorola, owing to the power of
leading software in music devices.
This combination has made music fans hope and wait for a product with style
and unique qualities that set it apart from all other items.

 Benefits from alliances:

a, Apple
If the cooperation succeeds, the Rork E1 product will become a market
craze, allowing Apple to raise revenues by more than $ 1 billion, or $ 1.14
per share, in the future. establishing a competitive advantage over industry
competitors in terms of market share and brand. Experts estimate that the
profit will be substantially higher, at 2.85 billion USD and 12.25 billion
USD, respectively. If iTunes software support services are included, the
total sales will be in USD.
b, Motorola Co
If the sale goes through, the corporation will profit handsomely, and
Motorola will maintain its second-place position. Following the
announcement of the company's performance for the first three months of
2005, its market share climbed by more than 5%. Over the same period in
2004, their profits climbed by 14% to $692 million, up from $609 million
[11]. It will widen Samsung's market share as well as Nokia's financial
disparity (in 2005 Nokia accounted for 32.5 percent ). At the same time, it
has shown that it is willing to take the risk of competing with Sony
Ericsson in a different, riskier market.

 Common interests:
Apple and Motorola are two companies that operate similarly, but their goals
and strategies are vastly different. Apple is attempting to profit from the
premium market segment, and one of its advantages is client loyalty. Motorola
dispersed their products to a wide range of audiences. As a result, both
companies recognize the value of their partners in reaching an agreement and
forming a link for the alliance.
 o These are two businesses that are not in direct competition with one
another, share few common markets, have different goals, and serve
separate clients. To be able to overcome other opponents, they must
work together to build a superior strength.
o Share fixed costs and risks, work together on R&D, collaborate to
build new markets, and maximize market growth.
o Learn from one another about the company's flaws, allowing the
company to gain a competitive advantage.
o Both companies in the alliance can pursue their own aims and markets
while working together to achieve the alliance's objectives, resulting in
improved earnings and a larger market for the company.
 The result of the alliance:
The product has failed in every manner with its standard design, function has
little impact, and features are still lacking in several places. Both companies'
sales and reputation have suffered as a result of these events.
Apple released a new device, the iPod Nano, about the same time (a
replacement for the iPod Mini, sold more than 1 million units after 17 days).
There are two variants of the iPod mini, with storage capacities ranging from
500 to 1000 songs [12]. As a result, Motorola's general manager believes
Apple has "played dirty," which has harmed the two companies' cooperative
relationship.

After the failed alliance in January 2006, Apple pursued a new initiative in the
sphere of communication, obtaining four certifications in the process,
including content relating to "digital music," "mobile phones," and
telecommunications. These actions indicate that Apple is gearing up for a
fight in the smartphone industry. In 2007, Apple released the iPhone, as
expected.

 Impacts of failed alliances:

a, Apple:
o Apple's profits have dropped from $1.58 per share in 2004 to $565
million, or 56 cents per share. Motorola launched the Rork E2 product
line shortly after the failure, an alternate product line that did not use
iTunes but inherited the SLVR L7 capable of installing iTunes, which
Apple immediately "removed" at the time. To decrease the impact of
iTunes, it has been integrated into the Rork E1.
b, Motorola:
o According to estimates from market research firm Gartner (USA),
Motorola's global market share has dropped to 14.6 percent from 21.9
percent in 2006. Motorola has also said that its phone business will be
loss-making through 2008.
 o Motorola's market share has plummeted from 23 percent in 2006 to 12
percent in early 2007, owing to the company's lack of success with
phones other than the blockbuster Razr 3V - Motorola has been
separating its mobile phone segment from the rest of the corporation
since the third quarter of 2008, in order to save production and
commercial activities that have been losing money for a long time.
o Motorola's market share has plummeted from 23 percent in 2006 to 12
percent in early 2007, owing to the company's lack of success with
phones other than the blockbuster Razr 3V - Motorola has been
separating its mobile phone segment from the rest of the corporation
since the third quarter of 2008, in order to save production and
commercial activities that have been losing money for a long time.

Nokia Samsung LG Motorola Sony RIM Kyocera Apple HTC Sharp Other
Ericsson iPhone

38.6% 16.2% 8.3% 8.3% 8.0% 1.9% 1.4% 1.1% 1.1% 1.0% 14.1%

Table 3: Mobile phone market statistics in 2008 announced by ABI Research – Source [13]

 Factors that lead to the failure of the alliance:

Apple is overly transparent about its partners' ambitions, so this is essentially
a technology experiment for Apple; the firm isn't focused on our gains, but
rather on its own, and is fearful of technology transfer development.
The willingness to share the risk of entering a whole new market while
exercising extreme caution while investing in new Motorola goods.
We have to question if Apple limited the capacity of the Rokr E1 to preserve
its iPod line and pave the way for the "iPod Phone" (iPhone)? Or that Apple is
working on a plan to bring a new digital music service on its own devices.

