Featured Tech.pinions – Page 55

Microsoft’s Windows 8-Deja Vu all over again

In 1994, Steve Balmer came down to San Jose and took me to dinner to show me an early version of Windows 95. Yes, in those days they valued analysts and actually came and met with a few of us often. As you probably know, this was their first full blown OS with a GUI after a rocky attempt at creating an OS with a new GUI in 1993.

As Ballmer was showing me the new user interface on top of a DOS shell, with its colorful icons and more graphically driven screen, I kept thinking to myself that I had seen this already. Of course I was thinking about the Mac’s GUI in which Apple pretty much showed Microsoft and others how to create an OS with a graphical interface and in fact, by 1995, Apple had their version of this on the market for 10 years.

Fast forward to 2011 and this time as I watched Microsoft show off a new OS for Windows at their Build Conference in Anaheim and as I saw the demo unfold and looked at the new Metro UI with its touch features and cloud links, I had that déjà vu experience again. As in 1994, I had already seen many of these features they showed and more from Apple two years ago as they began to show developers an early peak at Mac OS X Lion. And all of the gestures and touch features they showed in Windows 8 are already on the iPad. Yes, the Metro UI is different in its tiling approach to organizing data, but otherwise, many of its features are like Mac OS X Lion including in the way it moves the tiles from screen to screen and most of the gestures.

To be sure, both operating systems have a variety of advanced features and I will let the Windows and Mac aficionados slug it out as to whose is best and what is different from the others. But the bottom line is that Windows 8 is an impressive upgrade from the Windows of the past and it will finally bring the Windows OS into the 21st century.

The first noticeable thing in Windows is their tiling UI called Metro. If you have a Windows Mobile 7 smart phone or have seen one demoed you already know what this looks like since it quite similar. You assign various tasks and apps to a tile and pin them to your screen and you can pin as many as you want to and then move from screen to screen to find and launch them.

For the Mac users, it is very similar to how you go from app screen to app screen on and Mac or iPad. But on a Windows PC or even a tablet it is a most logical next step in Windows design and important to the Windows community. Also, since the Metro UI is fundamentally the same on a Windows PC and their Windows Mobile Smartphones, Microsoft is hoping to get more Windows 8 users to buy into their Windows smartphone strategy.

Another thing that is quite important is their seven-second boot time. This is something that Microsoft’s customers have been asking for since Windows came to market. And it is quite impressive. This alone should be a reason for people to upgrade to Windows 8.

And the demo they showed of their cloud links throughout the OS to their SkyDisk and apps in the sky are ground breaking for Windows PC users. Again, it mirrors much of what is in Apples iCloud offering coming this fall, but in reality, this is the future of cloud, OS and app integration for any OS in the future. More importantly, from the Windows 8 demo I saw, the actual integration seems very rich and if done as shown, is also one of the more impressive features of Windows 8.

And the other noticeable thing with Windows 8 is the fact that while it will run on Intel’s X 86 processors as is, there will also be a version of Windows 8 for ARM, aka Windows on ARM. This is quite important as the ARM processor is known for its ability to deliver long battery life and that too is one of the goals of Windows 8. It is designed to work well on tablets, where long battery life is key and on laptops where longer battery life has always been a demand.

From what we hear, all apps written for Windows to-date will work in Windows 8, but developers will have to modify them if they want their apps to use the Metro UI. But, it appears that Windows 8 with the Metro UI designed apps will need to be modified significantly if they are to run on ARM based devices as it has to be written to the ARM code, instead of Intel’s X86 core. That means that Windows 8 will first gain serious street cred on Intel based laptops and tablets, with Win 8 on ARM lagging a bit behind it. On the other hand, they showed some pretty impressive Windows 8 demo’s on nVidia’s Tegra 3, Qualcomm’s SnapDragon and TI’s OMAP processors and it would not surprise me to see development for Windows 8 on ARM accelerated in the near future.

You may think that Windows 8’s initial push will be to on laptops but I understand from my contacts in Taiwan that this is not a correct assumption. Windows 8’s first push will be to tablets. Microsoft is quite concerned about being so behind in tablets and they are really pushing their OEM’s to get Windows 8 tablets out as fast as possible. That will be the biggest push at first and I suspect that the first commercial version of Windows 8 will be on tablets. But I don’t expect the version for PC’s to be too far behind.

The one big question that Microsoft did not answer at their keynote was when Windows 8 would ship in either tablet or PC flavors. I have heard a lot of estimates and scuttlebutt behind the scenes about this, but we probably won’t see the first commercial version shipping until perhaps mid 2012 at the earliest. However, I know for a fact that they want to saturate the market with Windows 8 devices by the holiday season 2012.

Looking at Windows 8, it is pretty clear to me that this is a big an upgrade since Windows 95 debuted and will introduce Windows users to a great new UI experience. And just as they did in 1995 when that OS eclipsed the Mac, I suspect that barring any new surprises from Apple, this new OS will give Windows users at least a solid path towards keeping them in the Windows camp and Microsoft could have a monster hit on their hands in the very near future.

There is No Such Thing as an iPhone Killer

Samsung recently released its latest smart phone in the Galaxy S II line called the Epic 4G. Some in the media are hailing it as an iPhone killer, a statement that is at its deepest level entirely ignorant. Amazon will soon be releasing a tablet version of their popular Kindle e-reader and again people will proclaim or at least ask the question “is the Kindle Tablet an iPad killer.”

What I want to make clear is that there is no such thing in today’s technology landscape as an iPhone or iPad killer, or any other product killer for that matter. Many seem to assume that the tablet and the smart phone markets will be very similar to the historical PC landscape. Historically with PCs one dominant software operating system dominates and the rest have marginal market share at best. Even the PC landscape is changing.

The fact is that the market for PC’s, smart phones, tablets, and anything else we dream up will never again look the PC landscape during the 90’s and early 2000’s. There simply will not be one single OS that dominates the landscape. The market will support many and therefore there will be many choices and choice is good.

The reason for this is because when a market is maturing there is generally fewer or less quality options. There is in essence a market standard that leads the market to maturity. With PCs it was Microsoft and Windows which led the way as the standardized technology by which the market matured. With the Smart phone and tablet it will be the iPhone and the iPad that will lead the market into maturity. However once a market matures it begins to segment.

With Windows and the PC it took the product nearly 25 years to reach maturity. Smart phones, tablets and more will not take nearly that long and in fact will mature in around 3-5 years.

Due to the rules of market maturity, I can confidently say there is no such thing as an iPhone or iPad killer. There are only other product choices. John Gruber over at Daring Fireball makes some similar observations on how the market will support multiple solutions.

Why do I know this you ask? Because a Toyota Corolla is not a Mercedes-Benz killer. A Ford Truck is not a Prius killer. And an even closer analogy, a BMW series 3 is not a Mercedes C300 killer or vice-versa. The market can sustain all these automobile products.

To use another example Pepsi is not going to release a Coca-Cola killer. You simply have a choice of Coke, Pepsi, Sprite, Root Beer, Mt Dew, etc.

I have been studying the automobile market as it relates to a mature consumer market for some several years now and the similarities between the automobile market history and the technology market history are strikingly similar. The big difference is that the automobile market is about 20 years more mature than the PC industry. However when you study how the market matured and consumers adopted new technologies in the automobile industry you find moments in time that are very similar to the moment in time our industry is currently in.

Therefore we learn a lot about how today’s fragmented yet competitive automobile market and what it can teach us about what the consumer technology landscape of the future will look like.

This is the reality in mature consumer markets. There is a dominant solution that leads the market to maturity as consumer who are interested in their first product in the maturing market go with the market leader. As they become more familiar with their needs or wants with that product they then begin to shop around based on preference.

This is why the abundance of Android smart phone in the early stage of a markets maturing is actually more harmful than productive for the Android solution. I have stated before that the Android market is too saturated for its own good and that will be the case until the smart phone market reaches peak maturity in 3-5 years.

The critical key to any company in the market wanting to maintain or grow market share is to be around when the market actually does peak. Because once it does it is very difficult, without a pure market disruption, for new entrants or those who have minimal market share to grow.

Establishing market share early is of the utmost importance.

All Eyes on Microsoft and Intel This Week

This week two industry heavyweights will be holding conferences around their companies greatest assets. Microsoft will be holding its Build Conference where they will highlight and showcase Windows 8 their next major OS release. Intel will be holding its annual Developer Forum which is designed to promote and encourage new innovation in hardware and software for Intel’s X86 CPU architecture.

Myself and many in the industry will be closely tuned to these events this week as we look for Microsoft and Intel to show us their vision of the future of the PC and post PC landscape.

Both Microsoft and Intel are key players and heavy influencers in the technology industry. These events are important for them to demonstrate to the world, and more importantly to the key players in their ecosystem, their value.

With Microsoft I anticipate much of build to be about Windows 8 on other platforms than PC’s. I expect, and hope, they show how Windows 8 will add value to the hardware manufacturers who have set their eyes on smart phones and tablets. We already know that Windows 8 will inevitably be shipped on new PC’s going forward. If you make PC’s for a living, and are not Apple, you have no choice but to use whatever Microsoft builds for you. I am more interested in what Microsoft has to offer in the areas where they are not the only OS in town.

I also expect their Windows on ARM initiative to be highlighted and emphasized. I believe the Windows on ARM campaign from Microsoft is one of the more important if they want to see their Windows OS get to more devices like tablets and smart phones. Those devices do not run Intel’s X86 architecture, but rather run an ARM based architecture. If Microsoft can gain momentum getting software developers to use their tools to develop software for Windows on ARM then they have a clear path to bring Windows software to new devices running the ARM architecture.

Intel on the other hand sees the trend of Post PC devices and has to be worried because that future right now does not include them. Intel is aggressively working on bringing their ATOM processors to smaller devices to compete with ARM, the only problem is right now there is no competition. Manufactures looking to bring tablets and smart phones to the mass market are not even considering Intel at this point in time.

