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January 15, 2015



"Why not fire the morons who got the unit into this MARKETING mess. The devices are beautiful and they beat the iPhone hands down. Go hire an aggressive marketing boss from a really competitive consumer giant like say Coca Cola or something and give the Xperia unit the marketing management it deserves."

If marketing is the problem, will good marketing fix the problems SONY has ? perhaps a good comparison would be to compare ti with other Android handset makers. How does Samsung handles its marketing? from data it seems they spend a huge amount of money. Does SONY have that money? How about in comparison to LG they have recently been doing better what did they change? In terms of specs SONY I suppose is better than them.

I think lastly how are SONY's carrier relations? Are they on the same pedestal as Samsung ? Samsung can probably pay enough to get their own shelf space in a carrier store, plus provide marketing commissions to sales staff. What can SONY do to improve this other than pay the price required?

Tomi T Ahonen


Stop that! You're not bringing that bullshit in. Not here, not ANYWHERE on the blog. You know perfectly well the actual facts about the disaster and despair that apps are. They make money for Apple and Google for their iTax and gTax. There is no economy beyond games. If you feel like re-arguing some apps matters, you know which blog entry welcomes that discussion. You WILL NOT POLLUTE this blog with that BULLSHIT here elsewhere. Do I make myself clear? Stop it right now. Feel free to mention word 'apps' even once and I'll delete the last 10 comments you have entered. For every time you mention the word I delete another 10. If I find two separate COMMENTS from you with the word App in it anywhere else than the Apps Economy blog from you from now on, I delete all of your comments ever posted here on CDB blog, from the beginning of time. Test me LeeBase. Test me. So help me I am mad about this. You are a better man than this.

Tomi Ahonen

Tomi T Ahonen

Hi TDC123 and Baron95

TDC123 - Samsung has spent masses of marketing money promoting Galaxy but achieved only modest success for their marketing dollar. I've discussed that before on this blog, you probably didn't read that. But I would not hold Samsung as the model for how it should be done. I think it is CLEAR by the facts, that if the specs of the iPhone 6 models can command 700 dollar and above prices, and Sony sold premium smartphones on those specs (actually exceeding them) on very large screen smartphones 2 years earlier, then Sony made a MASSIVE marketing blunder by not discovering that price level until Apple came and showed it to them. Bad marketing, pure and simple. Of the retail support and distribution, yeah Samsung has worked hard at it and spends a lot of money on it too. That is part of what you can do when you are biggest. But here I would contrast Sony to the next tier, players ranked from 3rd to 12th biggest - the Lenovos and Huaweis and LGs and HTCs. These are all in the same boat as Sony and Sony's carrier relations and global reach in distribution is on par or slightly better. Here is where Sony's strong brand and very strong tech specs and consistent endorsements by reviewers should give Sony a solid if modest profitability edge over that field. The second tier players not so much Samsung or Apple.

Baron95 - I think you misunderstood me or maybe I wasn't clear. I didn't for one moment mean to suggest that the Xperia line can steal customers from Apple. Nobody can do that. Once you go i, you stay i forever. No, I meant among the Android mob. There are plenty of players in Android who are profitable from Samsung to Huawei. Why is Sony not. You love the iPhone. Now, if you were not allowed to buy an iPhone and had to pick one Android phone, would you not look very seriously at one of the Xperias? At least as one of your finalists? And can you see that in a store among 'normal' consumers who aren't very well into the details of this industry, just on an in-store 5 minute sales comparison, the Xperia line is the closest rival to the iPhone ie if you want an Android phone but love Apple, the Xperia is the nearest thing to it. That was my point. Not that Xperia would steal iFans. That ain't gonna happen. But Sony should be the king of the Premium end of Android. Sony in Android should be what iPhone is to the whole industry. THAT is my point. Don't you agree Xperia is the best looking, best tech specs, best total brand, best build quality of the major global phone brands at the premium end.

Tomi Ahonen :-)



Tomi still doesn't get that specs don't mean as much as he thinks. An example is that Apple's processors perform better even with fewer cores and less clock speed but the "specs" have higher numbers on the octacore Samsung exynos processors which perform worse and less reliably.

...or that the iPhone camera that Tomi previously called "Garbage" is considered the best overall even though it is only 8MP when there are phones with 15-20 megapixels and yet take worse photos because the processing software is not good.

...or that iOS has a much better ecosystem than Android and is a generally more stable and secure OS and they are now in the enterprise in a big way and in a way that Android is not - at least in western markets. So bespoke enterprise apps running iOS are becoming more and more common.

...or that people with money are going to buy Apple because they feel that it is a more premium brand.

Other than the few goofy people who buy Vertu phones - NO ONE is going to buy phones more expensive than iPhones in any meaningful volume. Certainly not running Android.

If I had to pick an Android phone I may pick Sony (or Moto). I would have jumped on a Nokia running Android in a second.

The mistake that Tomi makes is thinking that there is a large premium Android market when generally speaking Android isn't attractive for that end of the market when you now have iPhones with big screens. Most people will buy iPhones over Android at similar prices when the screens are the same size and you have a choice.

But no one is going to spend money on Android phones that cost more than the iPhone in meaningful volumes that Sony would like - when an iPhone is available. Not happening.

Sony is getting killed because there are now good looking phones on Android for $3-400 that run the same OS with 90% the build quality of Sony. Also the fact that Sony's marketing is crap hasn't helped matters.

Tomi T Ahonen

Hi Vikram

And how nice it is to talk to someone who clearly identifies themselves as a delusional iSheep. So nobody would ever pay for an Android phone more than an iPhone. Yeah. We could stop right here.

But lets take the issues you raise as you clearly do believe in them and some at least can be proven to be true or proven not to win the issue.

