iPhone is a successful device by virtually any measure. It provides a way to access content and connect with the outside world via the Internet with simplicity and ease — and people who own them love to use them. And that’s a problem for providers. They are clogging their networks.
At least that’s what I’m reading from complaints from the CEO of AT&T and Sprint’s recent financial troubles.
Let’s start with AT&T CEO Randall Stephenson, who admitted publicly at the Milken Institutes’s Global Conference this week that he deeply regretted offering iPhone users the all-you-can eat data plan for just $30.
Turns out when you give people unlimited data, they actually use their phones and damn, that bandwidth adds up. You see when you get a piece of highly sophisticated technology that does all kinds of things from show movies to deliver directions to Siri voice recognition, it turns out you want to, you know, use it. Imagine that.
But apparently poor Mr. Stephenson felt that all those people who bought iPhones and lined the coffers of AT&T through the initial years of exclusivity were bandwidth hogs and he wasn’t prepared for that.
AT&T now offers a tiered plan starting at $20 for 300 MB, $30 for 3 GB or $50 for 5 GB. I still have one of the old unlimited plans, which remains grandfathered in and it’s the only reason I’m still with AT&T at this point to be honest, but if you sign up today, you’re probably looking at a minimum of $30 a month for 3 whole GB. And don’t forget that doesn’t include unlimited texting which will run you another $20 per month.
Make sure you download an App that shows you where to find free WiFi around you. Geez.
Lest you cry for poor Mr. Stephenson, The New York Times reported that the tiered data plan approach has been very, very good to his company bringing in $6.1 billion in revenue last year.
At least AT&T is crying all the way to the bank. Sprint, apparently is not so fortunate.
The iPhone has always been a bit of a conundrum for Sprint. They wanted it so badly and once they got it, in order to differentiate themselves from the bandwidth-controlling AT&T and Verizon, decided to offer the old unlimited data plan. Fantastic for you, but for Sprint, not so much.
According to a Reuter’s article, Sprint placed a $15 billion bet on the iPhone and so far the phone subsidies combined with the unlimited data access is killing the company, so much so that Sprint CEO Dan Hesse has decided to take a symbolic pay cut in his salary and bonus. Nice, but probably won’t dent that bill.
When you see the success of the iPhone, it’s easy to think that it must be a boon for providers too, and in many cases it should be, but it also has a dark side. Users use these phones. They bombard the networks. They tax the bottom line because of subsidies.
I don’t cry for the providers though. Instead of whining, be a network and do your job. Of course phone users are going to use bandwidth. If you don’t like it, you’re in the wrong business.
Photo by Yutaka Tsutano on Flickr. Used under Creative Commons License.]]>
When I read yesterday that Nokia had set up a site to attack the iPhone, my first thought was: Big mistake. When I read this morning that it had created a video making fun of Antenna – gate – a problem that came to light almost two years ago — I thought: Wrong direction and just another case of tone deaf marketing.
See, most iPhone users, and there are a lot them, don’t care about the antenna problem. In fact, most people never encountered it and surveys find people love their iPhones in spite of it — as a recent JD Powers survey showed.
When it came to overall satisfaction, Apple blew away the field with a rating of 839. HTC came in next at 798. Apple was the only smartphone manufacturer to get five circles.
If you doubt consumer surveys, then look at the actual sales numbers that Nokia must fight as it enters the US market in earnest this month. All Things Digital reported this week that according to analysts at Genuity, the iPhone is the best selling phone at AT&T, Verizon, Sprint, and T-Mobile for the last 4 months running.
That means when given the choice of iPhone or any other smart phone, the vast majority of consumers are choosing the iPhone and that’s got to be discouraging to every other manufacturer, but especially to Nokia, which has staked the company on Windows Phone 7 smart phones.
But mobile loyalty tends to be weak right? People can be lured by the next big thing, can’t they? — or at least that’s the conventional wisdom. Unfortunately, for Nokia, that’s just not the case with iPhone.
Digital Trends reported last November on a customer loyalty survey conducted by GfK where 84 percent of respondents reported they would replace their current iPhone with another.
The numbers are remarkably redundant, aren’t they?
So when faced with a market where people are appear to be ecstatically happy with what they have, how are you supposed to compete? If you’re Nokia, apparently you create a video that makes your potential customer base look like they are stupid for the phone choice they made.
