Why Apple wants the cloud to disappear; “Apple is moving innovation down the stack into hardware/software integration, where it’s hard for Google to follow. And Google is moving innovation up the stack into cloud-based AI and machine learning services

Why Apple wants the cloud to disappear

Philip Elmer-DeWitt

JUNE 12, 2014, 4:57 PM EDT

You don’t need a plumbers license to use the faucet.

If “vapor” wasn’t already a computer industry term of art,  it would a good word for what’s happened to “the cloud” — a buzzword stretched so thin it’s all but lost its meaning.

Case in point: The 10-page special section in Thursday’sNew York Times on cloud computing that reads suspiciously like something ordered up with no other purpose than to carry three full-page ads. Nearly every time “the cloud” is invoked in Quentin Hardy’s lead story, he could as easily have substituted the Web, the Internet or — perhaps  more accurately — a bunch of servers attached to a network.

Three years ago, Apple  AAPL -1.67%  was making a fuss about what it called (and trademarked) iCloud. Steve Jobs himself introduced the concept in 2011, at what was to be his last keynote.

At last week’s WWDC keynote, it was barely mentioned. Yet as Quartz’ Dan Frommer noted in The “Apple doesn’t get the cloud” era is officially over, the event was packed with cloud-centric announcements: A Dropbox-like iCloud Storage folder, a nearly infinite Photo Stream library, a text messaging service that finally syncs properly, iTunes accounts whole families can share, the ability to start a phone call on an iPhone and finish it on a MacBook, etc. etc.

“None of this says ‘CLOUD™,” Benedict Evans wrote last week. “And none of it is done in a web browser.”

Evans believes this the omission is purposeful — and that it says a lot about Apple and its biggest frenemy: Google  GOOG -1.34% .

“Apple is moving innovation down the stack into hardware/software integration, where it’s hard for Google to follow,” Evans wrote. “And Google is moving innovation up the stack into cloud-based AI and machine learning services, where it’s hard for Apple to follow. This isn’t a tactical ‘this’ll screw those guys’ approach — it reflects the fundamental characters of the two companies. Google thinks about improving user experience by reducing page load times, Apple thinks about user experience by making it easier to scroll that page.” (See Digesting WWDC: cloudy.)

That about sums it up.



About bambooinnovator
KB Kee is the Managing Editor of the Moat Report Asia (, a research service focused exclusively on highlighting undervalued wide-moat businesses in Asia; subscribers from North America, Europe, the Oceania and Asia include professional value investors with over $20 billion in asset under management in equities, some of the world’s biggest secretive global hedge fund giants, and savvy private individual investors who are lifelong learners in the art of value investing. KB has been rooted in the principles of value investing for over a decade as an analyst in Asian capital markets. He was head of research and fund manager at a Singapore-based value investment firm. As a member of the investment committee, he helped the firm’s Asia-focused equity funds significantly outperform the benchmark index. He was previously the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. KB has trained CEOs, entrepreneurs, CFOs, management executives in business strategy, value investing, macroeconomic and industry trends, and detecting accounting frauds in Singapore, HK and China. KB was a faculty (accounting) at SMU teaching accounting courses. KB is currently the Chief Investment Officer at an ASX-listed investment holdings company since September 2015, helping to manage the listed Asian equities investments in the Hidden Champions Fund. Disclaimer: This article is for discussion purposes only and does not constitute an offer, recommendation or solicitation to buy or sell any investments, securities, futures or options. All articles in the website reflect the personal opinions of the writer.

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