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It's not about the phone, it's about the platform

Rhonen

Well-Known Member
Jun 8, 2010
101
12
Communities Dominate Brands: Understanding Smartphone Market Share? Battle not for phones, is for platform!

Couldn't find this in a forum search, but I found it from comments regarding Android outselling the iphone.

As I understand it, this blog is by an ex-Nokia exec. His take, Nokia owns the cellphone market. That market, combined, sold 1.3 BILLION phones last year. Smartphones were a drop in the bucket at 175 Million.

But smartphones will eventually become a majority and Nokia has a good head start on smartphones since most dumbphones and a lot of smartphones are Nokia/Symbian. I think he took a lot of heat over the iphone. While he feels it's the best smartphone atm on the market, he doesn't think Apple is a contender in a platform war. Neither are Blackberry or Palm.

He sees MeeGo (Symbian), Android, Samsung's Bada, and WinMo7 as contenders for the platform war. Makes all this smartphone epeen waving a lot more epic. :p
 
Platform? Then there are only 2: Apple vs android. Because it's not just phones but also tablets, netbooks, google TV, Android built into your refrigerator door so that you can schedule calendar events for the entire family...
Read the article, he talks about ipads and ipod touch. Both are still made by Apple, a single manufacturer. They'll remain niche like Macs are niche. They aren't actually a player in determining the dominant smartphone platform.
 
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But Apple has thousands of apps. Many are apps that we would want. Nokia has failed to deliver on killer apps for the symbian/maemo/meego/whatever OS they are using these days. PalmOS and WinMo also have lots of good apps but webos and WP7 removed compatibility thus killing off the platform.
 
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I'm very curious how Nokia will be able to stay dominant. Worldwide, they still are the smartphone leader in terms of market share. They are also the worldwide dumb phone market share leader. They need to convert as many of their dumb phone customers into smart phone customers.

Despite Apple's app store lead over the competition, it hasn't slowed down Android from gaining share at a faster rate than iphone. From the article, the key is carrier partnerships and handset manufacturers. Iphone is made by only 1 manufacturer - Apple, and in many markets, is only available on one carrier. For a niche phone, it works.

But this is about platform dominance in smartphones. There is no way iOS can ever dominate worldwide because they aren't made by enough manufacturers and aren't available on enough carriers. The App store won't help with that. It's just not going to happen, lets say, for everyone in America to drop their phone, drop their carrier, and all get iphones on AT&T because of Apple's apps.

What will happen is as phones get cheaper, everyone will just make smartphones instead of dumb phones - dumb phones used to be black/white screens until color screens got cheaper. dumb phones used to only make phone calls, now they play mp3's, text, take pictures. So when smartphones become the new dumb phones, they'll need an OS that is manufacturer and carrier independent. That looks to be Android, Win7, or MeeGo. Unless Apple starts licensing iOS, but I doubt that will ever happen.

It doesn't mean iphone will die. They'll just stay niche.
 
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I don't think Apple wanted to be niche. I think they were tired of being on the bottom with the Mac and iPhone would set things right this time. They weren't interested in making dumbphones for 'everyone' but they wanted to dominate the high end smartphone market.
When they first saw android, they probably thought of it as yet another mobile linux that would end up on cheap phones for the bargain bin but they didn't expect Verizon and google to be so aggressive at the high end.
 
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Apple traditionally has a market of people who want to make a statement and be seen with the cool stuff, as well as early adopters who embrace new technology. Macs were seen as a bit geeky, but the iPod took Apple's brand mainstream. People liked the simplicity and the iPhone captured a market - despite lacking features packaged badly elsewhere.

The Apple brand meant networks were desperate to get the iPhone. O2 in the UK sold its soul to get it, while networks waived all product/type testing in order to get the iPhone. Some handsets can be 'tested' by an operator for months, but Apple only showed networks the iPhone a week or so before release. If any other manufacturer did that, they'd be laughed out of the building.

Take Motorola, who got back into the game with Android but, besides Orange, nobody in the UK was willing to take on the handsets - so they had to go down the SIM-only route instead. When I met Motorola in Barcelona at Mobile World Congress, they told me that operators expect to be told what's happening 12-18 months in advance, and they'll order devices during that time. Only Apple can come along and sell on THEIR terms, especially when they're so bad.

Despite being desperate to have the iPhone, what network actually makes good money from having it? Tiny margins, no commission to sales staff.. it's the phone you want to sell for the 'halo' effect, but really - you'd really want them to buy something else. Here in the UK, Android is being pushed heavily - and a lot of the success of any platform will come down to how retailers and phone dealers promote and recommend.

