Mobile computing platform

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    Posted: 06 December 2009 12:14 PM

    Smartphone is likely to be the mobile computing platform of choice.  Would this market evolves into a monopolistic structure like PC industry or remains competitive like car industry?  Should Apple continue to control the whole widget or license its iPhone OS at an opportune time?  If Apple doesn’t license its iPhone OS, would it be limiting its growth potential to a mere largest market share (less than 10%) vendor instead of a dominant market share (greater than 50%) vendor?  Which would be better for investors?

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    Posted: 06 December 2009 12:39 PM #1

    Mace - 06 December 2009 04:14 PM

    Smartphone is likely to be the mobile computing platform of choice.  Would this market evolves into a monopolistic structure like PC industry or remains competitive like car industry?  Should Apple continue to control the whole widget or license its iPhone OS at an opportune time?  If Apple doesn’t license its iPhone OS, would it be limiting its growth potential to a mere largest market share (less than 10%) vendor instead of a dominant market share (greater than 50%) vendor?  Which would be better for investors?

    Eric Schmidt of Goog was on an interview recently (liked hearing him talk although didn’t completely agree with all he said).  Forget the exact details but something like in 10 years data transfer will be 10 times faster than today (there was a term for it and I botched the definition here but the main point is the pocket pc via the smart phone is going no where but further into our daily lives).

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  • Posted: 06 December 2009 01:08 PM #2

    Apple won’t license the iPhone OS. But it may sell a chip for incorporation into competing hardware that allows access to Apple’s content distribution channels (including other-platform app stores), if alternatives continue to make no headway. Apple would need to control and be able to update the firmware of this chip, which would have to be “activated”, just like an iPhone.

    Apple has acted differently to Microsoft by ensuring content format (other than native applications) is not proprietary (even though the DRM is). By also founding the OS on an open source Unix implementation, the opportunity for competition remains open. Competing OS’s are not excommunicated in the way MS’s policies cut off Windows competitors.

    Curiously, Microsoft could have opened up and relaxed its grip on its market before Apple, and might now be invincible. But they preferred total control, enabling Apple to grow an “unprotected” relatively open competing system alongside, capable of generating much higher revenues from a given market share.

    The distribution and DRM implementation for personal ownership of content not tied to physical media, while very likely controlled by Apple or a spinoff, will be a hidden part of the hardware products, in the same way that, say, the alternator in a car can be an essential component bought in by the manufacturer and not specifically visible to the user.

    [ Edited: 06 December 2009 01:11 PM by sleepygeek ]      
  • Posted: 06 December 2009 02:00 PM #3

    There’s no reason for Apple to license the iPhone OS.

    The Android OS will grow exponentially in 2010 in terms of the number of handsets using the OS. This will pressure margins on Android smartphones. That’s not Google’s concern. Google’s goal is ubiquity. It’s up to the handset makers to fight for market share and product differentiation.

    Both Motorola and VZ have picked on the wrong rival.  It will be very hard for VZ to brand an Android smartphone and achieve more than limited success.

    Apple wants more than a popular and profitable line of smartphones. Apple wants a fully integrated hardware paradigm with a sum functionality greater than than what would be possible from an independent collection of pieces. Each product will stand on its own, but integrated together providing a unique and enhanced user experience.

    Apple doesn’t sell products as much as Apple sells a relationship. The company is building out its eco-system and feeding that eco-system with regular hardware product refreshes that builds on the customer and feeds the eco-system (with Apple taking bits of change) from each or most transactions is an attractive and worthwhile goal.

         
  • Posted: 06 December 2009 02:13 PM #4

    Given Apples nature it doesn’t bother me that they own the whole widget.  I’m sure they will continue to do so.  I’ve said it before but one of the major misconceptions about the PC industry imo was that Microsoft was successful because of it’s willingness to license it’s software whereas Apple was not.  Microsoft was successful because it said IBM on it. 
    On a somewhat related note I changed a little tag line I’ve been spouting to family and friends about the iphone from:
    “It’s game over and the world just doesn’t know it yet”  to   “It’s game over and the world is starting to sense it” ...,largely based on this article from the NYTimes.

    http://www.nytimes.com/2009/12/06/technology/06apps.html?pagewanted=all

    Don’t get the wrong idea.  I’m not daft enough to think anybody really gives a damn.  smile

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  • Posted: 06 December 2009 02:21 PM #5

    Mace, your first premise is a bit off.  Its not smartphones that will be the platform going forward, its iPhoneOS, which now appears on the IPhone and iPod Touch, but is also soon likely to appear on a Tablet.  It is likely that Apple will want to capitalize on its dominance in the subnotebook market (and the hundredes of thousands apps) to develop full laptops that also use the iPhoneOS.

    So its just a matter of time before iPhoneOS replaces Windows for dominance in the entire computer market.  While things could change, the only platforms that I see as competitive with iPhoneOS are Android and Chrome.  At this point I see no reason, given the huge headstart of iPhoneOS, and all the other advantages that Apple has (like its physical stores) that iPhoneOS won’t have nearly 50% of the computing market even without licensing it to third parties. 

