Linked by David Adams on Tue 25th May 2010 04:07 UTC
PDAs, Cellphones, Wireless Over at Daringfireball this past weekend, John Gruber put words to what many people are thinking about after Google's rush of Android announcements and not-subtle Apple-bashing at this week's I/O conference: "all-out war." I agree with Gruber that a good old-fashioned bitter rivalry could be a great thing for the computing world, and for smartphone/handheld fans in particular.
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tylerdurden
Member since:
2009-03-17

Google approach is the anti-apple, and it makes sense... if you try to be like your competitor, you lose if that competitor is established and is large enough. And apple is indeed the 800lb gorilla in the US smart phone market.

Google doesn't want the US market, if they can beat Apple in the rest of the markets. And other markets favor the diverse-yet-from-the-same-source approach of google. Which was similar to what MS did for the desktop over 2 decades ago. MS wasn't concerned on the HW as much as they were in making sure PCs with all sorts of configurations, sizes, and speeds... were running a copy of a Microsoft OS.

Google's model was to give the OS for free, something MS is not capable of doing, since Microsoft's culture simply doesn't allow/support it. Google makes the money in the cloud, which where their traditional revenue comes from. So in a sense they beat MS at their own game, in the mobile space... which was probably their initial goal. Apple's vertically integrated approach is simply not as scalable. But Apple's culture is more focused on profit margins than in massive user bases.

So chances are there will be two established players in the mobile space: Apple for the boutique/upper scale customers. And Android for everyone else. The rest of the world cares first about price, and they have no problem putting up with the annoyances that American customers may feel insufferable. So Android does not look as polished, and using it doesn;t make you shit rainbows.... but the rest of the world doesn't care that much. It is after all a phone, and their purchasing power is smaller, so they have other things to worry their minds with.

Apple will make their revenue from apps and media content they can distribute and control. Whereas google will probably get money the way they always do: via advertisement. I wonder what players which depend on content revenue, like amazon, will pan out on this scenario. And probably Microsoft will be squeezed out of this market, since they are too late and can't really compete unless they really get traction with their mobile office as their main value proposition (since the missed the boat on content delivery, and/or advertisement revenue). It would be interesting seeing MS being so tied to the fate of the desktop they so dominated, in a karmik sort of way.

Edited 2010-05-25 08:58 UTC

Reply Parent Score: 5

spiderman Member since:
2008-10-23


So chances are there will be two established players in the mobile space: Apple for the boutique/upper scale customers. And Android for everyone else. The rest of the world cares first about price, and they have no problem putting up with the annoyances that American customers may feel insufferable. So Android does not look as polished, and using it doesn;t make you shit rainbows.... but the rest of the world doesn't care that much. It is after all a phone, and their purchasing power is smaller, so they have other things to worry their minds with.
Actually the rest of the world doesn't care much about Android or Apple. The purchasing power is actually higher when it comes to mobile phones in Europe and Asia. They have more models, better plans and they can use whatever carrier they want with their mobile since they all use GSM. Mobile phones are throwable objects. People get bored really fast. That is why they change it every year.

Edited 2010-05-25 09:14 UTC

Reply Parent Score: 3

tylerdurden Member since:
2009-03-17

"Purchasing Power" and "Product/Market Choice" are two very different things. Also I am talking about the smart phone market, not the throwaway plain cell phone market. Two very different spaces in cost and user/carrier behavior.

Edited 2010-05-25 18:46 UTC

Reply Parent Score: 2

nt_jerkface Member since:
2009-08-26


Google's model was to give the OS for free, something MS is not capable of doing, since Microsoft's culture simply doesn't allow/support it.


MS can charge 10 or 20 dollars for the OS and make additional revenue from content sales. If forced I think they would give their OS away then allow more market to go to Google or Apple. They had no problem taking a loss on the Xbox for years.

Reply Parent Score: 2

tylerdurden Member since:
2009-03-17

And if my grandma had balls I would have called her grandpa.

I am not talking about what Microsoft may do, I mean... technically they could make the bestest OS ever, give it for free, and include a week long vacation in a Tahitian resort. Sure that could happen, everything and anything could happen. But I am referring to stuff based on reality.

It is about what they have done and are doing. Which is why I referred to their cultural inability to do "Free." Even when the XBOX was sold at a loss, they never gave anything for free. The closest they have gotten to giving anything for free is the MSDN freebies for students. And even then it took them forever to get their act together in that regard.

Microsoft's model has always been about licenses first and foremost. They can't cope too well with different models, i.e. the Zune is still a distant second fiddle to iTunes.

Microsoft missed the boat big time with the mobile space. Once OEMs have Android for free, MS has to try very hard to justify enough of a value proposition to force them to push more expensive products due to the licensing overhead of windows mobile.

The ironic thing is that Windows mobile has been in the market for eons longer than almost any other phone OS out there today (esp. Android and iPhone OS). I think the problem is that MS never understood that OS licensing is a no go in such a cost conscious space as the mobile device one... when there are free alternatives which are as good (android), or vertically integrated alternatives with a much better user experience (iPhone OS + iTunes + App Store). Microsoft probably thought the same model that brought them dominance in the desktop would work in the phone market. However, without the same massive user base and market inertia... they are forced to compete in a level playing field, and there is where their weakness becomes too obvious.

But then again, I am not in charge of a multi billion dollar company. So who knows, maybe the new Windows Phone or whatever it is called may actually manage to get some traction.

Reply Parent Score: 2

WaltFrench Member since:
2010-05-25

“… Apple's culture is more focused on profit margins than in massive user bases.”

That was true before Jobs came back to Apple. He explicitly criticized the “obscene” 1995-timeframe profit margins on the Mac in a 2004 interview, when the Mac finally faced decent competition with Win95.

There's every indication that Apple is in this fight to take home a majority share of smartphone users. All of its attention is focused on the Android alliance as its only real competitor.

Your insight was true… a decade ago. Today, not at all.

Reply Parent Score: 2

tylerdurden Member since:
2009-03-17

I suggest, you check on the actual sales numbers and the actual profit margins for each apple product.

Reply Parent Score: 2

Shannara Member since:
2005-07-06

Yeah, but as true to Jobs, he's nothing but a POS. As it stands, you are lucky to believe one word of ten out of his mouth.

Reply Parent Score: 1

Neolander Member since:
2010-03-08

“… Apple's culture is more focused on profit margins than in massive user bases.”

That was true before Jobs came back to Apple. He explicitly criticized the “obscene” 1995-timeframe profit margins on the Mac in a 2004 interview, when the Mac finally faced decent competition with Win95.

Err... No. Really, no. 650€ is the price of an high-end fridge, that is a rather long-lived device where exigences about user safety and hygiene are quite high. Are you really telling me that a bunch of common electronic components (each only guaranteed to last one year and costing a few cents, expect the processor, the screen, and the battery which cost maybe 20 dollars each to make), put together using CMS soldering techniques (add up one dollar), and packed in a shiny box with 4 buttons, costs, say, a third of that ? And that the rest goes into salaries ?

Margins are still insane in the Apple world. Especially since they rely on carriers to sell their device at a normal price together with a Midas-priced plan, and don't sell any kind of lower-end device to accommodate the need of most people who don't need the third of what an iPhone could possibly do.

And they will lose just like when they faced Microsoft, by forgetting why the MacBook currently sells so well among students while iBook sells where nonexistent at best...

Edited 2010-05-25 21:19 UTC

Reply Parent Score: 1