Flashback

A post this morning on Engadget about the similarity between the most recent ad for the iPad, and one for the original Apple Newton gave me a profound sense of déjà vu.

It’s far from unusual to see Apple ripping off others when it comes to spots, and the same is true in reverse. But copying itself? Head on past the break to catch the similarities between Cupertino’s freshest iPad commercial and an eerily familiar Newton ad from yesteryear — something tells us the former will make a somewhat more indelible mark on the world than the latter, though.

Back in the mid-90′s, more than fifteen years ago, I was one of the pioneers of tablets with digital cellular connectivity: working in New Zealand for what is now Vodafone New Zealand we put together the Apple Newton with the Nokia DataCard and the Nokia 2110 to provide the first predecessor for today’s smart phones; this was even before the very first Nokia Communicator.

Anyway, take a look at the two videos:

Love the data, hate the graphic

One of the key themes we're focused on at the moment is the multilateral asymmetric contest amongst major platform players (Apple, Google, Microsoft and Nokia in particular), device vendors (Apple, RIM, Nokia, Samsung, Sony Ericsson, LG, Motorola, HTC in particular), service providers (Google, Apple, Amazon in particular) and network operators (Verizon, Vodafone, FT Orange and so on). There's some interesting data from Silicon Alley Insider illustrating the size of the stakes...

The cash resources of some of the major players

While the numbers are interesting, I have to confess I hate the graphic... It looks like an area chart, but it's actually a line chart. Tufte's head would explode...

And I'd love to see the analysis extended to include Nokia, RIM, Samsung and so on. And in this context, who cares about Intel, other than ARM and Qualcomm?

Nokia, Apple and asymmetric competition in Regent Street

The Register reports the sad but unsurprising news that Nokia's flagship store on Regent Street is going to close.
Nokia Store Regent St UK (from silicon.com)It was actually the most recently opened store: there are others at London Heathrow and in places like Helsinki, New York, Chicago and São Paulo. You can check it (and the other stores) out online: http://www.flagship.nokia.com/

For those of you who don't know the locale, it is directly opposite Apple's UK flagship store.

Apple Store, Regent St UK (from the London Evening Standard)I recently suggested to a client that they visit the two stores, for a sharp contrast in economics, illustrating what we call "asymmetric competition":

• the Nokia store sells 'phones - lots of different models
• the Apple store sells 'phones - a couple of different models
• the Apple store also sells services, such as mobileMe at ~$100 a year
• the Apple store sells music and video and applications, through iTunes (as cards, in the store)
• the Apple store sells computers

As a result, at the moment Apple has fundamentally different economics from Nokia. Apple makes money in a variety of related ways, from mobile devices, and from personal computers (each of which generates several times the margin of even an iPhone), and from complementary cloud services and digital media and other devices.

Perhaps unsurprisingly, this Apple Store is London's most profitable store, generating ~£60 million a year or £2,000/sq ft, three times the sales per square foot of Harrods.

Harrods

Each iPhone drives significant additional revenue and contribution beyond the device itself; as a result, Apple's economics are fundamentally different from Nokia's, or indeed from any other player without the same scope of activities.

There's a related discussion about 'phones vs platforms, and on the shape of product portfolios, which I will post on later this week.

Android(s) are coming...

There's a great (albeit lengthy) post on Gizmodo about Android, although the title may be a little overstated:

[Android] 2.0 is more than that: it's proof that Android is finally going to take over the world

As a digression, it's fascinating to see how a technological innovation can re-shape language: the former meaning of android is now relegated off the first page of search results on Google, which led me to try 'androids' as an alternative:

[youtube=http://www.youtube.com/watch?v=biBHJvGx3s8&hl=en&fs=1&]

The article from Scientific American about this date with a robot can be downloaded here; I find it intriguing partly because I began my career as a roboticist and cyberneticist.

Although it may overstate the case, because we are just in the earliest stages of a fierce contest amongst at least five credible competing app phone platforms, the post from Gizmodo does summarize well much of what provides the impetus for Android and why Android 2.0 is so important:

it's "the first truly open and comprehensive platform for mobile devices."

Android 2.0 means the handsets aren't just interesting anymore; they're truly buyable

In addition to everything else Android has going on, timing is on its side. Windows Mobile is limping along with two broken legs...