So specs about how many cores. I have NEVER listed the number of CPU cores as a 'competitive advantage' for any brand. Yes that is a specs issue and for most consumers it is totally irrelevant but Vikram, you brought it up, I never did. Sorry. You lose. You cannot accuse me of counting cores and claiming specs victories when NOWHERE on this blog can you find that claim. I understand you have a severe inferiority complex as your iPhone is deficient in its CPU, I know I know, its a regular pain point for Apple users all the way to the dawn of the Macintosh PC but sorry, I never once mentioned it. I agree with you, thats an utterly silly spec to mention but engineers love their specs and to talk about them. I never did.

You say the iPhone 8mp camera is better than some cameras that have 20mp sensors. That is definitely true. The megapixel count alone does not guarantee best pictures. Apple has most definitely the best 8mp camera of any smartphone with an 8mp sensor CURRENTLY but thats because the top camera brands in mobile have put their best effort of course to their flagships. And Apple definitely several times has beaten flagships with bigger camera sensors including Samsung's Galaxy. But sorry. Your main point is totally untrue that the 8mp camera on iPhone 6 is currently the best camera on a phone. Except at some Mac and Apple-oriented sites (and I can forgive you if those were the only ones you might have read haha), there are no tech reviewers of phones who claim the iPhone has the best camera currently. The Lumia 1020 and Xperia Z3 are regularly listed as better for their cameras, and where there are reviews of it, the Galaxy K Zoom totally wipes the floor with the iPhone 6. No, you are simply mistaken in your belief.

iOS ecosystem and apps, I totally agree with you that this is better on iPhones than Androids. Sure, you win this one. Go ahead and smile. It also means, for app developers the Nazi mentality at Apple of totally arbitrary rules of what gets and what doesn't get approved and all sorts of limitations that the free-er Android Play Store doesn't have but yes, you win. For the end-user, the iOS app store and ecosystem functions better. Not dramatically better and the average consumer will barely notice it but yes, we geeks, we notice it very well and I give this to you. It will not decide any non-Apple user to go one way or the other. It is not as dramatic as say Windows Phone vs iOS or Blackberry vs iOS. Android is now good enough so unless you are already indoctrinated to iReligion, the minor differences that iOS has over Android would only be noticed over time if someone used both, and the random new buyer today who isn't invested in either, will not think about this matter.

But then you mention enterprise apps. Sorry. Thats pure bullshit propaganda from Apple what you listed. The math totally does not work out and neither do any press or info. The facts are, that yes, iPhones are used in many large corporations for enterprise customers. But almost none of them are 'pure' iPhone users. The iPhones tend to be ONLY used in the marketing department which are of course all iSheep. The rest of the organization uses proper business phones like Blackberries. And as to the market. Its tiny. Who cares. In 2013 the total global enterprise market was 61 million phones according to IDC. That number is shrinking because of BYOD policies. Wanna grab all of that to the iPhone haha, be my guest. Its only 4% of the market this year. Who cares. Enterprise customers demand lots of specialized software support, and demand bulk discounts on the handsets. You want to dilute Apple profits by going after Blackberry's market, be my guest. No, the growth is in the consumer market and the SAME handsets sold to consumers generate bigger profits than to enterprises. I yield this market happily to you, but I can also promise you, the sales cycles are long and tedious and there is no way Apple gets 50% of that market in the next 5 years for iPhone. Thats not how enterprises buy their IT. The best phone is utterly irrelevant to that decision when legacy IT systems are concerned and the IT bosses start to count costs of adding a new system. Aint' happening. But I did not once mention ENTERPRISE markets for Xperia in this blog. Why would we care? For Sony to attempt enterprise for Xperia, a pure consumer phone, would be madness especially now that Sony has sold its Vaio PC unit. Madness.

On Apple more premium brand yes. You are totally correct on that. 18 years ago Apple was months from bankruptcy and Sony was the world's most valuable tech brand. Things change rather fast in this industry. Just because Apple is now valued, is no guarantee it still is 5 years from now and SONY has never been on the brink of bankruptcy. Its still today one of the most valued tech brands.

Then the silly argument 'nobody will buy phone more expensive than iPhone in meaningful numbers' Yeah. I hear you. I fully understand you somehow believe this. It is a mathematical certainty in a market of 2 billion phones sold per year that this will happen in the coming years sooner or later, that someone sells in the millions a phone that is more expensive than the iPhone. Its like looking at the Rolls Royce and saying nobody can sell cars more expensive than that haha. It is not only 'possible' it is CERTAIN that it will happen and that phone will run on Android. So Vikram, I know you were sincere in your comment and I know you read this blog often and comment frequently. Please trust me on this just enough - that I know we will cross this bridge soon. Maybe not this year but before 2020. Lets just 'park' this issue and return to it then when it happens and I promise you, if by 2020 it didn't happen, you may point me to this comment and ask me to admit you were right. If one of the brands, any one, sells a million or more phones at a price above the iPhone, then I am proven right and you are proven wrong, isn't it so. So lets just wait this one out. Currently I cannot prove it is possible because the last times it happened were with Symbian phones from Nokia haha and that is hardly a 'valid' current example.

On your confession you'd pick between Sony or Moto on Android, that is my ONLY point and you agree with it. I never said Xperia has any chance of capturing Apple customers. But think, Vikram. If for whatever reason you don't can't get an iPhone but you must buy an Android - lets say your wife works for Google and she insists. Or your employer allows BYOD phones on any OS except iOS because of some weird IT decision, or whatever, your carrier doesn't support that device or what. IF you can't have an iPhone and must buy Android - then yes, Sony Xperia currently is the nearest thing to the iPhone. We agree on this.

Then think about this. Apple iPhone makes MASSIVE profits. Samsung Galaxy makes modest profits. LG makes modest profits. Huawei makes modest profits. Xperia is on Android as is Galaxy, LG and Huawei. Why is Sony not MORE profitable than Galaxy, LG and Huawei (per handset, obviously, not in total profit where Samsung sells many more units). If Apple is the ultimate most desirable phone and thus most profitable. Shouldn't it then be 'child's play' for the NEAREST THING to an iPhone to be the next most profitable phone, even though, of COURSE far less profitable than Apple. This is the point. We agree Xperia is nearest thing to an iPhone at Android, and for any iPhone user, if forced to pick an Android, they'd take the Xperia. If that is the case, and Apple gets the biggest profit of any phone, then Xperia should - SHOULD - get the biggest profit among the ANDROID manufacturers. Isn't this so?