And I hate to break it Nokia, but it’s not just the iPhone. People love their iPads too. Fortune reported (via CNN Money) that a recent survey by ChangeWave found that a whopping 82 percent of iPad users reported being “Very Satisfied.’
That means making fun of Apple customers is probably not the best way to deal with the problem. There are lots of them and they are delighted with their products, and see no reason to switch.
My advice is stop trying to fight iPhone and go after Blackberry and individual pockets of the Android market. That same GfK survey found that just 48 percent of Blackberry owners reported they would buy another.
And while you’re at it, attack the soft parts of the Android market where quality and price vary dramatically.
Most iPhone users are not going to use their upgrade to move to Nokia phone running Windows Phone 7, not when they are so satisfied with what they have. Don’t go after the happy market. Try to exploit the one that’s miserable. You’re far more likely to succeed.]]>
Let’s start with NPD, which had good news for both companies, depending on how you looked at the numbers. NPD looked at US market figures only.
For starters, iOS and Android accounted for an astonishing 90 percent of the market, according to NPD, but how that breaks down depends whether you look at handsets versus operating system.
If it was purely phones sold, Apple held the top 3 spots for last quarter driven for the most part by the iPhone 4S, which was also offered by Sprint for the first time last quarter. If it was by OS, it’s much tighter than it once was, but Android held a 5 point lead 48 percent to 43 percent. When it came to first-time buyers, however, Android lead by a much wider margin, 57 percent to 34 percent.
Ross Rubin, executive director for Connected Intelligence at The NPD Group attributed this to users who wanted access to the faster LTE network on Verizon and only Android phones were LTE compatible.
IDC measured strictly by phones shipped by manufacturer, but they measured worldwide numbers, not just the US. In this case, Apple bested Samsung by a slim margin with 37 million shipped for a 23.5 percent market share. Samsung was hot on Apple’s heals though with 36 million units shipped for a 22.8 percent market share. In case you’re wondering Nokia came in third with 12.4 percent, followed by RIM with 8.2 percent.
And if you’re wondering how this compares to the fourth quarter in 2010, the big winner was Nokia with 27.6 percent. Last year Apple had 15.9 percent and Samsung had just 9.4 percent, so it shows you how quickly and dramatically the market has shifted
So what does it all mean?
It’s clear iPhone and the Android handset makers, particularly Samsung, are slugging it out for the worldwide lead as RIM and Nokia fade, but Nokia in particular has a make or break year ahead of it as it releases a new line of phones running Windows Phone 7.
Apple is going to continually ebb and flow with each new release. The iPhone 5, which could be out later this year, will likely give Apple another huge boost, but as fancy new Android smart phones (combined with cheaper alternatives) come out from every manufacturer you are probably going to see the numbers shift accordingly.
The cheaper Android phones in particular could have a big impact on the market. Even though all smart phones might not be equal, the cheaper ones could tip the market share numbers in favor of Android and could account for the growing gap between Android and iPhone for the first-time buyer (Verizon’s LTE offerings not withstanding).
In fact, Kevin Restivo, senior research analyst with IDC’s Worldwide Mobile Phone Tracker program saw this as a big factor in Android’s growth. “But a growing number of sub-$250 device offerings, based on the Android operating system, have allowed Google’s hardware partners to grow smartphone volumes and expand the market concurrently.”
However you choose to measure the market, it’s clearly all Android and iPhone, but what surprises me is that in spite of the number and variety of Android smart phone offerings, Apple continues to lead or stay very close.
And that’s just for starters.
Let’s look at the mobile numbers in Apple’s own words:
And that’s just the mobile story. It’s inherently clear that Apple’s mobile strategy is working. Even with competition all around it from Android phones and the Kindle Fire tablet, nothing slowed down the Cupertino juggernaut. To call it extraordinary doesn’t begin to describe how well Apple did.
Oh and by the way the company is sitting on $90 billion in cash.
As we watch Apple rake in the cash, it’s probably worth noting a couple of negatives here. Apple appears to be making money on the backs of exploited Chinese workers. What’s more it tried to sue competitors out of the market, even though it’s clear that the market loves it and it can clearly compete on its own merit.
Heck, Chinese consumers were so hot for the iPhone, they rioted when it sold out, prompting Tim Cook to say (in perhaps the understatement of the year so far), that they didn’t bet high enough on the Chinese market.