Intel at IDF this week, I am betting, will focus heavily on mobility and Smart TV. Within mobility I expect them to push heavily their UltraBook initiative showing off a range of new devices and PC prototypes to showcase the kind of devices they want to see hit the market.

I would not be surprised if Intel also shows off a tablet or two and perhaps even some early smart phone hardware running Intel silicon.

The bottom line is both Microsoft and Intel making big showing at Build and IDF are key. They are both key players in helping drive innovation in the technology industry.

We will see what kind of vision both of them provide of the future.

Is there a market for Good Enough “Tablets?”

In April I wrote in my PC Mag column about Amazon Stealing Android from Google and argued in this piece that Amazon was most likely building their own proprietary approach to integrating their overall Android Store and a set of music, video and cloud services and integrate it into their future tablet offering.

Then, in August I wrote how Amazon Could disrupt the tablet market by creating a tablet that could sell for $249 even though it would cost $300 to build, but make it up by amortizing users purchases of books, music and videos over an 18-24 month period.

I suggested that if Amazon did this they could disrupt the entire market for tablets by introducing a new pricing model tied to their services that would make it very difficult for any hardware only tablet vendor to compete in this burgeoning market.

Now, in a most interesting post from MG Seigler at Techcrunch we get an actual hands on description of this tablet and it reinforces the price I suggested Amazon would sell it for. And he goes on to give actual details about it coming out in November including the fact that it has a color 7” screen but no cameras and no i/o ports.

If what Mr. Siegler says is true, then this Amazon tablet is more like a Nook on steroids then a serious competitor to Apple’s iPad. It will have very limited features as a multi-purpose tablet, but will excel in offering Amazon driven music, video and clouds services. And of course, we expect that it will have a browser so it would give people using it broad access to Web based content although apparently it will not support Adobe’s Flash.

But this brings up a very interesting question. Is there room in the market for what we would call a “good enough” tablet? Clearly, Apple’s iPad seems like it will be the Cadillac of tablets and to stay with the GM metaphor, the Amazon tablet is probably more like the Chevy Malibu of tablets. Both are very functional but what is inside and what they can do on the road are very different.

While there is always a market for full-featured products like the iPad, there is also perhaps an even larger market for “good enough” tablets like the first gen Amazon tablet might me. And Amazon, with this limited design and low price point, seems to be aiming at the “Chevy” market for tablets where bells and whistles are less important then price and basic functionality.

This concept of good enough computing has been bandied about in the industry for decades. It started with desktops where high end gaming PC’s ruled the gaming and engineering/graphics market, while lower cost PC’s with less horsepower and functionality took the lions share of the bigger “good enough” PC market. And the same thing happened with laptops. Gaming laptops powered the upper end of the portable market, while thin and lights went after the business crowd and value laptops with less power compared to the other two models took the lions share of the broader portable market. And they were good enough for a very large audience of consumers.

Could this “good enough” approach to the market be repeating itself again with tablets? There is no question that even though Apple’s iPad may be the Cadillac of tablets today, Apple was quite aggressive with their pricing so that it has appealed to much more than a more well-healed audience that normally buys upper end models of everything. On the other hand, there will always be a large audience who either won’t spend much on products or can’t for economic reasons and will opt for something in this value line of products or in this place, a just “good enough” tablet if it is available.

My sense is that as with desktop’s and laptops there is room for both and I suspect we will see tablets at a lot of different price points taking aim at the needs of all level of customers wants and needs. And if history is our guide, the products in the “good enough” category could be very large indeed.

Why Silicon Valley Needs a New Name

I was visiting with one of Silicon Valley’s bright thinkers last week, Kanwar Chandra the CMO of CSR and founder of Sirf, and he told me that Silicon Valley is really no longer Silicon Valley. In fact, he said it needs a new name. He went on to say that Silicon Valley has really become the Valley of platforms.

He astutely pointed out that it is the center of mobile and wireless development platforms with Apple’s iOS and Google’s Android platform driving major growth around the world. And with Intel jumping on the low voltage processor bandwagon, along with the many Valley companies building IP around ARM cores, it is also the center of platform development in mobile related processors for companies to build next generation mobile devices. The company he founded, Sirf, is the leader in GPS processing and much of the GPS and mapping platforms are being driven by Sirf and other companies in the Valley related to location based hardware and software.

It is now the center of activity in social networking with Twitter and Facebook leading the way with their various platforms that people can develop on. eBay and Craigslist were created to be major platforms for driving eCommerce and both companies are based in the Silicon Valley region. The Bay Area has also been at the heart of BioTech thanks to the pioneering work of Genentech and work at Stanford and UC Berkeley along with many Valley based biotech firms. The Valley’s VC’s are backing start-ups in green energy here in Silicon Valley in a big way that suggests that the Valley will become a hotspot for alternative energy platforms too.

Companies in the Valley are also leading most of the major cloud based projects and initiatives with SalesForce.com and Oracle’s Web based apps providing critical platforms for enterprise. And we will soon see the introduction of Apple’s iCloud and I am willing to bet that they will define how the consumers see and understand what the cloud is all about.

More importantly, Apple’s iCloud will become a major platform for innovation. And of course, Google’s cloud programs are already a big hit and as they make their cloud based business tools more robust and take on Microsoft with their cloud initiatives from an Open Source approach, they too will provide a major cloud based platform for business and consumers.

This shift from silicon being at the center of the Valley’s tech existence to one of platforms driving its future growth is actually quite significant and one that needs to be recognized. To frame our region as just Silicon Valley these days does it an injustice.

But here is the problem. If we see the Valley’s reason-to-exist moving from Silicon to platforms, what do we call it? Silicon Platform Valley does not roll off the tip of the tongue. Or perhaps Technology Platform Valley is the right name. Or how about Silicon Valley now Platform Valley? OK I admit that I am very bad at naming things.

So, I need your help.

If Silicon Valley has evolved beyond its core technology and is now becoming the center for broad technology platforms, is there a better name for it then Silicon Valley? I know the tendency will be to just leave it as it is, but somehow I sense we need to grab hold of this idea of it being the center of new and innovative platforms and embrace it wholeheartedly.

So, while the chance of actually changing its name is remote, I am still open to any good names you can come up with that perhaps we can push behind the scenes and at least get people seeing Silicon Valley for more then being just the center of the universe for silicon based chips.

Your comments and name suggestions are appreciated.

If you feel obliged please comment below or feel free to send me electronic mail at Tim@techpinions.com.

Will an HP PC Spinoff Make a Stronger Competitor?

I have been having conversations with key executives around the industry about HP’s decision to explore spinning off their Personal Systems Group, which is the group that makes their business and consumer PC’s. An interesting question that has come up is whether or not spinning off PSG will make for a stronger or weaker competitor in the PC industry?

The logic goes that PSG was so tied up in big company atmosphere, who as of late was prioritizing software and services over hardware. Knowing how large companies often move slow and conservatively I can see how this could be an issue for a group who wants to act more like a startup.

So the real question is if HP does decide to go ahead and spin off PSG, will this move put them in a better position to compete?

I certainly can see and sense the desire from my PSG colleagues to move and innovate faster. The PC marketplace is changing rapidly and competition is getting fierce. But PC’s are not going away and can still be a legitimate business if managed well and they innovate in a more timely manner. So it makes a fair bit of sense to build a case that if spun out they could innovate, create and compete in a fast moving market.

It is also very difficult in today’s changing technology landscape to run a business with a successful enterprise and consumer division. Both require very different mindsets, strategies and leadership.

The fact of the matter however is that whether or not an HP spinoff can make for a stronger competitor in the industry will depend on the leadership and the talent that goes with it or is acquired as a new organization.

If the spinoff is approved by the board and moved forward with, this new entity would start its life as a Fortune 60 company with over $40 billion in annual revenue and it would be the #1 PC manufacturer (if you dont’ cound tablets).

That is not a bad way to start off. However the real test of the leadership will be not just to maintain but to grow their percentage of market share in all the areas they choose to compete.

Although execution will be critical and will be what others affirm as the challenge, what may be even more important is the right vision.

HP’s slogan has been the “PC is personal again.” However the real challenge of the companies who aren’t Apple is to make the “PC interesting again.”

Intel is hoping they can assist makers like Dell, HP, Acer, Samsung and others with their UltraBook initiative. Will UltraBooks Make PCs Interesting Again?

If HP does decide to spin off PSG what we will look for is their vision. What categories will this new entity focus on? Where do they believe the growth areas are? How will they compete, differentiate and add value?

Those questions and more will be what we look for as analysts in order to come to an opinion on how successful and competitive this new business will be in the marketplace.

Google-

Does anybody use Google+ any more? That seems to be the question floating around these days.

The Google+ project made its debut two months ago and by the end of its first month had a user base of 25 million worldwide, becoming the fastest-growing social media network in the admittedly short history of social media networks, according to the digital business analytics firm comScore. Almost immediately afterward, Experian Hitwise, an online consumer behavior and marketing consultancy, began reporting that Google+’s rate of growth was slowing, and that the average amount of time Google+ users spent on the site was declining. Then the otherwise respected website GigaOm trumpeted the dubious results of a “voluntary sample of more than 10 million Google+ users” that purported to find “that a whopping 83 percent of Google+ users are currently classed as inactive.”

People are asking if Google’s flagship social media service is destined to follow the trajectory of Google Buzz and Google Wave. People are wondering if social media fatigue is a factor. For me, it’s privacy fatigue as much as anything.

But back to the question: Does anybody still use Google+? As often is the case, I find myself in total agreement with Yogi Berra: “Nobody goes there any more; it’s too crowded.” Millions of people use Google+. Millions more are waiting to get in. But I don’t go there anymore.