That is why I am so critical of Sony. They have fucked this up. They are a Ferrari-maker, nearest thing to a Porsche (ie iPhone). But as Porsche commands huge profits, and Ferrari sells in the same price bracket a car of similar performance, why would Ferrari report continuous losses. If the cars are good (haha and we could argue Ferraris have not always been good) then they should also be profitable. And clearly the Xperia series has had no antennagates or bendiegates or other recent problems. The phones are good.

As to Android rivals matching 90% of the Xperia. Yeah. Thats utterly true. That is also true of cars, the Skoda is the same car, almost, as the Volkswagen, as the Audi, from the same owners. But MARKETING has convinced us to pay more for VW and most for the Audi. Almost same car. But of course there are subtle technical distinctions and the brand. Come on, Huawei vs Sony which is the better brand. And the specs do give that 10% boost for Sony. They have been piss-poor at differentiating themselves IN THE MARKETING where in reality their engineers did a great job on the phones themselves. Even you admit its the phone you'd buy as long as Nokia isn't making proper Android phones haha. (same for me, except obviously the iPhone is not in the frame for me haha).

But yeah, we agree Sony marketing has been crap. If the phone is great but the marketing is crap, then shouldn't Sony CEO at least attemp to hire a competent VP to run Xperia with proper marketing (and pricing is part of marketing) rather than sell the unit..

Tomi Ahonen :-)

John F.



Tomi, I understand your frustration with this issue, but it is an issue of years past, 90% of people care about functionality, convenience, durability and reliability. Assume 50% of the users of high end are women, 99% are not interested in tech.
Why people not interested in pro photography would need more than the camera found in the iPhone 6 or Samsung S5 ? i have seen the videos and photos on display, more than enough for the largest majority, in fact way too much already.

Asking yourself THIS IS THE PART I DON'T GET ... is your own answer, forget the specs! it is a thing of the past, apple sells you a life style that last you over 2 years and an ecosystem that delivers 99% of what you need, yes, if you have an audi 5 or a Lamborghini you better throw away your car and buy one compatible with Apple, but a large majority just don't care about specs, you know well that there is more than megapixels and cores.

Why the PC industry with a constant specs war, I give triple for half the price declined? because most people don't really care, thats why apple sell a lot of notebooks and desktops and became a top 5, most people want simplicity and an easy solution that works and needs no hands in to replace stuff or configure complicated stuff

Remember the timer in VCRs?

I can go on, and I know that some will rant that shit apple with lower specs will die in 2 quarters and people who prefer a mackbook are retards .. but it's becoming a bit like the auto industry, most people buy a car due to brand, trust, functionality, reliability, service, YES i know a person who was interested in the injectors and the accumulator performance but that is the 1%

Maybe is time that you factor buyer behavior into the equation, there are fantastics text out there.



I think that for you to be able to have at least a chance of understanding Apple and the iPhone, and why people buy them, you have to put the "delusional isheep" analysis on pause.

No company becomes as big as Apple, with so many satisfied customers, due to the customers being "delusional isheep".

That moniker is only a shortcut for critics who don't understand, or even don't want to understand, what is going on. Drop that and approach the conundrum as if iPhone customers are just like any other customers, probably exactly the same as Android customers.

And "the Nazi mentality at Apple"? Really?



@All Apple fanatics:

Please understand that the MAC's market share in 2000 was miniscule. Only after the success of the iPod and iPhone, people started to buy more MACs, too.

_THIS_ is why Apple can make huge profits with their entire product line - all relies on the success of the iPhone.

This is not necessarily a bad thing for Apple, but they must be aware that the iPhone is the product which drives their other products.


In my opinion Sony has made one huge mistake:

Every business area has to consider Sony's other areas:

- TVs were equiped with Sony's displays only. This means when Sony's displays were not competitive, their TVs were not competitive, too.

- Sony Music and movies: Sony's DVD players and Blueray players are the worst at playing illegal copies of content. Perhaps Sony thinks that this way they make more money with their content, but ion the real life it just means selling less players

- You need a Sony phone/ tablet to connect to the Playstation. You get SOny's Walkman app only on Sony devices. Why don't they release their apps for all Android devices? Do they really think they sell more phones/ tablets this way?

Samsung has a completely different approach: Every business unit is independent.

This means that Samsung can release smartphones with Qualcom SoCs, even though Samsung has their own Exynos-SoC.

If Samsung e.g. is behind in display technology, Samsung's TVs and Smartphones can be shipped with displays from a competitor.

This way, if one business unit falls behind it does not affect other business units.

I think that this is a much more sensible approach Sony _HAS_ to take over if they want to stay in business.

Simply let the Playstation guys make Android apps which run on all devices. The same goes for Sony Music and movies. Release Blueray players which support all existing formats.

And the most important point was already adressed by Tomi: Fire your marketing department!

I own the Sony Xperia Z2 tablet, it is a fantastic device. It is even developer-friendly, so you can install what you want on it, even a different OS (I am using CM12, which is Android 5.0-based).

But I bought this tablet because it was exactly what I was looking for. I have never seen any marketing efforts from Sony to push this product (apart from sponsoring the soccer world championship, which is not enough).

So I never would have considered the Sony tablet if I wouldn't have searched for such a tablet myself - when you enter a store here in Germany, you see mostly iPads and Samsung tablets. Sony is just "one of the other brands".

This is clearly a failure in marketing.



Again, "Apple fanatics". Sigh.

Even so, the Mac resurgence is indeed tied to the success of other Apple products. Most Apple observers are very much aware of that. But it really started with the iMac, and then sped up with the iPod.

For a long time, the iPod was the driver of the Mac growth. Now, the iPhone, and to some extent the iPad, has taken that role.

And even though the Mac has gained market share, I would argue that it still is miniscule. At a healthy level for Apple, but still very small.


