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Apple is partnering with professional services firm Deloitte Consulting to create a new Apple practice within Deloitte to help enterprises expand their use of Apple’s iOS mobile operating system and devices such as iPhones and iPads inside their operations.
The deal, which was unveiled on Sept. 28, will assemble some 5,000 “strategic advisors” to work in the new Apple practice. Those advisors will be “solely focused on helping businesses change the way they work across their entire enterprise, from customer-facing functions such as retail, field services, and recruiting, to R&D, inventory management, and back-office systems,” according to the companies.
The partners will also create a new Deloitte offering for customers called EnterpriseNext, which will aim to help clients take advantage of new possibilities inside their operations using the iOS ecosystem of hardware, software and services. EnterpriseNext will be designed to quickly develop answers to business problems through rapid prototyping, the companies said.
“We know that iOS is the best mobile platform for business because we’ve experienced the benefit ourselves with over 100,000 iOS devices in use by Deloitte’s workforce, running 75 custom apps,” Punit Renjen, the CEO of Deloitte Global, said in a statement. “Our dedicated Apple practice will give global businesses the expertise and resources they need to empower their mobile workforce to take advantage of the powerful ecosystem iOS, iPhone, and iPad offer, and help them achieve their ambitions, while driving efficiency and productivity.”
Apple created a similar enterprise partnership with IBM in July of 2014 to drive business use of its products. Other similar partnerships have also been formed with Cisco and SAP.
Tim Cook, Apple’s CEO, said the latest deal will expand his company’s efforts to gain business users.
“As the leader in digital transformation strategy, Deloitte is an ideal partner that brings a team of Apple-dedicated strategic advisors to help clients truly revolutionize how they work using iOS, iPhone, and iPad,” Cook said in a statement. “iPhone and iPad are transforming how people everywhere get work done. And through this partnership, we’re able to help even more businesses tap into the incredible capabilities that only the Apple ecosystem can deliver.”
Jan Dawson, chief analyst with Jackdaw Research, told eWEEK that Apple’s move to partner with Deloitte makes sense because even though Apple is not known as an enterprise technology provider “almost all big companies now have a fleet of iPhones somewhere in their business, and Apple wants to make sure those devices perform as well as possible and are integrated into the companies’ business processes.”
By joining with Deloitte, Apple will be able to help business customers with something it hasn’t been able to do adequately in the past, he said. “Whereas Apple can sell and support iOS devices itself for generic uses, Deloitte can provide much deeper expertise around horizontal business functions and for specific vertical industries than Apple ever could.”
“It’s easy to imagine that enterprise revenues are around 10 percent of Apple’s total revenues at this point, and growing faster than its consumer revenues, so this is an increasingly important area of Apple’s business, especially when it comes to driving growth,” he added.
For Apple, one key to the deal is that the company gets the promised value out of the arrangement, said Dawson. “These partners get a good PR boost from announcing high-profile partnerships with Apple, and doubtless get a lot of benefit from that. But the challenge with such partnerships is often making sure that customers really see the benefits, and that the anticipated revenues actually flow.”
Apple is making its push deeper into the enterprise at least partly to seek new revenue after watching its iPhone sales drop in the last six months. The recent release of its latest iPhone 7 models is again boosting sales, but new revenue streams are never a bad idea.
Apple Steps Up Its Enterprise Business by Partnering With Deloitte
In July, Apple’s third-quarter revenue and net income fell for the second consecutive quarter as the iPhone maker reported $42.36 billion in revenue, down 15 percent from $49.6 billion a year earlier, and $7.8 billion in net income, a drop from $10.7 billion, according to a previous eWEEK story. That gave Apple year-over-year declines in revenue and net income for two straight quarters, which was in contrast with the company’s prior string of 13 years of quarterly revenue reports without a decline, dating back to 2003.
The impressive streak ended in April when the company reported its Q2 financials, including revenue of $50.6 billion. That revenue was 13 percent lower than the $58 billion the company posted a year prior.
Hitting the company’s Q3 revenue and net income hard was a 15 percent drop in global iPhone sales to 40.4 million units in the quarter, down from 47.5 million in the third quarter of 2015. Sales of iPads dropped 9 percent to 9.95 million from 10.9 million a year prior. Apple’s Q3 revenue from U.S. sales fell 11 percent in the quarter to $18 billion from $20.2 billion the year prior, while its revenue in China dropped 33 percent to $8.8 billion from $13.2 billion in the third quarter of 2015.
The decline in iPhone sales that began in the second quarter had its roots in the first quarter of the year, when Apple sold 74.7 million iPhones, which was essentially flat from the 74.5 million sold in the same quarter a year earlier. In the fiscal first quarter, Apple’s revenue was riding high at $75.9 billion, a new Apple record at the time. The company’s first-quarter net income was $18.4 billion, which set another quarterly record, up from $18 billion in the same period a year earlier. Earnings rose to $3.28 per diluted share, up from $3.06 in the same quarter in January 2015.
But in this year’s Q2, iPhone sales fell 18 percent to 51.2 million units from 61.2 million in the same quarter in 2015. The second-quarter iPhone sales were also down sharply—by 32 percent—from the 74.78 million in the first quarter of 2016. In dollars, iPhone sales dropped to $32.9 billion in the second quarter, down 18 percent from $40.3 billion a year prior.