The Drumbeat for a Verizon / Apple partnership is getting louder (1 Viewer)

[DaveF]

That reflects my thinking: if Android is too much of a threat to remain on a single carrier, Apple will switch.


I'll further speculate that Apple's disadvantage is beginning and will only get worse year by year. Unlike with the Mac, Apple wants not just profits but marketshare. They want to define the direction of the new generation of phones and be able to push the carriers to do their bidding. That requires marketshare. With Android succeeding, Android will continue to succeed. And with Android on every carrier, if it succeeds through Verizon's efforts, it will benefit from that on all carriers, as it gains more traction and marketshare. And it can grow in absolute numbers 2:1 to Apple so long as Apple is AT&T exclusive. And that means Apple can only begin to lose marketshare and risk losing influence the longer they are constrained to AT&T.


And their walled garden and iron-fisted control only works as long as they are so valuable to developers that dev's tolerate it. As Android gets marketshare, developers may find that open, if weedy, garden more attractive. And if the apps go. so do the users. Apple can maintain a solid userbase, and be quite profitable -- as with Macs. But they'll be increasingly marginalized and no longer drive the market. And if they're marginalized too much AT&T will begin to dictate to Apple the terms of the hardware, the revenue sharing, etc.


So Apple is potentially at the cusp of their decline, and they need to get to other carriers as soon as possible.


Now, Apple's best-defense-is-a-good-offense move was first the iPad and now the iPad. Expanding the Touch OS beyond cellphone devices expands the opportunities for marketshare for this overall system, increasing opportunities for developers to work with the system, and reduces their reliance on the whims of AT&T and Verizon.


So, when does Apple go to Verizon?

* Before Android exceeds RIM's marketshare

* When they see growth from AT&T decline or cease

* When people start leaving AT&T to return to Verizon because Android phones are good enough.


Ultimately, I don't if we want a dominant Apple. But clearly we want a strong Apple to innovate the lead the design for the entire industry.

 

[Ted Todorov]

You do mention the other iPhone OS products -- and there Android has no traction at all. And while there are some feeble attempts at Android tablets in the works, the iPod Touch market has been surrendered to Apple - and they sell nearly as many of those as they do iPhones.


Android wouldn't exist without carrier subsidies. Between worldwide iPhone sales and domestic/worldwide iPod Touch and iPad sales, Verizon's customer base is a non-event. If Android was getting anywhere Apple wouldn't have 95% of the mobile App market (or whatever Adobe was claiming).


Further I think that El Jobso regards the iPad as more important than the iPhone, and without carrier subsidies Android is at a severe disadvantage trying to compete there.

 

[DaveF]

Even though the iPod Touch sales are big, I don't think it's nearly as important as the iPhone. It doesn't have the mindshare. It doesn't specifically drive the technology: the iPhone is always ahead of it. And ultimately, the mobile communications market will define critical mobile OS standards.


If the iPhone loses the cellphone market, the iPod Touch won't save Apple.


The iPad, I agree, is betting the farm. That's the watershed even in personal computing.

 

[Ted Todorov]

Originally Posted by DaveF

Even though the iPod Touch sales are big, I don't think it's nearly as important as the iPhone. It doesn't have the mindshare. It doesn't specifically drive the technology: the iPhone is always ahead of it. And ultimately, the mobile communications market will define critical mobile OS standards.


If the iPhone loses the cellphone market, the iPod Touch won't save Apple.


The iPad, I agree, is betting the farm. That's the watershed even in personal computing.

The ultimate battle is over developer mindshare -- a developer doesn't care if an iPhone user or iPodTouch user is buying there app -- in fact they don't know. If 90%+ of the app sales stay in the iPhone OS realm, so will the developers. It's as simple as that.

 

[mattCR]

Originally Posted by Ted Todorov

You do mention the other iPhone OS products -- and there Android has no traction at all. And while there are some feeble attempts at Android tablets in the works, the iPod Touch market has been surrendered to Apple - and they sell nearly as many of those as they do iPhones. Android wouldn't exist without carrier subsidies. Between worldwide iPhone sales and domestic/worldwide iPod Touch and iPad sales, Verizon's customer base is a non-event. If Android was getting anywhere Apple wouldn't have 95% of the mobile App market (or whatever Adobe was claiming). Further I think that El Jobso regards the iPad as more important than the iPhone, and without carrier subsidies Android is at a severe disadvantage trying to compete there.

I think this mindset will be death for Apple if they believe it. In 1986, Apple was 98% of the school education market. They dominated it in such a fashion that it was almost unthinkable that that would change. But low and behold, give it a few years, and it did.


For Apple, the transition from the AppleII to Mac was a fairly painful one in that regard, but longterm, it helped also.

But with the Iphone, they have a different gamble. Right now they are 95% of the app sales (though I doubt that, but maybe). Here's the hitch: Android has realistically been on the market less then a year. And Blackberry isn't really in the same segment, but they've only had AppWorld for about 7 months. Both of those are "young" products.


For RIM, it really doesn't matter. RIM (Blackberry) appeals in a lot of ways to a much different market, and that market is not likely to change, for several reasons that neither Google or Apple are willing to bend their product to meet those market segments (because they are by and large, in comparison to all cellphone users, small).

But Google is running an interesting gamble. It's the same one Microsoft made in the 1990s. You don't have to be perfect, you just have to be "good enough" and you have to be available in a broad means. Google will have android phones on every platform (Tmobile, Verizon, ATT, Sprint). Hell, Google already has pre-paid options.

Apple may find that it's agreement with ATT becomes stifling if Google races past it in installed user base. Because if that happens, and the installed user base shifts, apple will have to compete against a much broader audience. Fact is, more eyeballs equals more sales.