As we covered recently, an IDG study found that the iPad was making big inroads inside the enterprise and a new Cisco study confirms this. As Apple makes the transition to the enterprise market and at the same time begins to grow an Asian market, it’s no wonder that Apple is a company that appears to have a license to print money.
The Cisco study found demand is growing in the enterprise (although it varies fairly dramatically by country). In the US for instance, which leads the way in this regard, the report stated that 38 percent of executives have been issued an iPad. That probably doesn’t tell the whole story though because there are very likely many who never asked IT, and just bought one without IT’s knowledge.
From a practical standpoint as you would expect, the Cisco study found that IT worries about security and they want to see more custom apps — no surprises there.
From an IT perspective in spite of these numbers, it would be unwise to think of mobile as a one-horse race. As remarkable as Apple’s quarter has proven to be, there are other mobile players out there and you have to keep your eye firmly on all of them — all superlatives aside.]]>
Apple attributed the lower iPhone numbers to the persistent rumors of a new iPhone holding back sales of the existing one — a perfectly reasonable explanation — but when you combine this news with the death of company visionary Jobs, I’m wondering if Apple’s glory days are behind it and we don’t know it yet.
I can hear you moaning already, but bear with me for a moments and let’s look at another consumer electronics company that also had about decade of dominance before Apple stole its thunder. That would be Sony.
In the 90s I bought Sony everything. I had a Sony TV, DVD player, boom box and Vaio laptop. Sony was a killer brand and I was loyal…that is until I wasn’t anymore and my loyalty turned to Apple.
I don’t recall Sony doing anything particularly wrong to subvert its brand dominance. It’s just that Apple started making great products and it caught my attention. First it was a laptop, then a router, then a phone, then a tablet and before you knew it, I was comfortable with Apple’s quality and the way the products worked together.
But part of that product quality was due to the obsessive nature of CEO Jobs, who reportedly sweated small stuff and bullied engineers to get the exact design he could see in his head. He gave up on legacy technology like the disk drive and the CD/DVD drive long before his rivals did (or even his customers had caught up with his thinking).
If the iPad were to be released today, what are the odds, it wouldn’t run Flash and have a couple of USB drives. I can almost guarantee you it would because with Jobs gone, others voices are going to have an impact — for better or worse.
Without the creative genius of Jobs or his clear understanding of exactly what he wanted, the company will create products as most do on series of compromises. Engineers will say the screw placement is good enough. Marketers will want everything on the device Jobs would have insisted get left off and he won’t be there to say no.
And Apple has had a decade of dominance. Sony had theirs. Microsoft had theirs. These companies aren’t gone of course. They continue to roll along and will for the foreseeable future, still making money, occasionally hitting a home run, but for the most part they are not the brands people really lust for anymore.
So who will replace Apple? I’m guessing it will be Samsung, the South Korean mobile giant with its own parts manufacturing, its popular line of mobile phones and a tablet that scares Apple enough to go to court in Australia and Europe to force it off the store shelves.
I’m not suggesting this will be a precipitous drop by any means. It will proceed slowly, so slowly we won’t even probably know it’s happening — until the next big brand comes along to replace it and Apple is merely a good, but not great one that we remember fondly.
Maybe I’m wrong of course. Perhaps that drop in iPhone sales is just a blip. Maybe that rumor about iPad orders being down is wrong. It’s possible that Apple will continue to amaze and delight us, even without the genius of Jobs driving the company forward.
Apple has been a dominant brand for some time, but I can’t help but feel we are on the edge of a change, that the natural progression of things says Apple had its moment and now its time for a new company to step up and be *the* brand. Only time will tell if I’m right or not. ]]>
I find both of these numbers surprising for different reasons.
First all, some background on the survey: It was conducted by insurance company ProtectYourBubble.com, which according to the company web site will protect your iPhone 4s for 5.99 pounds per month (that’s $9.48 a month in US dollars).
The survey was a small sample for sure, so it’s hard to draw firm conclusions, but the fact that so many people were choosing this upgrade to be the one they jumped on board the Apple platform was somewhat surprising to me, but who knows, maybe that’s just how their upgrade cycles matched up. What was more interesting was that 44 people out of those hundred chose to upgrade from iPhone 4 in spite of the fact, this wasn’t considered a major upgrade by any means.