Tomi T Ahonen


It took me one click. Do you really want to fuck with me on MY blog? If you post ONE comment that is to my mind the slightest bit nasty in any way, you will be the next person forever blocked from my life including this blog, my TW feed and all other ways removed. This is your last warning. Go ahead make my day. Nobody fucks with me on my blog.

I suggest LeeBase you stay away for 24 hours and don't pester me. Then think VERY carefully how you post comments in the near future. You know what the rules are. If I warn someone, I am ALWAYS serious, you've seen a handful visitors forever banned from this blog and my life. I'm way too old for that shit that you just pulled.

Shame about the comments. Are you still in the mood to test me. Me? On MY blog where I've answered you patiently for so long.




The Mac's market share has not only grown the last 10 years, but the iPod/ iPhone also lead to _CONSUMERS_ buying Macs. 10 years ago Macs were bought mostly by _PROFESSIONALS_ (for music, DTP etc.).

I worked at an outlet in 1999, where the iMac promoters whined that almost nobody wants to buy their stuff because of the software situation.

So no, without the iPod/ iPhone things would be _VERY_ different today.

And Apple is on its way to its niche again - just the day before yesterday I talked to a neigbour (she is also an Apple fanatic). She has interest in the iPhone 6, but once she saw that the 16GB version costs €700 and the 64GB version cannot be bought for less than €1000, she stayed away for the time being.

Because even as a die-hard Apple fan she thinks that a €700 device with 16GB is a joke as well as the 64GB version for €1000.

Note that she recently left her subsidized contract and uses a non-subsidized SIM card for €10/month now - this gives her 300 minutes of phone calls or 300 SMS and 300MB data traffic, which is enough for her.

And I can tell you first hand that suddenly the Moto G for €180 looks much more attractive to her.



The software situation in 1999 (I'm a Mac user since 1986, both as a professional and as a consumer, worked at a retailer in 1994) is one of the reasons there is so much focus on the app store catalog from Apple today, I think. At the time, one of the most common reason for not buying a Mac was that Windows had so much more software.

To me, it seems the iMac was the start of the change. That and the Internet. Without the Internet, the Mac would not have gained a new lease of life, even with Steve Jobs at the helm.

And you will note if you reread my comment, that I said that iPod drove Mac growth. And now iPhone. But the iMac was the time it started to turn around. It still took a long while, but the iMac established Apple as a relevant player again. From that, Apple was able to build further with the iPod and now the iPhone.



Talking with Sony Marketing over 12 years ago, I asked the question why they did not leverage their enormous content catalogue and Walkman sub brand with their phones. The answer came back that they were separate divisions and therefore not relevant to Sony or Sony Ericsson. If ever Tomi stated a true fact, it is that Sony Marketing department should be "re-deployed" it's that. Sony with their content in 2003 had all the cards, well before Mr Jobs realised that he needed content and an eco-system to build a successful business. I still believe that it was an accident that i-Tunes was such success. The content owners , including Sony, simply thought that they could manage this niche Personal Computer vendor. Tails wagging dog , indeed tail becoming massive snake and devouring Dog!

Tomi T Ahonen

Hi John F and Maggan

John F - first off. Answer me this. If you could not have an iPhone and had to pick an Android phone instead, which would you pick today. If its not the Xperia, would the Xperia be among your finalists.

Second on the specs argument. I am not suggesting that everyone behaves like that. I am not suggesting that the majority behave like that. I am not suggesting that the iPhone is not the most desirable phone. I am not suggesting that the issues you listed are not important or perhaps, more important. BUT. Listen to me. ALL recent consumer surveys that have been published of what people want when buying a new phone have listed the screen size as among the top if not first choice and all have listed the camera among top issues. ALL OF THEM. People are not like you or me. Normal people, they do want a better screen than on their last phone. And instead of the 5mp or 3mp camera on their older phone, they now want an 8mp or 13mp or 20mp or more. Not all will then end up buying the 'best' on that criterion if other things matter more or the overall package trumps it, but that is what consumer surveys CONSISTENTLY tell us. And the app stores and number of apps and the OS that is in the phone comes always behind screen size, and often behind camera.

I am not at all disagreeing, that many customers have fallen in love with the iWay of doing tech, and good for Apple they did revolutionize the user interface - as I promised they would when they would enter the phone biz even before the iPhone was even announced - but that is not all people. That is not even the majority of smartphone buyers. Now. I am not arguing that Sony should create a new radical phone on some 'obsolete' idea. I am arguing that on these issues like screen size and camera - issues that truly decide purchase behavior more than OS or app stores or usability - on these issues SONY on its XPERIA flagships had managed to leapfrog Apple iPhone and do the EXACT right thing, that Apple later copied (better screens, better cameras) and do it BEFORE Apple iPhone did. Since this is a fact, that has been done, NOW the issue becomes why is Sony selling at a loss and Apple still selling at phenomenal profits. This is not a bad design matter. This is not a bad customer research matter. The Sony designers were brilliantly anticipating exactly what Apple too would soon do, except Sony did it earlier and better. Why can Apple make a huge profit on THESE changes to the iPhone (the usability did not radically improve from iPhone 5 to iPhone 6 etc) and meanwhile Sony can't produce the best profits out of the Android family. This is what is a marketing mistake, not a bad design or undesirable brand or bad analysis of why consumers buy phones. Androids outsell iPhones and by an INCREASING margin. So more people are willing to pay for Android phones that are so inferior, than iPhones. So the best of the Androids, ahead of iPhone on specs, why is Apple profitable, Samsung profitable, LG profitable, Huawei profitable but Sony several quarters now unprofitable. That is not bad phones, that is bad marketing. Do you get my point?

And John like I wrote to Vikram earlier, I am not suggesting that Sony Xperia can convert iPhone users to Android. That aint happenin. I am saying of the Android family, Sony Xperia should be best profits because it is nearest to the iPhone. If Android is the same for all, Sony has better brand, better design, better specs, better looks, better materials, better build quality etc. Among the Android family, the Xperia is the nearest thing to an iPhone, not Galaxy or Huawei or HTC or Lenovo...

