Seeking Alpha

davel

davel
Send Message
View as an RSS Feed
View davel's Comments BY TICKER:
Latest  |  Highest rated
  • Apple: Winning The Profit Battle, Losing The Smartphone War [View article]
    All androids are not the same.

    The millions of androids sold in China do not equal the androids sold in the USA. It is not a homogeneous market.
    Jan 29, 2015. 10:45 PM | 1 Like Like |Link to Comment
  • Apple: Winning The Profit Battle, Losing The Smartphone War [View article]

    I think the problem with Android is consistency. The software is not the same do to who you purchase the phone from and the hardware is not the same which limits what you can do. Google has solved the problem on their end with their software stack, so while you can enjoy the latest Google maps features on your phone the way it plays out may or may not work for you, or the hardware support may not be there.

    The point is there is fragmentation depending on what you are doing. The other point is these are pocket computers. As such Apple compels it's user base to upgrade frequently to maintain the experience. The carrot is the new features like Apple Pay.

    So yes for many features perhaps a low end android phone is good enough but is it really? There are probably many more places that sell cheap coffee than there are Starbucks, but starbucks makes the money. Does this mean stRbucks has been marginalized? Apple will never sell the most units. That is not their strategy. Apple keeps moving the needle and so for the next few years at least I do not see Android hurting Apple. In fact Google may decide to kill android and make it a software emulation on top of chrome.

    At the end of the day I am not persuaded. Everyone but Apple and Samsung lose money. How do you stay in business if you lose money? Samsung is getting killed because the Chinese are selling cheaper phones and Apple took away their one differentiator with the 6.

    Apple repeats the theme to developers every quarter how much money they make. They do this to make sure they get the message. You build for us first or only and you will make money. You build for them and you won't.

    Sure if you have enough volume you can make money selling ads for Google, but given the choice who are the developers writing for? The answer is still ios. Until that changes your thesis won't work.
    Jan 29, 2015. 10:44 PM | Likes Like |Link to Comment
  • How Will Windows 10 Impact PCs And Tablets? [View article]
    Yes. I agree. A tech company should not be run by someone who has no feel for technology. They don't have to be an engineer, but they do need to understand technology and why it is important.

    Steve Ballmer was a good operational manager. But he had no feel for technology. He completely missed the change in the landscape.

    When a similar thing happened to mr bill he did a week retreat and pivoted the company in one year to take out the competition.
    Jan 29, 2015. 09:17 PM | Likes Like |Link to Comment
  • Can Microsoft Innovate Profitably? [View article]
    AA

    Ok let's talk about this.

    You make two points.
    1) Apple is highly concentrated
    2) Microsoft is diversified

    How concentrated is Apple? The majority of their sales and profits come from one product, the phone. There are other large segments namely software sales, tablets, traditional pc's, but the company is built on the phone.

    They sold $9, 7, 4.5, 2.5 billions in categories other than the phone. Together that is almost what Microsoft sold in the quarter. So if their phone business went to zero they are almost as large a company as microsoft. My point is while they are concentrated they are still huge. But let us talk about risk. What is the likelihood that in the next few years someone knocks Apple off its perch? Not likely. Apple's biggest competitor in mobile is having huge problems staying profitable in mobile. Who is their competitor? I don't see it. Apple has 2 huge advantages in phones. Touch ID and Apple pay. No one else has this. No one is likely to have it any time soon. Apple took the company that provides the touch technology off the market precluding competition. In all likelihood Apple has no serious competition in high end phones over the next 2 years. They have the best ecosystem to support their devices. Their software is great. Over the past 7 years or so their phones have consistently beaten the competition in usability with what some consider to be substandard hardware. To wit, cache that is smaller than the competition, chips that don't clock as high, and yet in various usability benchmarks they score at the top of the lists. They have issues as others do, but nothing that will derail the train.

    Apple is focused on the consumer, they always have been.

    Microsoft. Yes. They are more diversified. The company for the past few decades has been built on 2 products. Windows and Office. Everything else is secondary. Without office there is no windows. Without windows there is no office. The problem is this monopoly no longer matters. No one company killed this foundation. The web did. By the web I mean the Internet and the rise of SaaS. This shift has broken the chokehold Microsoft has had on consumers and the enterprise and allowed companies like Apple and Google to thrive. This shift in technologies has allowed the current situation to arise. Namely that people can hve access to their information without being tied to an OS or file system. Data is now available via an http call. So anyone can access it. This has created a fundamental shift that has forced Microsoft to give away what it used to charge $100's for.

