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« Prepping for Q4 and Full Year Smartphone Stats. Some things to look out for | Main | Nokia HMD Comeback? First Year Finishes with 8.7 Million Smartphones Shipped and 1.0% Market Share by Year-End (Updated) »

February 01, 2018

Comments

Justunbelievable

Apple HomePod is another success for Apple.

"I am speechless. The HomePod actually sounds better than the KEF X300A. If you’re new to the Audiophile world, KEF is a very well respected and much loved speaker company. I actually deleted my very first measurements and re-checked everything because they were so good, I thought I’d made an error. Apple has managed to extract peak performance from a pint sized speaker, a feat that deserves a standing ovation. The HomePod is 100% an Audiophile grade Speaker."

https://www.reddit.com/r/audiophile/comments/7wwtqy/apple_homepod_the_audiophile_perspective/

This compined with the success of the Apple Watch, iPhone and other Apple products will draw more people in to the Apple Universe.

Per "wertigon" Ekström

@Justunbelievable:

Notice I said a conditional "if". The mighty holy roman empire was also invincible at one point, yet can you tell me why I'm speaking English instead of Latin today?

Jim Glue

Even counting "the rich" countries where Apple has a nice market share (though still the smaller one)...it is the size of Apple's market that matters...not how much "share" it has. 600M active users worldwide...that's a huge market. How big? Big enough to launch the Apple Watch all by itself. Big enough for iMessage and Facetime to have huge network effects. Big enough that the service revenue Apple gets would be a Fortune 100 company and one that is growing healthy double digits.

And that's not even based on the 600M number, but the "amount of those 600M that actively spend money on the ecosystem: apps, advertising, commerce, music, video, books and magazines". Not every Apple iPhone user is an active participant in the ecosystem. Let's imagine only half are. That "half" is a gigantic moneymaking opportunity...and not just for Apple, but for all of Apple's partners.

Android has 4 times the active install base...but even so, has a smaller economic pie to divide up among it's ecosystem partners. That may change. That SHOULD have changed long ago. But even if/when it does....that won't mean the money-to-be-made with the iOS ecosystem will just evaporate. The two ecosystems are well established and both would remain even if/when the top dog changes.

Android companies have been trying and failing to beat Apple at the profitable end of the market. They are actually losing ground, and have been for years. They have done EVERYTHING there is to do. Cheap, cheaper, cheapest. You can get an Android at any price point. And it's working for unit sales. It's just not changing the economic equation for ecosystem partners. Having more and more of the poorest people downloading your app for free doesn't benefit you economically WHEN advertisers aren't going to pay the same to reach those customers. Those customers actually COST you money.

In a future world where Apple stops pleasing it's customers, and Android manufacturers start offering a compelling alternative such that Apple starts to actually LOSE those valuable customers it has....THEN...we can talk about Apple being in trouble....is said state goes on and on and on.

Don't think so? Let's use the Google Home Max and the Apple HomePod sales as a weather vane. "Everyone" agrees that Google Assistant is far better than Siri. They are priced competitively with each other. Google has 4 times the install base to sell into. Home Max is compatible with all the major music ecosystems including Spotify. HomePod voice control is only integrated with AppleMusic/iTunes. Google Home Max was available for sale during the Christmas Holiday...HomePod was just released completely missing the major holiday selling season.

Google and Apple both have bajillions of dollars to market their respective speakers. Google doesn't have a chance in hell of selling it's Google Home Max in the volumes that Apple will well the HomePod. It won't even be close. 4 times the market to sell into won't matter when Apple has a FAR larger early adopter and willing/able to spend customer base.

ピコ太郎

Google revealed that its device shipments doubled in 2017 compared to 2016. According to Francisco Jeronimo, IDC's Research Director, Google shipped 3.9 million Pixels last year.

Essential Phone ships 88,000 units in 2017, according to the IDC.

ピコ太郎

@Jim Glue

While you're argument above is valid, you were arguing with the wrong reason, and wrong way to thinking. You were twisting a fact that iPhone, as the driving factor of Apple ecosystem is entering the declining period.

E.Casais

@ピコ太郎

Contra some commentators here who keep insisting on Pixel and Essential as contenders in the high end sector, I always qualified those brands as a distraction. The IDC figures prove me right.

At 3.9m/year, Pixel is a marginal player. Essential phones have an infinitesimal presence. The focus on those manufacturers is unwarranted and pointless -- they are not the ones that will shape the future of mobile.

BBK, Tinno and Transsion, on the other hand...

Huber

@Justunbelievable: "The HomePod is 100% an Audiophile grade Speaker."

I almost spilled my coffee because I laughed so hard when I read this!

Neither Google Home nor the HomePod are audiophile at all. They are tiny speakers without much power output and can never ever compete with systems from Canton, Elac or Teufel.

Granted, these systems sometimes cost an order of magnitude more than the cheap-ass Apple and Google speakers and on top need a good receiver for at least €800-1000 to perform well, but you get what you pay for.

I cannot even imagine to watch a movie with the tiny Google or Apple crap - where should the bass comne from? Do they have two 30cm subwoofers for these explosions in James Bond movies? I guess not.

