Why Apple keeps buying companies - and how it's used them for maximum impact

Off the record, company owners have told AppleInsider how being bought by Apple — or even having Apple just offering to buy you — is an intense experience. Apple does not casually buy any firm, it does always get the very best deal possible, and it will always hide what it's bought, if it can.

Consequently, if you go just by what acquisitions Apple is obliged to report, you only see a fraction. In 2019, for instance, it's a matter of public record that Apple bought six firms, including Intel's smartphone modem business.

Yet Tim Cook said in May 2019 that Apple had actually bought between 20 and 25 companies in the previous six months.

Cook also claimed that Apple first focuses on large-scale investments like developing its Austin, Texas, campus. But when that is done, he said Apple does look into buying other firms.

"If we have money left over, we look to see what else we [can] do," Cook told CNBC. "We acquire everything that we need that can fit and has a strategic purpose to it. And so we acquire a company on average, every two to three weeks."

Some of those firms are effectively erased as Apple is "primarily looking for talent and intellectual property," says Apple. Others remain well-known, even household names.

All of them shape Apple, and sometimes you can see how deeply fundamental that shaping has been. Apple would be unrecognizable today, if it even existed, were it not for the other companies that it has acquired.

Apple's best-known acquisitions, and what they were used for

Acquisitions by the numbers - as far as possible

Apple took 18 months from acquiring Siri to announcing it. Then it was 18 months before Workflow became Shortcuts, 18 months for Dark Sky to to be integrated into the Weather app.

And if it's correct that Mobeewave was bought in order to be part of Tap to Pay, then it was again 18 months from acquisition to announcement of the feature.

Plus Fleetsmith, the device management company that was presumably bought to be part of Apple Business Essentials, took 17 months.

Or rather, in each of these cases the 18 or so months started only when Apple was required to announce the acquisition. Unquestionably, Apple was talking with each of these firms for long before that time.

Plus Scout FM probably got bought to be part of Apple Podcasts Subscriptions, in which case it was merely 7 months from acquisition to announcement. And if September 2022's "iPhone 14" includes a 5G modem developed by Apple, that will use the patents it acquired from Intel 38 months before.

Why schedules can only be estimated

This can only possibly be a very broad overview of when and why Apple buys companies. Again, it chooses not to disclose the giant majority of them, and it almost never says why it has bought something.

Then acquiring a company is not a trivial matter. Off the record sources say that Apple has an acquisitions team whose function is to bring the deal home, to complete all the negotiations and legalities, once Apple has decided to buy.

It's likely that once the deal is closed - and ratified by regulators if necessary - this team moves on.

Whether Apple has acquired a firm wholesale, to keep running as it is, or is cherry picking talent for other projects, it's then an HR issue. The new acquisition or the new hires have to be integrated into Apple.

According to the New York Times in 2014, Apple looks for teams that work well together. And at that point, it would typically either give them entirely new projects, or pair them up with an existing team at the company.

After buying so many companies, Apple has probably got this down to an art, but it's still going to take longer to integrate a 100-person firm than a one-man or one-woman band.

Then there's the question of the destination, of where Apple wants to deploy this new feature, or use these new people. If it's something for the iPhone, then Apple will always be aiming for a September release regardless of when the firm was bought.

With so little data publicly available, all that be said for certain is that acquiring companies is practically a business itself.

Then looking at the list, it's tempting to suspect nothing Apple releases is done without some acquisition helping it along the way. That is particularly significant because when Steve Jobs returned to Apple, the company was said to be in the throes of the very common Not Invented Here problem.

Prominent Apple acquisitions

Jobs would surely have to be against the insular bias against outside resources, since he came back to Apple from being one.

Apple's single most famous acquisition and doubtlessly the one that changed the company to its very DNA, was the buying of NeXT in 1997. That brought back Jobs, that launched OS X, that created the iMac, and all of this saved Apple.

