An Ecosystem Keynote

  • Posted: 07 June 2011 08:18 AM

    If you just own one Apple device, most of the iCloud functionality is not that compelling. And what was announced yesterday isn’t the stuff that gets folks rushing into stores to buy products. 

    But Apple is laser focused on its core asset:  the ecosystem it has created.  It makes even less sense after iCloud for you to own an iPad and an Android phone.  Once you get hooked on any Apple product, the rest of the Apple products immediately become more valuable to you.

    iCloud won’t sell much more hardware for Apple this quarter, but over the next five years, it’s a huge step forward.

         
  • Posted: 07 June 2011 12:08 PM #1

    I do think that the online backup component of iCloud could help sell more devices. At least based on a couple anecdotes—my grandmother, and a friend’s dad.

    In both cases they are older, not technically inclined, and not very interested in a full-fledged computer. They currently use WebTVs on dialup, which are not getting any faster and with each passing day break on more and more websites.

    We’ve thought about getting them iPads but the main roadblock is that they are in another state with no computer to sync to, no way to back up or update software, and if anything where to ever happen to it they couldn’t get the device up and running again until our next visit when we could plug them into our laptop again.

    iCloud changes all that, and I think we will both probably end up buying them iPads in the next year as a result.

         
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    Posted: 07 June 2011 12:08 PM #2

    Lion:  http://www.apple.com/macosx/whats-new/
    http://www.apple.com/macosx/whats-new/features.html

    Features can be grouped into 4 areas:  iOS-like, Server, general OS improvements for end users, and OS improvements for developers.

    General OS improvements.  AirDrop ?  this can remove headaches for many.  Resume, AutoSave and Versions ? tyvm. 

    Lion improvements are possibly bigger than Tiger, Leopard and Snow Leopard combined.

    Lion is huge and the ecosystem (cloud) aspect is “only” 1 part of user benefits.

         
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    Posted: 07 June 2011 12:27 PM #3

    iCloud http://www.apple.com/icloud/

    The obvious benefits are

    a. file storage
    b. online contacts, calendar, mail and syncing thereof

    Then we have the big ones: 

    c. iTunes Cloud
    d. with iTunes Match
    e. and Push to Devices + New Purchases Automatically Everywhere. (this last one is available in Beta)

    Fall is the time for full availability.  (apologies to those in the Southern Hemisphere)

         
  • Posted: 07 June 2011 01:20 PM #4

    There’s been a bit of negative commentary that this stuff is all very well, but it won’t drive new users to the platform. As David points out, that’s entirely wrong. There is a huge market all over the world to connect those who have NEVER had a PC or a smartphone, and have little or no support available if they did. It’s a substantial proportion of the population (guess:20-30%), and there is no competition; no-one else has a solution that works for these people.

    This is a bit more subtle than a new iPhone as a sales driver, but I think it’s actually more significant.

    The really big worry (for shareholders) is the very big responsibility Apple is taking on itself to provide bug-free cloud services in perpetuity. A repeat of the MobileMe problems would be much more serious this time.

         
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    Posted: 07 June 2011 01:37 PM #5

    macorange - 07 June 2011 11:18 AM

    It makes even less sense after iCloud for you to own an iPad and an Android phone.  Once you get hooked on any Apple product, the rest of the Apple products immediately become more valuable to you.

    Fortunately, this is a very testable premise right now, well, in Q4. If iPad still dominates tablets, then iPhone should finally start a rebound in comScore stats. I don’t see that happening in phones. The sum of the loose connections in a freer and more open Android ecosystem vastly surpass the strong connections Apple presents. The best example is deep Facebook integration, missing from iOS 5.Granted, it ships with Gingerbread, but if it didn’t, a developer could add services and hooks to make it feel just as deeply integrated as Twitter. On Android, these integration points are public. Developers are both “allowed” and encouraged to exploit them. Android may lack some fit and finish and unity, but it’s fit, finished, and unified enough with flexibility that trumps iOS polish.

    As I pointed out in another thread, if a new social network “WeinerShare” takes the tech industry, 20-somethings, and Congressmen by storm later this year, iPhone and iPad users have to wait for iOS 6 for deep WeinerShare integration. Android users can get the same level of WeinerShare integration from the WeinerShare Company as exists in Android for Twitter and Facebook presently. They don’t have to wait for Google.

         
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    Posted: 07 June 2011 02:16 PM #6

    Bosco (Brad Hutchings) - 07 June 2011 04:37 PM
    macorange - 07 June 2011 11:18 AM

    It makes even less sense after iCloud for you to own an iPad and an Android phone.  Once you get hooked on any Apple product, the rest of the Apple products immediately become more valuable to you.

    Fortunately, this is a very testable premise right now, well, in Q4. If iPad still dominates tablets, then iPhone should finally start a rebound in comScore stats. I don’t see that happening in phones. The sum of the loose connections in a freer and more open Android ecosystem vastly surpass the strong connections Apple presents. The best example is deep Facebook integration, missing from iOS 5.Granted, it ships with Gingerbread, but if it didn’t, a developer could add services and hooks to make it feel just as deeply integrated as Twitter. On Android, these integration points are public. Developers are both “allowed” and encouraged to exploit them. Android may lack some fit and finish and unity, but it’s fit, finished, and unified enough with flexibility that trumps iOS polish.