Using these sytems for listening to music is a ridiculuous thought to me. Of course they are cheap, and some people may be OK with their sound quality. But calling them "audiophile" is simply crazy.

Jim Glu

HomePod sounds terrific to me. I'm not expecting it to sound like speakers that costs thousands. It sounds better than any bluetooth speaker I've ever heard at a BestBuy including $500 Bose. Has brought some very high end features to the $350 price point. But really, my Harmon Kardon Onyx 2 I spent $250 a few years ago still sounds fantastic and the latest, v4 is less than $150. The HomePod is a "nice thing" and Apple has a rather larger customer base willing to buy nice things. A $49 Echo Dot has turned my HK into a REALLY nice sounding smart speaker...but doesn't play Apple Music which is the service I subscribe too. Plays Amazon Prime Music (I'm a Prime subscriber) though and sounds terrific.

Some of the exceptional qualities of the HomePod - almost the whole room becomes the sweet spot. The HP profiles the room automatically any time you move it. The bass is exceptional without being super heavy. I've never heard such clear bass at low volumes.

The mic's on the HP seem magical. You can be blasting on full volume and speak to siri in a normal voice from across the room and she will hear you. From two rooms away (no walls) as well.

But for all the ways that Alexa or Google Home Mini is better at being a verbal assistant....you can buy one of their small versions for $49 and connect them to the speaker of your choice. I don't see the HP making a dent in the "general smart speaker" space. Apple will sell millions....on a slower growth trajectory.

Jim Glu

As for iPhone declining....It's maturing, flattening. There will be up and down quarters to come

Tester

@Jim Glu:

"HomePod sounds terrific to me. I'm not expecting it to sound like speakers that costs thousands. It sounds better than any bluetooth speaker I've ever heard at a BestBuy including $500 Bose. "

There's indeed a lot of crap in the market - but these speakers like the HomePod or the Echo will be a very hard sell to people which truly enjoy listening to music at high quality. I am by no means what qualifies as "audiophile", but every time I visit other people which listen to their music on some cheap-o crap setup, it gives me earsores. Nothing beats a good amp connected to some quality speakers and once you get accustomed to such a setup it's very hard to accept something lower. (The only downside is that such a setup will make the flaws in digitally compressed music so much more apparent...)

Per "wertigon" Ekström

In my country (located in the richer parts of Europe), one of the many signs of the impending iOS "doom" is already fast approaching; It is getting increasingly difficult to find qualified iOS developers according to HR at my company. They even have a bounty put out for anyone managing to recruit a senior iOS dev, which, despite a good bonus, does not have any takers yet. So they are relying on foreign consultants for now.

A shortage of iOS developers means, what? That iOS app ports will be suffering, which means... what? That iOS becomes the second rate citizen. That is the power of marketshare.

Oh yeah, and this is a service app (e.g. not profit driven, but value driven).

Jim Glu

Hi Per,

Do the iOS devs not exist or are already gainfully engaged?

Ordinary boy

@huber

Sorry but I don’t think you understand what I meant by the platform ecosystem.
It’s not just apps, but things like newspaper subscriptions, iCloud subscriptions, etc.

I don’t profess to have stats but I bet you hands down that the high end users the iOS platform has are the ones who spend on these things.
Then android platform in contrast, I would suggest has far far fewer users willing to spend money on such things even though android has a higher market share by far.

App developers flock to users who spend money and have more new to spend, and that’s iOS.
Even google has developed and updated apps first for iOS before its own android platform (which is also heavily fragmented with different versions)
That in itself speaks volumes in my opinion.

‘Most apps are not made for profit’
Well as I tried to convey, it’s about mindshare of a platform. Currently the iOS platform has the highest mindshare because it has the high profile users.
Developers will always flock to where the money is.

Windows phone didn’t ever win mindshare despite considerable efforts so is not a good analogy for you to use.

Here’s a couple of examples of what I mean....
A friend of mine is an airline pilot. He showed me some apps that all pilots use every working day. They are all on iOS only!
He said that as far as he could see all pilots used iPhones/iPads

My wife is a hospital doctor.
She uses at iPads at work every day.
For everything from patient notes to viewing scans X-rays etc.
And that’s across the health service.

The iOS platform is just considered as a secure and reliable platform.
It has mindshare in the highest echelons of society.


So i get that you think mass of users will trump all of this, but I think you’re wrong.
And please don’t take that personally. Only time will tell who is correct.

BTW I don’t own any apple products.

Per "wertigon" Ekström

@Jim:

They do not exist on the open market because of the same reason COBOL developers do not "exist". Most app devs focus on the mass market e.g. Android development, so very few new iOS developers. At the same time the ones already circulating are tied up in well-paying jobs or consultants.

It has become so bad, that my company is thinking about switching to a web app for the iOS support. Not ideal on that platform, but allows for enough support regardless. End result is the same, iOS gets treated as the lesser platform.