My enthusiasm for Google+ was never great to begin with, and it diminished after Eric Schmidt, Google’s chairman, explained that Google+ is really an Internet identity service with social media elements.

Schmidt, according to a transcript of a Q&A session at the Edinburgh International TV Festival, said that Google+ is “an identity service with a link structure around your friends.” In other words, it’s a product that helps Google sell ads more effectively by gathering information about its users. To that end, Google+ does not allow anonymity. It has a “real names” policy and requires users to provide traceable personal information. “It’s central for Google to have such a service,” Schmidt said.

Asked how Google can justify requiring real names if doing so puts some users at risk, especially in unstable political climates, Schmidt said, “Well, the first comment is that Google+ is completely optional. In fact, many, many people want to get in. If you don’t want to use it, you don’t have to.”

By its own admission, Google developed Google+ as a more effective way to gather personal information from users and their friends that Google can then use to target advertisements more profitably.

Here’s what you signed when you signed up for Google+:

“By submitting, posting or displaying the content you give Google a perpetual, irrevocable, worldwide, royalty-free, and non-exclusive license to reproduce, adapt, modify, translate, publish, publicly perform, publicly display and distribute any Content which you submit, post or display on or through, the Services.”

“You agree that this license includes a right for Google to make such Content available to other companies, organizations or individuals with whom Google has relationships for the provision of syndicated services, and to use such Content in connection with the provision of those services.”

I’m taking Eric Schmidt’s advice: I don’t have to use it.

How about you? Has Google+ become an important part of your social life online?

Why Content is the Biggest Roadblock for Apple TV

It appears as though the “Apple is making a TV” discussion is coming back around. Probably because of rumor reports that “sources in the know” are talking about a brand new product category.

Apple has a hobby business in a product called Apple TV. At some point in time this hobby will become a business, the question is when. The other question is will it be in the form of a full blown television? Will it simply be a set top box? Or perhaps will the iMac become a 40′ or larger monitor /TV?

These are all interesting questions and I can see good arguments for and against all of them. However the real issue as I see it is the content industry.

Problem #1 Hollywood
What many people don’t know is that Hollywood is nearly impossible to deal with. Unlike the record labels whose business is more distrubution, the movie studios and TV networks prefer controlled distrubution. Both the TV studios and the movie studios carefully control when, where and how their content is distrubuted.

They have exceptionally strong legal rights to their content and because of that they are in the driver seat. Take for example Starz, HBO and Showtime.

If you have ever wondered why there is no digital “subscription” service for first release titles of movies it is because Starz, HBO and Showtime own the rights to first run movies as a subscription service. This is why as a part of their subscription services comapnies like Netflix, Apple, Amazon etc can not offer a digital download or streaming subscription service which includes new releases on DVD.

This is why the only options to date to get a first release on DVD digitally is to buy it or rent it.

For any company to offer a subscription service to download or stream new release movies they would have to get HBO, Starz and Showtime on board, not to mention the studios, who I think have more lawyers than employees.

This is why in 2006 Starz tried to launch Vongo.com their attempt at a movie subscription service. The challenge with Vongo was that it didn’t have movies newer than 6-8 months depending on the studio.

The primary reason for this is because the studios want people to go buy DVD’s not subscribe to a service for the cost of a DVD that allows them to stream it as many times as they want. Because of that only the premium pay-per-view model is available for a movie in digital form until it has been on DVD for at least 6-8 months. So all though Starz, HBO and Showtime on the rights to a subscription movie service they studios don’t give them those movies until 6-8 month’s after it has come out on DVD.

Historically Blockbuster and now Netflix and Redbox get away with offering a subscription service for physical DVD’s because of copyright laws. Legally anyone can pay full price for a DVD and sell or rent that DVD at whatever price they can fetch. Unfortunaly digital copyright laws work differently.

Hollywood tighlty controls their first tier window of physical and digital DVD distribution and I don’t see that changing anytime soon. The fact of the matter is the purchasing of DVD’s is what they want people to do and they will protect that business to all ends.

To make a long story short, it would take a miracle for us to see a subscription service to stream new release DVD’s.

Problem #2 Comcast, Dish, DirecTV and others
What about a service to subscribe to network TV shows? We do this already since we pay a fee do Comcast, Dish, Time Warner, DirecTV or someone else. So it would seem logical to assume someone can offer something similar through the Internet.

The only problem is those above service providers pay hundred’s of millions of dollars for the rights to offer that content as a subscription service. The reason we get 100’s of channels for a fee each month is because hundreds of millions of dollars were spent to reserve the right to distrubute that content.

Put yourselves in the shoes of ABC, NBC, CBS etc. They get massive amounts of money up front for their programming. Do you think they are going to jeapordize that by letting people stream or access their content for free or cheap?

Although some networks today allow next day viewing for free with mandatory ads I am betting that at some point in time that model changes as well. What’s more is that even though supporting free streaming by ads is a business model, it comes no where close to hundreds of millions of dollars up front.

Hulu is in fact already experimenting with only allowing people to watch a show online the next morning if a fee is paid then anyone can watch it after seven days with ads.

I would expect in the near future if you want to stream a show for free online you will need to wait at least a week after it has first run. This will instantly kill any chance at the water cooler affect of a show and most likely discourage online streaming all together.

If you add up all the business model issues facing any company who hopes to offer or disrupt the current TV ecosystem it amounts to a monumental challenge.

The bottom line is the biggest hurdle for Apple to make Apple TV a business is not a technical one, it is a legal one.

I completely agree that the televion will someday become the next big platform to deliver rich content and services to and that it NEEDS to be disrupted in a major way.

But to quote a friend of mine who is a Hollywood lawyer:

“Two things drive Hollywood – fear and greed.”

I’m not optimistic that either of those forces will work in the technology industries favor.

Real Intelligence

The age of intelligent machines is upon us. How did we get here? Who led the way?

You probably know that machines beat humans at chess, and that IBM’s Watson beat humans in the television game show Jeopardy. If you live in Silicon Valley, chances are that you’ve seen Google’s autonomous vehicles cruising local streets. But AI also plays a major role in routing commercial aircraft and truck fleets, in planning battles and supply routes in Iraq and Afghanistan, and in thousands of other applications that now touch our daily lives.

The IEEE Computer Society’s IEEE Intelligent Systems magazine just established the IEEE Intelligent Systems Hall of Fame, and named 10 inaugural members. In alphabetical order, they are:

Berners-Lee

Tim Berners-Lee, the 3Com Founders Professor of Engineering and head of the Decentralized Information Group at the Massachusetts Institute of Technology; a professor in the Electronics and Computer Science Department at the University of Southampton; director of the World Wide Web Consortium; and a founding director of the Web Science Trust;

• Noam Chomsky, linguist, philosopher, cognitive scientist, and Institute Professor and Professor (Emeritus) in MIT’s Linguistics and Philosophy Department; noted for his theory of generative grammar that revolutionized the scientific study of language;

• Douglas Engelbart, head of a Stanford Research Institute group that developed the first computer mouse, hypertext, networked computers, and precursors to GUIs;

• Edward Albert Feigenbaum, a Stanford University professor emeritus of computer science and cofounder of applied AI startup firms IntelliCorp, Teknowledge, and Design Power;

• John McCarthy, a Stanford and MIT professor who proposed Lisp, time-sharing computer systems, and program correctness proofs; credited with coining the term “AI”;

• Marvin Minsky, Toshiba Professor of Media Arts and Sciences and Professor of Electrical Engineering and Computer Science at MIT, who developed the Society of Mind theory with Seymour Papert and many other advances in cognitive theory;

• Nils J. Nilsson, professor of engineering emeritus at Stanford, who while at SRI International developed statistical and neural-network approaches to pattern recognition;

• Judea Pearl, a professor of computer science and statistics at University of California Los Angeles and director of its Cognitive Systems Laboratory; best known for introducing the probabilistic approach to AI and developing Bayesian networks as inference tools;

• Raj Reddy, the Mozah Bint Nasser University Professor of Computer Science and Robotics in the School of Computer Science at Carnegie Mellon University; and

• Lotfi Zadeh, a University of California, Berkeley computer science professor known for his work on soft computing, fuzzy logic, and neural-net theory.

To put things in perspective for those of us with more pedestrian interests, here are the first 10 inductees of the Baseball Hall of Fame: Ty Cobb, Babe Ruth, Honus Wagner, Christy Mathewson, Walter Johnson, Nap Lajoie, Tris Speaker, Cy Young, Grover Cleveland Alexander, and George Sisler.

UPDATE, Aug. 29 — After watching this video of a conversation between two Cleverbot avatars, we may not be as close to the age of smart machines as I thought.

A personal note to readers

A personal note to Tech.pinions readers:

I’m honored by the invitation from Ben and Tim Bajarin and Steve Wildstrom to write for Tech.pinions. I’m also delighted to have this opportunity to reconnect with many old friends from my New York Times and Fortune years, and to make many new friends, and to resume a dialogue about technology that started back when 640K was enough for everyone.

Notice the word “dialogue.” I spell it the old-fashioned way, not the currently fashionable “dialog” – readers of my blog will discover I’m something of a work freak — but the meaning is the same: A conversation between two or more persons; an exchange of ideas and opinions.

Swindon_Magic_Roundabout_eng — A roundabout looks like ...

Journalism is now a two-way conversation, unlike the old “one-to-many” broadcasting model that for centuries applied to troubadours, town criers, book publishers, newspapers, magazines, radio, television, and Web 1.0. Ideally Web 2.0+ journalism is even more than that, triggering not just two-way dialogue between writer and reader, but also many-to-many discussions among readers.

In other words, I don’t want my writing for Tech.pinions to be just a two-way street; I want it to be a roundabout in downtown Cairo or Rome at rush-hour.