Maggan - haha yeah, that was fair. But also, I am not the only one talking of iSheep and of arbitrary rules at the App Store and the reality distortion field of Apple. I didn't invent these concepts. But the moment someone like Vikram earlier suggested it is impossible for an Android device to achieve price levels above iPhone and sell in volume, that is of course a delusional position. Its as silly as saying that Porsche can never make a car faster than a Ferrari. Except in his argument's case its more like all car makers in the world cannot make a car faster than Ferrari as essentially all other smarthpone makers are now on Android. So I had to tease Vikram a little bit and we know he's a loyal Apple fan and he's been here for a long time, and I did answer his comment also fully.

I think you've been here long enough that you know I greatly admire Apple and keep reminding their customer loyalty is by far the best and its essentially impossible to ween iCustomers away from iReligion, not just on iPhones but any iGadgets from iPads to iPods to Mac PCs. And as long as Apple continues to keep those loyal Apple fans and customers satisfied, doing things with the user convenience and simpicity at the top of all products designs and services, they will retain the loyalty and can command a huge profit premium on the Apple brand. But again, I am not the first to call the Apple fanatics a cult-like tribe. Its bordering on religious fanaticism. And then if its a cult, the facts start to become osbcurred. And the facts are, that the iPhone has no leadership issues for this industry whatsoever since the multi-touch touch screen of the original iPhone featurephones of 2007. Not one item of real innovation or leadership. Apple is a follower and iPhones are slow adapters of tech that others have pioneered and figured out will it work or not. Some like that. Not everyone. And many who own iPhones think they are the best phones in the world because they have no modern frame of reference. Especially the best market for Apple, the USA. There smarthpones appeared late, were mostly enterprise-oriented like Blackberries and Palms, and none of the world-leading flagships bothered to launch in America early and Americans were blissfully unaware of the top phones. So American consumers have acquired a totally unrealistic image of some supposed Apple leadership in mobile. It makes sense to them because they have witnessed it in their own market, there were no real rivals and their domestic press was in love with Steve Jobs and drank in all that cool-aid.

Now, some people love a fully automatic car, automatic transmission etc. Others want more control of their cars and want a manual transmission or one that has manual override over the automatic. Guess which country has the highest preference for automatics? Yeah, the so-called 'lazy' Americans. The iPhone is automatic transmission for phones. The easiest simplest to use but limited in so many ways from what essentially all others do (or used to do). Like no support of Java (worlds largest installed base for apps) or no support of Flash (was one of the largest standards for video) or no support of microSD cards etc. The app store is the most restrictive. Apple then does all those nasty things like suddenly without warning installing music to everybody's phones (U2) or removing without warning and permission music files suddenly, etc. Some people love it when everything is automatic and it always works. Fine. I get it. A 3 year old who hasn't learned to read can use an iPhone. A 103 year old whose eyes are too weak to read can still use an iPhone. Neither would ever have a chance with 2007 era smartphones from Nokia or SonyEricsson or Motorola or Samsung. Apple is excellent at that, making things easy - and simple - and removing the ability for consumers to do their own modifications - and preventing industry-standard tech from being used.

There are PLENTY of smart people who hate that. This is the exact same philosophy that the Macintosh had from its beginning. And the Mac which now is 30 years of age, has never managed to breach 10% market share of the PC industry. Some people love the Apple Way. They will become - sorry - iSheep - and they will be supremely happy and would hate Windows or Android or Blackberry or Tizen or whatnot. All Apple products are not just intuitive, its the 'same' logic across them all. Once you learn the Apple way, you want it in all you tech. So if an iPhone user has a Galaxy Gear smartwatch today and finds utility out of it, that person can't wait for the Apple Watch to be released. Just like how iPod and Mac users drooled waiting for the first iPhone.

I get it, I really do. And I love Apple and I admire them and I wish them all the best. But I am not delusional and I live by the facts. The love of Apple can cross over to delusion. That is when I make my points very strongly. It is a fact that of all the changes Apple did going from iPhone 5 to iPhone 6, all those changes were done by Sony on the Xperia, every single one of them, before Apple did it, and done as well or BETTER before the iPhone 6 series came out. Who is the leader, who is the follower? I deal with the facts. Then of course, Apple being Apple, they managed to hoodwink the global handset buying public that it was now Apple brilliance that should be celebrated, years after this tech had already been introduced by others. That is stretching the truth - Apple has to do it, they would see their share price fall hard if the illusion of Apple leadership were to vanish. I am not here to help prop up Apple's share price. I am here to tell the truth as I see it, about this industry. At some point the reality will set in, just like with the Mac, that no, iPhones are 'never' bleeding edge tech, other brands are the trailblazers - but Apple will argue, that is a good thing as Apple users will get only the tech that is worthwhile, and when it is mature enough. This is the mantra at Apple, to make things easy. The first iteration of new tech is not always easy. It can be very messy.

So Apple take their time. And the loyal Apple customers will always PREFER that. Please Apple, we love you, do not ever change, make sure every generation every product is the best in its class - for usability. That is what Steve Jobs taught Apple management before he died. As long as they do that, they will retain their loyal core. But the silly denial of reality, that is like Fox News and that will change. When the reality really sets in, that Samsungs and Sonys and several other brands have more advanced tech then those customers who were tricked into buying Apple because they thought they were buying the best, they will leave. But they weren't the core that Apple wanted anyway. That will happen in the US market the hardest because Apple's market share is the best there. So there are many current iPhone owners who are in that category, thinking they had bought the top-of-the-line and will become disillusioned. The Samsung comparison ad campaign is partly targeting those customers of Apple. Did you know that iPhone 6 Plus is a meek copy of Galaxy Note from years ago.. that stings if you are not at Apple because its the easiest to use, but you were there because you thought that Apple made the best smartphone or that Apple was the industry leader (as in leader in introducing the latest tech).