    The New York Times cover story in the business section today finally “gets it”.  Not only does the article highlight the huge implications of the App Store, but it finally reaches the right conclusion after a lengthy review of all the side issues: “Its the platform, stupid.”

         
  • Posted: 06 December 2009 02:21 PM #6

    sleepygeek - 06 December 2009 05:08 PM

    Apple won’t license the iPhone OS. But it may sell a chip for incorporation into competing hardware that allows access to Apple’s content distribution channels (including other-platform app stores), if alternatives continue to make no headway. Apple would need to control and be able to update the firmware of this chip, which would have to be “activated”, just like an iPhone.

    Apple has acted differently to Microsoft by ensuring content format (other than native applications) is not proprietary (even though the DRM is). By also founding the OS on an open source Unix implementation, the opportunity for competition remains open. Competing OS’s are not excommunicated in the way MS’s policies cut off Windows competitors.

    Curiously, Microsoft could have opened up and relaxed its grip on its market before Apple, and might now be invincible. But they preferred total control, enabling Apple to grow an “unprotected” relatively open competing system alongside, capable of generating much higher revenues from a given market share.

    The distribution and DRM implementation for personal ownership of content not tied to physical media, while very likely controlled by Apple or a spinoff, will be a hidden part of the hardware products, in the same way that, say, the alternator in a car can be an essential component bought in by the manufacturer and not specifically visible to the user.

    Sleepy…,you’re a bit of a marvel and this bit is one of the reasons I’m so glad you’re back to posting occasionally.  Hadn’t thought about this as a possibility even a little.  Thanks. 
    P.S.  How’s that recluse Tommo?

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    Posted: 06 December 2009 04:40 PM #7

    I think Apple is after a bigger piece of the business of mobile computing then existing market share.  The Iphone OS will a big part of the secret sauce but is only a part of the puzzle.  Apple has been busy over this past year prepping for the next big push.  It will be interesting to see how it all plays out, but Apple is positioned to capture a much larger share of computer user dollars.  When we let the analysts neatly categorize all these devices into nice little buckets we can miss out on the major trends.  Back in 2008 when Apple bought PA SEMI they decided not to put all their eggs in the Intel basket.  This was a huge strategic move.  Rather then rely on Intel to lead the way in technology for mobile or purchase 3rd party SOC’s from the likes of Samsung or TI,  Apple went with a purchase of PA SEMI for the best designs which would be difficult to match.  The advantage of writing the software optimized to the hardware can be a huge advantage both in time to market and functionality.  We hopefully will see the results soon.  Tied into this effort is the move to the cloud based computing which will result in a lighter client device for the majority of computing tasks.  Apple has been busy supporting open source efforts for webkit and HTML 5 as well as the SproutCore JavaScript frameworks, these will allow future devices to access cloud applications from things like a tablet or Iphone.

         
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    Posted: 09 December 2009 08:07 AM #8

    pats - 06 December 2009 08:40 PM

    I think Apple is after a bigger piece of the business of mobile computing then existing market share… Tied into this effort is the move to the cloud based computing which will result in a lighter client device for the majority of computing tasks.

    Another key factor to a workable user experience from the cloud is the meshed networks, promised for so long. Implementation has been slowed by poor battery life and trust (meaning, can I trust my data being sent through everyone else’s device? No? Then I don’t want to see it). Tablet computing in the cloud would mean a pervasive transceiver sucking down battery juice. If our devices meshed, each individual transceiver would scale back the power to only reach the next available meshed device, saving battery.  Apple has already addressed most of the software optimization of tranceivers, and the PASemi products could address the trust issue. I’m much more comfortable trusting my casual data to an anonymous encrypted hardware layer, untouchable by mere mortals, than to several layers of cached software.  I’d also be happy to keep my equipment in the mesh if it were being handled by a dedicated, power efficient chip independent of the rest of the device.

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  • Posted: 09 December 2009 12:12 PM #9

    Every time someone questions whether Apple should license their OS, they are overlooking a fundamental fact of Apple corporation. It does not matter whether we’re talking about the iPhone OS or OS X.  The fact remains that Apple is a hardware company whose purpose is to sell their specific line of computers and other consumer devices.  The OS that Apple has developed is intended as a FEATURE of Apple devices to set them apart from the rest of the market. Apple’s Macintosh computer line may have an element of “coolness” in the package, but what REALLY sells is that the OS truly sets the Mac apart from any other make of computer, most of which run Windows.

    The same can be said of the iPhone.  While the design of the package puts it in the high-end of the cool market, the OS is what really sets it apart from other smart phones. Now people may complain about the iPhone being locked down so apps cannot be had from 3rd party sources without a hack, but that is a separate issue.  If people are wanting some of the apps that are found in the App Store, I’d say that is up to the developers to decide if they want to support more than one platform with their software. Just as computer software developers decide whether they want to support both Mac and Windows (and Linux, etc.) with their software, the decision to support more than one smart phone platform is functionally it is no different - except there are more smart phone platforms to deal with.

    As such, Apple not only has no compelling reason to license the iPhone OS, they have good reasons NOT to license it. As long as they keep the iPhone OS unique to Apple’s smart phone line, it will set it apart from other smart phones no matter how closely other makers copy (within the limits of design patents) the iPhone’s physical form.

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