1.3 Strategic Alliences of Apple Inc. and Google

 Introduce of Google:
Google, the world's largest Internet firm, was founded in 1998 in the United
States. The Google search engine is the company's principal product, and it is
widely considered as one of the most useful and powerful on the Internet.
Google handled almost 80% of all Internet searches through its website and
client sites including Yahoo!, AOL, and CNN in early 2004, when it was at its
pinnacle. This number has now reduced since Yahoo! stepped out of Google
in February 2004 to employ a technique they devised on their own [14].

 Apple – Google alliance content:

 Apple and Google reached a deal in 2005 that made Google the default search
engine on Apple's Safari browser on Mac computers. Despite having an
alliance, Steve Jobs launched the iPhone in 2007. Eric Schimidt, then-CEO of
Google, was summoned by Steve Jobs to demonstrate how Google would
operate on the iPhone. The event itself revealed more insight into Apple and
Google's cordial connection, as well as the development of synergy between
the two firms with new product lines.
As can be seen, Apple's fundamental strength has always been in creating
beautiful hardware and simple software for its users. Google is at the forefront
of "cloud computing," which allows users to access data and apps via the
Internet. It's easy to see how the two fundamental talents can compliment each
other in the future. These two enterprises are examples of co-opetition, in that
they are both aggressive competitors, but they also need to work together to
prevent smaller businesses from growing [15].

 Benefits from alliances:

Apple and Google have differentiated themselves by launching distinctive
projects. It has benefited Apple in the following ways: boosted smartphone
consumption, decreased the value of mobile computers, improved revenues,
and crippled (innovation) of competitors. Direct competitor of Apple.
Apple, on the other hand, has a positive connection with Google after many
years. All of that changed in 2009, when Apple refused to allow the Google
Voice software to be downloaded from the iTunes App Store. Or, following
the release of Siri, Apple decided to use Bing rather than Google. The
cooperation between Apple and Google, on the other hand, is continuing
solely because it is a profitable arrangement for both companies.
By 2017, Apple had revealed that Google was behind all of Siri's responses.
This is the agreement reached when both companies are dissatisfied with their
performance and are confronted with numerous challenges outside of the
market.

1.4 Another Strategic Alliences

 In1991: AIM (Apple, IBM, and Motorola) was formed in 1991 to research and
create PowerPC systems [16].
 In 2014: Apple and IBM teamed up in 2014 to develop a composite
semiconductor that could support numerous virtual operators at the same time.
Allows the computer to accomplish multiple tasks at once while also
maximizing memory use [17].
2. Export Entry Modes
2.1 Direct export
Apple launched its first formal retail outlets in Virginia and California on May 19,
2001. Then there was the Apple Store in New York, which was made of clear
glass. At the time, this incident astounded both investors and consumers. Apple
 Computer chose to build a chain of retail outlets where its whole line of
computers, software, and accessories would be on exhibit. Apple's stock, which is
sliding in the computer industry, played a role in the decision. This demonstrates
Apple's desire for greater control over product distribution.
Since opening stores, Apple's finances have continuously increased. Apple had
$16 billion in revenue from 327 retail shops in 2011 [18] .
More than 300 million consumers visited Apple Stores throughout the world
between mid-October 2011 and August 2012 [19].
Every day, Apple's Genius Bar engineering team attends to up to 50,000 clients.
The company has 511 locations worldwide as of May 14, 2021. Apple Store will seen
growing to 600 locations worldwide by 2023 [21].
Figure 6: Apple store system around the world – 2021 – Source [20]

Apple store system around the world

300
271

250

200

150

100

50
50 38 40
28 22 20 16 15 11
0
American China, United Canada Australia France Italy German Spain Orther
Hong Kingdom country
Kong,
Macau

2.2 Indirect export

However, even though Apple puts a lot of effort into their physical stores, a large
part of their sales and revenue comes from indirect distribution channels. In 2018,
Apple reported that 29% of their net sales came from direct channels and 71%
came from indirect channels. Consumers can buy Apple products from third-party
sellers and carrier providers. This includes stores like BestBuy, Walmart, and
Target as they are easily accessible and might offer discounts [22].
 Apple sells its products through
a network of authorized
retailers. Apple will divide its
distribution criteria into two
categories: AAR (Apple
Authorized Reseller) and APR
(Apple Professional Reseller)
(Apple Premium Reseller).
Because Apple products are
high-end, they are distributed in
countries by distribution
businesses that Apple trusts and
selects.
According to the Apple
Authorized Reseller standard, authorized units must meet a number of stringent
criteria, including location of goods, staff quality, and so on. Apple goods have
been distributed in the United States through AT&T since 2007. (At the start of
2011, this period will come to an end.) It is KT Corp in Korea and ChinaUnicom
in China. Cellphones, Mobile Viet, Minh Tuan Mobile, and other brands are
available in the Vietnamese market [23].
Standard certified Apple Premium Reseller units are
permitted to offer a broader range of Apple products
and services. Apple, on the other hand, will be able to
influence the layout and design of the sales area, as
well as participate directly in the hiring process. With
more stringent interview rounds and screening
requirements. F-Studio and TopZone, two stores in
Vietnam that have met APR standards, are currently
available. In Hong Kong, there is an iWorld, and in Mumbai, there is a Unicorn
Apple Store.

