Category: Theory

Theory.

Google as Android "Vendor"

In a recent tally of mobile OS market share estimates from Canalys, the market was organized by OS vendors. The number of devices sold by operating system vendor includes as many OS’s as each vendor may supply.

For example, Microsoft licensed two different OS’s during the period: Windows Mobile 6.5 and Windows Phone 7. Nokia also offered multiple versions of Symbian, which have varying degrees of inter-operability.

Google’s offerings include (as per footnote) OMS and Tapas platforms in addition to Android.

Fragmentation is not a new subject as OS licensing models have been ripe with it for as long as they existed.

What I want to draw attention to is the concept of Google as “vendor.” Continue reading “Google as Android "Vendor"”

Of Platforms, Operating Systems and Ecosystems

In the earnings Q&A Stephen Elop used the word ‘Platform’ once, ‘Operating System’ three times and ‘Ecosystem’ 15 times.

Though they seem interchangeable, the three phrases have significant differences in meaning. Briefly put, a Platform is a business model concept,  an OS is a technology concept and an Ecosystem is a marketing concept.

Platform

A platform, as the New York Times recently pointed out, can take many forms. Continue reading “Of Platforms, Operating Systems and Ecosystems”

A new era in financial analysis is dawning

The story of amateur out-performance has been getting more attention lately and that’s a good thing. Success emboldens more amateurs to try their hand at financial analysis. Transparency of methods and data demystifies a practice that is not as complex, and a skill that is not as hard to obtain, as it’s often assumed.

While, quarter after quarter, the gap between the two cohorts is calibrated, what we haven’t heard much of is a defense from the professionals.

That’s a bit strange given the negative impact some of the attention must be having on their reputations. This is why I was glad to see that Adam Satariano’s well-written piece finally got some reactions from the professionals. Continue reading “A new era in financial analysis is dawning”

What Google can learn from John Sculley: How technology companies fail by placing their strategy burden on technology decisions

And so we come to the question of Chrome and H.264. First off, it should be clear that video codecs are infrastructural technology[1]. They are commodity algorithms which are generally invisible to users. They are ubiquitous and are “shared” in the sense that they are available for licensing often without much in terms of cost.

So they don’t really offer strategic advantage to the adopter. Some may end up adding slightly more to a cost structure than others, but not in a way that determines strategy.

Flash on the other hand is not infrastructural. It is not shared, it is not invisible to users, it is a brand, it has a significant business model and market value. It is sustaining to Adobe.

So the argument I’ve heard against Google’s decision is that they are using an infrastructural technology decision (a new video codec) to placate or sustain Adobe Flash, at the expense of Apple, a potential or perceived rival.

If this was the plan, it would be a strategic mistake. Continue reading “What Google can learn from John Sculley: How technology companies fail by placing their strategy burden on technology decisions”

Who killed the Intel microprocessor?

The recently announced move by Microsoft to support the ARM architecture with their Windows product, indicates something profound is happening in the market for microprocessors.

Dr. Hermann Hauser puts in bluntly:

“The reason why ARM is going to kill the microprocessor is not because Intel will not eventually produce an Atom [Intel’s low-power microprocessor] that might be as good as an ARM, but because Intel has the wrong business model,” said Dr. Hauser. “People in the mobile phone architecture do not buy microprocessors. So if you sell microprocessors you have the wrong model. They license them. So it’s not Intel vs. ARM, it is Intel vs. every single semiconductor company in the world.”

via Intel Microprocessor Business ‘Doomed,’ Claims ARM Co-Founder – Tech Europe – WSJ.

To make sense of that you have to step back and look at what’s been happening in microprocessors and how mobile computing is affecting the whole processor value chain. Continue reading “Who killed the Intel microprocessor?”

Resetting Motorola

Motorola—like HTC—is thus a bellwether for makers of Android phones, whose sales have now caught up with those of the iPhone—about 300,000 a day worldwide. Some industry analysts doubt that it will be able to create a big market for its devices and make enough profits before cheaper providers move in. If they are right, the smartphone market may eventually become like that for personal computers: a handful of huge competitors with tiny margins. The difference will be that these firms will hail from around the world rather than being mainly American.

via Motorola: Breaking up | The Economist.