So let’s get started: What shall I write about? You tell me.

What’s the next big thing? What’s happening now in technology, or looming on the horizon, that we need to be discussing now?

Background: In 1984 I started writing a column about personal computers for The New York Times, where I was assistant science editor. In 1992 I convinced the Times to assign me full-time to report about “cyberspace.” I quit to do an Internet startup in 1996. As the Great Wayne Gretsky advised, I’ve tried to skate ahead of the puck, journalistically speaking.

Here’s where I think the puck is going, in terms of technology:

Bioengineering and its impact on global health and life sciences.
The Cloud, the reinvention of enterprise IT, and software as services.
Data security, hackers, cyberwarfare, privacy.
Robots. When people talk about the post-PC era, they say “tablets” and “smartphones” when they should be thinking robots.
Environmental sciences and the role of technology.

These are just my Top Five; there will be fascinating developments in mobile technology, commercial spaceflight, nanotechnology, electronic payments, and all sorts of other areas.

Which ones do you think will be most important for the next five years? What am I missing?

Why Microsoft Should Buy HTC Not Nokia

I don’t want to be in the predictions business. I like being in the industry analysis business. However to be an effective analyst and in particular focus on industry trends like my firm does we need to not only analyze the current markets but what the future markets may look like as well. Sometimes we are lucky enough to have some of our forward thinking analysis come true.

When I wrote the column on why Google Should buy Motorola two weeks ago, it was part of my own internal excersise to anticipate possible scenarios based on which companies are more valuable competitively together rather than alone. We do this often because we do a great deal of competitive analysis.

As I stated in my Techland column last weekend, the industry has changed. With the announcment of the Google / Moto deal and the HP PC division spinoff, companies will be forced to opperate very differently if they want to compete and stay relevant.

It is inevitable at this point that we see more large company acquistions or mergers and/or more companies exit certain business’ to focus on more profitable ones.

As I stated above, some companies are more valuable and competitive together rather than alone.

Many believe that Microsoft should buy Nokia, including our president and my father Tim Bajarin. It is hard to argue with his logic or his historic background in the technology industry. In his article on the subject, he pointed out that a vertically integrated Microsoft and Nokia would have a better chance of competing with Apple and Google/Motorola in the future.

I can certainly see Microsoft buying Nokia, but if I was Microsoft I would buy HTC.

HTC Needs More Than Hardware

I’ve stated almost everywhere I write and give keynotes that making money on hardware alone in consumer markets is extremely difficult. If you don’t have proprietary value to add to your hardware to differentiate yourself in the market and drive extra revenue, then you have a rough road ahead.

HTC has always taken this approach and understands this. The problem is their software partners Microsoft and Google don’t want them customizing their software and makes it increasingly difficult for HTC to do so. I don’t see this changing anytime soon.

This is why many in the media have rightly made the point that HTC could benefit greatly from webOS. I completely agree, however it is yet to be seen whether webOS gets spun off with the hardware business. If it doesn’t then one strategy would be for HTC to license it, but again the question of differentiation will come up.

Microsft Needs More Than Software
I believe the trend to verticalization in this industry is real and signficant. The fact of the matter is optimizing software for hardware is a challenging task when an OS is licensed. Steve Wildstrom points out in this article the challenge with open(licensable) operating systems. Apple accomplishes this better than anyone because of their control of the hardware, software and services related to the Apple ecosystem. Apple’s model is closed but it is also a complete holistic ecosystem. And it is obviously working.

Microsoft has two of those three elements and if they want to control their own destiny they need to either enforce much more strict requirements of hardware or they need to own a hardware business for smart phones, tablets and possibly more.

I don’t think enforcing more hardware restrictions is the right path because it doesn’t allow for differention. Microsoft with Windows Phone and Google with Android are not positioned to help their partners differentiate. This is a strategy that will suffocate hardware only players.

The bottom line is that in the future consumers will gravitate more toward ecosystems rather than products. That ecosystem will consist of hardware, software and services.

Companies who orient themselves to build products will have very little consumer loyalty in future product decisions. Companies who build ecosystems will find more loyal customers year after year. In this column I point out why some ecosystems are more sticky than others.

HTC and Microsoft could together become a very powerful global player in mobility. HTC makes great hardware and has some excellent software expertise as well. Both benefit Microsoft greatly.

Competing with Apple is for many companies the worst thing to try and do. However if Microsoft bought HTC I would argue that together they have the best shot.

Apple After Steve

Everybody has heard the news by now: Steve Jobs resigned because he “could no longer meet my duties and expectations as Apple’s CEO.”

In his letter of resignation to the Apple Board of Directors and the Apple Community, Jobs wrote: “I strongly recommend that we execute our succession plan and name Tim Cook as CEO of Apple.

My first immediate reaction is sorrow that he’s stepping down. I presume that his decision is health related, and wish him and his family well.

My second reaction, to paraphrase Monty Python, is that he ain’t dead yet. His brief and eloquent resignation letter says he plans to hang around a while.

Will Steve Jobs die? Of course. Silly question, as he would be the first to say. (Actually, “stupid f&*$#$g question” is more likely how he’d say it.)

In his graduation speech to Stanford’s Class of 2005, Jobs said: “No one wants to die. Even people who want to go to heaven don’t want to die to get there. And yet death is the destination we all share. No one has ever escaped it. And that is as it should be, because Death is very likely the single best invention of Life. It is Life’s change agent. It clears out the old to make way for the new.”

I suspect he might see stepping down as CEO in the same Schumpeterian way. He and Steve Wozniak started Apple in a garage and it’s now the most valuable company on the whole f&*$#$g planet. Apple sets the agenda for the global technology industry. Jobs himself is by consensus the most important business executive alive today. Earlier this year he effectively decreed that the Personal Computer era was over, and last week the world’s No. 1 PC company, Hewlett-Packard, effectively said, “You’re right again, Steve. We’re toast. You kicked our butt. We give up.”

It would be hard to conceive of a better time to say “Mission Accomplished” and hand the keys to the next generation.

I haven’t checked the after-hours ticker but I assume AAPL is getting cored. That’s silly, too, for anyone with a view that goes beyond a day or two.

There’s always lots of new stuff in the pipeline at Apple, stuff that takes months and years to develop, and Tim Cook already has been running things on a day-to-day basis for some time. Will Cook be as good a CEO as Jobs has been? No one knows. Can he be even better? Again, no one knows.

Could he be worse? Hey, it’s not like Tim Cook is the second coming of Gil Amelio. I remember sitting in the front row at a Macworld conference in the mid-1990s, as a Jobs-less Apple appeared to be in a death spiral, as then-CEO Amelio gave a rambling keynote address while absent-mindedly beginning to undress himself on stage. Apple PR folks were apoplectic. It’s hard to imagine Tim Cook melting down in a similar way.

One thing we do know is that Jobs’s DNA already inculcates the culture at Apple. That may change a few years out, but … that’s a few years out. The fact that Jobs is no longer CEO of Apple is not suddenly going to make HP or Microsoft or Dell any smarter. The fact that Tim Cook is now running things is not suddenly going to invigorate any of Apple’s competitors to execute their strategies any better.

Another thing we know is that Apple is probably going to introduce a fifth-generation iPhone that will run on all carriers, including new carriers in China, the world’s largest untapped market for smartphones. That fact that Steve Jobs is no longer at the helm will not cause millions of Chinese, or Americans for that matter, to slap their foreheads with an epiphany that Android, Windows Mobile, and WebOS are suddenly better choices for mobile platforms.

Notice also the not-so-subtle jab at the media in Jobs’s letter of resignation: “I strongly recommend that we execute our succession plan.” There is in fact a succession plan at Apple and the Board just approved it.

I suspect that Tim Cook didn’t open his first conversation with the Board of Directors by saying, “Okay, boys, now that I’m running the show we’re going to reinvent this company from top to bottom. I’ve been itching to go completely open and dump this whole ‘Apple ecosystem’ strategy.”

At the same time, I can’t think of any company that is as closely identified with its CEO as Apple was under Steve Jobs. Apple without Steve Jobs (or, to be accurate, Apple with Steve Jobs in the Sinatra-esque role of Chairman of the Board) will not be perceived as the same company with Jobs on the sideline. Jobs is a genius. The genius is (sort of) gone. Therefore, some of Apple’s genius is gone, too, until proven otherwise.

In that commencement address at Stanford six years ago, a healthier-looking Jobs gave a speech that was very much like the Apple products for which he is known: Elegantly crafted, attentive to detail, rich in content, but no unnecessary words or buttons. He was talking to a fresh crop of Stanford graduates, but his message almost certainly applies to Tim Cook, Phil Schiller and all the other top Apple executives who are now at the helm.

“Don’t be trapped by dogma,” Jobs said, “which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”

Jobs also said this: “I have looked in the mirror every morning and asked myself: ‘If today were the last day of my life, would I want to do what I am about to do today?’ And whenever the answer has been ‘No’ for too many days in a row, I know I need to change something.”

So, Steve woke up one morning recently and decided he needed to change something besides the world. Namaste, dude.

A version of this post appears in Fiscal Times.

Contemplating the Future of Apple Without Steve Jobs as CEO

Today’s news that Steve Jobs would step down as CEO came as a surprise to many. But I believe Jobs had been preparing for this day for at least 5 years. Apple watchers over that time began to see signs of Job’s putting more and more responsibility into the hands of his executive staff as he often had to step away for health reasons. And during that time Tim Cook, Phil Schiller, Peter Oppenheimer, and the rest of Steve’s executive team understood that they needed to be more in tune with understanding Steve’s vision, directions and ultimate thinking on the long term future of Apple.

While we may tend to be concerned about Steve Jobs the person, I am not concerned about Apple the company. Steve Jobs has in place a very deep bench of executives who really do know Steve’s long-term vision and Jobs’ 10-year roadmap for this very important company. And they are more committed then ever to carry it forward and to extend his legacy well into the future.