...as far as most consumers are concerned, anything Windows Mobile can do, Android can do better

The Palm Pre, polished and beautiful as it is, can't keep up with Android's exploding app inventory, multiplying hardware partners and rock-star ability to draw talent

Android 2.0, along with Palm's WebOS and Apple's iPhone OS, are the main reasons the BlackBerry OS feels so clunky and old

Let's take a quick look at each of the other major contenders:

• the iPhone is the current leader, and critically works well across not just app phones, but through iTunes across other platforms such as personal computers and TV


• although RIM's BlackBerry has been the long-time leader in the enterprise, it is not doing as well in the consumer marketplace, particularly outside North America, and its software platform (RTE, APIs and SDK) looks increasingly clunky in comparison to iPhone and Android


• Nokia is investing heavily in the transition to Qt and Maemo - the big question is really can it get there fast enough


• Microsoft's most recent release of 6.5 was late and lacked usability, and despite some good things being said about it 7 is still some way off, eroding support for it


• while WebOS is technically elegant, the Pre's implementation is slow, Palm lacks distribution and was really late with its SDK - it will be extraordinarily difficult for Palm to overcome these handicaps and establish itself as a credible competitor in the face of the likes of Apple, Google, Nokia, Microsoft and RIM

Android's a strong contender, but it's by no means yet certain that it will rule the world. In fact, one of the real possibilities is that rather than reaching a tipping point, a few of these will co-exist over the medium- or even long-term.

À propos the 'app phone'

David Pogue has a review today of Motorola's Droid which includes some discussion à propos how to categorize and name devices of this type.

Motorola Droid

He promotes the noun 'app phone' for them, attributing it to @mentalworkout.

[Cool app, BTW, for those who have fear of flying. I took the Virgin Atlantic flight to London earlier this week; if you're lucky enough to fly in Upper Class, it's such an extraordinarily soothing experience that you probably don't need the app.]

I really like 'app phone' , and suggest that we all adopt it for this class of devices:

• Apple's iPhone


• all current Android 'phones


• most modern BlackBerrys - post Curve


• Palm's Pre


• Nokia's N97 and N97 Mini running the latest version of Symbian

This post re-surfaced for me, however, one of the key topics that we have found ourselves debating frequently over the last many months; what is a 'smart phone', and what should we call it?

This is a common challenge in high-tech; how do you think about new phenomena? How do you build robust mental models? We believe that having the specialist expertise to do this, and the relevant experience of having done this, is one of the key things that differentiates Endeavour Partners.

First, what are the key criteria:

• downloadable applications - in which case do BREW and Java devices qualify?


• user interface, such as (responsive) touch screen or QWERTY+touch pad/trackball interface to allow easy navigation for the web and similar applications


• running multiple applications - which disqualifies the iPhone?


• great at browsing - typically with a full WebKit browser


• third party applications have to be available, affordable and accessible


• what about size - is there some constraint here, because otherwise a laptop could qualify?

And what about the additional capabilities that are now part of the competitive benchmark:

• fast graphics - for video, browsing and gaming


• accelerometers


• GPS - for location services


• WiFi

There are several specific devices or types of devices that illustrate this challenge, and the grey areas involved:

• older BlackBerrys with thumbwheels but without trackballs - great at e-mail web but suck at browsing


• the Nokia E71, a great (particularly when it launched) device handicapped by its click-pad for navigation (which on one occasion proved enormously frustrating as the cursor moved in clicks that circumnavigated a small target without ever being able to actually click on it, on a site that should have been designed with mobile devices in mind - Handango)

Nokia E71

• many of Nokia's myriad Symbian S60 devices that have 12-key keypads, lacking either a touch screen or a viable navigation method for browsing


• and what of the forthcoming Nokia N900 - is this a smartphone, or not?


• and given how unresponsive the touch screen on the N97 and N97 mini can be, and some of the usability challenges that remain with Symbian, do the N97 and N97 Mini qualify?


• almost all Windows Mobile devices, that lack a touch pad, requiring a stylus or arrow keys for what is enormously painful navigation (Sony Ericsson's Experia X1 is one of the few devices that overcomes this challenge)

On purely pragmatic grounds, and notwithstanding flame wars from some purists and Verizon's new advertising campaign, clearly any definition that excludes the iPhone on the technically focused grounds that it does not run multiple applications at once, except for some built-in apps such as Mail and Phone, does not make much sense. Although this may be an important consideration, it clearly does not deter users, and the ease of switching amongst applications mitigates this significantly.

The related question was what to call these things? We tried the term 'smart device', to emphasize the that the capabilities went way beyond making a call. Unfortunately that promotes confusion as it embraces some very devices that do not have 'phone capability at all.

So, let's endorse the term 'app phone' for these high end devices, and use the term 'smart phone' for the broader group of which these are a subset.