When I argued that the meek shall inherit Android, the profitability data was the core evidence. That argument, made in August, was:

So here we have the real challenge to Android:  partnership with defeated incumbents whose ability to build profitable and differentiated products is hamstrung by the licensing model and whose incentives to move up the steep trajectory of necessary improvements are limited.

In other words, Android’s licensees won’t have the profits or the motivation to spend on R&D so as to make exceptionally competitive products at a time when being competitive is what matters most.

The surge in emerging market Android entrants has been the latest setback for branded Android vendors. What should be the long term strategy for companies like Motorola and Samsung? Continue reading “Resetting Motorola”

How sticky is Android?

There is an assumption floating around the debates in this and other forums that the “battle” between mobile platforms is a land grab. The unspoken implication of this assumption is that once a user is captured she is permanently locked into the chosen platform never to move to another again as long as she lives.

For example @dutchtender remarked:

many people’s first smart phone will be android. android can take them “cradle to grave.” android will be there with a higher end solutions when they can afford it

This is a strong but untested claim. It may be true but we owe it a bit of thought.

Continue reading “How sticky is Android?”

The PC clones of the post-PC era

Since I spend most of my time thinking about what will happen, at the end of each year, rather than looking forward I like to look back to see how wrong I’ve been. The great thing about being wrong is that you learn something. Especially if you use a foundational theory to tie concepts together. Theory building is all about finding anomalies that adjust and improve it.

Fortunately, exactly one year ago, on December 30 2009 I wrote an article asking if Android was disruptive. It turned out to be the right question to ask for 2010.

What have I learned since? Continue reading “The PC clones of the post-PC era”

G'Five overtakes Samsung in India: What does this mean for your favorite mobile OS?

With a market share of 31.5 percent, Nokia is still the largest vendor of handsets in the Indian market, followed by Chinese brand G’Five with about 10 percent share, IDC said on Wednesday.

via PCWorld.

No, I haven’t heard of G’Five either. The article goes on to say that there are 68 new vendors in the market accounting for 41% of total shipments. There were only five new vendors with a share of 1% in the first quarter of 2008.

It was not long ago that Nokia held over 70% of the Indian market. That market is now larger but the share for Nokia has dropped by half at least. The share was not lost to Samsung but to 63 new entrants. They managed to capture 40% of the market, roughly equal to what Nokia lost.

These new vendors will launch Android phones next year or the year after that. According to IDC, Android obtained 9.4% in the third quarter up from 2.9% y/y. The number of Android models went from 2 to 19 in the same time frame.

What does this mean for Your favorite mobile OS? Continue reading “G'Five overtakes Samsung in India: What does this mean for your favorite mobile OS?”

The parable of the the PDA: predicting the smartphone's future

When reading the comments disputing the possible end of the voice-phone era I’m reminded of similar comments disputing the end of the PDA era.

Although the Apple Newton pioneered the market in 1992 and John Sculley came up with the acronym, the Newton did not sell in significant volumes. It wasn’t until 1997 with the Palm Pilot that the PDA market took off. Microsoft quickly followed with a licensed OS based on Windows CE. In 2001 Microsoft launched the Pocket PC brand to cement its attack on the PDA market. The first phones using a Microsoft OS were using something called Pocket PC Phone Edition. The first Nokia smartphones (Communicators) were built like mobile PDAs.

The logic was quite compelling. The original PDA was built to mobilize contacts, calendars and notes. They replaced bulky paper organizers and seamlessly synced to PC productivity software like Outlook. It was a compelling product in the US where small business customers needed to keep track of hundreds of contacts. Users could even ‘beam’ contacts to each other via infrared. The idea of adding a phone function to the device made sense insofar as contacts could be immediately dialed from the contact app rather than typed into another device’s phone keypad.

By the early 2000’s PDAs were forecast to sell by the hundreds of millions. Continue reading “The parable of the the PDA: predicting the smartphone's future”