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Apple's 5 Greatest Innovations

There's little question that Apple (NASDAQ: AAPL  ) has been the most innovative company of the past decade. But Apple's innovations didn't begin with the iPod in 2001. The company had a quarter century of innovation by then, developing products that changed the world.

Let's take a look at the most market-changing innovations in Apple's history, and where the company may be going next.

Apple II
Apple II was the product that made Apple into a computing powerhouse, and made Steve Jobs and Steve Wozniak household names. Introduced in 1977, it came to define the early personal computing industry. At $1,298, it was a relatively affordable computer and, with a keyboard, disk drive, and monitor included, it was a product that novices could use, making the home computer more accessible to the masses.

Apple II was followed by the better-known Macintosh, but Apple II is where Apple really showed its innovative chops. It also gave Apple the cash flow to develop products outside of personal computers. 

Did you know that Apple invented the personal digital assistant -- or PDA -- nearly a decade before the first Palm Pilot  was released? This was one of the company's biggest innovations, but it was so far ahead of its time that it was basically a commercial flop. The Newton had apps like Notes, Dates, and Names, which were similar to the Notes, Calendar, and Contacts apps on today's Apple devices. It also allowed data to be used across applications, which was a new innovation at the time. 

The Apple Newton and first-generation iPhone. Image courtesy of Blake Patterson.

In many ways, the development of Newton created the foundation for the iPod, iPhone, and iPad product lines. It was an adventure outside of traditional computing, and taught Apple a lot about how devices interacted in the consumer computing market.

The Newton may be the least known of Apple's innovations, but it was a revolutionary product at the time.

Most people think of the iPod as the device that brought Apple into our everyday lives, but it was really iTunes that made the iPod's popularity possible. iTunes linked the iPod to a world of digital music and, when it made its way to the PC, Apple's popularity exploded.

It's easy to forget that through iTunes, Apple turned the traditional music distribution model on its head, making individually priced songs the norm, and making CDs obsolete in a short period of time. iTunes proved that digital media distribution could be done on a large scale, bringing music, TV, and film to the digital age. It also became an integral part of Apple's best-selling product.

The iPhone
While the Apple II, Newton, and iTunes were phenomenal innovations, Steve Jobs will be most remembered for the iPhone, the device that changed the future of electronics. When it was released in 2007, the iPhone changed everything we thought we knew about cell phones.

Apple stores still generate huge crowds when new iPhones are launched.

The iPhone combined phone calls with Internet capability, apps that brought productivity to our pockets, and (for better or worse) made text messaging a breeze. The iPhone turned the BlackBerry from a device so popular it was known as a CrackBerry, to a manufacturer struggling just to survive. 

But the iPhone wouldn't be what it is today without the connection between Apple and third-party developers, who brought innovation to all of Apple's touchscreens.

App Store
The App Store was a new way of distributing software when it was released, and analogous offerings from Google and Microsoft have changed both the development of software and the distribution model. For example, I haven't bought software at a store for years, and my latest computer doesn't even have a disk drive to load it with.

What may be even more innovative is how the Apple App Store has democratized the software industry. Startups like OMGPOP, Supercell, and Rovio  can go from concept to billion-dollar valuations almost overnight. Under the old software model, that would be nearly impossible.

What's most impressive about the App Store is how we've almost forgotten how revolutionary it is. It was just over five years ago that the App Store was launched, and now it's the main distribution method for Apple's software. Innovations that are adopted so quickly are what has made Apple such a success for investors.

What's next for Apple?
If Apple is going to continue to be a market darling, it will need to continue its high rate of innovation. I think the next logical step is TV, where the groundwork is already laid to disrupt the industry with Apple TV. The iPhone was launched without a distribution method for third-party apps, and Apple TV is taking the same route. But recent months have seen more apps added, and I think a third-party app store is on the way next year. 

Where do you think Apple's next big innovation will be?

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Read/Post Comments (6) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On December 18, 2013, at 9:08 PM, prginww wrote:

    The Apple II was not sold with a monitor included. A standard television set would typically serve as the monitor using the UHF connection. I owned one of the first Apple II Plus systems in 1978 and it was a great device, with excellent branding even back in those days!

  • Report this Comment On December 19, 2013, at 10:14 AM, prginww wrote:

    Having owned a Palm Treo in 2004 the iphone wasn't that innovative. They just made it prettier.

  • Report this Comment On December 19, 2013, at 10:18 AM, prginww wrote:

    Walt Mossberg just published his last column in the WSJ and reviewed the top 12 gadgets over the last 20 years. Apple had 5 of the 12, including No. 1 (Newton).

  • Report this Comment On December 19, 2013, at 11:34 AM, prginww wrote:

    I'm surprised the Mac and/or iPod was not on the list… I guess the iPod is assumed to be the evolution of the Newton… which, I did have one of those and I think Apple learned from the newton how important good interface was… the newton was bulky, clunky, and hard to use.

    Either way…. all on the list are great innovations for the time and set the groundwork for some amazing products.

  • Report this Comment On December 19, 2013, at 1:19 PM, prginww wrote:

    Macbook and iPod are on Mossberg's top 12 list.

  • Report this Comment On December 19, 2013, at 8:31 PM, prginww wrote:

    I am sorry iphone was not innovative anyway. There were Smartphones before iPhone but was not commercially successful. There were huge windows mobile apps before iPhone apps (you had to find and download them online just like computer programs; there was no official app store). The Apple app store and itune was innovative. Only difference I remember iphone was from other smartphones at that time was that Iphone combined ipod (huge musical player) with a phone.

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