EU Antitrust Push
The EU looks like it is stepping up its anti-trust efforts and is going after Google (over ad-click), Facebook (over its data practices, and Qualcomm (over anti-competitive practices). None of this is shocking, as the EU sees plenty of opportunities to pursue given some of the FTC’s initial work in these areas providing influence and ammunition.
There will be a time to more deeply analyze each of these cases and their implications, but the ambition here is clear of the EU, and this is just one of many shoes to drop when it comes to the broader tech regulation conversation.
Apple Watch vs. Swiss Industry
From year one, Apple Watch has demonstrated revenue that was larger than any Swiss Watch manufacturer, but not yet the entire industry. New reports now suggest Apple shipped more Apple Watches than the whole of the Swiss Watch industry which is the first ball to drop. The next will be when Apple Watch generates more revenue than the whole of the Swiss Watch industry.
For years, I maintained a model of both Apple Watch shipments and installed base. Getting a ballpark number for shipments is not that hard. However, the installed base is much more difficult. Refresh rates for Apple Watch are all over the place, with most holding onto them for quite a while. I believe the installed base is nearing 100m, but getting to a precise number is nearly impossible.
What’s happening with smart wearables is a groundswell, and when it comes to watches specifically, the high-end watch brands feel like dinosaurs. While the highest-end brands like Rolex, Omega, etc., may always only focus on being jewelry, some like Tag is trying to compete in the smart-watch sector. But they have not yet found their strid,e and I do wonder if any Swiss Watch brand figures this out or if they simply get stuck in a corner as niche products.
While Android Wear remains the likely platform of choice, the platform still has a lot of maturing that needs to happen to meet the needs of this quick-growing market that is entirely dominated by Apple Watch. My hope is Google focuses on more tech-forward companies and creates a pure smartwatch solution more like Apple Watch than like a Swiss Watch.
The Apple Watch is a low-end disruption in plain sight for the Swiss Watch industry, but it also represents the sleeper category for the future of computing. The latter is what I think is being missed most often by those commenting on smartwatches. It’s not a watch, nor is it simply a smartphone extension. It’s the underlying platform for an entirely new way of computing that includes our ears (audio) but will also include vision at some point as well.
If more companies understood this they would be much more aggressively competing here.
Chinese smartphone OEMs. vs. Google Play Store
In what I think is the most interesting news, at least so far, today is the Chinese smartphone OEMs are reportedly looking to create a replacement for the Google Play store.
China’s Xiaomi, Huawei Technologies, Oppo and Vivo are joining forces to create a platform for developers outside China to upload apps onto all of their app stores simultaneously, in a move analysts say is meant to challenge the dominance of Google’s Play store.
The four companies are ironing out kinks in what is known as the Global Developer Service Alliance (GDSA). The platform aims to make it easier for developers of games, music, movies and other apps to market their apps in overseas markets, according to people with knowledge of the matter.
I want to be skeptical, and I sort of am, that this can be successful outside of China. However, it’s hard to ignore just how big the Chinese OEMs are globally when it comes to shipments. This chart shared by IDC’s Francisco Jeronimo helps paint the larger picture.
Chinese OEMs essentially control over half of the smartphone sales globally. On paper, it looks like the Chinese are well-positioned to challenge Google. But it’s not that easy.
The report looks at the App Store and providing an alternative for developers to upload their apps to this new platform. But the challenge is not necessarily the App Store, and it’s the range of other services Google provides that is core to the global Android experience. Maps being a big one, search another, and Google’s growing prowess in AI-fueled services that add value to the overall experience.
I can see a scenario where Chinese OEMs can provide a sufficient alternative to the Play Store, but I see no scenario where they can provide even adequate replacements to the range of other Google services that are entrenched in every major market outside of China.
This dynamic will be interesting to watch, as it may be nothing more than a tactic designed to negotiate with Google, but if I’m Google, I’m not taking this threat seriously, at least yet.