Haha that was quite a rant.. But yeah, do remind me when I go overboard on the iSheep etc stuff. But yeah. I don't think its a bad thing, not for Apple, not for the consumers who love the Apple Way and not for the industry. I also know that the type of customer is a small minority of all consumers who can either afford the Apple premiums or who would want it that way. So as you've seen me write many times, the natural market share for iPhone will settle into the high single digits or maybe hit 10%. Not much more than that when all phones are smartphones from year 2019. What Apple has to hope and pray, is that nobody else muscles in on their action - best user interfaces and easiest phones to use. That could be catastrophic. And who was best at UI before the iPhone? Nokia. What was the only smartphone up to now often rated better than its contemporary iPhone rival? Nokia N9. Who is coming back to smartphones next year? Nokia. If there was one handset maker who could challenge Apple on this, the only one is Nokia. And you betcha they are itching to give it another try after how brilliant the N9 on Meego was, but idiot Elop didn't let that project fly.

Tomi Ahonen :-)


Tomi, I'm up for that bet! But 1M phones on a model that sells at a higher price than iPhones may be too small a number to be considered "meaningful" in a market of over 2B handsets a year by 2020.

I would say it has to be over 10M since Apple sells over over 180M iPhones a year now. If it sells more than 10M then I lose. If it sells less than 1M then you lose.

And if it sells between 1-10M then we argue about who was right ;)

Call me an iSheep if you'd like (am not, have Android phones too but iPhones and iOS are better) but the facts will bear me proven right in the next few years. Just like with Macs, Apple sells over 90% of the over $1000 consumer PC's (in the US - don't have worldwide numbers), Apple will sell an even higher percent of the premium phones. The PC market is an apt comparison because it became a race to the bottom in price. Few people are buying the expensive Samsung S9's (which is why Samsung got out of the PC market in Europe) or upper tier Vaio's (which is why Sony is facing the same issue). If you want a premium PC and you have a choice - you buy a Mac.(Not everybody - some people have no choice, a few prefer Windows, and gamers with high performance rigs will choose a custom Windows PC). But you will look for a lower price PC vs a higher price PC because they both run Windows. You may want slightly more ram, thinner profile etc... but a medium priced PC will do 90+% of what a more expensive one will do. Same with phones.

You may find it hard to believe this, but people won't buy expensive Android phones on a price at par or higher with the iPhone now that it has a big screen. People will buy Android phones because they are cheaper. There will always be a few people who buy the highest end Android phones but they are very few people - mostly a few people who like the complete flexibility of Android and like to tinker with the platform. Most people with money who can buy an iPhone will do so over Android. This is already happening in the wealthier countries where people have money like the US, Australia, UK and Canada and wealthier parts of Europe now that the big screen iPhones are coming out. The only space for Android in these countries will be for cheaper phones.
And an important factor isn't just the app ecosystem but the Apple ecosystem - iPads, Macs, and the new Apple TV that will also help run your house that will come soon. Add in Apple Pay, which the banks are advertising on Apple's behalf as they are fighting for customers, and it clearly ties you into Apple's ecosystem - for those that have money. Add in the upcoming Apple Watch which will blow away Android smart-watches and it is clear that the iPhone is strengthened because of all of these Apple ecosystem factors which Android doesn't have - except in parts and in a generally inferior way.

As an aside for Android watches that some of the premium watchmakers are looking to develop, they will be dead on arrival since you generally need to pair them with a smartphone to make them properly useful and integrated (I know that things like the Samsung Gear doesn't have to technically be paired but it is much better when it is for many reasons) and people who buy such a watch, say from Tag Heuer won't be buying Android phones to make them work. Those people buy iPhones. Again, there are exceptions to every rule, and many of them may work at Google ;) or be like Tomi but they are a very small minority.

I think that you and I generally agree on Sony. Their problem was that they don't have any cheap phones and are competing against all the other top phones for Android with a worse marketing effort. Also I only have really liked their Xperia line since the last year. Before that I haven't been that interested but now they have beautiful phones. The problem is that HTC makes nice phones, Xiaomi makes nice phones and so does Samsung (I can't stand them but they do have good specs) and Moto X is also a great phone - as well as LG's phone etc...

Having said that Sony's are more beautiful for sure but I really don't see them anywhere so there is some sort of marketing and distribution problem.



"You may find it hard to believe this, but people won't buy expensive Android phones on a price at par or higher with the iPhone now that it has a big screen."

This is wrong. I personally bought devices which were _MORE_ expensive than Apple's offers, e.g. the original Samsung Galaxy Tab in 2010.

And I do know many people who act this way. This is because Apple ignores industry standards and want to force you to buy _EVERYTHING_ from Apple, along with their stupid functional restrictions.

There are a lot of customers who don't buy Apple because of this. If you honestly believe that everybody who has the money buys Apple is delusional.


"No company becomes as big as Apple, with so many satisfied customers, due to the customers being "delusional isheep"."

This is very true. Talking about iSheep or similar things simply means the same as "I don't understand why people choose Apple over some other brand" and nothing else. It's sad to see how people don't get this.

"Drop that and approach the conundrum as if iPhone customers are just like any other customers, probably exactly the same as Android customers."

This is also very true. People paying for Apple branded products expect quality and value for the money. Brands are important because people will know what to expect when they buy a product manufactured by a familiar brand. The brand loyalty Apple gets is coming from there. The product doesn't have to be absolutely best if it's good enough and the risks of changing brands are not present.

People hate to take that kind of risk if they want to get a tool they need and the tool they already know is good enough. Why would someone use time and effort into comparing several competing brands if it's not really needed?

Tomi T Ahonen


Haha fair point about the scale, but then its an unfair challenge on another level. 10 million is 1% of all smartphones today. For one brand to find that many customers at that price point and milk that segment before rivals come in, that is unlikely. Would you give me this - if there is a family of Android phones that total 10 million across multiple brands - and their price is above the current base price of the top price iPhone - then I win. Almost no current Android manufacturer except Samsung could afford to take that production risk to introduce a new phone at the top of the price pyramid and commit to a volume of 10 million units. The bottom tier of Top 10 smartphone makers are selling only a bit above the 40 million level.