What people don’t realize is that Apple does not work like most companies that operate on a quarter-to-quarter basis or planning cycle. Instead, the products they have in the works now are designed through 2013 and the current roadmap extends well through 2015. In this time period, nothing will change for Apple. In fact, I expect Apple to continue to grow even more during this period.

Let’s also remember that while Jobs will not be CEO, he still is Chairman and as long as he can, he will be influencing their current and future product designs and roadmaps. My sources say that while his health wavers at times, he plans to be an active Chairman and to be deeply involved with major decisions and future directions.

But there are two other key reasons that I believe Apple can carry on even with Jobs in a more diminished day-to-day role. It is because Apple is no longer a device company alone. They are now driven by a vision that includes hardware, software and services. And more importantly, the devices they create are just elegant screens that give people access to their software and services. Although their main screens today are the Mac, iPod, iPhone and iPad, they have a lot of room to innovate around the TV, in-car navigation systems and who knows what other screens they may want to design that front ends their software and services. And more importantly, their software, apps and services are a solid foundation that they can continue to build on.

The other thing that makes me certain that Apple will continue to be a force is something Jobs said to me in one our discussions many years ago. I asked him what drove him. He told me that technology could be complicated to use. He felt his mission was to make technology easy to use so that everyone could reap the benefits of technology. He then said that making technology simple to use was hard work, but that this was at the heart of his vision for Apple.

If Apple’s current executive team has caught this vision, especially the one about making technology easy to use so that everyone can benefit from it, then Apple will be just fine. And given their rich integration of hardware, software and services, they still have a lot of room to create great product that people will want to use.

But Job’s Legacy will always be that of a pioneer who sits at the intersection of liberal arts and design and forever changed the way people think about technology. Most executives would be thrilled if they have one hit in their careers. Jobs has had the Apple II, the Mac, the iPod, the iPhone, the iPad, iTunes and Pixar. These technologies and more to come from his vision delivered through his team will keep Apple in the forefront of our connected world and a major player for a long time.

Why the iPad is Not A Tablet

It’s not a tablet, it’s iPad 2.

That statement is a subtle but powerful one embedded deep in Apple’s iPad 2 website. I challenge you to find Apple call the iPad 2 a tablet anywhere on their website.

So I also ask this question that others have posed. Is there a tablet market?

On the surface this is probably a dumb question. Apple is selling millions of iPads a month and tablet fever is all around us. Or is it? Is there tablet fever or iPad fever?

You will notice that when Steve Jobs introduced the iPad he never once called it a tablet. And since then, you have never heard anyone at Apple call the iPad a tablet.

The competition has. Analysts and media have called the iPad a tablet. But not Apple. There is a reason for that. It goes back to Steve Jobs overall view of a tablet. As Windows tablets came out, he looked at them and said “people don’t want that.”

He felt that Windows tablets were too PC like and while more portable it just delivered the same old PC experience just in a new form factor. (Are you listening Microsoft and the Windows 8 tablet team?)

Instead, he put his team to work trying to come up with something people would actually want and actually use. He concluded it would not be a tablet in the PC world’s definition but rather, something completely new and different. It is not his fault that we (competition and the media) keep calling it a tablet. Apple will try and distance themselves from this tablet concept and terminology as much as possible.

Software Is the Real Magic
What Apple has actually created with the iPad is just a portable screen that gives users access to what is Apple’s real genius – its apps and services. They just happen to make a portable screen that is elegant, beautiful and easy to use for accessing these apps and services. What is even more interesting is that if you really look at what Apple does in hardware, it is just to create stylish screens like the iPod, iPhone and now the iPad, that front-ends their apps and services. Hardware is only as good as the software it runs.

When Apple first introduced the iPhone, a Sr. Apple exec laid it down on the table and asked me what I saw. I told him I saw a device with a blank screen. He then said that is what he wanted me to see. When off, it has very little value. But once turned on, that is where the magic is- in the software and services. His point was that Apple is a software company and it is the software that makes this “screen” sing and dance. I fully expect Apple to deliver more elegant screens that front these apps and services in the forms of TV’s, in-car navigation systems, and who knows what else that they may feel is needed to serve as a front end to their software and services.

While Apple is creating these screens to serve as front ends to their software and services, most of the competition is stuck in the old line PC way of thinking about creating a tablet that has its roots in the tablets of the past. They take the typical hardware approach and at the moment are hoping Google will create the software and services that they can tap into. Or those waiting for Windows 8 tablets are hoping that Microsoft will deliver a world of apps and services that they can hitch their wagon to.

Stop Making Tablets
But to be competitive with Apple, vendors have to realize SOON that they cannot create a tablet if they have any hope of challenging Apple. In fact, I would stay away from the word tablet altogether as this term is pure death for them. Rather, like Apple, I would give my “screen” a name of its own and start working on my own software and services play that would allow me to also build more screens that front my apps and services. (By the way, when Amazon introduces their “tablet” soon, listen carefully to what they call it. It will probably have the Kindle brand but don’t expect them to call it a tablet. It is just another screen, like the Kindle, that front ends their apps and services.) Why A Tablet (screen) is Key to Amazon’s Success.”

Of course, the opposite is happening. Competitive vendors think that this “tablet” market will follow what has happened in the PC world and the smart phone world where Windows and Android have surpassed the Mac and IOS. But something tells me that this is different. Apple has not created a tablet. They have created a lightweight portable screen that is the gateway to their software and services. The iPad and its ecosystem will stand alone. In that sense, Apple has proven there is a market for iPads, not tablets.

Now it will be up to the competition to prove that there is another market for what they want to call tablets. And at the moment, considering what HP just did with their TouchPad and the slow adoption of any other tablet out there, it leaves one to think that at the moment there is really just an iPad market, not a market for tablets.

Why the iPhone 5 Could be Apple’s Biggest Launch Yet

Yesterday Techcrunch added more fuel to the reports that the iPhone 5 will indeed be a dual CDMA / GSM world phone.

Making one single device that runs on all the worlds networks makes a great deal of sense. Not only does it streamline Apple’s manufacturing process allowing all their resources to go into building one device, but it also sets them up for what could be their biggest launch yet.

It would be a huge deal to launch the iPhone 5 simultaneously world wide on every major carrier. The strategy itself is simple. Make it possible for every person on the planet to buy an iPhone 5 on the carrier of their choice.

One could make a strong argument, and many have, that the reason other platforms like Android have been gaining is because the iPhone isn’t avaialable on every carrier. This could all change very soon.

And there are two markets of significant interest in this scenario- the US and China.

USA
In the US, if the iPhone is available on all our major carriers, that would mean it would also come to Sprint. If this happens it could have a lot of impact. Sprint sells a lot of Android phones. They also have one of the more aggressive pricing plans for data, voice, text and web. If the iPhone 5 launched on Sprint and it included their aggressive price plan, it would make a very competitive offering.

The timing of this launch is key also. For roughly the last three years the holiday season has been the time of year many people get new cell phones. This is because, for the last few years, new cell phones have made for timely Christmas presents. This means that many consumers are eligible for new phones as a part of their carriers upgrade plan around the fall timeframe. Make it possible for every person on the planet to buy an iPhone 5 on the carrier of their choice.

By launching the iPhone 5 on Sprint, Verizon and AT&T right before or during the holiday shopping season it would probably insure that they could sell more than 80 million iPhone’s this year.

China
Last year I read an interesting article by Shaun Rein who contributes to Forbes but is the Managing Director of the China Market Research Group. He brings a great deal of insight to the China market and in his article last year on “Why the iPad May Succed in China, where the iPhone hasn’t” he makes an interesting point.

“.. why the iPad is likely to succeed where the iPhone didn’t is that Apple didn’t wait as long to launch it. The iPhone debuted in China more than two years after it hit the U.S. market. This time Apple waited only a few months, long enough for early adopters to travel to the U.S. and Hong Kong to buy an iPad and build buzz but not enough for massive numbers of people to have done so. By the time the iPhone officially launched in China, nearly everyone who wanted one already had one. What sane company would delay selling a key product to the world’s second-largest consumer market, where retail sales continue to grow at 16% to 18% a year?”

When a company delays a product in a certain country, no matter what the reason, it sends the message to that region that you are not the companies highest priority. His point was that by not delaying the iPad launch it helped create even more demand in that country.

By making the iPhone 5 avaible on all carriers world wide at the same time, every market has an opportunity to create their own regional buzz and not be left wanting. What’s more, if in every market the iPhone 5 is available on every carrier then consumers will win because they truly have choice to switch or not to switch carriers to get the iPhone 5. This in turn will force the carriers to provide better services and better prices in order to compete.

I would love to see Apple does this when they launch the iPhone 5. It would send a powerful statement to the technology industry as well as to tall the markets they sell and want to sell products in. This would also level the playing field where in every location on any carrier where you can buy an Android, BlackBerry, and Windows phone you can also buy an iPhone. Let’s give consumers the choice and let’s see what happens.

The bottom line is if Apple launches the iPhone 5 on every major network at the same time it would almost certainly dominate every major market.

Is There Room for A New Mobile OS?

A couple of years ago, when various handset makers were looking for a mobile OS to back for their devices, they were given a proposition from Google that was hard to refuse. Google would provide an open source version of Android and with it allow the vendors to customize and add their own features so that they could differentiate their products from other Android licensees.

At first this worked well and Google got dozens of device makers to hop on the Android bandwagon. And for the most part, Android took off, especially in smart phones. But over time, many Android licensees found Google difficult to work with because of their design approach to Android, which was always a moving target. And while Google called it an open mobile OS, as time went on, it became much more controlled by Google and licensees have had less room to do things to help differentiate their devices. Even worse, they have found it more challenging to control their own destiny when it comes to many key services tied around their own offerings.

