Netgear CEO Blasts Steve Jobs' 'Closed' World, 'Ego'

Australia’s Sydney Morning Herald recently printed an unusual interview with Netgear CEO and global chairman Patrick Lo (pictured). A heavy amount of criticism came from Lo regarding Apple CEO Steve Jobs’ position on Flash and on closed systems in general, but what was more surprising was his backhanded comments regarding Jobs’ future at the helm of the company. Read on for the details …

You can find the original Sydney Morning Herald (SMH) interview here. The interview was conducted “at a lunch in Sydney,” where Lo was presumably interviewed about the state of technology. Microsoft, Google and Apple were all subjects for discussion, but Lo’s comments about Apple made it obvious there’s no love lost.

He called out Steve Jobs’ “ego” as part of the reason for the lack of Flash and the company’s closed systems. Even though Lo admitted that Apple’s success was due in part to its closed and proprietary systems, he said Apple would be overthrown by “open” solutions like Android.

The scathing criticism seemed a bit much even for the SMH, which noted “Apple has had unparalleled success by being able to control the entire ecosystem around its products,” but Lo contested it was only successful because Apple “own[s] the market,” on certain technologies such as MP3 players. He then said Android market-share has overtaken the iPhone market share in the United States (although Lo didn’t cite his sources, and it’s a hotly contested issue since a number of factors are used to measure iPhone/iOS market share vs. Android phones/devices).

Then Lo lowered the boom. “Once Steve Jobs goes away, which is probably not far away, then Apple will have to make a strategic decision on whether to open up the platform.”

Wow. Is Lo suggesting that Jobs is on his deathbed, or merely that he can’t remain at the helm much longer? Either way, it’s an insensitive comment, and it also begs the question: Why the heck would Apple suddenly “open” up because Steve Jobs is no longer presiding over the Apple Empire? I find it hard to believe that one of the most successful companies in the world doesn’t have a contingency plan.

Regardless, Lo said “a closed system just can’t go that far” and Apple will have no choice but to open up to compete against Android. I say bunk. Just because Android’s market share has grown doesn’t mean Apple’s has slipped. If Apple suddenly saw a dramatic slide in its adoption rate and user base, then maybe the company have cause for alarm, but as far as anyone in Apple — and anyone who has watched Apple for more than a year — can tell, Apple doesn’t have that problem. Not even a little bit. Want proof? What other company in the world has people lined up around the block just for a retail store opening (or a product in general)? I was there for the opening of the 14th Street Apple Store in New York. It was a complete madhouse — lines of people were double-wrapped around two city blocks.

What’s more, I don’t think Lo understands Apple products very well. The ‘closed’ nature of Apple provides consumers with a consistent overall experience they’ve come to love and trust and rely on. Most end users don’t really care about Android, open source and ‘religious’ computer battles.

That’s why I think Lo is looking at it from the wrong angle. As the CEO of a networking company, he’s coming at it from a more geeky tech developer angle. He qualifies his comments on Apple’s strategy with his experience in watching previous industry battles, including the battle of competing protocols over TCP/IP.  Lo suggested that in all his referenced cases, open overthrew closed, but Apple’s countertrend is only successful because Steve Jobs is a “thought leader.”

But it’s more than Jobs being a thought leader. It’s because Apple makes good stuff that the consumer wants. Again, market share numbers are irrelevant and constantly changing. What’s concrete is the cash. In fact, according to The New York Times, if Apple’s iPad business was a standalone company it would be in the top third of the Fortune 500 right now.

Lo even attacked iTunes, saying Apple needed to open up iTunes  (though he didn’t comment on what exactly needed to be opened up but called Apple’s cut a “ransom”) and also said Android would take over the world and become the “de-facto” standard for consumer devices, including TVs.

But here’s where it gets a little more personal: Apparently, Steve Jobs hasn’t given the Netgear CEO “a minute” of his time, and in turn, calls Jobs’ anti-Flash position completely ego-driven. Which is just plain wrong. There are plenty of legitimate reasons to not want Flash, but I won’t get into it. That’s so Summer 2010.

Finally, in turning away from Apple, Lo also spit on Microsoft, saying it was “game over” for the Windows Phone 7 market. No comment from me.

Bottom line? I think Patrick Lo has a love affair with Android, or open source in general, and isn’t looking at the big picture. Or maybe he just is personally ticked off that Steve Jobs is too busy for him. Either way, he should take a step back and re-evaluate. Apple’s success isn’t really about closed and open systems, it’s about the consistent user experience and being able to sell consumers something they didn’t even know they wanted (iPad). Apple’s progress as an innovative company will continue, because it doesn’t have the Microsoft ‘me too’ attitude, and it doesn’t spread its focus thin like Google. It would be foolish to underestimate Apple’s potential. It was a rip-roaring decade for Apple and I expect more of the same, especially with nearly $30 billion in cash on hand.

I reached out to Netgear to get official comment regarding Lo’s words. I’ve been told my e-mail has been passed along, but I haven’t gotten an official comment yet.

I finish with this thought: Apple will have to go bankrupt before Jobs — or anyone under the Apple executive umbrella — “opens” anything up.

Sign up for The VAR Guy’s Weekly Newsletter, Webcasts and Resource Center. Follow The VAR Guy via RSS, Facebook and Twitter. Follow experts at VARtweet. Read The VAR Guy’s editorial disclosures here.