Is Apple’s Vision Pro Production Hampered By Fractured Globalization?
By Greg Kahn
Emerging Tech Exchange
Founder & CEO
Published on August 29, 2023
There’s a new reality for Apple’s mixed-reality vision.
As it prepares for 2024’s introduction of its Vision Pro spatial computing headset, Apple's vaunted global supply chain management approach may encounter some significant obstacles due to increasing geopolitical tensions and technology restrictions.
As a result, Apple CEO Tim Cook will have to quickly adapt production of the Vision Pro needs to adapt to the changing global landscape. That’s the argument made by Breakwater Strategy analysts Steven Weber and Shea Agnew in The Information. They assert that the traditional model of developing a new platform on a global scale with a global supply chain is no longer viable, even for a company like Apple. The authors emphasize that the Vision Pro will be launching into a world marked by.
Among Weber’s and Agnew’s key points:
The Changing Landscape: The authors highlight that the concept of sourcing from anywhere, building once, and marketing globally is no longer feasible due to geopolitical tensions and data restrictions.
National Assets: The technologies necessary for the Vision Pro, including microprocessors, materials science, batteries, screens, and AI, are now seen as national assets by governments, leading to restrictions and isolation.
Adapting to Regions: To succeed in this environment, Apple might need to adopt a more regional approach. This could involve building separate design-manufacture-market clusters in different regions like the U.S., Europe, and East Asia.
Fragmentation of the Global Digital Economy: The global digital economy is fragmenting due to national legal and regulatory boundaries. Different regions are focusing on building their own technological ecosystems.
China's Influence: China, with its innovation in areas like electric vehicle batteries and quantum technologies, is challenging the assumption that it's merely a fast follower. The U.S. is responding by adopting certain elements of China's industrial strategy.
National Security Concerns: National security concerns are shaping technology and data flow across the Pacific. Data privacy, cybersecurity, and capital flows are becoming key areas of focus.
Bloc-by-Bloc Restrictions: The authors predict that spatial computing is launching into an era of bloc-by-bloc restrictions on technology and data, driven by regulations, cybersecurity, exports, and capital flows.
Still, there are some counter-arguments to be made (or at least a few issues that deserve further discussion):
Global Approach Benefits: While the authors argue for a more regional approach, some might contend that the benefits of a global approach, including economies of scale and a consistent brand image, could still be relevant.
Cross-Border Collaboration: Others might argue that technology companies could work collaboratively with governments to establish international standards and protocols for technology and data flow.
Innovation Hubs: Some might suggest that creating innovation hubs in key regions while maintaining a central strategy could strike a balance between global expansion and regional adaptation.
Consumer Expectations: Given that consumers often expect a seamless experience across regions, some might argue that maintaining some level of global integration is necessary.
Regulatory Challenges: Developing and adhering to different regional regulations and standards could introduce complexities and potentially limit certain features.
Technological Interconnectivity: The authors emphasize a lack of common ground between different regions, but counter-arguments might focus on the importance of interconnected technology for global collaboration and problem-solving.
Weber and Agnew make a compelling case for impending gloom. But I find it hard to believe that Apple hasn’t anticipated the hurdles and already laid the groundwork for managing the more aggressive trade and regulatory stances between China and the U.S.
The bottom line is that Apple’s economic power as a partner tends to surmount the usual tensions between governments. Plus, given Apple’s logistical acumen, I would expect the roll out of Vision Pro to be much smoother than doubters expect.
What do you think? Will a more fragmented global economy cause significant problems for Tim Cook and company? Drop me a line with your thoughts.
Greg Kahn
Emerging Tech Exchange
Founder & CEO