    Microsoft is a big player in the cloud but the biggest player in the cloud platform is Amazon. Microsoft has many powerful assets at its disposal but the big cloud players seem to be using custom solutions. Amazon, Google, Facebook are known to design their own hardware to support their infrastructure. They use tools like Hadoop to manage their data. These building blocks have nothing to do with microsoft. Microsoft makes a lot of money but virtually all of it is dependent on Windows. With the waning influence of Windows their empire is in trouble. I am not saying they will go to zero, but like IBM which was once the 800 lb gorilla, Microsoft has significant headwinds to it remaining a powerful force and some would argue the force in technology.

    One more thing. Your last point was about the consumer. Microsoft has never catered to the consumer. Never. Their primary and really only customer in its history has been companies. Be they small, mdium or large companies or the programmers that work for them. Their focus has never been on the consumer. If you look at their products you will see this.
    Jan 29, 2015. 09:04 PM | Likes Like |Link to Comment
  • Apple: Winning The Profit Battle, Losing The Smartphone War [View article]
    Paolo

    You make some good points.

    Regardless of market size Apple monetized better. I know you know this. So while Android is larger, Apple is more profitable. Which markwt would you go after?

    The other issue I want to address is price. Yes, Apple focuses on the high end. However they also offer phones in the medium price point, so this is not an all or nothing strategy.

    At some point Android will be good enough, but with Apple Pay and the convenience of Touch ID is Android really there? I think Apple is continuing to add to its value proposition.

    While it is true that Android and Apple have met the same needs in different ways the near term will see both camps striking out in different ways. Apple is touting the IBM partnership. Samsung, Android's strongest player, is in a swoon. Motorola the last vendor to push medium types of phones crashed and burned. So far the good enough argument is not good enough.
    Jan 28, 2015. 11:19 PM | Likes Like |Link to Comment
  • Can Microsoft Innovate Profitably? [View article]
    Microsoft made 26.5b sales last qtr
    Ipad made 9b in sales alone.

    You seriously think microsoft is in a better position?
    Jan 28, 2015. 10:57 PM | 1 Like Like |Link to Comment
  • How Will Windows 10 Impact PCs And Tablets? [View article]
    Well if this is evolution early results indicate Microsoft is evolving to extinction.
    Jan 28, 2015. 10:48 PM | Likes Like |Link to Comment
  • How Will Windows 10 Impact PCs And Tablets? [View article]
    "you get a smooth transition into a more touch-friendly environment. As soon as you flip back or re-attach, you get a smooth transition back to a keyboard and mouse-friendly environment. "

    This kind of breaks the whole point of Windows 8 doesn't it? One interface for mobile and another for pc's. I don't know if win 10 or 11 or 12 will save microsoft.

    I am more interested if the company can grow revenues with subscriptions and how the company leverages its assets for the cloud.

    As far as I can tell mobile loses money for the company so the whole one OS thing doesn't matter.
    Jan 27, 2015. 07:18 PM | Likes Like |Link to Comment
  • Can Microsoft Innovate Profitably? [View article]
    You make a good point regarding moving its customers to a newer version of the software. However it also means that Microsoft doesn't feel they can charge for the OS anymore. This highlights where Microsoft is which is a company in transition trying to figure out how it can make money to fund its empire. It has great assets but the foundation of Windows and Office is broken.
    Jan 27, 2015. 07:12 PM | Likes Like |Link to Comment
  • Update: Microsoft's Q2 Earnings Show That The Transition Is Gaining Momentum [View article]
    10 m is a nice number. But the competition sells more.

    Apple sold 74m phones in the same quarter. Xiaomi sold 60m phones last year.

    It is nice that Lumia is gaining momentum, but the phones are mostly low/mid range phones. Typically not the type that make money. So longer term if microsoft can't make money selling devices will it wake up and kill the category?
    Jan 27, 2015. 06:57 PM | Likes Like |Link to Comment
  • Update: Microsoft's Q2 Earnings Show That The Transition Is Gaining Momentum [View article]
    Msft is in transition.