Now that Google has bought Motorola, many Android licensees believe Google will be exercise tighter control over Android and with Motorola develop a more vertically integrated approach to the market. This is similar to what Apple does through owning the hardware, software and services; integrating them tightly together to provide customers a seamless user experience. While Google has said that they will continue to develop Android as an open source product and work with licensees equally, none of the licensees I have talked to actually believe this. At the very least, they expect Motorola to get early code. Many believe tighter integration between Android and Motorola hardware is inevitable and doubt they will get a similar deal in any way. The various lawsuits against Android as well as the potential of having to pay extra royalties to Oracle and Microsoft should they win their legal cases against Android does not make them happy either.

Not long after the news that Google would buy Motorola, and that HP was going to ditch webOS, Microsoft started courting Android and webOS developers even harder. In fact Microsoft is offering free Windows phones to webOS developers and more hand holding if they jump ship and start developing for Windows Mobile 7and 8.

But what I am hearing from vendors and carriers is that the original need for a completely open mobile OS is what still they really want. Supporting Microsoft is equal to just supporting Android. Indeed, Microsoft would still control the OS and dictate the terms of use and development and give licensees very little room to innovate at either the hardware or software level.

It is also not clear where webOS is going. We don’t know who its owner will be yet. Does it stay with HP or go with the spinoff? We also don’t know if it will ever be an open OS that licensees of the future can freely customize for their own markets and customers. One thing that needs to be kept in mind is that in developed markets, complete ecosystems of hardware, software and services define the user experience. But that may not be the case in emerging markets.

In emerging markets, the need to have a truly open source mobile OS is very important since they need to be able to customize their offerings around a specific language and localized services. This is especially true for emerging market carriers. The fact that mature markets demand hundreds of thousands of mobile apps does not necessarily translate to the actual needs of smart phone users in emerging markets. There they need the dozens or hundreds of apps that are customized for their regions, customs and traditions.

Everyone knows Apple’s approach to their OS is proprietary. Even though Microsoft’s Windows Mobile 7 OS is freely licensable, it is fully controlled by Microsoft. And now that Google has bought Motorola, Android is looking more and more like it could become more tightly controlled as part of a vertically integrated offering. Unless HP quickly states that webOS will not only be licensable but also truly open (which I don’t think they will ever do), then I believe that there is serious room for a completely new mobile OS to emerge and especially give handset vendors targeting emerging markets an OS of their own to work with.

We are already hearing that even the big handset vendors who are backing Android are seriously looking for an alternative OS to back to hedge their bets and to help them go after emerging markets where giant app stores are less important for success. This leads me to believe that there is not only room for another mobile OS but a need for one that is truly open that will never be encumbered by big company agendas that drive the designs of their mobile OS.

Should Tablet Makers Concede the Market to the iPad?

Recent reports, news and analysis have come out that underscore an industry cliche, there is not a tablet market only an iPad market.

From news on the rather weak sales of Android tablets from vendors the last few quarters to the recent news that HP TouchPad sales are dismal, it is clear that the masses have spoken loud and clear – they want iPads.

Those who make tablets entered this market for a variety of reasons. One however I heard often was that they were afraid Apple would “iPod them” in the tablet market. Years ago there was a similar analogy that went “there isn’t an MP3 market just an iPod market.

The logic was if they could get into the market early enough they could hopefully not get “iPoded.”

However this is exactly what we are observing happen today. I believe this will be the case for the next few years. So the question is for the time being should the vendors concede this market and commit those resources to other areas where they have a chance to compete, like Smart Phones for example. Or perhaps they themselves can focus more on RND and create new product categories and innovations all together.

Jim Dalrymple at the Loop makes a great point:

“Apple has spent 10 years working on the iPhone, iPad and the integration with iTunes for app, music and video downloads. The competition would have us believe that in a few short years they too have perfected all of this.”

The bottom line is at this point in time the barrier to entry to the tablet market is actually quite high. There are market forces at work that explain why other tablet makers are having a hard time competing and succeeding.

Harvard Business Review in a foundational strategy article called “The Five Competitive Forces That Shape Strategy,” highlight seven essential points on barrier to entry. I’d like to focus on three that relate heavily to why the barrier to the tablet market is quite high.

Incumbency Advantages

“No matter what their size, incumbents may have cost or quality advantages not available to potential rivals. These advantages can stem from such sources as proprietary technology, preferential access to the best raw material sources, preemption of the most favorable geographic locations, established brand identities, or cumulative experience that has allowed incumbents to learn how to produce more efficiently.” – HBR Five Forces

In this point the HBR article points out how the incumbent has advantages not available to new entrants. Things like brand, forcefully constraining supply chain, holistic experience, preferential access to the best raw materials (at favorable prices), efficient manufacturing and scale, and more are all in Apple’s favor.

Unequal Access to Distribution Channels

“The new entrant must, of course, secure distribution of its product or service.” – HBR Five Forces

Retail is and will continue to be one of Apple’s strongest competitive advantages. I’ve wrote extensively about this “Apple Retail is Key to Their Competitive Advantage.”

By controlling their own retail store, which is in extremly convenient geographic locations all over the world, competitors simply have unequal access to distribution channels.

Also more simply put, in a big box retailer you see vendors competing with each other for retailer and consumer attention.

Walk in to an Apple retail store and you will find zero Apple competitors.

That is what I call unequal access to distribution channels.

Demand-side benefits of scale

“These benefits, also known as network effects, arise in industries where a buyer’s willingness to pay for a company’s product increases with the number of other buyers who also patronize the company. Buyers may trust larger companies more for a crucial product: Recall the old adage that no one ever got fired for buying from IBM (when it was the dominant computer maker). Buyers may also value being in a “network” with a larger number of fellow customers. Demand-side benefits of scale discourage entry by limiting the willingness of customers to buy from a newcomer and by reducing the price the newcomer can command until it builds up a large base of customers.” – HBR Five Forces

This is a big one. Look around and you see tablet makers offering extremely aggressive price promotions. It seems like the prices of competing tablets drop every month. Yet Apple has not lowered the price of their latest generation iPad one single time. What’s more competitors make razor thin margins less than 10%. Let’s just say Apple’s margins on the iPad are significantly more.

In short the cost cutting strategy to undercut the incumbent and gain market share is simply not working.

If competitors are making little to no money, struggling to get distribution, and overall struggling to compete in general how long can they stay in this market?

Conclusion
The reality is the lure of the bright shiny new tablet market is too attractive for vendors to concede to Apple. That however does not change the fact that competing will be monumentally difficult. Even if they did concede I would recommend it only be until the market matured. At which point new entrants have a chance to succeed as the market fragments and consumers begin to shop based on preference. The evolution of consumer markets show us that a standard technology brings a market to maturity and then that market fragments allowing for a more vast variety of consumer choice. The tablet market will mature at some point and at that point consumers may desire a more wide variety of choices.

The brilliance however of Apple in this regard is worth noting. Apple has strategically lured those who compete with them in categores like PC’s and Smart Phones into competing in a category they have no chance in for the foreseeable future.

The result is that Apple competitors are allocating invaluable resources away from other product segments that could be significantly more profitable and competitive for them.

I believe that success will only come to those who want to compete with the iPad by thinking fresh and taking bold and innovative risks.

Why the Open OS Model Failed in Smartphones

Fifteen years ago, when Microsoft ruled the world and Apple was near death, the tech world was convinced that the conceptual batter between Windows and Mac–open operating systems available to all comers vs. closed systems–had been decided firmly in favor of open. But what applied to PCs in the 1990s does not appear to work at all for smartphones in the 2010s, as Google’s planned purchase of Motorola Mobility marks the beginning of the end for the open OS approach.

A major reason for this is that phones–and tablets–are very different from PCs even though they perform many of the same functions. A phone is a much more tightly integrated device in which it is very difficult to tell where the hardware ends and the software begins. Getting the user experience just right is both harder and more critical, because quirks that are a minor annoyance on a PC–or which can be remedied through an accessory such as a better mouse or keyboard–become killer flaws.

It’s easy to forget today that the first real winner in the smartphone market was Research In Motion’s BlackBerry, a closed system. RIM’s accomplishment was to provide a tightly controlled, secure mobile email device (the earliest models offered neither voice not internet service) that provided seamless access to corporate mail servers.

RIM could make this work because it controlled the hardware, the software, and the BlackBerry Enterprise Server middleware. Its rivals in those early days were the Palm Treo and Microsoft Windows Mobile. Palm was a bizarre beast that never really worked. Its owner, 3Com, first licensed the Palm OS to other manufacturers, then spun its software unit off into a separate company, PalmSource. The Treo was developed by one of those licensees, Handspring, which had been started by Palm’s founders. Palm eventually bought Handspring and reacquired some rights to the Palm OS, but it never had full control of the software. That’s a major reason why Palm and PalmOS gradually became non-competitive.

Microsoft’s mistakes were different, but illustrative of the traps inherent in an open phone operating system. In the best Windows tradition, Microsoft gave its handset manufacturers a lot of design freedom. It ended up with phones with a variety of screen sizes and configurations, with and without touchscreens, with and without physical keyboards. The hodgepodge of hardware made it impossible for Microsoft to provide a consistent–or particularly good–user experience on all Windows Mobile devices. And third-party software developers had a very hard time writing applctions that worked well, or sometimes at all, on all devices. In a final irony, until almost the very end, BlackBerry did a much better job of providing mobile access to Microsoft Exchange servers than Windows Mobile did.

Apple, of course, changed the game completely with the 2007 introduction of the iPhone, and again in 2010 with the iPad. Apple controls every aspect of the ecosystem, Apple software running on Apple hardware that can load only Apple-approved applications. This has horrified fans of open systems. such a Cory Doctorow and Jonathan Zittrain, but the mass market’s love for these devices has allowed Apple to suck up the lion’s share of profits in the handset industry and to define the tablet market to the point where it has no effective competition.