    As I pointed out in another thread, if a new social network “WeinerShare” takes the tech industry, 20-somethings, and Congressmen by storm later this year, iPhone and iPad users have to wait for iOS 6 for deep WeinerShare integration. Android users can get the same level of WeinerShare integration from the WeinerShare Company as exists in Android for Twitter and Facebook presently. They don’t have to wait for Google.

    Brad not sure I get your point.  Apple has outgrown the smart phone market rate of growth every qtr it has existed.  In the case of Apple I think you can agree that they are not in a land grab mode for market share.  They have consistently grown the platform/ecosystem.  Since Android is free & open to all comers.  If I’m a white box phone maker, I can now use android instead of some other RTOS like Brew and my feature phone is suddenly a Android smart-phone.  My point is the individual handset makers are not making a ton of money compared to Apple’s iPhone and Google is dumping a ton of engineering effort hoping their is a pot of gold at the end of the rainbow.  I doubt Google as a business is some altruistic ” Do No Evil” entity, many of the engineers most definitely believe in open source, but a business makes money for shareholders.  As far as controlling APIs in Android, it may be possible to build your own API and get Google to sign off on them but Google is pretty much controlling what goes into each release.

         
  • Posted: 07 June 2011 02:27 PM #7

    This from someone on a non-techie travel board

    ‘I just got off the phone with my husband, listening to his excitement at what Apple is going to be offering… then I saw this thread

    We are gradually moving everything to Apple products - it’s hardest with phones as we have multiple contract termination dates, but we’ll get there!

    This is going to be big

         
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    Posted: 07 June 2011 03:00 PM #8

    sleepygeek - 07 June 2011 04:20 PM

    There’s been a bit of negative commentary that this stuff is all very well, but it won’t drive new users to the platform. As David points out, that’s entirely wrong. There is a huge market all over the world to connect those who have NEVER had a PC or a smartphone, and have little or no support available if they did. It’s a substantial proportion of the population (guess:20-30%), and there is no competition; no-one else has a solution that works for these people.

    This is a bit more subtle than a new iPhone as a sales driver, but I think it’s actually more significant.

    Totally agree.  Long run PC sales will be cannibalized by iOS devices.  This has already begun, will continue thru the summer and hit a new gear in October.

         
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    Posted: 07 June 2011 04:25 PM #9

    The iCloud fitting into the ecosystem is just scratching the surface. They are releasing features slowly to allow the consumer to adapt and adopt these new features at a comfortable rate. I anticipate the iCloud and its iterations to be much more down the road within the next 12 months from now, as new layers are revealed each quarter.

    Just saving music and photos doesnt justify the size and amount of data centers Apple is currently building. There is much more in store in the near future.

         
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    Posted: 07 June 2011 04:40 PM #10

    richardlo - 07 June 2011 07:25 PM

    The iCloud fitting into the ecosystem is just scratching the surface. They are releasing features slowly to allow the consumer to adapt and adopt these new features at a comfortable rate. I anticipate the iCloud and its iterations to be much more down the road within the next 12 months from now, as new layers are revealed each quarter.

    Just saving music and photos doesnt justify the size and amount of data centers Apple is currently building. There is much more in store in the near future.

    I agree

    Think of the files created on various programs from web pages to movies that could be moved to the cloud.

    It allows a first time Apple user to buy a product, create something, access it anytime, and not fork the money now for a Mac.

    The cloud is the perfect solution in a recession.

    WS does not see that yet but 2 years from now they will.  Keep inind these features showed yesterday won’t be available until fall.  In the mean time the stock gets hammered for three more months.

         
  • Posted: 07 June 2011 11:45 PM #11

    macorange - 07 June 2011 11:18 AM

    But Apple is laser focused on its core asset:  the ecosystem it has created.  It makes even less sense after iCloud for you to own an iPad and an Android phone.  Once you get hooked on any Apple product, the rest of the Apple products immediately become more valuable to you.

    iCloud won’t sell much more hardware for Apple this quarter, but over the next five years, it’s a huge step forward.

    Couldn’t agree more.

    macorange - 07 June 2011 11:18 AM

    If you just own one Apple device, most of the iCloud functionality is not that compelling. And what was announced yesterday isn’t the stuff that gets folks rushing into stores to buy products.

    Don’t think of iCloud as something that sells iPad Touches, iPhones, iPads and Macs. Think of iCloud as something that makes you want to own several Apple devices and keeps you from ever wanting to leave the wonderful world of Apple.

         
  • Posted: 07 June 2011 11:46 PM #12

    David Nelson - 07 June 2011 03:08 PM

    I do think that the online backup component of iCloud could help sell more devices. At least based on a couple anecdotes—my grandmother, and a friend’s dad.