Still, what was even more unexpected was that Siri, the voice assistant, which I think is the biggest draw on this phone wasn’t the chief reason these 100 people were getting it. In fact, 37 people cited the 8 megapixel camera as their favorite new feature, compared with 34 who named Siri, a small but interesting difference.
One other data point found that more than a third of respondents believed Siri was just a gimmick, which seems odd to me because this feature is getting a lot attention from early adopters.
Finally, when asked what phone they would buy in a world where iPhone didn’t exist, the top answer was very surprising: 34 percent said they would buy a Blackberry. Microsoft might want to be worried that only 3 percent of those who responded would buy a Windows phone in a world without iPhone. It’s worth noting that 27 percent said they would get an HTC phone and 24 percent a Samsung phone–both of which run Android– in this hypothetical iPhone-less world.
Meanwhile, AT&T’s activation servers were overloaded again, as with the iPhone 4 launch. This is really inexcusable for a company with AT&T’s resources and one that supposedly is a networking company first and foremost. They should certainly be able to make sure they have enough server capacity to accommodate an anticipated rush like an iPhone launch. How they can let this happen repeatedly is really beyond belief.
100 people randomly picked from a crowd of people waiting to buy the phone probably isn’t scientific by any means, but there were certainly some interesting answers. I’m betting we’ll find that Siri does turn out to be the number one feature on this phone by far, no matter what this survery found. And further that it could change the way we interact with phones by using the far more natural voice and far less natural keyboard input.
Photo by 246-You on Flickr. Used under Creative Commons License. ]]>
By now, you probably know that Steve Jobs died tonight. I was going to write about something mundane like the differences in Microsoft and Adobe’s mobile-cloud strategies, but that can wait for another day. Tonight we come to celebrate Jobs’ undeniable influence on mobile computing.
If you think about it for a minute, he changed everything, first with the iPhone and later with the iPad. If you want to be technical about it, it all really started with iPod a decade ago, but the iPhone started a shift in the way we interact with one another and the Internet on cell phones.
It was the first touch screen mobile device with the perfectly wonderful awful idea of an App Store, a place where developers could sell small, distinct applications designed specifically to complete a simple task while taking advantage of the fact you were on a touch screen mobile device. It’s still a remarkable idea, and every phone that came after it that uses a touch screen including Android owes a deep debt of gratitude to the vision that Steve Jobs brought to the modern smart phone. And of course, the App Store phenomenon has spread rapidly and far.
Yet even surpassing the iPhone, was the iPad, which in many ways altered the entire computing landscape. To me, it’s still difficult to believe that this device which we take for granted now, was only released in April, 2010. Yet within months it started a trend called the consumerization of IT. People wanted their work applications to work as well and as smoothly as the iPad. You started to see devices like scanners with touch screens. It really did change everything.
And within months, you were starting to see its influence everywhere. Of course, there would be the parade of wannabes from Samsung, Motorola, Asus, Dell, RIM and HP (for about a month) and the Kindle Fire is on its way as well, but as with every touch screen that came after the iPhone, every tablet has to live up to the beauty and elegance of the iPad.
When I was at the SharePoint Conference this week, I saw a marketing rep trying to give away tickets for a raffle for an iPad 2 outside the convention center. A hard-core Microsoftee sneered at her with derision and spit out the words, “Why would I want that toy.”
As I walked toward the door I turned around and grinned at the guy and said, “Seriously?!” And he said, “Yes, it’s a toy. You ever try typing an email on there?” Well, it’s not really great for generating content because of the touch keyboard, but this man clearly missed the point of the iPad, and for that matter any tablet that comes down the Pike from here on out.
It is about media consumption, not media creation, and for that, there has never been a better device created in terms of size, weigh, screen quality, touch screen, applications and so forth that has come together as well as the iPad has up to this point.
We don’t really know what will happen to Apple in a post-Jobs world (or to any of us that cover and use mobile devices on a daily basis), but one thing is certain, he left a legacy that will never be matched.
And I don’t say that as post-death hyperbole. It is simply a fact. Jobs changed the world and not many of us can say that. Perhaps someone will come along some day with the intelligence, vision and spirit of Steve Jobs, but I fear when they made Mr. Jobs, they broke the mold and we won’t see the likes of him ever again.
It’s sad day for the world, but for those of us who cover mobile and cloud computing, it’s like the day the music died. And it really makes me wonder where we go from here.
