Introduction
Apple, a long time competitor in the personal computer market, has in the past taken a back seat to their rivals, and was even was on the verge of bankruptcy. The problem for Apple was their paradigm - if an innovation did not come from within Apple, they did not want to know about it. When Apple made a paradigm shift in the mid-nineties their business changed and prospered. Apple brought in inventions from outside the company, they redesigned their supply chain and forged very unusual partnerships to gain a competitive edge. Will they be able to maintain this edge against major competitors who are keen to knock Apple off its towering tree with product developments and strategic alliances of their own? Will Apple's closed mindedness creep back in, and see them repeat costly mistakes from the past and lose their advantage? Using the framework provided by Wells (1998) three strategies are recommended that focus on technology, marketing and the development of the iTunes element of the business to maintain and develop Apple's competitive advantage in the digital entertainment market.
Slicing up the Apple ? the Perceiving stage
In the perceiving stage of the strategic thinking process Wells (1998, p.90) suggests that there are 6 stakeholders to consider ? customers, competitors, strategic partners, providers of complementary products, suppliers and distributors.
We examined several key stakeholders below and found that while Apple has several major competitors in the digital entertainment market it has developed relationships with its competitors so that they are also suppliers.
Customers
The customers of the Apple iPod are people who want to enjoy the benefits of the latest technology in digital music players. ...