The downside to fragmentation - Page 2

The quoted article complains that there are a lot of camera designs with permutations that don’t precisely fit his needs (wants). But how would only having, say 34 (instead of 343) choices solve his problem? What he really seems to be complaining about is a lack of design creativity and/or market research to identify consumer wants (that’s assuming there are many more people like him who want the kind of camera he says he wants) rather than the number of choices per se. If several dozen camera designs were more along the lines of his expressed wants, would he continue to complain about the 343 number? Of course not. There would be no reason for him to.

As for “asking a salesman”, I would say it makes much more sense to:

a. Identify your wants (needs)
b. Do an Internet survey of available products to see which products come closest to meeting your needs
c. Read what others have to say about the products

It isn’t at all difficult to do this in the Internet age. This forum and others have LOADS of discussion about the merits of various products. It takes time, but if someone’s going to have an “I can’t be bothered with the research, just spoon feed me something” attitude, I think he deserves what he gets. As I said in an earlier post, I used this process to choose a cell phone, and it didn’t take much effort at all. “Asking a salesman” was the LAST thing I thought of.

The smart guys like you and me are also the guys who are the pickiest about what they want. The "I'll just ask a salesman" (or someone knowledgeable) people aren't the kind who worry much over this or that feature. They'll answer a few questions asked by the salesman, buy what he recommends, and go away happy. If a person is happy, there's no problem, even if it's an "ignorance is bliss" situation. The article you quoted is unrealistic in that it was written by a guy who's obviously knowledgeable and picky. He simply wouldn't be the type who'd be content to ask a salesman.

 

They aren't, it seems.

http://www.asymco.com/2012/02/03/first-apples-rank-in-mobile-phone-profitability-and-revenues/

 

So does that mean that a large number of marginally differentiated products, by definition, are too many?

 

I don't understand what that graph is supposed to prove. Is Apple very profitable? Yes. Does that therefore mean that various Android products are insufficiently profitable to continue making them? Where does that follow?

What it means is that Apple cheerleaders are so brainwashed that they can't see that they are being charged more than necessary for their iDevices. They are more than happy to be overcharged -- it's their privilege to fill their coffers and trumpet loudly about how much they're being fleeced.

HTC reports losses. 

http://www.bloomberg.com/news/2012-01-06/htc-has-first-profit-drop-in-two-years.html

 

Motorola Mobility lost money (even accounting for being bought by Google, it's down year to year)

http://www.wgnradio.com/business/breaking/chi-motorola-mobility-reports-4q-net-loss-20120126,0,2455602.story

 

Nokia sees 73% drop in profits.

http://www.huffingtonpost.com/2012/01/26/nokia-q4-2011_n_1233280.html

 

RIM is dying

http://www.nytimes.com/2011/09/16/technology/research-in-motion-posts-disappointing-results-and-its-shares-fall.html?_r=1&pagewanted=all

 

Samsung is doing well, with strong profit growth

http://www.reuters.com/article/2012/01/26/us-samsung-idUSTRE80P1KY20120126

 

Apple, with a portfolio of nine phones (all colors, storage sizes, generations), has the largest marketshare, profitshare, and is first or second in US market-cap.

 

 

 

You posed a test:

 

 

No it doesn't, as I pointed out to you.


There is no ONE answer, and it would be silly to attribute profitability solely to the number of models.

 

 

  iPhones cost the same as Android (and other) smartphones. iPads cost the same as Android tablets. iPods... are there competing music players now?

 

But if that isn't the case (because you'll posit the 64 GB iPhone 4S at $399 is more expensive than the latest Android at $199 plus a $99 SD card), your argument is that Android phone makers and Google don't make any money because their users are smarter than Apple customers? You're saying that if Android phone makers were making money, it would because "Fandroids" are brainwashed fools who don't know the value of their money? So then RIM users are the most brilliant, so unbrainwashed they'll drive the company out of business. And Samsung owners are idiots, since Samsung is showing profit growth?

 

An interesting case to make, Hanson.
 

 

 

 

 

(*) You're right of course that it's impossible to attribute the decline in profits to number of models per se. But then you shouldn't have made posed such a simple-minded test knowing it wouldn't lead to any truth with available data.

 

But you're not wrong. As Hanson observes, Apple's profit dominance is due to the subliminal brainwashing signals in their advertising.

Name an Iphone that's available at 30 bucks a month on a no contract plan. Oh, that's right. You can't.

  "Seem" not to be? Explain why a company would make a model of something they don't make money on. Sam made a claim about "too many" based on some pseudo-pyschological claim that "too many" choices are somehow bad (even though the author he cited in defense of this idea conceded that he got perfect fitting jeans from all the choices available), ie he was ignoring economics. I say if it sells, there's no reason not to offer it. How is this wrong?

