Apple: Frugal to a Fault?

In contrast, Apple relies more on hit products. As the company moves more into consumer electronics, it starts to resemble a designer at a Milan fashion show, says Roger Kay, founder of consulting firm Endpoint Technologies. "Every year they have to have a hit," he says. "They can't screw it up."

With Apple's stock up nearly 800% over the last three years, and now trading at more than $65 a share, that pressure has only increased. The widely held expectation among investors is that Apple's growth will continue to outpace the market.

But to do so, the company's going to have to move beyond selling computers and digital music players. "Their challenge going forward is that they basically have to have a pipeline of hits over time within the categories they have. And since those categories will get saturated, they're going to have to bring out new [product] categories," says Barry Jaruzelski, a vice president at consulting firm Booz Allen Hamilton.

Of course, few analysts believe Apple has a problem now. Many say that what's important is not how much a company spends on R&D but how well it spends it. And for most of those analysts, Apple is a good example of a company that gets a lot of bang for its R&D buck.

"You look at what Microsoft is spending on R&D and I guarantee there's wasted money there," says Kay. Even though Microsoft's research budget is more than 10 times Apple's, "look at what they've produced. It's not controversial that they haven't turned out 10 times as many great products as Apple."

In fact, many analysts praise Apple for not simply throwing money at R&D as its revenue soared. Expectations may be growing for Apple, but companies face a difficult trick in augmenting their research efforts in an efficient, effective fashion.