There comes a time for every business when it is time to reap what it has sown. There is no way around it.
Whatever it has built from the sweat, tears, and blood of its efforts has to come to fruition. Otherwise the accumulation of delays, limitations, and shortcomings becomes fatal at a critical tipping point.
This is one of those times, and companies are being judged by the biggest private company — by most measures — in world history.
Apple, with all the weight behind it, is decisively moving on a technology that is critical for its future today. “Disruptive” hardly applies, because there is no equivalent.
Apple is going all-in on wireless charging technology, and it is using its tried-and-true cash-heavy approach to take the best from potential suppliers and making them part of its brand.
In the process, it is showing us a perfect example of what happens when a handful of tech companies hit a make-or-break point. Right when three moving pieces need to fall in place at just the right time.
Three-Point Checklist
For potential to translate to revenue for a tech company, three overarching requirements need to be fulfilled at just the right time.
It needs to scale to economy, it needs to have a product ready to go off-the-shelf, and it needs to have an industry-leading position.
First off, scaling is pretty easy here. Apple is going to use its standard modus operandi. It is going to find an existing supplier and make it rain.
In 2015, the information provided by Apple about its suppliers to its investors only included the first 200. Defense contractors have nothing on the logistics involved here.
Apple sold about 230 million iPhones in fiscal 2015, hoovering up $155 billion in sales from them.
Global scaling and record company revenue are two CEO signatures, a handshake, and maybe a couple cocktails away.
Having “off the shelf” tech goes a bit beyond the most basic concept. It isn’t so much that the product needs to be boxed up and ready to ship. It is all about the red tape.
Wireless charging falls under the jurisdiction of the FCC. It is the same as your WiFi router. The only difference is that the energy being transmitted is designed to be absorbed instead of interpreted as data.
The FCC, as you might imagine, moves at the standard bureaucratic pace. It is the business version of the military’s “hurry-up-and-wait” system.
The approval process has to start years before sales are possible. Certification needs to be obtained for consumer sales before any deal is struck.
No buyer will commit without the ability to place an order for as many units as needed to establish an economical and consistent unit count and cost.
Apple requires billions of widgets over the lifetime of a multi-year deal. The stakes are higher here than anywhere else.
And finally, if a potential supplier can jump through the first two hoops, Apple has one final test for them.
In essence, Apple is interviewing job applicants, and whoever applies will have their CV painstakingly scrutinized.
Seeing What Fits
The first two qualifications are easily evaluated in this situation.
The money is there for potential suppliers, along with their investors. Apple is essentially calling up new talent to the big leagues with hefty signing bonuses.
As for whether or not the products or patents the potential suppliers have are approved for mass distribution, it is a binary issue. Apple wants it today, ready or not, yes or no.
The real question is — who has the best pitch, along with the best references and credentials?
Apple has publicly divulged that it is consulting with companies to move beyond the gimmicky charging mats to provide wireless charging at a meaningful distance.
A couple centimeters won’t cut it. Scaling it up by a factor of 10 meters is a prerequisite.
Specifically, it stated in a public release that it is looking to overcome technical barriers, including loss of power over distance, by working with partners in the U.S. and Asia to bring wireless charging to new iPhones as early as next year.
That just happens to coincide with the iPhone 7 launch in Q3 2016, a flagship product with guaranteed sales in the hundreds of millions.
I know of one company with FCC-approved, patent-protected tech that is being tested by dozens of Asian manufacturers, including one of Apple’s largest suppliers — Foxconn.
The proprietary power transmitters are already being built into designs by Haier, the world’s largest manufacturer of household appliances.
In 2015, it took home two “Best of” awards — and three honorable notices — from the Consumer Electronics Show, and was placed as the chair of a working group to consolidate two of the three industry standards into one.
Plus, it has publicly demonstrated how it can charge the power-hungry current generation smartphones at up to 15 feet.
Credit Due
This is it. No more R&D promises and forward-looking statements. No more future benchmarks to hurdle.
A make-or-break deal is happening now, and it will set a new standard for producers and consumers alike.
These opportunities are easy to miss. Deals are sealed behind closed doors; before counter-bids or press releases.
They are designed to cut everyone else out before any of us can react to the specifics. The only way to capitalize is to recreate the process.
To be honest, I wish I could lay claim to this classic example of how a technology crosses a tipping point from potential to profits almost overnight. Nick called this one, and he has the best analysis of the situation available, bar none.
He vetted the potential of the market, the qualifications of the company, and did the due diligence of his pick long before this was even on my radar.
So, credit given where credit is due. Check out the research he is sharing for yourself.
