Apple sans Jobs will see rivals trying hard to close the gap

The extinguishing of the creative force behind the iPod, iPhone and iPad means a host of competitors — already closing the gap in some markets — will redouble efforts to counter the domination of Apple Inc in consumer electronics.

“Competitors like Microsoft will try and capitalise on any weakness, stumble or oversight to shift the public’s attention away from Apple and toward their own offerings,” said Todd Lowenstein, Portfolio Manager at HighMark Capital Management. “Apple is still the unquestioned leader, but competitors like Android and Microsoft are coming to market with compelling offerings and seemingly are starting to close the gap.”

“The downturn in the economy will likely spur more and more competitors with more and more mimicry products,” said Stanley Crouch, Chief Investment Officer at Aegis, pointing to Amazon.com’s new low-cost tablet computer as a recent example.

“When you get this incredible pressure from low-cost entrants, it’s very tough to maintain market share and margins,” said Crouch.

South Korean conglomerate Samsung is one of the best placed companies to deliver something fresh and exciting to rival Apple, analysts said.

It already makes the closest competitor by sales to Apple’s iPad tablet and the two companies are scrapping for top spot in the smartphone market, having overtaken Nokia, the market leader for the past decade, earlier this year.

Apple is also Samsung’s biggest customer through the sale of mobile chips and display screens. The relationship and rivalry has helped Samsung become a top global brand over the past decade with a stock market value of $115 billion, a third of Apple’s. But the two are also involved in a bitter dispute over mobile devices, suing each other in 10 countries involving more than 20 cases since April.

Samsung’s Galaxy range of smartphones and tablet computers run on Google’s Android operating system, which Jobs believed to be a blatant copy of Apple’s mobile interface. The global scrap between Apple and Samsung — with both sides trying to ban the sale of each others’ products in several countries — is not likely to cool, said Colleen Chien, Assistant Professor at Santa Clara University’s School of Law.

“I don't see that’s going to disappear just because of the passing of Steve Jobs,” she said. “Jobs was a very competitive person and the patent lawsuits were an extension of the company's strategy of getting more aggressive.” Jobs, the man known for minimalist design and marketing genius, handed the reins of Apple to long-time operations chief Tim Cook in August, who unveiled the latest version of Apple’s iPhone this week, in a launch that, unusually, failed to wow fans.

The iPhone — introduced in 2007 with the touchscreen template now adopted by its rivals — is still the gold standard in the booming smartphone market, and its sales have dealt a blow to the ambitions of many competitors.

But phones based on Google’s Android, which is available for free to handset vendors such as Samsung, HTC, LG and Motorola now have a greater combined market share than Apple’s iPhone.

Microsoft is set to release a new generation of Windows phones in the next few months in partnership with Nokia, and has its sights set on Windows-based tablets flooding the market next year, marking the next great tech battleground.

In a sign of more immediate competition, Amazon took the wraps off its Kindle Fire tablet last week, tacking on a mass market-friendly $199 price tag that analysts said poses a serious threat to the iPad.