Apple is OK when it's up against say, Nokia.. a straight phone. Or Palm, an organizing phone that hasn't really successfully battled out RIM for that market. But Google is a different animal. Google is marketing itself on "we have incredible apps, because we are google" And unlike those others, Google has also built up a lot of brandname awareness in a positive light.


Google share could grow much faster then Apple share, simply because it will be on many more platforms at a myriad of price points.

I don't see Apple hopping to Verizon tomorrow. I don't know if they can without a stiff penalty. And the iPad is another gamble in that pattern too. But, if they let Google completely outflank them, they will run into another problem of "good enough" beating out a potentially better idea because it's so much more available, cheaper, and offers floods of diversity/differences that apple can't keep up with.

 

[Ted Todorov]

Matt, I agree with everything you say, but keep in mind the AT&T exclusivity is a US only phenomenon. In most countries the iPhone is on most major carriers. Not coincidentally Android is nowhere outside of the US.


This just isn't analogous to the Mac vs. Microsoft battle of old*. The old Apple didn't have Steve Jobs (or Tim Cook for thatn matter). Sculley was an idiot. They also didn't have two other equally successful product lines running MacOS. History just isn't going to repeat itself with Android.


EDIT:

*Other missing ingredients -- Android isn't in business the way Microsoft was. There wasn't the Microsoft Windows fragmentation that exists in ANdroid (anything pre 3.1 was so bad, nobody stayed on it. And 3.1 to 95 was a huge leap. DOS apps worked under Windows etc.

The games are on iPhone OS, not Android (and interpreted Java is never going to match C/Obj-C/Assembler on iPhone OS for hard core game performance).

 

[DaveF]

Quote:

Originally Posted by Ted Todorov

History just isn't going to repeat itself with Android.

Apple is doing everything it can to prevent that. OS 4 is clearly a response to Android. Apple marketing made an overt response to NPD's report that Android has overtaken iPhone in US marketshare. Their iAds looks like both a revenue source and also an indirect attack at Google's core advertising business.


Apple's dominance is not assured, they know it, and are running as fast as possible to remain the leader in both marketshare, profits, and hearts-and-minds of consumers.


It's a very interesting time in computing. It reminds me a bit of the excitement of the 80's with the myriad competing systems, changing drastically every few years.

 

[Sam Posten]

Keep dreaming De La Vega, AT&T is the worst part of iPhone and while your painful processes will make leaving hurt, many will do so and the publicity will drown whatever the actual number of poor souls stuck with you represents.

http://www.electronista.com/articles/10/05/19/att.says.family.work.plans.keep.iphone.users/

 

[DaveF]

And Vz is rumored to have an interim (pre-LTE) Voice+Data network upgrade in the works.

http://www.boygeniusreport.com/2010/05/19/verizon-apple-iphone-to-launch-with-simultaneous-voice-and-data/

 

[Sam Posten]

The natives are getting restless again.

http://www.zdnet.com/blog/btl/five-new-questions-that-stem-from-bloombergs-verizon-iphone-report/36398


http://www.boygeniusreport.com/2010/06/29/verizon-to-launch-lte-network-on-november-15th-handsets-on-black-friday/

 

[mattCR]

What no one wants to say, because they don't quite grasp this yet... Verizon's backbone is not any larger then ATT by anyone's figures. So, if there is a hell of an adoption of iPhone on Verizon, you can count on some of the issues. Verizon's benefit is that they have much higher penetration into the NY market.

 

[DaveF]

If they make the same prediction every few months, they'll eventually get it right.

I still think the iPad 3G plan had quid pro quo of continued AT&T service. But maybe it was at threat of taking the ipad to verizon? So I don't believe these rumors yet. 

However the counterarguments on apple not handling CDMA and gsm phones are asinine. Simply observing their product lineup with BTO options puts the idea to rest. 

So my bet is no V next Jan. But being wrong is ok

 

[Sam Posten]

I don't care who gets it next, just move some traffic to a competitor and lets see how things work out =)

 

[Anthony Hom]

The traffic should be better on Verizon, since you cannot use the phone service and data network simultaneously. You can do that on the ATT network, but AFAIK, Verizon still has this limitation.

 

[Sam Posten]

LTE soon.


http://www.engadget.com/2010/07/19/verizons-4g-lte-sim-in-the-wild/

http://www.engadget.com/2010/07/18/verizons-lte-rollout-is-imminent-computers-updated-for-4g-sim/

 

[DaveF]

Based on EVO battery performance with its variant of 4G, I predict Apple will delay any 4G phone until they are low power consumption. Which maybe LTE radios are already battery-sippers. But Apple has shown it will compromise total performance to manage battery life.

 

[Sam Posten]

I gotta admit something, I didn't think the Sprint 4G is LTE, but now I have no idea if that is right or not. anyone know for sure before I go look it up?

 

[mattCR]

Originally Posted by Sam Posten

I gotta admit something, I didn't think the Sprint 4G is LTE, but now I have no idea if that is right or not. anyone know for sure before I go look it up?

Sprint 4G is WiMAX. They and Intel partnered (and as a result, Clear) so there is that. Sprint has said they may consider LTE, but they are WiMAX for now.

 

[DaveF]

Yes, which is why the power issues with the Radio may be uncomparable. It might be LTE is more energy efficient compared to WiMax. I have no idea; I'm just a dog on the internet


I think Sprint's gambit was to get WiMax rolled out faster than everyone else could do LTE. Because I think LTE is being adopted by both Verizon and AT&T. So if Sprint doesn't get enough traction soon enough, they'll be stuck with a dead-end technology no one else uses.

 

[Sam Posten]

Right, ok then.


'Good luck with that'.