Author: Horace Dediu

Why HTC?

In the suit against HTC, Apple’s listed infringing phones include HD2, Touch Pro2, Tilt2, Imagio, Pure and Touch Diamond. These all run Windows Mobile and not Android. HTC shipped 80% of the Windows Mobile units in the field, a far larger volume than Android so it stands to reason that the law suit is as much targeting Windows Mobile as Android.

In 2006 Microsoft announced that their partners/OEMs/Operators will get indemnification on IP suits regarding their OS. It’s not a sure thing that Apple’s patents cover any part of the Windows Mobile stack–vs. whatever parts HTC layered on top. However, there is a high probability that Microsoft will join Google in HTC’s defense.

I should also point out that the media’s emphasis on Google as the exclusive target of the suit is sensationalistic. Focusing on Google possibly misses a hidden agenda.

Namely that Apple is attacking the hub of the modular approach to mobile computing while largely leaving the integrated vendors like Palm and RIM alone (the dispute with Nokia is over license terms for GSM patents and not yet about UI patents).

Therefore it’s entirely likely that HTC was singled out to disrupt the business logic of modular mobile software. HTC is the pioneer and the hub as the largest licensee for both WinMo/WinP and Android and the inspiration for hundreds of OEM/ODMs to make modular products.

HTC’s defense will be complicated and difficult due to these dependencies. Legal risk weighs heavily on large corporations, especially when the payoff is marginal at best. Other vendors looking at this licensing model might think harder about participating, and that may be the whole point.


L’iPhone, le smartphone préféré des Français (part deux)

And the most successful market for the iPhone based on the Gartner numbers, is, um, France, where the company has gained over 10% of the market, at the expense of Nokia and Sony. “France is now the most successful market in the world on a relative basis,” says McCourt.

link: France Now iPhone’s Most Successful Market? – Tech Trader Daily – Barrons.com

See also:

77 % des téléphones vendus par Orange à Noël ont été des iPhone
L’iPhone, le smartphone préféré des Français


Analyst: App Market to Reach $15.xx Billion by 2013

An upswing in the market share of “smart” devices, along with an increase in application focus from OEMs, OS developers and mobile network operators will drive yearly app revenues from US$1.94 billion (2009) to US$15.65 billion in only four years, according to our most recent research findings. The application market’s growth is driven by the widespread push of advanced handset capabilities by the mobile industry and the increasingly-connected global consumer base. This trend will continue, seeing global smartphone users numbering 970 million by the end of 2013.

link: SMARTPHONE APPLICATION MARKET TO REACH US$15.65 BILLION IN 2013 | research2guidance

Nice numbers. Too bad they blew their credibility by showing too many significant digits in their estimate. How can they state with a straight face that the market could reach $15.65 billion without some hint of a potential margin of error?


Microsoft: Mobile Platforms Don't Matter

AppleInsider | Microsoft Pink-Zune details emerge alongside Windows Phone 7

Dilger in fine form today ripping Microsoft a new one.

The collapse of its Windows Mobile Marketplace has now caused Microsoft to radically reword its mobile app strategy going forward in such a way as to vilify the entire concept of apps. At the launch of Windows Phone 7, the company presented a video that portrayed the iPhone’s ability to run mobile apps as a confusing world with too many doors to choose from, each leading to rooms with starkly white walls, an experience that frustrated and puzzled a professionally dressed woman.

It really isn’t sporting anymore to pick on Microsoft in mobile. Ridicule turns to pity.


Microsoft Leaks Details of WP7 Platform

Charlie Kindel on Windows Phone Development : Different Means Better with the new Windows Phone Developer Experience

  • There’s zero backwards compatibility with Windows Phone 6.5 applications.
  • It’s still based on Windows CE underneath (version 6 in this case)
  • Developers are going to need to re-code their apps.
  • So what will they code it in? So far, we’ve been told Silverlight and XNA.
  • Kindel’s post also mentions Web 2.0 Standards and Microsoft developer tools, along with .Net.
  • Nothing about C++ or native code versus managed code, but expect managed code to be de rigeur.

Check out some of the comments in the link above.


iPad vs. Kindle: Purchase Intent Survey

A survey of nearly 3,200 consumers by ChangeWave Research finds that 40% of people planning to buy an e-reader in the next 90 days expect to get Apple’s iPad. The current leader, Amazon.com’s (AMZN) Kindle, came in second at 28%.

link: E-Reader Buyers Coveting iPad Over The Kindle – Investors.com

This should be put together with data showing at least 15% of iPhone users showing purchase intent for iPad.

