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« Its Now Official, Nokia Shareholders Approved the Deal | Main | So Previewing Smartphone Bloodbath Year 5: Who Is Still Left Alive »

November 20, 2013

Comments

RottenApple

@Leebase:

If you want to downplay Android and praise WP, at least be consistent!

Most of WP's growth is in the same low end segment which you are downplaying for Android.

So low end growth for WP is good but low end growth for Android is irrelevant? Sorry, but that's just twisting numbers to fit your story, not the story told by the numbers.

E.Casais

"Apple is spreading the practice of phone subsidies."

Hem, no. That practice existed long before Apple came with the iPhone. Besides, this practice only works for high-income market segments, and is the only way Apple can truly distribute its devices: iPhones are sold to operators, that have to commit buying specific quantities of them. We should never forget how special (and shrewd) Apple's business model is.

"25 countries WP outsells the iPhone."

A very strange measure, since it is the Lumia 520, the lowest end WP model in the Nokia range, which is selling. And the comparison between iPhone and low-end has already been dismissed as irrelevant: "Apple will NOT do anything to compete with the bottom of the market which is where the growth is coming from."

"I think HTC has a much brighter future than Blackberry."

I would rather say that HTC has a somewhat less dark future than Blackberry.

It is quite surprising how fast HTC dropped. The firm was the darling up-and-coming smartphone vendor that had adopted the supposedly "right" recipe of betting on Android -- and is now fighting for survival.

In truth, HTC devices had always been dubiously engineered; I cannot think of any other smartphone vendor whose products have been so frequently affected by overheating problems. This must have contributed to the backlash on the market.

John Fischer

The real comparison won't be happening anytime soon around here, the real numbers are a bit different.

Compare the last 2 versions of android against the last 2 of iOS, forget the rest. Dead dinosaurs

Compare iphone 5s to its real competitors, stop including "get one free android phone if you buy 2 rolls of toilet paper"

Apple only competes in one segment, it would be really interesting to see the numbers if properly segmented, i guess is too difficult to get data out of samsung.

Comparing iOS7 to android 2.0 makes no sense or to any forked version in china

Comparing 5s to low end 50 us$ phones makes no sense

Comparing Porsche Macan to Kia cee'd makes no sense

Not recognising WP is growing and not dying as predicted makes no sense

RottenApple

@John Fischer:

Your post also makes no sense. This is the same selective numbers picking that some of the more annoying posters here are notorious for.

Either a smartphone is a smartphone, then all numbers need to be seen as one market, or the low end is irrelevant, then you also must ignore low end numbers that fit your agenda (e.g. WP 'growth' - which to me looks more like stuffing the channel below cost. Here's one bit of warning: Nokia could get away with it. Microsoft with all their money behind it will be far more closely watched!)

It's also quite nonsensical to view Apple as '5s only'. A significant quantity of Apple sales are lower spec versions, so please exclude those as well!


@E. Casais:

"In truth, HTC devices had always been dubiously engineered; I cannot think of any other smartphone vendor whose products have been so frequently affected by overheating problems. This must have contributed to the backlash on the market."

Sounds right. For all the praise the HTC One got for its design, it got severely trashed for being the 'least repairable phone ever'. Maybe it's just that most people look for more practical values in their phone aside from 'nice looking'...? I know, for me an SD card slot is important, as is a replaceable battery. HTC skipped on both.

Thomas

So we now have a market where, broadly speaking, the software is free and branded and provided by the US west coast, while the hardware is cheap and branded and sold by Asians. Sic transit gloria europa, but the next stage of the game looks about to begin.

E.Casais

@RottenApple

Everything you say jibes. Cool design is (for whatever reason) associated to ultra-thin devices, which HTC liked to produce. To achieve ultra-thin cases, sacrificing removable battery snaps and microSD cards is one easy way to go. It also implies tightly packing electronics together -- which makes heat dissipation more difficult. And if electronics are not well balanced, then some components will run at maximum rate in order to keep up with performance requirements -- generating even more heat. After a bit more than one year of being constantly submitted to thermal stress, your nice-looking but less than ideally practical device dies and a repair is too difficult (hence expensive).

Does anybody remember when HTC was the king of Windows Mobile smartphones and PDAs? Those devices looked cool too, but they never had exactly a stellar reputation.

E.Casais

"broadly speaking, the software is free"

What? Neither WP nor iOS are free. And the discussion showed that Android cannot be construed as free either. On the PC, neither Windows nor OSX are free. Only linux is -- but it cannot be construed as coming from the "US West Coast".

"the next stage of the game looks about to begin."

Meaning what?


Thomas

Broadly speaking, the OS market is now dominated by Android, which is free. It looks like the only competitor iOS will become increasingly niche, Mercedes-style. I think WP can be ignored as a rounding error. The PC market is not germane.

The next stage of the game is about to begin because what we might call the Pacific situation doesn't look like an equilibrium either.

RottenApple

@Leebase:

"You have six more months of "Apple is breaking records" before you can return to your regularly scheduled "Apple sales declining" for the two following quarters. It's a yearly cycle. Each year better than the last. Except in "smartphone market share"."

You are again ignoring that Tomi uses a 4 quarter moving average to come to this conclusion. Apple's growth in absolute numbers is slowing down. So I have my doubts about 'ever growing'. If growth slows down it'll go down to zero eventually. Right now Apple still has the advantage to flood a few previously untapped markets but once these are done, we'll see.

Pekka Perkeles

"This quarter we will see Apple sell more phones than anyone but Samsung and Nokia....more mobile phones including feature phones. 3rd largest mobile phone company in the world. Who would have guessed that when the iPhone was introduced? Get ready to see world record making sales revenue and world record setting profits."

