Lenovo President On Apple: "The Winners Of Today Will Be The Losers Of Tomorrow"

Despite the massive success of Apple's iPad, Lenovo doesn't appear too rattled by the company's failure to capture the next PC paradigm first. "I think the industry likes to declare winners but the reality is the industry changes so fast," says Peter Hortensius, president of Lenovo's global product group. "And that change is happening so fast that the winners of today will be the losers of tomorrow, and the losers of today will be the winners of tomorrow. The reality is there will be somebody out there we haven't even thought of in five years doing something cool and new."

For Lenovo, the No. 1 PC maker in the world, the fact that Apple has already sold 100 million iPads is merely a sign of the unprecedented market opportunity for tablets. Yet there's no doubt Apple has disrupted the ecosystem—Cupertino now sells more iPads than hardware makers sell PCs. The launch last month of Windows 8, Microsoft's mobile-centric operating system, could give PC makers new hope in mobile. But the question still remains: Why didn't Lenovo invent the iPad first?

"Well, if I knew that I might be living on a beach somewhere in a tiki hut retired," Hortensius jokes.

For decades, Lenovo and other hardware manufacturers built huge PC businesses in partnership with Microsoft, which licensed software to these OEMs in order to establish a dominant market share. But that model has dramatically changed in recent years: Apple, due to its vertical approach of controlling both hardware and software, was able to create whole new industries—music players, smartphones, tablets. OEMs, dependent on third-party software makers like Google and Microsoft, watched helplessly as Apple took the lead in these new categories, leaving some to wonder whether that traditional software-hardware partnership model was becoming a disadvantage.

"Well, there are advantages and disadvantages to every model, " Hortensius says. "If you look at our industry, there are some players that are very vertical. Some players have been successful with that model, and some players have frankly failed with that model. We think we've done quite well with the model that we have."

Hortensius points to the fact that the traditional model has yielded higher market share in most cases, though it may take time in new markets. "Today, Android is the predominant operating system in phones, and Windows is still the predominant operating system in PC-like devices," he says.

But Hortensius' larger point is that it's still incredibly early. Yes, Apple has dominated the tablet market, but Windows 8 is barely a month old. Lenovo's business is growing—it just captured the top PC maker slot worldwide. It owns roughly a third of the PC market in China, and, only being No. 4 in the U.S., still has tremendous room for domestic growth. In other words, as Hortensius says, "It's very easy to get caught up with the way the world is if you live in California. But the reality is, tablets in China are not nearly as strong."

We've already heard similar arguments from HP, Dell, Acer, Toshiba, and others. But for Lenovo, it's the company's global footprint that will be its greatest advantage. As Fast Company reported in our profile of the company last year, Lenovo boasts a network of roughly 15,000 stores in China, almost as many as Starbucks has globally. "But if you go into the mainstream [U.S.] consumer space, it's, you know, 'Lenovo who?'" Hortensius says.

That's changing. And despite Apple's success, Lenovo thinks it has more than a fighting chance in mobile.

"I think the global view is that everyone got a little bit surprised by touch [technology]. We had touch devices, but the industry just didn't connect the dots like [Apple]," Hortensius says. "The reality is that in our market, you still haven't seen iPads take off in a huge way in China. If you look at where the industry is now, I think we've caught up. And if you look at the next wave of human interface technology—voice, gestures—I don't think you're going to see the industry getting surprised again."

[Image: Flickr user Kevin Tiqui]

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38 Comments

  • Rage Against Fraudy

    Asians have never invented anything because they never do anything for the love of creating beauty, only on the love of money, which is why all they can do is sit and copy the west helplessly. Lenovo only rules in China because of trade barriers and hypernationalistic education, not because they better. And everything Lenovo has it bough from IBM.

  • Eric Tan

    Innovation?  Lenovo exists because it bought IBM's personal computer division.  It's successful in China because it is a Chinese company.  Other than some nice repackaging of their products, what have they invented, innovated or designed recently (or ever)?

  • Ol' Bob

    Today's winners may be tomorrows losers - but that doesn't mean that today's losers will not ALSO be tomorrows losers.

  • Brianscottowen

    The only thing Lenovo is good at is soliciting prostitutes in China, Argentina and Brazil. They are arguably one of the most unethical companies I have ever encountered. They have Senior Vice Presidents, Executive Directors and Senior Managers who knowlingly let this illegal and unethical conduct and behavior exist. They are breaking the law and they have no respect for the law or the sanctity of marriage! Please stop purchasing products from Lenovo. They do not care about people at all! All they care about is how many laptops, tablets and desktops they sell.

  • Sean Millon

     And that is supposed to be a concern to me...how? What these executives do on their own private time, and dime (or yuan), is their own business. As far as customer service go, they aren't IBM, nor in the same class, but I can't honestly say I've ever had a problem getting what I've needed out of them.

  • oneumbrlla

    While all this conversation and debate on whether the product is good or the company innovative is great, the essence of the article is about the tomorrow of technology.  My one question, that is not answered, is around the idea that we will not be surprised in the future by voice or gestures.   I disagree. With regard to voice inputs and outputs ( those done by the computer) we are in very early days.  If you think Siri, right now she cannot do much, impressive as it is to market offerings.  What is the next wave is the open question for Lenovo and others.

  • ZZZeroGold

    Apple made tablets popular with the iPad, but it's not out of luck. They took something that already existed and improved it by leagues. They found real-world applications for tablets. But the most important thing that their success can be attributed to is DESIGN. Apple succeeds because they consider design in what they do. Visual aesthetics as well as user experience. People enjoy using their products because they feel nice to use and to look at.

