Apples to Apples: Will History Repeat Itself as Android Gains on the iPhone? 55 comments
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I opened one of the first computer stores, Microdigital in Liverpool, in 1978. So I was in a good position to see the rise of Apple (AAPL) to dominate the personal computer (PC) market. I even visited Apple in Cupertino in California and was offered the UK distributorship. So this put me in the front row as they built up to own the market, then threw it all away.
Apple computers were well made, came with excellent documentation and were easy to use. All of which was not necessarily true of the competition. Apples were also expensive but were worth the extra. They became a bit of a cult, a fashion item, as well.
The big strength of Apple computers was that the software and the hardware came from the same company, so they worked. The resultant dominance in the early 80s was such that other PCs might as well not have existed. Apple had a virtual monopoly. Then along came Microsoft’s (MSFT) MSDOS and changed the rules. Here was a standardized operating system (and consequential applications) that would run on machines from many hardware manufacturers. So the hardware manufacturers had to compete against each other on price and features. And it was war.
The result of this war was the survival of the fittest, rapid evolution that improved the breed. And Apple was left well behind looking underpowered and overpriced; they could not even vaguely get near competing with the MSDOS machines. So Apple’s market share collapsed and they fell back to serving niche markets such as pre-publishing. In just a couple of years they went from near monopoly to sideshow.
And history could very well be repeating itself. Substitute Personal Computer with Smartphone. And substitute MSDOS with Android. Otherwise it is the same. Apple dominates the consumer smartphone market with the iPhone. The hardware and the software come from the same company and it works. It is a fashion item, a bit of a cult. Android, however, is available to all hardware manufacturers. Most of them are developing models that use it. So they will have to compete against each other on price and features. It will be war with rapid evolution improving the breed. Already the Samsung (SSNLF.PK) i7500 looks better featured than an iPhone.
Some may think that the tens of thousands of applications on the App Store make the iPhone entrenched. But remember that these were put together in a little over a year, so Android can do the same in a year. Just as Apple’s dominance of PC application software was quickly overcome when the MSDOS computers arrived on the scene in big numbers.
Of course Steve Jobs and Apple, having been there before, may have the answer this time. They need to entrench their position, which they are doing by going to multiple air time providers in each territory and by going to new territories. But Android will be doing all this too. They need to very rapidly advance their hardware technology. There is plenty of room to do this; the iPhone has a rubbish camera and no OLED screen, for instance. And the iPhone operating system has lots of room for improvement. But Android will be doing all this too.
Apple are moving on from the iPhone with a tablet device and probably a home console. Maybe this is their strategy. Don’t compete, move on.
The one saving grace that Apple has here is its brilliant marketing. In fact, to me, Apple is a marketing company first and a technology company second. Compare and contrast that with Google (GOOG) who has a trail of great products that have failed due to poor, almost non existent, marketing. But Android is different because it doesn’t need Google marketing, it will be marketed by all the handset manufacturers and air time providers. Companies like Vodafone (VOD) , Sony (SNE) Ericsson, Sprint Nextel (S), Samsung, Motorola (MOT), LG (LGERF.PK), Toshiba (TOSBF.PK) and Garmin (GRMN). Formidable, isn’t it?
Now for the gaming perspective. The iPhone and App Store have produced the biggest flowering of gaming creativity in history. In terms of range of products they have left every other platform behind. However the business model employed here is easily copied. So we are moving into a new age where the iPhone game publishers will maximize their profitability by going multi format. Develop for Android, iPhone, PSP, DS and possibly PC simultaneously and reap the marketing benefits. It makes sense.
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Silly, silly post.
And you spell it 'zealot' not 'zelot'.
On Nov 04 09:39 AM Whoa Nelly wrote:
> The Droid is not even available for sale to the general public yet
> and already all the Applezelots are declaring the device and the
> platform DOA with not a single sale to anyone!!!
>
> One thing you will never do is argue facts & logics with a zelot.
This is coupled with a strong management team that goes well beyond Steve Jobs and they now have a retail component that allows them to even more tightly control their message.
Of all of the companies you mentioned only Garmin looks like a company that I would even consider investing in. The financial clout that Apple can bring to the table cannot be minimized. Only Google has a similar position but, by your admission, they are leaving the marketing up to the phone makers. This looks to me like bringing a knife to a gun fight.
For Apple the iPhone is one of a stable of well selling products. For many of these companies, like Palm, these new phones are the equivalent of a Hail Mary pass to try to make it big in the smartphone market.
Something WILL eventually replace the iPhone, but given the financial strength of Apple and its superb marketing, I doubt very seriously that it is going to be Android.
"In fact, to me, Apple is a marketing company first and a technology company second."
This is just silly.
Your position only makes sense if you start as you have with your conclusion and dive very deep for any supporting ideas that can be massaged separated from reality to look better than a dead fish.