    In both cases they are older, not technically inclined, and not very interested in a full-fledged computer. They currently use WebTVs on dialup, which are not getting any faster and with each passing day break on more and more websites.

    We’ve thought about getting them iPads but the main roadblock is that they are in another state with no computer to sync to, no way to back up or update software, and if anything where to ever happen to it they couldn’t get the device up and running again until our next visit when we could plug them into our laptop again.

    iCloud changes all that, and I think we will both probably end up buying them iPads in the next year as a result.

    Great anecdote.

         
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    Posted: 08 June 2011 12:05 AM #13

    I might have interjected with a “but there’s limited space with iCloud” yesterday DN, but Apple left silent in the keynote that iCloud will have premium offerings (they mention it in their press release).  So iCloud can be set up with enough persistent online storage that a surprisingly large number of people may be able to keep all of their stuff on-line and on-demand at all times.

    Provided iCloud is as fast as Software Update is everywhere, we could be seeing the first snowball rolling down some really, really huge mountain.

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  • Posted: 08 June 2011 12:17 AM #14

    Bosco (Brad Hutchings) - 07 June 2011 04:37 PM
    macorange - 07 June 2011 11:18 AM

    It makes even less sense after iCloud for you to own an iPad and an Android phone.  Once you get hooked on any Apple product, the rest of the Apple products immediately become more valuable to you.

    Fortunately, this is a very testable premise right now, well, in Q4. If iPad still dominates tablets, then iPhone should finally start a rebound in comScore stats. I don’t see that happening in phones.

    The facts upon which you build the foundation of your premise are in error. The iPhone does not need to “rebound”. Here are the year-over-year growth percentages for the iPhone over the past ten quarters, courtesy of DawnTreader and Posts at Eventide:

    88.47%
    122.72%
    626.36%
    6.89%
    100.25%
    130.74%
    61.25%
    91.42%
    85.82%
    113.06%

    The iPhone may not be outgrowing Android, but it is outgrowing the smartphone market. Further, the iPhone is a phone whereas Android is an OS. If you want to compare apples to apples and OS’s to OS’s, then Apple has sold over 200 million iOS devices which represents 44% (as opposed to Androids’ 28%) of the mobile operating system market. (Source: WWDC 2011 Keynote Address; 40:00 minute mark).

    It will be difficult to judge the effectiveness of iCloud in the short run because the iPhone is selling at near capacity and the iPad IS selling at capacity. The proof of this pudding will only be seen in the long term. Will the number of Apple customers who own multiple Apple products increase? Will Apple’s already stellar customer loyalty numbers for their iPhones, iPads, and Macs go up even further? Only time - and some carefully done research - will tell.

         
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    Posted: 08 June 2011 01:07 PM #15

    Gene Steinberg unleashes especially pointed barbs against Microsoft.

    TechNightOwl

    your iPhone or iPad can be activated, synced and updated online without the need to connect to a Mac or PC, so the cord is cut.

    This is totally opposite of what you?d expect from Microsoft, who is still trying to make the PC the focal point, simply because they earn the largest share of their profits from the sale of Windows and Office licenses. Sure, Microsoft is hoping to provide a veneer of Windows Phone 7 integration with Windows 8, but it appears to be noting more than window dressing. Underneath the altered skin, it?s still Windows for better or worse. Although things might change between now and the official release date, it?s clear Apple has worked far harder to embed the best of the iOS ? or at least the features that make sense ? in Mac OS 10.7.

    But the unkindest cut of all was Apple?s decision to sell what is clearly a major system upgrade for $29.99, a mere 99 cents higher than Snow Leopard, which was never advertised as a major feature release. I expect the number of changes in Snow Leopard were probably roughly compatible to the real changes between Windows Vista and Windows 7. Only Microsoft charged you full price for the retail upgrade, and I expect they will justify a similar price structure for a Windows 8 upgrade box for the very same reason. I also don?t expect that Microsoft has a clue how to make it a credible online-only release. Apple has perfected that technique with the Mac App Store, which now includes the Lion developer releases.

    Sure, Microsoft could try to imitate Apple in the same fashion as they pay lip service to mobile OS integration in the next version of Windows. Windows 8 might be available in some new online app repository, but don?t expect Microsoft to seriously consider a retail price of under $30. If they did, they?d lose tons of money, considering all the cash they pour into (or squander on) Windows development. I once suggested on my tech radio show that Microsoft probably spends more than Apple has on every single version of Mac OS X for a single Windows reference release, though I admit I?m just shooting from the hip there. Yet efficiency is not in Microsoft?s DNA.

    Worse, with Apple integrating everything into a powerful online ecosystem, iCloud, the best way to enjoy the user experience will be to go all Apple. Even though PC sales are relatively stagnant or dipping somewhat these days, Macs continue to move at a healthy clip. Making it painless for Mac users to upgrade to the latest and greatest OS ? well, if you?re using Snow Leopard at any rate ? is only going to smooth the migration path.

    Financially, Microsoft’s margins on Windows 7 may crash.  Windows 8 may be laughed out off the beach.