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Apple executive talks about R&D, new campus and more; report exposes the company's difficulties in making acquisitions

Luca Maestri He is certainly not Apple's best-known or most popular top executive, and not least, considering that, unlike beat figures like Eddy Cue or Phil Schiller, he is the man of numbers and money. This does not mean, however, that he also has nothing to say: the day before yesterday, February 14, Ma's CFO (chief financial officer) gave an interview at the Goldman Sachs Technology and Internet Conference, touching on some important points regarding operations of the Cupertino giant.

The full audio of the interview, in English, can be heard directly on the Apple website, but we highlight below some of the most relevant parts.

Luca Maestri, Apple's new corporate controller

On Apple's growing spending on Research and DevelopmentMaestri stated that, with the growth of Ma's product portfolio, it is naturally necessary to spend more on the creation of new technologies that support the advancement of these products. In addition, Apple today prefers to develop these technologies internally than to acquire them from other companies, thus allowing better control over spending, timing and the quality of the final result. "A great strategic investment", says the executive.

He also talked about Apple?s growing focus on services at the expense, some would say, of the hardware development that has always been Apple's forte. According to Maestri, only Apple's services division today is the size of an Fortune 100 and Ma intends to double its size for the next four years. The main areas of focus are the App Store and Apple Music; Regarding the latter, the executive points out that Apple is still the largest company in the world by far in terms of digital music and the acquisition of Beats was an important step in this journey.

Talking about the Apple's overall growth, the CFO reiterated a point that the company has made clear several times on other occasions: emerging markets (which presumably includes our beloved republic) represent the greatest opportunity today for Apple to grow further. In many of these countries, Ma still has a market share of only one digit; that is, there is still the opportunity for great growth.

About the iPhone, the company's flagship today, Maestri stated that the smartphone grew again mainly due to the interest in the Plus model, which, according to him, had an increase in demand "above expectations" due to exclusive features such as the dual camera. Already in the wearables segment (and the executive puts Apple Watch, AirPods and Beats products on the same cake), the CFO said he was confident in them and said that Apple would put even more effort into their developments going forward: ?We we could have sold even more, to be honest. We think it is a great platform to innovate. We are still in the initial steps, but we are really enjoying the moment. ?

Maestri also spoke of the prospectus of protectionist economic policies Donald Trump. The executive stated that an increase in import rates for local companies would not be a good measure for the economy, as it would bring setbacks for the consumer.

Finally, the interview addressed the coming Apple Campus 2, in the process of being inaugurated. Maestri believes that Ma's new headquarters will attract a large number of visitors simply because it is a new national tourist spot al, MM Tour VI! According to the executive, Apple needs to find out how to deal with this, as it has no experience in the business of managing a place to visit. and work is something that, he makes a point of remembering, a vision of Steve Jobs.

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From Maestri's interview, it may seem that everything at Apple flows in the most perfect harmony at all times, but remember that, even though he is not a guy specialized in marketing, he is still a strong man of the company and needs to watch over her image. A report from BloombergHowever, it shows that within Cupertino's enchanted kingdom, at least one aspect is not dealt with with such skill: acquisition of other companies.

The report, which offers an in-depth look at Apple's purchases and mergers in recent years (and a great read, if you can handle English well), says that often Ma's ?arrogant? and ?risk-averse? face he lost negotiations that would be positive for the company.

Beats acquired by Apple

Cupertino's lack of experience in this type of operation is also a deterrent: in the 41 years of Apple's existence, the biggest purchase of another company ever made was that of Beats, for US $ 3 billion; the second largest was that of Jobs' NeXT, in 1996, for $ 400 million. Putting it in perspective, Facebook, in 13 years of existence, has already made three acquisitions in excess of $ 1 billion, while Microsoft has already made at least ten in its entire history.

Chart of acquisitions of technology companies

This matches Maestri's statement that the company prefers to develop its technologies internally rather than buy other companies. However, some analysts believe that this paradigm will have to be broken if Apple wants to succeed in a field where it shows a strong interest: that of streaming of video content. Although the company is apparently doing well in producing its own content, analysts who spoke to Bloomberg opined that, if Ma wants to have serious pretenses in the segment, having to take the scorpion out of her pocket to buy some great player in the industry, something similar to Netflix or Amazon Prime Video.

To ensure the absurd $ 50 billion of total service revenue, predicted for 2021, Apple would have to make yet more colossal acquisitions and can find a place to sit now, because the report cites as possible examples Tesla or even the Walt Disney Company , one of the largest media conglomerates in the world.

For that, however, Apple will have to overcome its limitations when it comes to negotiating. Apparently, Tim Cook and his gang refuse to work with investment banks and negotiate directly with the company to be acquired; the team responsible for advancing negotiations at Apple consists of a maximum of 12 people. This behavior is seen in the technological environment as "arrogant" and "difficult", and can be a stone in Cupertino's shoe on his journey towards flights still taller. Perhaps it is the case of lowering the ball a little so that it can rise even more?

(via 9to5Mac, AppleInsider)