Apple signals more aggressive move into the enterprise
By Ryan Faas
Apple’s CFO Peter Oppenheimer and CEO Tim Cook touched on a range of topics during Apple’s quarterly earnings call Monday, but one theme surfaced repeatedly: the rise of iOS devices in enterprise environments. While Apple has traditionally reminded investors that its products are in use by more than 90% of Fortune 500 companies, that datapoint has often been a quick blip after which announcements or questions went back to other topics.
This time, however, both Oppenheimer and Cook repeatedly touched on iOS’s success in the enterprise in more significant ways.
Early in the call, when discussing the iPhone and iOS 7, Oppenheimer made several enterprise-related points. The first was to note that iOS 7 has received the federal government’s FIPS 140-2 certification, which allows the mobile OS to be used by a variety of federal agencies. The certification also has significance in the private sector, because government contractors and companies in tightly regulated industries like finance or healthcare tend to view FIPS certification as an endorsement of a platform’s encryption capabilities.
Oppenheimer also referred to iOS 7 development tools (including the new Xcode Server feature in Mavericks Server) and the ease that they offer companies in developing enterprise apps. He then went on to discuss large-scale iPhone deployments at major enterprise companies, including some that he said had around 50,000 active iPhones within their organizations.
The topic of iOS 7 and apps in business environments came up again during the discussion about iPad sales during the quarter. Oppenheimer referred both to the advantages offered by enterprise apps that companies develop themselves and to the ability to leverage existing apps available in the App Store. He didn’t specifically mention Apple’s Volume Purchase Program, which allows organizations to license apps for users and revoke that license if a user leaves the company. But that program is one way in which Apple allows enterprises to take advantage of the App Store in the same way as traditional desktop software purchase and deployment.
Already a big player
Towards the end of the call, Tim Cook also talked briefly about Apple’s position in the business and enterprise community, noting the percentage of companies using or supporting the iPhone in the Fortune 500 (97%) and Global 500 (91%); he supplied similar numbers for the iPad for the Fortune 500 (98%) and Global 500 (93%). In addition, he noted that the iPad represented 90% of tablet activations in enterprise environments.
More important than stats, however, was Cook’s description of the enterprise market for Apple devices, noting that Apple had “done a lot of the groundwork” to be a major player in enterprise mobility. He also noted that the path and timeline of enterprise acceptance and adoption can be longer (and potentially slower) than in the consumer market. Perhaps the most striking sentiment was the implication that Apple expects to get more payback from its efforts to meet the needs of enterprise companies, in part because of the “stickiness” of its ecosystem.
Although not directly enterprise-focused, some other statements were telling. Apple touted the quick adoption of iOS 7 (now powering 80% of iOS devices, up from 74% last month) with its new features and security capabilities, while teasing that no single Android release enjoys anything like that adoption rate. The company also highlighted the fact that OS X Mavericks, which has its own share of enterprise-oriented features, was released as a free upgrade (for consumers and business users) and that the company had decided to make its iWork productivity suite (which finally resolved its problem with securely sharing documents in its most recent update) free with the purchase of a new Mac or iOS device.
All of that speaks to a real commitment on Apple’s part to retain and expand upon the dominance that the company has achieved in business. It’s also striking in comparison to the dismissive attitude Steve Jobs sometimes exhibited towards the needs or requests of enterprise IT.
Ironically, one new technology that Apple seemed determined not to discuss in a broader business context is iBeacon, the Bluetooth LE proximity technology that Apple launched in its U.S. retail stores last month. Instead, the company’s remarks about that technology focused exclusively on retail and deployments in major sports venues.