If we assume 45 million iPhone users by time of launch (42 million units have been sold as of end of December) and 15% would buy iPads it would therefore not be unreasonable to assume about 7 million iPads will go to iPhone users alone.

It’s unfortunate that we cannot calibrate against installed base of Kindle users since Amazon has never released any sales figures.


Blackberry Loves U2

BlackBerry – BlackBerry Loves U2

Last year U2 chose Research in Motion as the main sponsor for its tour.

Read More: Wired.com

Blackberry might love U2 but does Bono still like Palm?

You might know Elevation for its most famous partner, U2’s Bono. In the summer of 2007, the firm committed $325 million to Palm in exchange for a 25% stake in the ailing handheld computing pioneer. By the following winter, the partners would up their investment by another $100 million.

Elevation has since sold some of its preferred stock, but according to Palm’s SEC filings, it still holds enough common and preferred shares to account for roughly 30% of the business.

Others who bought around the same time as Elevation are struggling with a 33% loss, and that’s after accounting for a $9-per-share dividend.

Read more: fool.com

Maybe Bono should pick up his Blackberry in between gigs and work on a deal between RIM and Palm.


Android vs. Google Part II

AppleInsider | First AT&T phone with Google Android will feature Yahoo search

As the Backflip will mark the first time U.S. customers under contract with AT&T will have the option to choose between Android and the iPhone, every Motorola Backflip that AT&T sells might potentially be at the expense of an iPhone.

That Backflip sold will not generate Google any ad revenue since it will offer Yahoo/Microsoft search exclusively. Nor will the Backflip generate any license revenue for Google, because Android is licensed without a fee.

If that buyer would instead have bought an iPhone, the search from mobile Safari would have some non-zero value.

It is therefore pretty obvious that, at least in this instance, Android is destroying value for Google.

See also:

Android vs. Google (part I)


Known by All, Understood by Few

Erick Maronak, manager of the Victory Large Cap Growth Fund, says Apple is the best-run company in the U.S.

I would add it’s also almost the biggest and at the same time least understood. A lack of understanding is reflected in a high risk rating, which is itself shown in the company’s Beta.

All told, that makes Apple the fourth largest market cap in the US with the volatility and apparent risk of a startup.

Asymmetries of information don’t get better than this.


Apple, Little Understood, Is Best-Run Company | Mutual Fund Center | Financial Articles & Investing News | TheStreet.com


Suiting Up

Well, I don’t want to talk about any specific company. I’m just making a general statement that we think competition is good. It makes us all better. And we are ready to suit up and go against anyone. However, we will not stand for having our IP ripped off, and we’ll use whatever weapons that we have at our disposal. I don’t know that I could be more clear than that.

Tim Cook, my favorite Apple exec, in January 2009.

One thing should be obvious: the accusations against HTC are aimed at Google and Microsoft or more broadly still, they are aimed at any mobile software competitor that intends to use touch and gesture inputs.

When Jobs said in 2007

We’ve been pushing the state of the art in every facet of this design. We’ve got the multi-touch screen, miniaturization, OS X in a mobile device, precision enclosures, three advanced sensors, desktop class applications, and the widescreen video iPod. We filed for over 200 patents for all the inventions in iPhone and we intend to protect them.

he implied that Apple had approached this new input method with much more care than when they introduced the mouse and windowing interfaces in 1984.

Unlike the fight over Windows, which was a copyright debate, this will be all about patents. Apple ultimately lost the GUI fight over the MasOS windowing interface, which is why I think they are much more prepared this time.

Given this strategic intent, the only questions were how the war would be engaged and on what terms. A few skirmishes caused some head fakes.

First, came apparent threats against Palm. Apple was certainly debating going after Palm, but I think they realized it would not be a good strategy. Mostly because the signal would be weak. There would be few consequences to Palm being punished. Palm’s integrated model is not employed by many of the larger device vendors. Except for Nokia, all other vendors license their OS, Samsung, LG, Sony Ericsson and Motorola would not be infused with anxiety over Plam taking a hit.

Second, came the pre-emptive attack from Nokia. Apple was not ready to go after Nokia last year because Nokia did not yet have a UI “worthy of being infringing”.  In other words, there was no target to shoot at.  Nokia’s suit was pre-emptive in that it centered on their desperate wish to have a cross-license agreement–trading GSM patents for touch patents.

That skirmish should not detract from what’s the real goal here:  securing monopoly rights to mobile computing interfaces.