Now to your main argument, that now that iPhone 6 has solved the large screen issue, most won't buy top-end Androids. I think you are confusing market shift with market decline. So Android is growing faster than iPhone (has been from the start). There are more new buyers of Androids per year than there are new buyers of iPhones. The gap between the two is expanding in Android's favor. That growth is happening at the bottom of the price pyramid in the below $100 phone price level. So if you look at the mix of total Android phones sold and say two years ago 1/3 was a premium price phone, today 1/5 is that, or something like that. If the market had not grown in size, then yes, premium segment in Android was shrinking. But as Android has grown, the premium segment has stayed about the same size while the bottom of the price pyramid has grown very strongly. Meanwhile, while iPhone has not grown as fast as the industry, it is growing FASTER than the other premium phone rivals. But here the mix is something like 60/40 in Apple's favor now when it was about 50/50 two years ago. Not a collapse of other brands but Apple keeps gaining there.

At the very least, your argument doesn't have evidence yet. Ok, you said after iPhone 6 release so maybe we'll see it next year. Here is a counter-argument. The world's most expensive (mass market ie not jewelry) phones were made by Nokia. They sold phones more expensive than the current top iPhones up to Elop's reign. Nokia vastly outsold the iPhone and Nokia did this profitably and the gap between iPhone and Nokia's lead was expanding ie Nokia was pulling away not Apple catching Nokia. At that time it was not unusual to find premium phones like Nokia E90 Communicator costing about 1,000 dollars vs 600 dollars for the iPhone - and the E90 was far superior to the iPhone on just about every aspect including larger screen. Nokia was not afraid to offer very many varied form factors to suit different customer needs and segments and regional preferences. Similar to what Samsung is doing now, but Nokia did this far more and also at the top-end flagships, like the E7 'Communicator' the last phone that Elop didn't mess with, launched January 2011 and costing 700 dollars.

The other phone maker known for its own iconic styling was Blackberry. Blackberry sold more smartphones in 2010 than the iPhone. At that time it was not a big risk to attempt different form factors and price points because so many existed and the iPhone wasn't anywhere near the most expensive phone being sold. Then came Elop with his iPhone-envy, who made the Lumia series a clone of the iPhone, only slab form factors and forbidding any deviations from that form factor even as Nokia engineers produced other design concepts. And Elop priced the first Lumias below the iPhone price (with deliberately modest specs, below those of the past Nokia flagship). Then as he Osborned the Symbian line and MeeGo line, those smartphones saw their prices collapse. Nokia - who had offered phones far more expensive than iPhones and phones of varying designs, suddenly quit doing that. Not because market research suggested there was no market. Because the CEO was a moron. But now nobody was 'pointing the way' that there EXISTED a market of real size at prices above the iPhone. And the new Nokia CEO in his idiotic Burning Platforms memo sang the praises of a supposed iPhone leadership, and then his Lumia phones are all iPhone clones with modest specs. All in the indsutry were spooked - why - because EVERYBODY knew that Nokia had the industry's best consumer research and insights. Nokia had to know something that the others hadn't yet found out. So SonyEricsson and Motorola - the two high-price brand rivals - also stopped selling phones at high prices.

And everybody was mimicking now Nokia mimicking iPhone. All flagships start to resemble each other. Then Blackberry tanked. Suddenly the last remaining alternate form factor for flagship phones almost died. Now nobody dares to release QWERTY based flagships either. Yes, there is clearly a demand for QWERTY phones but they only satisfy that demand at low-end (often feature)phones.

We have arrived quite accidentially to a point, where all manufacturers are making near-identical flagships not because this is the only way people want phones, but because Nokia and Blackberry (BB 10) steered the industry to this point. This is as if every car maker suddenly decides that the only luxury car ('flagship') can be an SUV. Yes you'll get sedans in midrange and cheap cars, yes you can get sportscars in mid and cheap prices but if you want a luxury car, only SUV form factors will be available. From Rolls Royce and Mercedes and Cadillac and Ferrari and Porsche and Lamborghini and .. you get my point. Humans are not like that. Some will want a sports car, looking like an Aston Martin or Ferrari, and someone will suddenly be brave and test that theory (again, because it was like that once). Someone else doesn't want the tall form of an SUV, they want a low-limousine like normal Mercedes and BMW and Audi might sell today, and again, one manufacturer trials it and has a huge hit car, and then most of the others will rapidly return to offering luxury cars in several form factors, not just SUV's.

This happened by the way in the car industry in the 1980s. The oil crisis of 1979 caused long lines at petrol pumps around the world and fuel economy became the burning desire, and the Volkswagen Golf was the best mileage car and everybody rushed to make clones of the Golf. For a while the whole car industry seemed to only make Golf-clones. This lasted for a couple of years, then a few brave car makers tested old concepts, I wonder if there is a market for convertibles. Saab did the 900 convertible and it was a smash hit. Chrysler tested the concept of the minivan and it was a roaring success. Audi introduced the 'jellybean' rounded edge car the Audi 100 (in the USA sold as the Audi 5000) and suddenly you could do large limousines again with reasonable fuel economy. All these cars were instantly copied by rivals and the car industry returned to diversity.

I am convinced we are at that kind of moment now. Every time that I post about a slider/folder 'Communicator' style flagship phone with a 5 inch touch screen and full QWERTY physical keyboard slider like the Nokia E7 and Nokia N950 - I get a big enthusiastic response at Twitter from random followers who say they'd buy it in an instant. I am not suggesting such a form factor would outsell the iPhone or that it would outsell pure touch-screens. I do mean, that there is a big unmet demand of a proven design concept, that used to sell in umpteen millions per year, that Nokia idiotically stopped making and would be an instant hit again. Someone will try that theory sooner or later because so many people talk so fondly of those phones. That handset maker will have a 'retro' hit in the way as the Saab 900 Covertible, the Chrysler Minivan and the Audi 100 were bestseller prodcuts and pushed their brands to huge profits for years riding those design concepts that were only rehashes of the past.