Except for Android, the open model has now all but collapsed. Nokia never achieved widespread adoption of Symbian by other manufacturers. Linux-based LiMo went nowhere, as did Nokia’s Maemo, Intel’s Moblin, and their love child, MeeMo.

The status of Windows Phone is uncertain. After the Windows Mobile nightmare, Microsoft set very tight design standards for its attempt to rejuvenate the platform. OEMs have a limited choice of display size and a physical keyboard is optional, but other specs must comply with the reference design. And Microsoft’s tight alliance with Nokia could result in, effectively, a line of “official” Nokia-built Windows Phone products. It’s nominally still a market where Microsoft offers its OS to any willing license, buy Redmond really controls the game.

Android’s openness has been a blessing and a curse. The free-to-all-comers OS has allowed the platform to gain a great deal of market share very quickly. It has also proved extremely frustrating to consumers, with a proliferation of designs and software versions all with different capabilities and no consistency in their ability to run third-party apps. With an iPhone, you know you will always be able to run the most recent version of the iOS software and any product in the App Store (with minor exceptions for some older models that lack some hardware features of more recent ones.) With Android, you just never know.

I suspect this will change in significant ways as a result of the Motorola Mobility acquisition. Google is never going to become Apple, but I suspect that the Android market is going to look a lot more like Windows Phone does today, with Motorola playing an even more central role than Nokia will for Microsoft. This sort of hybrid of open software with an official hardware maker is novel and largely untested; Palm and Nokia both nibbled at it, but neither was a fair test.

However it turns out, however, it looks like any attempt to build smartphones on the PC model is over.

Why A Tablet is Key To Amazon’s Business

I was being interviewed by a journalist recently where the discussion was around the impending release of an Amazon Tablet. I enjoy helping journalists out with stories and I gladly accept interview requests because the discussion is always engaging and often helps sharpen my own thoughts on a subject.

This was the case again when I was asked why a tablet is important to Amazon’ business and business strategy. That is the question i’d like to address in this analysis.

A Tablet is Amazon’s Brick and Mortar
Here is an analogy: a tablet is to Amazon what a physical store is to Wal-Mart.

If you think about Amazon’s business, it started with selling books online and then quickly became a place where consumers can buy just about anything and shop competitively from one single location. It just so happens however that this location is not physical it resides fully within your browser. Amazon’s location is virtual.

To contrast, a company like Wal-Mart is evolving into the digital age with a strategy that includes their brick and mortar stores. To some degree Barnes and Noble is doing something similar but only in the realm of books. Amazon however has no intentions to create a physical location where you walk in to experience their service. I would argue however that Amazon is very interested in giving you a physical storefront and it started with the Kindle.

The Retail Experience Matters
I wrote an article on Why Apple Retail is Key to Their Competitive Advantage. In that article I highlight some key things about retail.

Any retailer will tell you how important the overall retail experience is to their success. Some companies do retail poorly and others do retail extremely well.

The Kindle for Amazon started completely around discovering, purchasing and reading books. The Kindle is the retail storefront to Amazon’s digital book library.

I believe that the evolution of the Kindle will follow Amazon’s business evolution. It started with books then included everything else. Which is why this next device that will most likely be a fully featured tablet will also come with Amazon’s complete shopping experience built in. This includes not just digital storefronts like books, music and movies but physical items as well. Since Amazon is one of, if not the largest digital storefront, it benefits them to get devices on the market where they control the shopping experience.

This is one of the reason’s I believe Amazon re-jiggered their iOS app strategy to stay away from Apple’s transaction model and fees. I don’t believe this move was just about avoiding fees but that Amazon wanted to control the user experience with their storefront instead of Apple. This is why previously with the Kindle app on iOS the Kindle store launched a web browser and took you out of Apple’s ecosystem and into Amazon’s.

Reflecting on that point briefly it becomes clear that Apple’s app store commerce model works for those for whom billing and storefronts are a problem but it does not work for those companies who have spent millions of dollars perfecting their own e-commerce experience.

Amazon also has an interesting strategy with their Prime service that could be strategically integrated as well with their tablet. Perhaps Amazon gives better deals or promotions to those who own the tablet thus incentivizing more purchasing from their store directly on the tablet.

This is why I believe a tablet is strategic for Amazon. Of course they can and will make sure their services are available on every device imagineable. However if they bring a device to market that is a full blown tablet but also includes the most elegant and seamless experience to research, discover and purchase from; then that device becomes the retail storefront to everything Amazon sells – and more.

Further Reading on Amazon:
How Amazon Could Own the Android Tablet Market

Why Microsoft WILL Buy Nokia

In a recent post on Why Google had to buy Motorola, I pointed out that both Ben and I had predicted that this would happen because we were convinced that in order for a company to really be successful in tablets and smartphones they had to own the ecosystem of hardware, software and services.

Today’s announcement that Google would buy Motorola’s Mobility Solutions group underscores this thinking. As Google studied the ingredients of Apples success, it became obvious that Apple’s ownership of the OS and then its ability to fine-tune the hardware to deliver a seamless user experience was critical to consumer’s strong acceptance of the iPad and iPhone. Apple uses this ownership to drive amazing innovation.

This allows them to deliver the upcoming iCloud service so that it can synchronize content and data between all OS devices and utilizes the hardware in special ways. And it gives them a platform for future innovation. For example, what if the next version of the Nano has Bluetooth on it and can be used in a wristband/watch option. Since it is IOS based, it would have the new alert system that will be in IOS 5. That means that technically, if you get an alert on your iPhone in your pocket, that same alert shows up on your Nano watch. This is just one example of how Apple can continue to drive innovation at the hardware, software and services integration level. Knowing Apple I am sure they have dozens of these types of things in the works.

Google clearly went to school on this and while they claim that the patents were a key part of the reason they bought Motorola Mobility, the other reason is that they clearly know that by owning the hardware and software they can now drive the innovation of Android from both the hardware and software level and take more control of their future. And while they want others to keep licensing Android, they basically threw their partners under the bus in order to insure Androids long term success. I predict you will see Android defections or at the very least, companies hedging their bets by endorsing a third alternative by the end of Sept.

Now, don’t think that this same thinking has escaped Microsoft. They have to have come to the same conclusion. Microsoft clearly wants Windows Mobile Phone 7 to become a worldwide hit and at this moment, Nokia is just another distributor of Windows Phone 7 in the same way HTC and other are. But if they decide to keep this OS as a pure licensed property and trust the hardware partners to innovate on their own, that boat has sailed. They too will come to the conclusion that if they want Windows Mobile 7 to be the third major alternative to Apple’s IOS and Google’s Android, they will need to own the hardware as well as the software and services.

Of course, this goes completely against their 30 years of history of being a software licensing company. Actually, they have precedent in hardware with the XBOX. But the rules have changed when it comes to mobile and I believe that Google’s move to buy Motorola Mobility has now forced Microsoft’s hand.

I now believe that it is no longer a matter of “if” Microsoft will buy Nokia but instead a question of “when” they will do it to make sure that Windows Mobile 7 can compete against Apple and Google.

Google: Set Top Box King?

Largely overlooked in the initial reaction to Google’s proposed $12.5 billion purchase of Motorola Mobility is the deal’s potential impact on the cable set top box business. When Motorola split the company in two, the decidedly un-mobile set top box group (formerly General Instrument) went to the Mobility unit. The U.S. market for set top boxes for cable and cable-like services, such as Verizon’s FiOS, is split between Motorola and Cisco (the former Atlanta Scientific.)

The cable box has been a huge impediment to the development of really practical systems to get internet video onto living room TVs. Motorola and Cisco build the boxes their cable provider customers want and that means very limited integration with the internet. In the view of the cable companies, Facebook and Twitter are fine, but Netflix and Hulu most certainly are not. And while it is possible to build a CableCARD-equipped device that allows customers to receive both cable and internet TV on a third-party box, resistance by the cable companies and the failure of the Federal Communications commission to enforce its own rules has resulted in a minuscule market for these products.

Google TV is a great example of a product that was choked by the set top box monopoly. The closest Google could come to integrating cable into its supposedly comprehensive service was to use a ridiculous and antiquated device called an IR blaster to let the Google TV unit control the set top box. IR blaster-based products have been around for years, but have never won favor from consumers (for one thing, at least in my house, the little IR sending units keep falling off the cable box.)

So what would Google do with its new presence in the living room if this deal goes through. It could simply follow the Motorola course and go on making the set top boxes that cable operators want, but that seems profoundly un-Googley. Or it could strike a new course, offering the first mass-market home entertainment united that fully integrate cable and internet services. That could revolutionize the business–or drive all the cable operators to Cisco, which has never shown much inclination to rock this particular boat. My bet is that Google will at least try to build the product that Google TV should have been in the first place.

6 Ways Apple Has Influenced the Last 30 years of the PC Industry

On Aug 12th, the industry celebrated the birthday of the IBM PC and its impact on our world of information. But we would be remiss if we did not also point out some of the key technologies Apple brought to the PC industry and how some of their pioneering technology and decisions actually pushed the PC industry towards stronger growth.

Screen Shot 2011-08-14 at 10.08.19 PM — Credit: Austin Computer Museum

The first technology was the Mac and its graphical user interface. When the Mac was introduced in January of 1984, the IBM PC had been out for three years already, and its UI was still text based. But Apple shook up the computing establishment by introducing the Mac with its GUI, mouse and voice feedback and forever changed the man-machine interface for good.

The second major thing they did is toss out the 5 ¼ inch floppy disk and move to what quickly became the next major storage medium for PC’s. Jobs and company decided that the Mac should have a 3 ½ inch disk. At the time, the computing establishment smirked at Apple’s bold move, but soon after realized that this smaller disk size allowed them to create smaller PC’s and by 1986 this smaller floppy became the mainstream industry standard.