Apple just as they have done in iTunes, iPod and now iPhone have revolutionary technology ready to roll out as soon as the competition is preparing something to try an compete. You don't roll out ALL your innovation at once and have only a fraction get recognized! Instead you roll out a complete system where NO would be competitor can touch you. Fortunately Apple is years ahead of the competition and skates to where the puck is going to be while competitors like Microsoft skate to where it was three years ago. Stupid is as stupid writes. You sir have completely missed the infrastructure ecosystem that makes all Apple products simply untouchable.
Deep thinker your not and no doubt you have been living in your limited conceptual understanding ever since you failed to find any way to sell your exclusive distribution of Apple computers thirty years ago. Clearly your conceptual thinking hasn't improved since then.
Stupid is as stupid does. Apple is not doing stupid. Small minds of course will swallow your article as they always have. Fortunately the innate human desires being satisfied by Apples ecosystem doesn't allow one off their hook creating the oft quoted statement that "Once you go Mac (Apple) you never go back!". Disagree? Tell me what percentage of Mac users ever change to Windows or anything else, right approximately ZERO. When it comes to how many leave the iPod ecosystem once they have an iPod, right ZERO! Same thing for iPhones nobody is willing to let go of their applications and usability. Compare your arguments with the past eight years of the iPod where the features were far more limited and the ecosystem just starting to grow. Jobs and co are not thinking NOW they are twenty moves down the road far beyond where any shallow and stupid thinkers are today. Thats why Apple rolls out the next great thing each time some idiot like Ballmer mouths off shooting his puck at where the net appeared to be three years ago. Deep thinkers like Ballmer and are a Jobs delight. They have the good sense to laugh privately because deep thinkers can be hired even by the lower primates with money but to put together their whole system is likely beyond their conceptual much less practical abilities.
Once your in the Apple ecosystem you simply don't WANT to get out and in fact would fight to STAY in. Now Apple is readying to add another leg to their many legged stool to keep all the brighter or at least self aware people in their ecosystem. We all know what we want when we lose it few know it before they have it and it's rare that any know what others want before it is conceived of. Jobs knows what you will want after each of his next twenty moves and has alternate paths for each eventuality. Thats what makes his job fun. Thats why he only hires the cream of the crop and they rarely leave this creative environment that is so satisfying.
Apples ecosystem is the elephant in the room that the dull and stupid don't see but the part that everyone recognizes they are unwilling to give up at any cost once they're in it. A few stray temporarily because they have no insight into themselves nor anything technology related but people like YOU Bruce are rare as are the truly ignorant.
It's not a fad when your product has the highest customer experience rating on the planet, no matter who conducts the survey! When you go to a mall with an Apple store, look around. The other stores are dead...Apple is buzzing with sales and excitement. It's not the hype, it's the stuff which feels and works intuitively (and easily) like nothing else does.
The app store makes the iPhone an all in one computer that fits in your pocket.
"And exactly how am I supposed to move my thousands of hours of music and photos and videos from my iPhone to an Android phone?"
Personnally I can't possibly understand why anyone other than an Apple investor who doesn't use their products would ever see this as a good thing.
Comments like this are what lead people to believe Apple is a marketing company. You've been led to believe that being forced to stay with Apple (even if you would choose to do so regardless) is a good thing. I'll just never understand.
You could seamlessly get music from any PC onto any MP3 player and back again, yet somehow being prevented from uploading music from your iPod onto your work computer or your friend's laptop became a good thing. Apple can't keep doing this forever. People are sheep but only to a certain extent.
Only CGP, jpan and a few others show a semblance of additional balance and insight. I said with the first iPhone that Apple might not understand the mobile industry (far more dynamic and innovative than PCs and music players, with the added factor of cellco hegemony) and could take years to catch up on 'mobile' technology (just as Palm and RIM before it struggled for years with GSM and 3G), and don't yet yet see reason to change this view.
Apple has eclipsed RIM (now stalled and probably set for imminent decline), but has no obvious ammunition to ward of Android. App Store is a distraction -- very important to iPhone as a handheld computer (its strength), but irrelevant to Apple or mobile industry in revenue terms, and potentially easy to replicate if the small group of key App developers port elsewhere (already happening seriously, I think).
Most of the comments seem to assume iPhone has won and is dominant, seemingly oblivious to facts that the opine has <20% smartphone market share (Nokia still far bigger, and MS/RIM nearby), sub-2% handset share (ever heard of the world beyond the US, and it's not all undeveloped?), and the real giants and kingmakers are the cellcos (and, nowadays, possibly also internet giants like Facebook, Twitter...and, oh yes, Google).
There are some hints that the iPhone 4 may be released soon, within a few months (rather than middle of next year), but not yet convinced nor yet expecting fireworks. If it happened, it could be a wise move for Apple, especially if it shows a lot more hardware and OS progress than did 3G to 3GS -- iPhone's are pretty poor hardware-wise, and telephony is mediocre, so rational consumers might be far better off getting an iPod Touch (the only thing holding up iPod sales these days) featuring most of the handheld computer pluses, and save 90% of the lifetime cost and 24-month lock-ins of 3GS....
