2.1 - Neoliberalism (Apple)

Question 1

What impact has Apple had in China?

Answer 1

• brand image and brand loyalty is important
  
  • desire for Apple logo
• Apple represents freedom, liberalism and high economic status
• mass adoption of smartphones has resulted in traditional culture disappearing

Question 2

How much is the music streaming industry worth?

Answer 2

• $6.85bn/yr

Question 3

What is vertical integration?

Answer 3

• TNCs buy up companies within supply chain
• usually at successive steps within the supply chain
  
  • brings parts of supply chain in house and in control of TNCs

Question 4

Why are TNCs so dominant?

Answer 4

• establish and operate on economies of scale
  
  • means doing same thing as other companies is cheaper
  • further growth means future growth is cheaper
• income generated from growth is large enough to allow for investment in advanced technology and gain edge over competitors
• free markets allow for goods to be sold in new countries

Question 5

How does Apple do vertical integration?

Answer 5

• Apple designs its own chips for iPhones
• Apple manufactures these iPhones
• Apple sells these iPhones through its own website and stores

Question 6

What is horizontal integration?

Answer 6

• expansion within the same stage of the supply chain
  
  • eg. Buying out a company that supplies the same parts as you
  • is good as it allows for development of economies of scale and sharing of expertise and technology

Question 7

How has Apple done horizontal integration?

Answer 7

• acquired Beats to enter premium headphones market
• Acquired Shazam to enhance Apple Music and Siri