    I use a Lenovo Thinkpad at work and it works fine as a piece of equipment to get things done, but do I want to take it with me everywhere I go? Absolutely not. It's hideous. There's nothing fun about it, it's all work and no play. Not to mention it runs Windows specifically which isn't exactly user-friendly all the time. Lenovo seems to care only about the function of a computer and little of the experience of a computer, and that's where Apple has them beat. So long as Apple doesn't have any more big screw ups like the Maps ordeal, they will likely remain at the top of their market. They make great products that not only work well but are visually appealing while Lenovo makes products that work well but aren't at all visually appealing. Which would you choose? 

    Lenovo needs to learn the design is everything. I wouldn't hate my work laptop if it didn't look like a piece of shit laptop from the 90s.

  • gbacoder

    it was also TIMING. the tech came just right at the time with high quality displays and capacitive touch screens. This tech aspect cannot be ignored either. When someone says it's all tech or it's all design - 99% of the time they are wrong. It's never that black and white, and tech will always be the leader for some time to come,  but yes good design really helps too.

    Lev also failed to innovate in the tech, not just the design side.

    And it's not even "design" so much - as polishing a user interface / ergonomics. Not really part of the design field (how it looks). But an important part, just like the tech.

  • Sean Millon

    Yeah, because the Thinkpad line is intended for business consumers, not high school girls expressing themselves on Facebook. Y

  • Sal Conigliaro

    So in following Hortensius' own logic, Lenovo won't be the #1 PC maker for long. 

    Sounds like Peter is a bit heavy on the spin. Why is it that CEOs can't ever be honest? I'd have more respect for the man if he'd say (in respect to tablets) "Look, everyone tried to bring tablets to market and it didn't catch on until Apple created the iPad (and a whole new market). They did it well and kudos to them. We are the #1 PC maker in the world and we're very proud of that. Apple has their market segment, we have ours."

    Instead, it's "Well, Apple is ahead, but it's clearly very early." Translation: We'll going to catch them and be #1. But here's the cold truth: No, you won't, Peter. Because Apple has successfully transformed itself into a consumer electronics company. They are not a computer company anymore. Think Apple dropped 'Computer' from their corporate name a few years back on accident? No, they saw their path to the future.

    IBM, Lenovo, Dell, Microsoft, et al won't capture the market that Apple has with their iPads because they're still making products looking through the "hardware spec" lens. Just look at *part* of the product grid on the Lenovo page for the 'IdeaPad':

    7" HD Multitouch Display

    9" HD Multitouch Display

    9.7" HD Multitouch Display

    10.1" HD Multitouch Display

    11.6" HD Multitouch Display

    Quad Speakers

    Dual Speakers

    Seriously? I'm in the "computer industry" and this is confusing even to me. What do you think John Q. Public thinks when they see that?

  • Surrounded by NITWITS

    what's astounding is that it until apple created the Iphone and iPad, there was nothing of equivalent (refined) function and design on the market. yet, now at every turn, almost every company has their stunted version of these two (once innovative) products. Unfortunately, judging by the latest apple products revisions, they may be out of ideas... so what is everybody going to copy?  simply tweaking here and there is a recipe for a gradual march to irrelevance... They could realistically price their products and gain significant market share (vs Windows) but they likely won't, because they have this " we don't have too" mentality.

  • ZZZeroGold

    Well they don't have to lower their prices. The market is still good for Apple and people are still lining up for days to buy their products at the high prices they're already set at.  Any good business person would take advantage of that situation. I'm sure prices will lower as demand goes down, but it likely won't be for a long time. 

    I agree though, Apple is likely headed downhill from here on out now that Steve Jobs is gone. 

  • Brint

    You have to be kidding... Even the New/Old CEO ButtHead Neard* (the New Word-Term) will not let Apple Innovation Die... You, like millions, are being lulled to sleep with the notion Apple is out of ideas because SJ is Dead... SJ died but not Apple... The next Newest Wizz-Bang Model is not only in the works but has been in Development for 8 Years... When it makes it's appearance (that's a clue for you) it will heralded as the greatest innovation to ever make an entrance onto the Stage of Current Standards... Once again there will be mass scrambling from all the Copy Cat non-innovators to carve out a small slice of insignificant Apple Pie...

  • Surrounded by NITWITS

    They've got quite a nest egg and probably very little debt. sometimes you need to sacrifice profit for market share. I mean what else are they going to do with all that money? If they they wanted too, they could really put quite a bit of hurt on Microsoft and prolong their viability. even if they've got nothing new to offer, they would have a vast amount of new customers to assimilate

  • Rage Against Fraudy

    iPhone 5 was the most successful smartphone launch ever. Apple's not going anywhere unless all the Asians invading it right now ruin it.

  • Sean Millon

     Oh, then if they're going to "assimilate" all those existing customers from MS, they'll have to lower their prices. Have you not noticed the kind of premium pricing Apple products carry? They're going to expect everyone to climb on board and pay the same premium whilst warming up to the public as offering the replacement for Windows and the everyday PC?

    You, sir, are effing crazy.

  • def4

    Let me answer that baffling question for you my dear Hortensius.

    You didn't create the iPad because you work for a manufacturer of commodity products that makes money through scale, not innovation.

    You can't innovate because you are not free to build any product you can imagine, you are only allowed to build and sell what Intel and Microsoft support.
    Most of the features, limitations, characteristics, price and value that can be extracted from your product are decided primarily by Intel and Microsoft, not yourself or your colleagues.

  • Jack Schofield

    Yeah, that's why Lenovo also sells smartphones etc with ARM chips (not from Intel) running  Android (not from Microsoft). Odd how often "patronising" goes hand in hand with "stupid", isn't it?