Their third major decision was to introduce a Postscript laser printer at an affordable price. This was a huge industry breakthrough. Most laser printers at the time cost well over $50,000 and took up a large space in an office. Not only did Apple bring this laser printer in at a price under $10,000, but also their laser printer actually sat on a desktop. Then, they were smart enough to link Aldus’ Pagemaker to the Mac and this laser printer and desktop publishing was born. From a historical perspective, you cannot underestimate how much this desktop publishing solution has impacted the world of publishing, graphics and even movies.

The fourth major thing they did was introduce Mac’s with CD Rom drives. Again, this was a revolutionary move at the time and in fact, this ushered in the era of multimedia computing. I had the privilege of being a part of the first multimedia roundtable held at UCLA in 1990 that was co-sponsored by Apple and saw first hand the potential that a CD ROM would have on computing by allowing a PC, for the first time, to deliver a storage device that could integrate text, images, audio and video into a storytelling medium. Again, the traditional PC vendors smirked at Apple’s move and said it was just another unneeded expense. But within two years they got the message and started to integrate them into mainstream PC’s as well. And, with the CD rom in PC’s, for the first time, the PC garnered serious attention from mainstream consumers. If you know your PC history you know that it was multimedia computers that finally got the PC into homes and the consumer PC market was born as a direct result of the role the CD ROM played in bringing multimedia content to the PC experience.

The fifth major influence on the traditional PC market came with the introduction of Apple’s colored Mac’s not long after Steve Jobs came back to run Apple in 1997. In fact, this major move to make industrial design a cornerstone of all Apple Macs has, over the last decade, forced the PC industry to completely rethink what a PC should look like and again, it took Apple to lead the way and help them see the future of the PC.

And now they have introduced the iPad. While Jobs likes to say that this is product of the post PC era, I beg to differ with him on one point. If you open up an iPad, it has a motherboard, CPU, memory, IO’s, screens, etc. In my world, that is a PC. And in that sense, Jobs and team again is influencing the PC market in an even more dramatic fashion.

While over the 30 years of the IBM PC, Apple did not achieve the type of market share of the HP’s, Dells, Acer’s etc. And during much of this time, the company actually struggled to remain relevant. But nobody can deny their impact during this period and now, it is the Dells, HP’s et all who are all chasing Apple.

The 13″ MacBook Air is the Perfect Notebook

I have used a lot of notebooks in my 11 years as an industry analyst of consumer technology products. In fact I have used nearly every type of design, form factor, performance, and screen size imagenable across notebooks and desktops. Because of that I am convinced that the 13″ MacBook Air is the perfect blend of everything required to be a great computer.

Prior to using the 13″ MacBook Air I used a 15″ MacBook Pro. In conjuction with that Notebook I also used last year’s 11″ MacBook Air. The primary reason for this was I wanted a notebook that was more travel friendly but I also wanted one with enough performance to handle the media processing I do.

After using the latest 13″ Air I have found it to be the perfect blend of portability and performance.

Hardware/Design/Portability/Performance

In my office I have a 27″ monitor that I hook my notebook up to when I am at my desk, making screen size when “docked” somewhat irrelevant. However, I move around a good deal as a part of my job. Whether it’s commuting to clients’ offices all around the Bay Area or traveling the country or the world my notebook is in my bag a lot. Because of that I used to travel with the 11″ Air.

Although extremely portable, arguably the most portable and powerful sub 12″ notebook, I still found the screen size a hinderence to long term use. It certainly sufficed in a lot of ways but I found myself desiring a slightly larger screen often.

The 13″ is the ideal size allowing for a larger screen experience without sacrificing portability.

I also found last years 11″ slightly underpowered when it came to the media processing that I do. I make a lot of HD videos of family and events and such so I need a certain level of performance or I will go insane. Apple says the new models are 2.5 times faster, but the 13″ model is faster still, and surpassed my expectations in handling video and audio processing.

The backlit keyboards are certainly nice but not all that necessary for me. The internal SD card reader is another feature the 13″ has over the 11″ that has been a very nice to have.

At the end of the day, the 11″ is “under-screened” for my needs and the 15″ Pro is just slightly to large for me to travel with comfortably. Fitting right in the middle, the 13″ Air is perfect.

Battery Life
Lastly i’ve been extremely impressed with the battery life of the MacBook Air line. Throughout the last year using the 11″ Air I was constantly shocked how long the battery would go. Especially with what I will consider general use.

It seemed as though I could shut the computer and leave it for a week then pick it up and nearly no battery had drained. I attribute most of this to a true state of “sleep” due to the solid state hard drive. It’s very similar to the iPad experience.

I don’t like to do battery benchmarks because there are so many usage variables. All I can say on the matter is that I can use it for a full day on a single charge. Granted this includes opening and closing my computer as I bounce around for meetings. I’m not sitting stationary working all day on a single charge.

In my opinion all that matters when it comes to battery life is that when you are mobile and not able to plug in you have enough battery to work. In that regard the 13″ Air delivers.

I’ll say it again. The 13″ MacBook Air is the Perfect Notebook.

How Important is the Design of the iPhone 5 to its Success?

I continue to watch with amusement the various pictures and speculative drawings for the iPhone 5. And the rumor mills are working over time trying to figure out what the iPhone 5 might look like. In fact, the folks at MacRumors have one of the best mock up drawings I have seen on the rumored iPhone 5 and, at the very least, it is cool to see what an iPhone 5 might possibly look like.

But how important is the new design really to the iPhone 5’s success? Yes, it could have a bigger screen and maybe even be a bit slimmer, but I contend that the iPhone momentum is already so strong that no matter what Apple does with the design of the iPhone 5, it will be a monster hit and could sell as many as 30 million in the holiday quarter. (Apple sold 20 million iPhones in the last quarter.) In fact, our research shows huge pent up demand from both ATT and Verizon customers in the US and very strong demand for this new phone around the world.

I know that the design of the iPhone itself will make the most news when it is launched but there is an even more important technology that needs to be factored into the iPhones future success. To understand this technology, let me relate to you something that happened when the first iPhone came out.

When the iPhone was launched, I had a briefing from the top executives at Apple responsible for the iPhone. After they showed me its design and specs, they did something very pointed and telling. They laid the iPhone on the table and asked me what I saw. I knew this was a trick question and I could have answered it a lot of different ways. But what I said is that I saw a device with a blank screen on it. They affirmed my answer and went on to say that this is what they want people to see. Although they were very proud of the iPhone design, they told me that by itself and when not turned on, it is just a dumb device. However, when you turn it on and the OS and apps get fired up, that is when the iPhone becomes an iPhone.

From the beginning, Apple built into the iPhone’s success equation an ecosystem of hardware, software, applications and services that together make it the iPhone. Yes, the design of the phone is important. But when turned off, it is not very smart. On the other hand, when it is turned on and the screen lights up, that is when the magic takes place. The hardware is only 1/3rd of the iPhones success equation. And while Apple may tweak the design of the iPhone on a yearly basis and add things like more memory, better communications features, better camera, etc, I would argue that what they do with iOS is much more important to the iPhone’s overall success and increased world wide demand. It is what you can do with the iPhone that matters.

So while you might be hyperventilating about the potential features and design of the iPhone 5, keep in mind that the iPhone itself is only part of the iPhone’s success equation. I believe that what Apple does in the next version of IOS and future versions of their mobile OS is actually much more important to the continued growth and success of the iPhone. It is the software that will determine the real future of this important Apple product.

Why iPhone Competitors Should Release Less Products

The Next Web asks an interesting question in this article titled “As Apple’s smartphone sales boom, should its rivals release fewer handsets?”

As I pointed out in my article “Why it matters that Apple is the number 1 smart phone maker,” Apple only needs one product each year to dominate the smart phone market. They are the only company that takes this approach. Every other smart phone manufacturer releases a plethora of handsets each year, many of them based on Android.

Arguably this massive amount of handset choice is one of the leading reasons Android has such a large market share. The interesting question TNW brings up is whether or not Apple’s strategy of one handset each year is a better strategy for each manufacturer.

For Apple they focus all their research, design, engineering, hardware, software, and services teams on just one product. The result is the single best selling handset year after year.

There are rumors that Apple may fragment the iPhone line and offer different priced options but for that we will have to wait and see. Even if Apple did that it would still be the iPhone brand.

The challenge Android has, which TNW brings up, is the Android brand – more specifically the Droid brand. This brand did wonders for Android in the very beginning as Motorola and Verizon spent millions of dollars marketing the Droid brand. Now however it is unclear to the end consumer what devices are “Droids” and which ones aren’t.

On top of the Droid brand we have manufacturers launching products with random names all the time. The Bionic, Sensation, Revoluion, Captivate, Status, Thrill, Photon, Triumph, and XPRT to name a few of the most recent. You have to be a gadget freak or gadget blogger to know what the difference between all those devices I just listed are and those are only half of the Android devices released since January of this year.

Putting yourself in the consumers shoes and trying to research and make a decision on which Android phone to buy could be daunting. I pointed out in a column I wrote for SlashGear earlier in the year that too much choice can be paralyzing for many consumers.

This is why the iPhone strategy has been so brilliant. It simplifies the decision making progress but is also arguably the best handset on the market as evidenced by huge sales. Apple’s less complicated product strategy and laser focus on making THE best handset is paying off.

The biggest benefit I can see for iPhone competitors to release less handsets each year would be that those competitors could pour more resources into fewer designs. The result I would assume would be better smart phones.

Personally I would love to see what a company like HTC, Motorola or Samsung could do if they poured all of their resources into one single device to try and take on the iPhone.

The problem is I don’t think they will do it.