Never heard of them? That’s because there’s no official corporate venture capital division at Apple Computer. But there should be.
Apple has a history of making strategic acquisitions to improve their line of products and software. Shake, for example. Supposedly Apple is currently in talks to buy Roxio, as well as negotiating fuel cell development.
These are all big picture, complex, strategic purchases for Apple. But what about the little guys? Apple builds rather than buys, choking off developer incentives. The first developer to get squashed was Karelia when Apple introduced it’s “innovative” Sherlock 3- a blatant copy (and a poor copy at that) of Karelia’s highly acclaimed Watson. With the latest build of Apple’s Mac OS X they’ve done it again: the new Application Switcher is identical to Proteron’s LiteSwitch X.
With every start-up, there is the risk that an established player will be able to copy your product and take your clients away because of their superior distribution channels, marketing, etc. This is a very real risk for many fledgeling companies.
Apple, in sharp contrast to many technological companies, has chosen to copy start-ups products and introduce them to the market themselves- sending a powerful negative message to developers. Intel, T-Mobile, Siemens and Nokia all have corporate venture divisions that make investments designed to stimulate innovation and and grow market share.
Intel has dedicated around 500 million to wireless investments alone. Apple is sitting on $5 billion in cash. Even $50 million for “small” purchases like Watson and LiteSwitch would change the entire mood of OS X development. With the golden prize, being bought by Apple, developers would have even more reason to innovate- instead of reason to be afraid.
And, I seriously doubt that Apple’s “Build vs. Buy” position is even more economical. Even if Apple ended up paying a bit more for a few applications, in the long run I believe they would end up winning- by giving developers more incentives to design great software for the Macintosh platform- and winning more customers along the way, which would more than compensate for any initial cash outlay. And more customers and innovative products is the whole idea behind corporate venture capital.