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Apple Really Only Does Two Things

Behind the big facade of their website, apps and very attractive stores what Apple does, and does better than all the other tech companies is two things. And only two things. They build hardware that everyone, including their competition, drools over. And they retail what they make.

Sure you can talk about their developer programs. You can talk about how they have a platform to sell apps, music, movies and television content, or how they provide a route for universities to share lectures, and others to deliver podcasts, but at the end of the day all that "content" does is drive more sales of hardware. And all that hardware drives more people into the Apple Store or to the online version.

This very binary approach is pretty much what built many industries in the USA. Take the automotive industry. They make cars and trucks. They sell them. Everything else they do is designed to support either one part of the business or the other. Airlines are the same. They fly planes and sell seats and cargo space. In many ways, Apple eliminated the computer store, while airlines have done a pretty good job at eliminating the travel agent and are on their way to get rid of more middlemen each year.

Now, let's compare Apple to the banking industry. The latter has expanded into so many different sectors that they have to have lawyers just to make sure they're not doing anything wrong, or to help get them out of trouble with one regulatory body or the other. It used to be banks did two things. Took deposits and disbursed your money. Then they got into lending. Then brokerage, then all kinds of "financial services." As they did they got deeper and deeper into the debacle of the last decade. 

If you think this binary approach doesn't work just look at Domino's Pizza whose stock is outperforming Google and others. Domino's does two things. They franchise/operate pizza parlors. They deliver pizza.  And everything they do, supports either operating a pizzeria more efficiently, or delivering a pizza.

Binary works.

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