The truth is somewhere in between?

 

_Man_

 

You say that, but then the article you cite doesn't seem to have much trouble sorting through the choices. You really are making a problem out of nothing. People like choices. They'd rather have a lot than a few. The market will sort out the right number, without all the psychological gibberish about how being better satisfied is somehow "bad".

The facts state otherwise. It's true that Ipad holds 58% of the tablet market, but that's VERY far from meaning everything else is "nothing". The Android share is up to 39%, which means that there are a LOT of people who have none of the trouble picking an Android you claim they "should" have.

http://www.phonearena.com/news/Android-tablets-hunting-down-the-iPad-market-share-without-mercy-new-research-shows_id26291

That report computes market share based on units "shipped", not sold. This is a problematic method.

The last study comparing I saw "sold" numbers was for the US, before Xmas, and put the iPad at ~89% domestic share (but without Nook or Kindle)
http://daringfireball.net/2011/11/fun_with_numbers

Maybe global is down to 50%. But we need a decent study on actual #s sold.

Why would a company run their business badly and fail? Like Kodak? Or RIM?

Who can say. But they do.

Corporations can't actually tell the future, so they can certainly lose bucket-loads of $$$ on risky moves in the process, especially in relatively new markets like tablets.

 

Time will tell whether Android will get anywhere in this market segment and whether it will truly thrive and reap meaningful profits for most of its supporters in the smartphone world.  Probably still too soon to be sure of anything me thinks although I agree it's not looking great for most Android supporters in the near term.  In the case of Amazon (and even B&N), it's really more the other way around, which probaby doesn't bold so well for Android as a general platform for mobile computing.  Kinda like what happened w/ Unix.

 

_Man_

 

The irony is the analyses indicating Google makes more money from iPhone than Android on advertising. But that's at risk, with Apple now (seemingly) bent on eliminating Google from their default configurations. (Look to see Google maps removed and replaced with an Apple map solution this year in iOS6, I estimate.)

 

I wonder if Google would be better served by aggressively pushing a single-phone solution, a Nexus phone, sold on all carriers with the latest software, and only one or two revisions per year, guaranteed software OS upgrades day and date for at least two years, and no carrier crapware pre-installed. Essentially the iPhone strategy, to make available the definitive Android phone to everyone and not just fourth-run Sprint.

Why am I not surprised that you want every company to be like Apple? I don't look at prospective purchases from the standpoint of what's best for the company (as you seem to). I calculate what's best for ME, and being force-fed ONE so-called "definitive" product isn't it.
Why would a company (or anyone else) assume that not offering only one "definitive" model defines what constitutes running a business badly?

To be honest, google's strategy would work more effectively if it was something like Microsoft's, not Apples... plenty of different handsets, however you like it.. but when OS updates come out, everyone gets it universally

Time for some car analogies.

There's just too many Hondas. Damn those 11 models. What's worse, there's 7 variations of the Civic alone that come in a total of 17 different options packages from the factory. I'm not even going to bother counting how many variations and options packagaes Honda offers across their entire line.

This is fragmenting the car market, and there are just too many choices. I'll never be able to decide which one to get.

I wonder if Honda would be better served by aggressively pushing a single model solution?


Oh, and I wouldn't model my products after something you can brick by connecting via bluetooth to a car audio system. Yes, I've seen it happen with an iPhone just last week.

It. Just. Works. My. Butt.

I wouldn't mind that. I'm not overly worried about the update aspect, since htc has said my phone will be getting Android 4.0 in a couple of months.

So, every car model across all brands have their instrument panel laid out in the same manner, and all controls work the same? Every model is also serviced in the same manner, and technicians do not need to be trained? Inventory of parts for repairs do not need to be developed across the different models?

I do not think it's any more difficult for a person to figure out how to use the different model phones than it is to figure out how to operate different models of cars. It seems like every rental car I get in causes me to search for some hidden control, or wonder whether the headlights turn on/off automatically, etc. As automobiles add more and more technology, the similarities between the operations of different models grows further and further apart.

The owner's manual for my car has a lot more pages than the one for my phone.

It seems ironic for you to talk about constraints on mobile phones when advocating still further restraints by restricting the number of choices.

Well, you can dock your smartphone in a car for actual use, but I don't think you can do the reverse, so...

 

I don't necessarily agree w/ everything Sam's saying, but I also don't think the car analogy works all that well either...

 

As I blurted before, I think the truth in all this is somewhere in between...

 

_Man_