Interaction of micro elements
The interaction between 5 competitive forces, create environment for Apple very competitive and hard to survive. Low entry barrier, rapid innovation of supplier and changing demand of consumer create the product life-cycle shorten. A lot of competitors with very similar product specification let product easy to imitate and alter PC become near to commodity product. Thus this leads to low market share industry. In addition, strong power of suppliers, a lot of competitors and strong power of consumers create the industry as low margin industry.
* Macro environment
Macro environment is a far environment which comprise of several forces that raise strategic issue to Apple. These forces are social force, economic force, politic force, and technology force which well known as PEST (figure 3).
1- Technology forces
The first force that influences computer industry structure is rapid and sustained technical progress. Each year, integrated circuits and other electronic components become better, faster, and cheaper, providing opportunities for improving existing computers as well as designing a new kind.
As computer comprises of hardware and software, Apple is really affected by technology innovation forces around it. Rapid innovation on hardware by component producers (e.g. Intel, AMD) and software by competitors (e.g. Microsoft) as well as complementary products from partner gives no choice for Apple except responsively catching the new hardware technology and also continuously innovating to sustain differentiation.
Starting from 1976, Apple created personal computer as a proprietary system. Apple created the hardware by assembling components, create operating system (e.g. MacOS) and develop applications. That time, as Apple controls both hardware and software, Apple can create personal computer that deliver great personal experience compare to its competitors.
That time, Apple computer main competitor is...
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