Now the same thing will happen with the price points. If every flagship phone looks like the iPhone and is priced about the same and has roughly similar specs, then consumers feel there is not much differentiation and at that price they will then want the best brand (Apple). But Apple cannot afford to do 5 flagshhips per year or 10. So if Samsung, Sony, Lenovo, HTC and Xiaomi each goes into a DIFFERENT direction, then Apple can't match all. This is again basic marketing. Today because of the sheep mentality of panic that hit the industry when NOKIA suddenly produces iPhone-clones only - and Nokia had to know something the rest did not - for a while yes, all followed. That is supremely silly. So someone will test the waters. And they will discover that yes, there is plenty of 'air' to explore above the 750 dollar price level of the iPhone 6 Plus. This is not the core mass market premium customer. It will initially definitely be a geeky segment. But there is plenty of opporuntity here. Take battery life. We all hate that the battery runs out so fast. When will one major brand release its flagship with a distincitive look, not the thinnest phone made but a proper flagship (5.5 inch screen, 20mp camera etc) with a battery that lasts for 2 days watching video 24 hours a day haha... And then price it at 900 dollars. It will sell. Will it sell 500,000 units or 1 million or 5 million, who knows, but it will sell and now the price ceiling is busted. Or someone does the next super cameraphone like the Galaxy K Zoom or the Lumia 1020 before it or the 808 Pureview before that. But 808PV was on the dead Symbian OS. L1020 is Windows Phone and on retail boycott. K Zoom is by whatever bizarre lunacy-logic by Samsung NOT SOLD in most markets. Someone will do the next best cameraphone and do it on Android and sell it globally. It will win all cameraphone comparisons and as best cameraphone flagship it will easily match the 4 million per quarter (16M per year) level that Nokia's N8 did as the last cameraphone-flagship that wasn't crippled by market conditions around it. This could be an Xperia or Galaxy or perhaps the rumored Nikon smartphone. It will sell huge. And if that smartphone maker is smart, knowing there IS NO competition, they will price it at 999 dollars. Would I have paid 999 dollars for the K Zoom last year? Yes I would have. Wanna know what it cost? 450 dollars only (vs contemporary iPhone and Galaxy S at 600 dollars). There is absolutely no rival to the K Zoom that is flagship specs all around but by far the best camera ever on a phone. Why wasn't it priced at 999 dollars and sold in every market? Samsung are clueless about marketing.

Which brings me to my summary. The current 600 dollar / 750 dollar supposed price ceiling is a total illusion that was the result of a coincidence of 2 of the 3 largest smartphone makers suddenly collapsing and the industry picking up the wrong lesson about why. If there was a real 600 dollar price barrier then the iPhone 6 Plus would not see any sales at 750 dollars. And obviously now the rival brands will rush to bring out 750 dollar 'super' flagships of their own. And the myth will have been busted. Some will be brave to go beyond 750 dollars and that is when the dam breaks. And then with far more price-revenue expected of those phones, the costs of the components can go up too, allowing radical tech to be incorporated further pushing those brands into differentiation from Apple. Like Audi 100 or Saab 900 convertible is a radical departure from Volkswagen Golf and at far higher prices and profits.

I know in my bones this will happen. I have no proof of it. I will be reporting when it happens and I know you'll be around to read that blog haha.. Lets discuss the issue again then.

A few quick commments. Yes, Apple is very good at tying people ever more deeply into their ecosystem, the wallet is just the latest example. You know where they got all that from? NTT DoCoMo of Japan did that 10 years before. Almost everything on the services side that Apple has done starting from the App Store is copied from NTT DoCoMo but in a far more greedy way (Apple takes 30% of every dollar; NTT DoCoMo only takes 9 cents out of every dollar).

Now the last point, you see HTC, Xiaomi, Samsung, Moto and LG making very similar phones to Xperia but you admit Xperia is very desirable and you seem to prefer Sony over the others even if its very close. That is my point. All run on Android. If so, and if Xperia is the closest thing to an iPhone on the Android side of the fence, then why can't Sony make bigger profits per phone than LG or Samsung or HTC? Its a problem in marketing! As is the fact that you aren't seeing Xperias where you are (distribution problems).

Tomi Ahonen :-)


Tomi, I'll agree to multiple brands if you use 1% of smartphones as the standard in any given year because 10M maybe 1% now, by 2020 it will be maybe .5% of all smartphones.

So if you can show that by 2020 there will be more than 1% of all smartphones that sell at a higher baseline price than the baseline highest priced iPhone (in this year the iPhone 6+ at $750 USD), then you win the bet. But the territory pricing should be basically equivalent, ie. comparing crazy Brazilian or Russian pricing to the US pricing.

Combining all brands gives you an advantage but I think that I will be right still ;)

Having said that, I will stipulate that you are the best forecaster of numbers in the business (I just disagree with some of your commentary - especially about Nokia ;) )

I think that you make a good point about battery life. Maybe someone will come out with a beast of a phone with crazy battery and a amazing camera that doesn't care about weight or thickness and that may impress a certain segment of the population. That would differentiate from the iPhone and I am sure that there maybe people who buy it. But the issue is software- image processing, photo-capture speed, etc... where the iPhone has the advantages. That is where Android fails in comparison. There is a reason why most of the top photographers use iPhones if they are taking cameraphone pictures. This doesn't include the reason of certain very good specialty photo apps that are exclusive to iOS.

But battery is a great point and maybe a true DSLR camera would separate it from an iPhone. I don't know, I'd have to see it. The K Zoom's problem is that it is interesting but super ugly in my opinion. That's always been the issue with Samsung's design.

It's possible that someone will come out with a 6-6.5 inch phone with an incredible screen, 3 day battery life and a true DSLR camera and there are enough brands that sell similar phones that sell in the right volume...

...we'll check back in 2020 ;)

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