venture investing and
acquisition strategy is not very aggressive To stay ahead, Apple usually
over-invests in its
supply chain. The company is reported to pay a significant portion of
the factory construction cost in exchange for exclusive rights to the output
for a set period of time, and then for a discount once this period expires.
Not only does this allow Apple to come out with new components long before
rivals, but these components are very difficult to duplicate.
The company makes fewer acquisitions than their competitors. When Apple does
buy companies, it's almost always tight lipped about how they will fit into
its strategy and how easily their technologies can be integrated into
existing company projects. Yet, some acquisitions stand out in terms of
adding important features to existing product lines or opening doors into
Apple made its first acquisition in 1988 when it purchased Network
Innovations. Apple's $429 million acquisition of NeXT in 1997 helped the
company move smoothly from PowerPC to Intel processors. This deal also
back to Apple.
In 1998, Apple acquired the intellectual property and the development team
from Macromedia to make Final Cut Pro one of the top video desktop editing
programs on the market.
In 2002, Apple's acquired a German firm Emagic for $30 million. The Mac
versions of it's high end audio recording and production application
Logic was further developed by Apple to produce Logic Studio. The PC version
of Logic was buried.
By acquiring FingerWorks, a developer of gesture recognition technology, in
2005 Apple added a significant patent and engineering value to its
multi-touch technology package.
PA Semi was another essential acquisition. Apple which is now referring to
itself as a mobile device company wants as much of the value chain under
their control as possible. Purchased in 2008 for US$278 the chipmaker
startup was tasked with making system-on-chips for iPhones and iPods.
Apple's $275 million acquisition of mobile advertising firm Quattro Wireless
in 2010 reflects the company’s desire to strengthen its mobile technology
portfolio. Quattro deal gives Apple an alternative to Google's entrenched
dominance in mobile advertising. Quattro is a counterpart to AdMob, the
mobile advertising firm that Google acquired in 2009 for US$750 million.
With Quattro, Apple is able to deliver advertising to mobile devices while
improving the measurement and execution of digital ad campaigns.