Tester

@Jim:

Regarding iOS development you have to understand one thing. As strange as it sounds, most programmers are strangely deadlocked toward one programming language.
Some do C++, some do Java and others do Javascript. For iOS you need Objective-C and Swift, which are an entirely different besst conceptually. And iOS (and macOS, but there to a far lesser extent due to existing cross platform UI frameworks) is the only platform where you need these skills. So for obvious reasons it's not what most developers learn. Android has it easier because the main language there is Java, which is common enough to get broader coverage.

That means, that iOS developers are a pretty isolated group, the only chance to find someone who isn't deeply entrenched into the Apple way of thinking (and therefore has a well paying job, and - on the downside - very little chance to broaden their horizon) is to get the developers with cross-platform skills. And as it stands, most of them prefer to work with more common programming languages to avoid getting pidgeonholed on a minority platform. The company I am currently working for is desperately short on iOS developers, meaning that right now I am basically the only person managing their main iOS app - not because I am an iOS developer but merely because I am flexible enough to work with other languages than what my strength (i.e. C++) is.

Developer shortage is a common problem in the industry - and my guess is that due to the special languages Apple uses it is far, far more pronounced for their platforms.

DoomedIsayNofuturewhatsoever

So now the Apple is doomed because there isn´t any developers for their platform?
Of course Apple is obviously not doing anything about it. But yes. Obviously doomed.

apple.com/newsroom/2018/01/leading-european-technical-colleges-adopt-apple-everyone-can-code-initiative/

"London — Apple today (JAN 19, 2018) announced 70 colleges and universities in Europe have adopted Everyone Can Code, a comprehensive program designed by Apple to help everyone learn to build mobile apps. These colleges and universities are adopting Apple’s App Development with Swift curriculum, helping to create opportunities for all students and equipping them with the skills they need to pursue careers in the booming app economy.·

And Tester is funny because he says that iOS development sucks because he did not get the pay rise. If I would be the only guy doing something I would definately ask for more money for my time.

DoomedIsayNofuturewhatsoever

...And Apple has 13 million registered iOS developers who have generated over 100 Billion dollars so obviously Apple is doomed because they are making too much money and are too succesfull. They have to fail and lose money then they will grow market share. Excellent products wont do it for them that bath leads to distruction.

"Based on assumptions of revenue rates for mobile services and iOS share of engagement, my estimate of the economic activity on iOS for 2017 is about $180 billion. Including hardware sales, the iOS economy cleared about $380 billion in revenues 2017.

Additional assumptions around growth rates suggest that iOS economy will achieve the half trillion revenue rate in 2019."

asymco.com/2018/01/08/the-ios-economy-updated/

Per "wertigon" Ekström

@Doomed:

"Apple today (JAN 19, 2018) announced 70 colleges and universities in Europe have adopted Everyone Can Code"

How many developers does that translate to? Let us assume each of these Universities enrol 50 students. Of these fifty, 20-25 will drop out, and of the ones that graduate, another 20% of those will go do something other than iOS development. Like Android development, game development, etc. That means across the whole of Europe we will see a modest increase of 1680 developers per year. When the demands across Europe is more akin to 50 000 a year - it's way too little.

The second problem is time. Some of these Universities will start on day 1 with this, but most will not start to pick up steam until Autumn 2019 at the earliest. That means these developers will hit the work force in 2021, at the earliest opportunity. That is three years away. A *LOT* can happen during three years. We saw Nokia go from #1 to rock bottom in the span of three years.

For an open platform or a market leader this is not as big of a deal, but for Apple this will only increase their image as second-rate platform - and if that image enters the public consciousness on a broad level, they will be finished. People will say "Yeah. Apple makes some good products... But they are overcharging too much for what I can essentially get on Android minus a couple of neat extras."

"Additional assumptions around growth rates suggest that iOS economy will achieve the half trillion revenue rate in 2019."

Which is completely irrelevant.

Most shops do not develop apps to make money on the App. That is not the purpose. The purpose instead, is marketing and / or utility, to further increase sales of their bread-and-butter.

Take a hotel franchise having an app where you can order room service directly from the App. Or a fast food franchise with an App that have small contests, lists times when open and even offers free meals through coupons. Or banking apps. The purpose of these apps are not to make money, but to make people buy their services more and/or increase their utility.

If these types of apps cannot be developed for iOS because of no iOS devs, then they will treat iOS as a second-rater - and sooner or later, so will also their customers. It's not hard to see that.

Jim Glu

I have no problem believing the distribution of developers is not even across the globe. If a particular market is oriented Android first, it would only make sense that there would be more Android resources. It MIGHT not mean there are more Android resources AVAILABLE. Over time, demand and supply come into some kind of balance.

In the US, corporate mobile development is heavily skewed to iOS. Silicon Valley? iOS. Second is web development for mobile for those companies that want to stick to what they know and do not have such needs that can't be handled by a mobile oriented web app. Then Android. But that still means there are plenty of Android jobs. All tech employers feel like they have trouble finding enough talent. But that's the US

Panaman

I suppose C++ is doomed. We have been trying to find skilled C++ developers for two years and there's clear shortage of those.

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