But, despite all that, Apple has profit margins that all of the other manufacturers would kill for. They'd give up a sizeable percentage of marketshare to make the money per box that Apple does. Nokia shifts huge quantities, but the margins are shocking. They also have distribution arrangements all over the place, with stock being shunted all over the world and quickly devalued to the point where even a flagship device is selling for peanuts.

Besides retailers pushing the likes of Android, while selling an iPhone to those who come in and ask for one and aren't interested in anything else, developers are clearly choosing a minimal set of platforms. Android, iPhone/iOS and RIM. Even Microsoft will not get loads of support, and I've long given up on WebOS and Symbian.

Bada is highly unlikely to work, and given Vodafone has ditched it's variant LiMo OS for Vodafone 360, which Samsung helped develop to create Bada, kind of proves my point.

Android is expanding to be more than just mobile phones. iOS is also doing the same. The market can stand both very easily, and Apple needn't go for world domination.

One thing though; I want Apple to continue to be successful. Whatever any anti-Apple person might say, they need Apple to innovate and move the industry along. Tablets have been around for years, but suddenly the iPad has made everyone want to release a tablet and market in a totally new way. Apple made that happen. Just like they did with the iPod, as Sony didn't seem to have a clue on what to do with its Walkman brand before.
 
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I don't think Apple wanted to be niche. I think they were tired of being on the bottom with the Mac and iPhone would set things right this time. They weren't interested in making dumbphones for 'everyone' but they wanted to dominate the high end smartphone market.
When they first saw android, they probably thought of it as yet another mobile linux that would end up on cheap phones for the bargain bin but they didn't expect Verizon and google to be so aggressive at the high end.
I don't think apple wanted to be niche, either. But I also think they realize their strategy - going for quality and a proprietary format - is not conducive to majority market share, either.
YouTube - Steve Jobs want to sell 10M iPhone in 2008
Here, Jobs says he's going for 1% market share of ALL phones, not just smartphones. They want to be a premium brand product, not a phone for everyone brand. 10 Million out of 1Billion is niche market strategy, niche market numbers.

Eric Schmidt: We Could Get $10 Billion Annually From Android
Here, Schmidt is looking for a BILLION people market share. That is majority share thinking, that is a phone for everyone brand. It shows since Android is available to all manufacturers and all carriers.
 
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The question is, who makes the most money at the end of it. Apple can probably make more with far less marketshare, which keeps the brand up there with the likes of BMW, Audi, Mercedes etc.

Actually, the iPhone has become very mainstream now - but that's probably because iPhone users are using apps, watching movies and showing off their device. Statistically, they're still in the minority - yet go on any train, plane or bar/restaurant in any city that has the iPhone and you'll think everyone has one. While some people like to have some individuality, many others will see everyone seems to have an iPhone and feel it's obligatory to join in on the party.

I think Apple is doing everything right, and other manufacturers would probably love to be able to develop fewer devices every year and concentrate on one or two - like the very early days of cellular when Nokia released a single handset or two in a year.

Apple is annoying me for Steve's arrogance about iOS and of course the handling of the 'Antennagate' saga.

I can't wait until Nokia finally adopts Android and then migrates its many services over as differentiators. They'll do exceptionally well I think. They can design nice looking handsets, have all the distribution channels set up, and employ some very talented people who must be so gutted that they're held back by the constant delays on Symbian (with Symbian 3 only catching up, not going forward) and MeeGo that is, in my opinion, never going to take off however clever it is.
 
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I can't wait until Nokia finally adopts Android and then migrates its many services over as differentiators. They'll do exceptionally well I think. They can design nice looking handsets, have all the distribution channels set up, and employ some very talented people who must be so gutted that they're held back by the constant delays on Symbian (with Symbian 3 only catching up, not going forward) and MeeGo that is, in my opinion, never going to take off however clever it is.

I would absolutely love it if Nokia made Android based phones. Their phones are freaking amazing to me, tho a bit on the higher price range. But sadly I think they invested too much in Symbian to abandon ship yet.
 
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Then what is this deal with Facetime? Video calling on just the iPhone is pretty much a joke unless everyone has one.

Facetime is suppose to be an open protocol. That is what was told at WWWDC.
Just like bonjour and webkit, they will open up the protocol for others to use.
It uses standard codecs and protocols in a wrapper. And just like DAAP, you will see Linux distros and apps incorporating it.
 
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Facetime is suppose to be an open protocol. That is what was told at WWWDC.
Just like bonjour and webkit, they will open up the protocol for others to use.
It uses standard codecs and protocols in a wrapper. And just like DAAP, you will see Linux distros and apps incorporating it.
So it only works iphone to iphone because they are the only phones with that protocol right now? Has any other handset manufacturers expressed interest in developing it for other phones?
 
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