I had an interesting meeting yesterday with an incredibly large multi-national that is quietly moving to the Mac platform. I've been hearing rumblings of this for some time in a number of firms, which suggests that the penetration of Apple into enterprise accounts is substantially greater than reported. In addition, the feedback I've been getting suggested, before the economic mess broke, that it was on the verge of going vertical. But, the economic mess did hit, so let's talk about what is going on and what the impact of the economic problems is likely to be.
Why Apple Was Sneaking into the Enterprise
Over much of this decade, control over the desktop and what people used on it has been shifting sharply from IT to the line organizations that actually fund the related effort. Tied to the goal of giving managers as much profit and loss control over their respective units as possible, and thus allowing the people closest to a problem to determine the best tools to address it, control of PCs has been moving solidly away from IT.
The first big indication of this was the lack of adoption of Windows Vista by the early adopter organizations. While these IT departments had promised to deploy Vista early in exchange for the traditional strong incentives, virtually none actually made the move because the line organizations refused it. This, to my knowledge, has rarely happened in the past and reflects on two problems endemic to the current Windows platform.
It isn't perceived as better than what it replaces, and the migration experience is both painful and expensive so people don't see a benefit in the move and don't want to incur the personal cost to make it.
In addition, the cost for a notebook computer in a large enterprise including support runs about $1,800 per year per employee, excluding only non-OS software licenses. In an Apple shop, cost is dramatically less because the employees pick up much of the support burden themselves. Often, the employees can even be encouraged to buy their own machines, dropping the annual cost well below $1,000 per employee per year. This provides, in hard times, even more savings. Because the employees participated in the solution, they are more likely to rely on their own resources to fix problems and not on an overburdened IT organization.
This shift of responsibility to line organizations, coupled with the strong economic benefits detailed above, should result in a massive swing towards Apple. Economic conditions could either accelerate or eliminate this trend.
Does the Economy Help or Hurt the Apple Move?
If it were just about money, the answer would be easy and very positive for Apple. In fact, I still expect it to get a nice increase because of this trend. However, with regard to the economy, the problem we aren't talking about is security. Theft is expected to go up massively as economic conditions worsen. Apple products have historically not only been attractive targets for thieves but they have been vastly less secure than their business-focused PC counterparts. They lack TPMs, which are required by most enterprise buyers to secure the PC internally; they lack biometrics or card readers for physical access; and anti-malware offerings are incredibly limited for the platform. Right now, the security ecosystem around Windows, hardware, software, and services is vastly more robust than that around the Mac.
This security exposure is the Achilles' Heel of the Apple platform. All it will take is one or two visible losses where confidential information is compromised for organizations to ban the offering. The faster these Apples ramp into business, particularly to executives, the greater the likelihood that such an event will occur. It is somewhat ironic that Apple, which is very security-conscious itself, hasn't more aggressively dealt with this exposure.
Thoughts and Recommendations
I'm not recommending against Apple, but before any company does a large deployment of Apple products, I would recommend they spend some time at Apple going over how security is done there. Then, I suggest they emulate it. Apple is very secure and lives off its own products, suggesting that there are workarounds. While on the tour, I'd also suggest to Apple that it might want to consider more conventional methods to secure its offerings, in exchange for the promise of earlier large commitments. Embracing TPMs, following Microsoft and attacking malware, and implementing harder user authentication methods would go a long way towards closing the gap.
Apple still has three distinct problems when dealing with enterprise buyers. One, it doesn't embrace the enterprise or enterprise purchasing processes, which typically require two bidding vendors. Two, it doesn't listen to enterprises and take their recommendations. Three, it isn't as aggressive on security as true enterprise solutions providers. Of these, only the security problem is a true deal breaker because it represents potential career-ending events. The other two can typically be overcome with the proper approvals.
In the end, it will depend on how Apple plays this, as always, but it appears the company has an unprecedented opportunity to expand into a market that has generally ignored it. In fact, with very little effort, it is quietly expanding into that market now. It is kind of amazing to think that the Apple platform, which carries a premium price, may actually be one of the best bargains in a very tough year for large enterprises.