Someone may wonder why all this would or could happen without iPhone Mini.

Haha?

Winter

@Leebase
"What next? Watch India's response to subsidized iPhones."

Only some 30 million Indians (3.1%) owns a laptop with Internet. The "middle class" in India is people who spend between $2-$20 per day. In short, the average middle class Indian is not your typical iPhone buyer.

It is a nice market for the iPhone, but not a global market share breakthrough.

http://www.dailymail.co.uk/indiahome/indianews/article-2327182/The-myth-great-Indian-Middle-class-Roughly-30-Indias-population-lives-poverty-line.html

Winter

@Leebase
"China is just as poor...and just as rich."

No, the Chinese are quite a lot richer than the Indians.

http://www.ey.com/GL/en/Issues/Driving-growth/Middle-class-growth-in-emerging-markets---China-and-India-tomorrow-s-middle-classes

AndThisWillBeToo

@Pekka Perkeles
You clearly have not followed Tomi at all. He told already in 2007 that Apple needs to go to lower price points if they plan to be profitable.

and yes, haha.

N9

I am still curious about your opinion about Blackberry. While sales of the new devices have been described as a complete desaster, at least according to statcounter (gs.statcounter.com) they seem to have stopped the erosion of their user base - even gaining a lot of users in the US. And does anybody know what is meant with the Linux graph which appears if you select China and mobile OS?

E.Casais

"They probably can do that now. An iPhone 4 in a plastic body with non-retina screen can probably already be made and sold for $200 brand new and still run all the apps."

That I strongly doubt. A firm that has been designing, producing, and distributing high-price, high-margin products since the very beginning is simply not organized to deal with genuinely low-cost, low-price products. It would most probably fail at it because

1) It does not like it: this means forgoing high-margins and all the lavish development resources it can devote to its activities.

2) It does not want it: low-cost -- and for phones this means less than $200 new and unlocked -- means competing directly with the Huawei and ZTE of the world, not having operators committing to buy loads of devices, and having a much more difficult time touting some unique selling proposition.

3) It does not know how to do it: forget about those fancy designs, custom materials, special-purpose machine-tools just to implement unique designs, and top-of-the-line lavish electronics. Do not think for a second that "all apps will work" without considerable exertions from the software side; do you really think that a full-fledged iOS and current versions of apps can run unchanged and smoothly on some low-end CPU&GPU with restricted RAM, slowest 3G&WLAN, and limited flash memory? And forget about upscale Apple stores with genius bars for low-cost devices.

Refurbishing a three-years old design is a nice tactic, but then the original BOM for the iPhone 4 was estimated at $187.51 (for iPhone 5* it is $199), and even after shaving some costs (the retina display itself was $28.50) it will have to cover other expenses such as development, marketing, distribution, etc, and compete with _modern_ devices such as the Motorola G (at $179) or the Lumia 520 (at $155). Scaling down works only to some extent -- to truly cut costs, you must design for low-cost right from the beginning (which is still a competence of Nokia, for better and for worse).

No, Apple is simply not organized for the low-cost. It actually never was.

It is companies that live by doing low-end that move upmarket. The converse is quite rare, because it is so difficult.

Tomi can clamour for a low-cost iPhone -- it will not happen.

N9

@LeeBase
Statcounter. But I don't know what they are measuring exactly (web traffic presumably). I just found it interesting.

Winter

@Leebase
"Just like Google is really about selling ads, the iPhone is really about selling data services and long term contracts"

But these are going the way of the Dodo. Telecom is going towards more competition and lower margins.

RottenApple

@Baron95:

I can tell you where those 200000 apps come from: Massive bribes (a.k.a. 'sponsoring') by Microsoft to develop apps for the system.

I know because the company I work for just made such a deal itself. So we get covered:

- all development costs for the app
- a 5 year subscription to MSDN for free, including access to all development tools and Windows versions for that time.

No good businessperson can refuse such an offer. Without that deal our interest would have been rather low.
But so, we are guaranteed to get our investment back and learn at the same time to develop for yet another platform. Whether the app becomes successful is irrelevant for us. It's a no-risk deal as long as we deliver the finished product.

You see, the iOS and Android app ecosystems are self sustaining. WP, just like on the hardware side, only lives because Microsoft is pumping insane amounts of money into it to keep it alive. But yet again, this well known fact is conveniently ignored to make a point that has no merit.

It's also quite irrelevant that WP is faster growing than iOS and Android in their infancy. Back then this was a new market. This still has to be compared with the competitor's state today, not 4 or 5 years ago.

Last but not least, how does this work with your claim that low end users don't participate in the app ecosystem?`WP is primarily a low end platform so since there's interest in apps it can't possibly be that low end users don't use their smartphone as a smartphone. So many, many thanks for proving your main arguing point against Android wrong.

N9

@Baron95
So instagram finally arrived for Windows Phone. Only it is missing essential functionality. Did Microsoft not pay enough?

Spawn

BB10, SailfishOS and Tizen run Android apps. That's the point: Android, its APIs amd frameworks, are all open source, can be easily integrated, define the standards cause they are de facto standard.

The only ones fighting that are iOS and Microsoft and they lost there "war of ecosystems" (as Elop, the call me the 21 million General Failure, named it). Its past, its done.

And while past and future success of the Android ecosystem accelerates and expands far beyond Smartphones and Tablets those that try to fight rather then accept, incoperate and uild up on are those hit most. Looking at you Microsoft. Its going to be a very hard time next years. Elop's public statements to shutdown bing and xbox are only the first visible cuts. Everything that isn't profitable but eats billions of Microsoft $ will be killed. Guess in whay category Windows Phone, Surface, RT are?

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    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Hong Kong but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

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