Photo by Danny Novo on Flickr. Used under Creative Commons License. ]]>
For now, Apple is a train with so much momentum, nothing is going to slow it down. iPads and iPhones will continue sell like proverbial hot cakes. Apple will continue to rake in millions. New versions will come and go — but what then?
The real test for new CEO Tim Cook will not be in keeping the current crop of mobile-cloud products moving forward — he proved he could do that when Jobs went on medical leave in 2009 and again earlier this year. What will truly test Cook is the development of the next big mobile thing.
It will only be then that Cook and his executive team can show that they can execute in the same manner without Jobs’ considerable influence pushing whatever that thing is to market. What’s more, the question hangs out there as to whether Apple can continue to build excitement about that big thing without Jobs’ marketing acumen and cult of personality.
Whatever happens in the future, Jobs has left Apple in an enviable position. With a reported $75 billion in cash, Apple could survive for years and years, even as an also-ran company living off its former glory — and I don’t see them sinking to such depths.
It would take a mighty big screw-up to mess with what Jobs has built with Apple, and by all reports Tim Cook is an extremely competent man in his own right.
But having management skills and being a visionary are two different things. It’s clear that Jobs’ shoes are going to be hard to fill when it comes to the vision thing.
If I were a betting man though, I think I would place my bets on Apple. Just a couple of weeks ago Apple was fighting Exxon as the most valuable company in the world! Think about that for a second. A consumer electronics company was vying to be the most valuable company in the world. It’s remarkable really.
And it’s that legacy (for lack of a better word) that Jobs leaves firmly in place as he steps down. The stock fell on his news of course, but chances are as Apple continues to sell product in the way we have come to expect, it will rise again.
None us knows of course what happens to Apple in the post-Jobs era, but we do know one thing. Apple still has the products people want and some very smart people in place — and they should be a force to reckon with in technology for some time come — with or without Steve Jobs.
Given the choice of his laptop or his Blackberry, even with his laptop within easy reach, the colleague chose the mobile device — and that’s telling. As smart phones get more sophisticated and the network connection speeds get faster, it’s something that’s bound to become so common place we won’t need a picture and a blog post to point it out.
In fact, it’s highly likely that a similar dynamic is happening as we speak inside your organization (or at least it should be). As I wrote last week, in iPads are Coming – Ready or Not, the tablet may be helping drive the trend away from a PC world in which we use either our mobile smart phone, or a tablet when we need a larger screen. As I pointed out in my post, many organizations are looking very carefully at tablet solutions today.
The fact that this trend is coming together as we speak is particularly interesting to me because in 2002, I wrote my very first article for EContent Magazine (where I still write today as Contributing Editor) called Project Oxygen: A breath of fresh air for the Internet. The article described an MIT project with what was a fairly radical notion at the time–that our primary access to computers and the Internet would be via hand-held devices and that network access would be ubiquitous as the air we breathe (like Oxygen).
As I wrote at the time:
The stated goal of the project is to create a computing system that is “human-centered and pervasive,” meaning that the computer reacts to human needs, rather than forcing people to work according to the computer’s design, and that the computer and network connections are always available no matter where you are just as the air you breathe is always available.
The project included a mobile device that could change to support whatever activity the user required whether that was a PDA, a phone or a pager (much like a smart phone today) and the network component sought out the strongest connection based on location and task (not unlike Cell and WiFi networks today, although that still needs some work to achieve the full goal of the project).
The point though, is not that we achieved to the letter every component of Project Oxygen, but that we have achieved so much of it so quickly, and as the article speculated, it changed the way consume content — both as consumers and at work.
As Ray Ozzie pointed out in his farewell ‘Dawn of a New Day’ memo to Microsoft employees last fall, he sees a time in the not-too-distant future where we live in what he called a “post-PC world.” As he put it, “…slowly but surely, our lives, businesses and society are in the process of a wholesale reconfiguration in the way we perceive and apply technology.”
I believe that wholesale reconfiguration centers around these new mobile devices like tablets and smart phones (not to mention ‘The Cloud’), and that Ptacek’s post shows that perhaps we are further along than any of us expected or realized.
The lesson here for IT, in case you missed it, is that if you’re not focusing on these devices today, you’re probably already behind. Just as Ozzie warned his company on his way out the door, “close your eyes, and picture what a post-PC world might look like,” because if you ignore Mr. Ozzie, you could be left in the dust. ]]>