    From a $$ standpoint customers are paying subscription vs buying software. Microsoft hopes to upsell additional services, but this will take time and is not guaranteed.

    Consumer pc sales are still soft and will remain that way because the consumer has moved on. This is why tablet and phone sales are so important. Unfortunately consumers prefer other platforms which is a major issue for the company.

    Why is it that Microsoft introduced their touch enabled office product on iOS and then android before their own platform? That is where the users are. The company has no choice but to put its software on other platforms. It's a brave new world full of opportunity and risk.
    Jan 27, 2015. 06:46 PM | Likes Like |Link to Comment
  • Update: Microsoft's Q2 Earnings Show That The Transition Is Gaining Momentum [View article]
    You repeat the nonsensical surface 1.1 b.

    What does that mean? How many tablets were sold? How much profit or loss was attributed to this 1.1b figure. Microsoft hides these figures so you won't know. What is important is that segment was down y/y. Not a positive sign.
    Jan 26, 2015. 10:04 PM | 2 Likes Like |Link to Comment
  • Watch Out Apple: Here Comes Xiaomi, Microsoft Might Be Right Behind [View article]
    Mb

    Thanks. I did not know they made it out of the lab. And I know Apple got its idea of a wimp interface from Xerox.

    http://bit.ly/15Gr4Mn

    So why was this not successful? Was it a terrible computer?

    Not to pick but the article says it came out in 1985 while the Mac came out in 1984.

    Regardless of the reason why it or its predecessor did not make a dent, the Mac was a seminal computer and the iPhone was equally game changing
    Jan 24, 2015. 07:24 PM | Likes Like |Link to Comment
  • Watch Out Apple: Here Comes Xiaomi, Microsoft Might Be Right Behind [View article]
    @mike Blair

    To your point of Apple inventing things. It depends on the definition of invent. Few companies actually invent things. Most iterate off others works.

    Apple had a hand in the ARM architecture when PDA's were forming. It helped Acorn with some technology to push that chipset forward which of course became the chip that smartphones use today.

    The Mac was the first GUI based computer generally available. His set the pattern for computers for decades. It is the same model used by any windows 8 computer used today

    The iPhone was the second computer innovation Apple produced. They made computers truly available to the world. People who hve trouble using computers have no trouble with an iPhone or its clones. These are two seminal events in computer history that are truly groundbreaking.

    With the AppStore Apple has moved purchasing software from the retail store to a website. Has this been available before? Sure. But with the introduction of Apple's website the death of app cd's in a store was rung.

    Apple Pay - while nfc and other payment systems have been around, notably Google Pay. No one cares. Apple's implementation of a payment method , ease of use and security is a game changer. It's popularity is helped by not cutting out the incumbant banks who are helping advertise its usefulness unlike Google's method which cuts the banks out.

    Itunes. By offering a price point of a dollar for purchased music tracks they stopped the rampant piracy of music even if the labels decry Apple for stealing their lunch. Pandora of course has disrupted this model but that does not negate Apple's influence on then sale of music.


    Please list 5 companies you feel are more innovative than Apple so we can discuss specifics. In fact why don't you pen an article on this subject?
    Jan 24, 2015. 10:27 AM | 1 Like Like |Link to Comment
  • Watch Out Apple: Here Comes Xiaomi, Microsoft Might Be Right Behind [View article]
    Mr Blair

    If what you say is true in China Apple sales if its phones should fall off a cliff because Xiaomi sells phones that are just as good for less.

    Let us see what happens in a few weeks.


    For your other points, Xiaomi has no ecosystem outside of China. Are its phones really as good? If so Apple is dead. If not Samsung is in trouble as it will have yet another company selling a good enough phone.

    You mention Android but forget that in China Google has no services so android does not mean the same as here.

    You mention price. Apple has solved the price problem for those who want its phones in a similar way to the USA. In China and India you don't have to pay the full price, but you pay in installments.

    Apple's biggest problem in these two countries is distribution.
    Jan 18, 2015. 12:28 PM | Likes Like |Link to Comment
COMMENTS STATS
3,515 Comments
2,577 Likes