IV, The problems Apple has faced in the last 3 years

1. Covid pandemic
Covid-19 has had a significant impact on the global economy, with numerous firms going
bankrupt as a result of their inability to thrive. Apple, on the other hand, continued to
defy the epidemic, with revenue remaining strong in Q4/2021. According to Canalys,
iPhones accounted for more than one-fifth of all smartphones sold worldwide in Q42021.
With 22% of total smartphone sales worldwide [24].
According to TrendForce, Apple's phone sales are predicted to exceed 223 million units
in 2021, a 12.3 percent rise over 2020[25]. According to the smartphone market report
for 2021, Apple is the most successful brand. Apple reported revenue of $123.9 billion
for the third quarter of 2021, a new high compared to $111.4 billion a year earlier.
 Apple's earnings per share for the quarter were $2.10, up from $1.68 in the fourth quarter
of 2020[26].
Despite the ongoing impact of the Covid-19 pandemic and supply chain concerns that
hamper manufacturing, Apple estimates yearly revenue of over $366 billion in 2021.

2. Trade conflict between the United States and China

The trade war between the United States and China formally began on March 22, 2018,
when US President Donald Trump declared tariffs on Chinese goods sold to the United
States in order to avoid what they see as acts of aggression. Unfair trade practices and
theft of intellectual property are two issues that need to be addressed.
2.1 Apple's reliance on China for income
Apple's reliance on the Chinese market for income is one of the reasons why it
has been hit so hard by the US-China trade war.
Selling items to Chinese consumers accounts for a major amount of Apple's sales
and profits. Apple's revenue in this area accounted for 17 percent to 25 percent of
total global revenue from 2015 to 2019. However, the trade war has caused
China's business results to fall from 51.8 billion USD in 2018 to 43.7 billion USD
in 2019, and its market share to fall from 20% to 17%.
 Figure 7: The size of Apple’s China Business – Source [27]
2.2 Made in China Supply Chain
On May 10, 2019, the US hiked tariffs on Chinese imports from 10% to 25%,
taking the trade war between the two countries to a new level. The decision will
raise the cost of crucial iPhone components, which are Apple's most profitable
product. The increase in tariffs on items imported from China will raise the cost
of manufacturing Apple devices and components, and because that cost is already
factored into the product pricing, the products will become more expensive.
Apple's already high-priced items are now even more so. This is exacerbated by
the fact that demand for iPhones in China is declining. Apple and component
manufacturing partners (Foxconn, Pegatron, Wistron, etc.) for Apple planned to
shift some production lines out of China as production prices in China rose in
tandem with unpredictable tensions in the US-China relationship. Supply chain
reform will take time, and China will continue to be the world's top electronics
manufacturing hub for at least the next five year.

V, Solutions to improve business situation

Apple's iPhone goods require even more imaginative and ground-breaking designs and updates.
There haven't been as many major advances in current iPhone versions as there have been in
previous generations. Users appear to believe that the iPhone is no longer a one-of-a-kind item.
The iPhone is no longer the most important technological landmark in the world. Because, with a
large screen, good configuration, and a lot of Google services integrated, smartphones running
the Android operating system can perform everything the iPhone can do and even provide a
better experience than the iPhone.
Because market categories are not all the same, Apple must determine a level of differentiation
for each sector separately, allowing it to better meet customer expectations. Customers in the
European market, for example, are generally unconcerned about price when purchasing, and
businesses can take advantage of this to increase profits by establishing distinction. Customers in
the Asian market sector, on the other hand, are particularly worried about price when purchasing,
thus Apple can employ a variety of techniques, including a flexible pricing strategy.
Apple can strengthen its competitiveness even further by expanding its market share beyond the
high-end market or forming strategic agreements with other electronics businesses, like Apple
did when it merged with Microsoft to bring high prices to the market. Customers have a variety
of options. Furthermore, even if Apple enters the low-cost phone market, it will maintain a
competitive advantage. Because Apple has a strong iPhone brand and many people like its
products, but not everyone can afford it due to the expensive price.
Because Apple only stockpiles enough components for production, it needs to expand the supply
of components in the manufacturing process even more to avoid product shortages. In the future,
they intend to grow their market into a variety of countries and compete with Samsung, Huawei,
and others.
Apple relies too heavily on outsourced resources; normally, product assembly must be delivered
to China, which means Apple is responsible for a significant portion of transportation,
production, and other expenditures. is compensated for the product price, resulting in extremely
high prices for its electronic devices. To avoid relying on Chinese raw materials and to keep
tariffs down, the corporation needs to discover a variety of raw material sources.

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