By the way, I do have an iPhone, and very impressed with it as a handheld computer (where it deserves plaudits), but it sucks at the phone and hardware levels, and is murdered by the stunted O/S and control freakier, and is evolving far too slowly. Unless Apple pulls a few rabbits from its hat soon, the successor will be an Android, possibly third-gen, post-Droid, when vendors start to really differentiate the hardware and interfaces (and I'll have a Touch, to retain all that Apple's doing best). King of amazing how far Android has progressed in twelve months, and shows Apple up very badly in how little the iPhone has evolved in 2.5 years...mobile is currently a journey, not a destination...
To go from zero market share to any sliver represents a gain. Is that really so hard to accept?
The evolution of Android has only just begun. It's far too premature to declare a "winner" (if one is so compelled) one way or the other. Why not embrace competition, for the sake of the innovation of your own patently biased product of choice if for no other reason?
what came first ?
the apple iphone or its great apps ?
truth is; (by now)
google went the right way, a open operational system.
guess why they did it instead of pieace of hardware ?
yep.. you got the point.. in the OS world they will have people working for them. and if the geeks and professional developers do fall in love for google OS just like they did for apples iphone, damn.. then apple is in trouble, because they will start developing and porting all its apps for android.
both apple and google have a big advantage over microsoft(windows mobile) and symbian, called FETISHISM.
for some wierd fucking reason(acctually, for the same reason you root for the losing team when watching any game), all uber geeks out there, love google, love apple.
if android peaks up(it becomes trendy) YES. IT DOES POSES A THREAT TO APPLE.
all apple fanboys here, I am sorry, but that is the fact.
another advantage is the hardware.
its notourious, how ANY SMARTPHONE. is superior in resources to iphone. iphone doesnt have decent camera, doest have flash, its slow, extremely limited, though, its fashion, trendy and has tons of apps.. so we go back to the egg/chicken question..
#1 can other co. make their phones a trendy ? - yes, motorola and its razor have already proved that.
#2 if android apps peak up.. - yes again. apple is f** up!
#3 the most ridiculous argument i read here was: iphone will never be out-trended. HAHAHA COME ON, DO ME A FAVOR. so, basically, you are assuming IPHONE, IS THE ULTIMATE DEVICE. nothing else will ever come to replace it.
haha ohh boy.. ok ok, keep believing this.
LAT BUT NOT LEAST: right now, forget the iphone, or any other phone, focus on WIMAX vs LTE and the CARRIERS.
they are where you are going to make money.
with that said.
good luck to all.
android-fan-boys
apple-fan-boys
and money-fan-boys (i am located on this bandwagon)
1. What will happen when a Droid user is on a call with her boss or a very important client and need to check something on the company's web site. As I understand it, she will have to terminate the call in order to get the information, as Verizon's CDMA network cannot handle voice and data simultaneously. Will her boss be pleased? Will the client stick with her? In both cases, her own choice led to the difficulty. (The one person I know who bought a Pre is ready to ditch it and get another phone--probably an iPhone--for this very reason.)
2. What will happen when the first virus strikes Android phones? "Open source" could equate to "virus heaven." Combine that with little or no control of applications and there may be a major disaster just waiting to happen. It could make the problems with the Sidekick look benign.
3. What will happen if the Android phones start crashing because of poorly-designed apps, as well as malware? The Treo was plagued by "problem" applications that could crash the phone, even if they weren't "viruses." ("Multitasking" in the sense that Android uses it could make the probability of crashing higher.)
4. One reason that Verizon seems to have the "better" network may be that they don't have to support the data load that ATT does. Will their system stand up to a much greater data load?
Based on hype factor alone (which may, but won't necessarily turn into a market changing event), this could significantly change the market- but not in a Apple vs. Google way.
Yesterday, the market consisted of Apple and everyone else. Today, the market consists of Apple, Android, and everyone else. This affects the "everyone else" category much more than it affects Apple.
Anyway, Thanks Bruce for the historical look back. It does seem similar in some ways, doesn't it? While history repeats, it's never quite the same river again. My guess is that Apple is facing a big risk of its commitment to supply hardware with it's brand on it costing it some business here. Android is open while MSDOS was not. But the world has changed. Google isn't IBM. There was no Apache or GPL licensed code in the 80's. We shall see.
1) design a lifestyle product - iPhone has done this
2) design the relationship between mobile device, home computer, internet where by the user is "syncronized". Apple has done this, and for most parts Google has done this.
there are other points, such as ability to customize the device for your own tastes and needs (eg business/enterprise or personal use)...
the lifestyle product always wins, the difficulty is to maintain that desire. Apple does it better than the rest. And I myself hope that it continues. Within the last 6 months I've converted to a complete Apple world... and my life became easier for some reason. This lifestyle set of products actually made my lifestyle even easier... Its what people want.