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The iTunes ecosystem, now responsible either directly or indirectly for nearly one out of every four dollars Apple makes, was the most powerful catalyst of disruptive innovation the tech industry has ever seen (Tariq, Ishrat, Khan, 2011). Disruptive innovation was created in the initial processes of how Apple develops products, and continues to this day in the approach they take to integrating suppliers into the process early, defining very high levels of performance for each members of the value chain as well (Dedrick, Kraemer, Linden, 2010).
What is also unique about Apple's disruptive approach to innovation is the ability to learn from one product generation and use the insights and intelligence gained for the next product. This is how Apple was able to transition so quickly from the iPod to the iPhone; the processes in place for evaluating user experience, combined with supply chain integration, led to a dramatically different phone anyone had produced before (Tariq, Ishrat, Khan, 2011)....
Apple was able to gain all of these insights quickly and attain an experience curve effect in their innovation processes, accelerating the pace of innovation at the same time. That is why today their pace of new product development makes them nearly uncatchable on iPods, the iTouch and the iPhone.
References
Dedrick, J., Kraemer, K.L., & Linden, G. (2010). Who profits from innovation in global value chains?: A study of the iPod and notebook PCs. Industrial and Corporate Change, 19(1), 81.
Tariq, M., Ishrat, R., & Khan, H. (2011). New product development processes a case study of apples success with iconic iPod and iPhone. Interdisciplinary Journal of Contemporary Research in Business, 3(1), 158-169.
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