It wasn't the most expensive acquisition, at least not in terms of the initial purchase price. We'll never know how much it cost Apple to implement Jobs's plans, such as the streamlining of the entire manufacturing process that Tim Cook introduced for him.

But at the point of sale, so to speak, NeXT cost Apple $429 million (and shares), while 17 years later, the firm spent $3 billion to buy Beats.

Beats is also significant because it is one of the few acquisitions where Apple kept the name - or mostly.

So for instance, Apple is still selling Beats headphones eight years after it bought the company. But Beats Music ceased in 2015 and was renamed, subsumed, or perhaps just replaced by Apple Music.

That streaming service did include a 24-hour station called Beats 1, which ran until 2020 when it was rebranded as Apple Music 1.

Similarly, Siri was the name of the voice assistant's original developer company as well as the voice recognition app itself, and Apple kept the name as it acquired that firm in 2010.

Siri continues to this day and shows no sign of be renamed or rebranded. Nor does Shazam, which Apple reportedly spent $400 million to acquire in 2018.

It's not known how much Apple paid for Beddit in 2017, but that name also continues. Except it took Apple until 2018 to launch its updated Beddit Sleep Monitor 3.5 - and it's now no longer on sale.

Quieter Apple acquisitions

Apple was never going to put an "Intel inside" sticker on its iPhones, not even after it made a $1 billion acquisition of Intel's smartphone modem business in 2019.

It also, though, decided not to keep the name Texture, when it allegedly spent $485 million to buy that online magazine service. Texture was another service where Android users lost out because of Apple buying it as part of an exclusive new service, this time Apple News+.

Then there was one acquisition where the company was iOS-only, and still users feared that Apple was buying it only to shut it down. There is no longer any app or service called Workflow - but there is Shortcuts.

From its original purchase in 2017, Apple has taken Workflow and its developers far further than they could have done outside the company. Shortcuts are now an important part of iOS, and with macOS Monterey they came to the Mac, too.

We'll never know

Then there are the acquisitions that probably come under Tim Cook's category of "talent and intellectual property." We will almost certainly never know exactly what any of these company buys directly lead to features we use, but they do all point to where Apple is heading.

The company is clearly focused on music, for instance, as its purchase of classical music streaming service Primephonic in 2021 shows. And its buying AI Music in 2022.

Apple hasn't commented on the reasons for buying AI Music, but unusually, it has revealed some of its plans for Primephonic.

"Together, we're bringing great new classical features to Apple Music," said Apple's vice president of Apple Music and Beats, Oliver Schusser, "and in the near future, we'll deliver a dedicated classical experience that will truly be the best in the world."

If Apple is usually quiet about companies it buys, it is absolutely tight-lipped about any that appear to be related to the as yet unannounced "Apple Car."

A rare publicized car acquisition was Drive.ai, which Apple bought in 2019. That was a self-driving shuttle startup, and buying it gained Apple both employees and cars.

There's more

If Apple has kept up the rate Tim Cook said in May 2019, it could now have bought a further 50 companies since then. Surely that rate dropped during the coronavirus pandemic, but otherwise there is no reason to think it's slowing down.

It's not like it lacks the money.

Except, once Apple began climbing back up from near-bankruptcy before acquiring NeXT, money has seemingly not been an issue. With the rare exception of Beats, Apple does not spend enormous sums on buying firms.

Facebook spent around $19 billion buying WhatsApp, for instance. Microsoft recently bought Activision Blizzard for $68.7 billion. But then Microsoft also once bought Nokia's cellphone business for $7.2 billion, and that doesn't seem to have worked out well.

Over the years, analysts have claimed Apple wanted to buy Tesla, said it should buy Disney, and insisted it would be wise to acquire Peloton.

Apple, as yet, has done none of this. It keeps on acquiring and doing so with the same eye on "everything we need that can fit and has a strategic purpose to it."

Presumably even within the acquisitions we'll never know about, some work out better than others. Even so, Apple looks to be treating acquisitions the way it does everything else - playing the long game, every time.