- I see software and display technology having the greatest impact on an industry that’s in for another bumpy year.
- I will explore each of the top 5 in the coming 5 days.
1. Integration of applications starts to affect user purchase decisions
- Every man and his dog offers a graphically rich user experience with cool transitions these days.
- All the devices pretty much look the same.
- Most applications are available on all of the major platforms at the same time.
- So what is going to drive the user purchase decision?
- With these factors effectively commoditised, I believe that the degree to which applications and services are integrated with each other on devices will become the next differentiator.
- Microsoft scores best here followed by Android (and its Linux bretherin) with Apple at the back of the pack.
2. Samsung consolidates its position with bendable and foldable displays.
- I expect Samsung to push these along with its next generation TVs at the CES and MWC shows this year.
- Bendable displays opens up portable devices to whole new range of form factors and use cases.
- Many of them will be useless but as long as they are cool, they are likely to sell in huge volumes.
- Samsung is the only display maker currently capable of making these displays and I suspect that they will be only be available on Samsung devices for some time.
- This, I believe will allow Samsung to consolidate its position in the mobile market while holding onto its margins this year.
3. Android begins to lose share to Microsoft.
- Many commentators are of the opinion that the ecosystem battle is over and with Apple ad Android dividing up the world between them.
- I hold a different view
- Android looks vulnerable and all indicators are that user loyalty is low.
- If Microsoft can execute, I believe that Android users could easily be enticed to switch.
4. Apple and Samsung settle their differences
- Things are starting to drag.
- Endless lawsuits with no real resolution one way or the other is both tiresome and expensive.
- Hence I believe that there is an increasing desire on both sides for a truce.
- This is likely to take the form of a royalty bearing arrangement where Samsung pays Apple a royalty.
- Using my trusty dartboard and historical precedent, I reckon this would be around 1-2% of the wholesale price of every infringing product it ships.
5. HP loses the war of words with Autonomy’s former management.
- This war of words is very unusual as most of the time, those accused of accounting fraud head for the hills.
- Mike Lynch and Co are fighting their corner and I suspect that HPQ’s assertions are not nearly as damning as they seem.
- The key to this will be the whether or not the FBI and the SFO decide to press criminal charges.
- In cases such as this, charges are pressed if there is a reasonable chance of a successful conviction.
- Given that this is likely to come down to the finer interpretations of accounting, makes a successful conviction much more difficult to achieve and as such I think that the FBI and SFO will decline to proceed.
- I suspect that the worst is not over for HPQ and once again the company will find a whole lot more egg on its face before the year is out.
Blog Comments
Jonas Hermansson
January 2, 2013 at 12:18 pm
There is a long tail of apps that we do not see on Windows phone. For many users there are apps that belong to this long tail that are central in everyday life. I expect this to be an issue for windows phone through 2013 at least.
windsorr
January 2, 2013 at 1:07 pm
Yes I agree this is an issue. I am just not sure how important it is at this point in time. Its like broadcasting. a few really popular stations and a long tail of special interest channels.
Juha-Pekka Sipponen
January 2, 2013 at 1:42 pm
I agree that Android is vulnerable because it is not as tight of a package than Apple or Microsoft is. That is especially true at the mid-to-high range. But much of the Android dominance comes from the mid-to-low range where its open and free “productization ecosystem” (in the lack of a better word) results in well priced components and “free” software sponsored by Google. I’d argue that anyone who wants to beat them in the volume game (and earn some margin along the way) needs to be better at that cost game. And that is not easy with Microsoft’s relatively ‘proprietary and limited supplier choice’ model. However, mobile phone is such a personal item that there is always an opening for something that is ‘a better mousetrap’. But at the low-to-mid, it needs to be something so much better that even the most cost conscious Wal-Mart and Ikea-loving consumers will pay a premium for it. To get there, just execution won’t do, for Microsoft or anyone else. One needs great and timely execution (along with some innovation and some luck).
windsorr
January 2, 2013 at 2:13 pm
totally agree…However I don’t think that there is much chance of Microsoft beatin them at the volume game but at the value game and the profit game, that is another story. Wherever a MSFT can match an Android phone in price, I see risk to that segment. IN the super cheap, barely works, I-have-just-bought-my-first-smartphone-to be-like-everyone-else segment, I doubt Microsoft will play. Basically because there is no profit there at the moment. Many of these cheap and cheerful vendors will, I think, compete each other into oblivion.
Juha-Pekka Sipponen
January 2, 2013 at 3:11 pm
Well put. The reason I tend to talk about the volume game is that due to the market polarization there may not be that much value & profit game left at swept-by-Android-but-below-Apple price points. The margin damage may be quite persistent. So the only way for any sustainable business is through the formula of small-to-medium margins x massive volumes + small overheads.
The reason I say that is because I think the characteristics of the lowest tier (“super cheap, barely works, I-have-just-bought-my-first-smartphone-to be-like-everyone-else segment” as well described by you) are really not that different from the tier above (“best value-for-money, no frills, budget, gets-the-job-done”). It’s still not “I want the best/latest/newest out there and I will find the money” in which one gets compensated handsomely for the new and expensive wizardry one put in.
Like you point out, maybe in the cost game indeed the cheap and cheerful vendors will compete each other oblivion, or at least to a semi-permanent zombie stage. But then somebody else will be stepping to the plate. Because Planet Earth will need someone to supply those affordable gadgets. Smartphone is not a Pokemon toy one can live without but a human necessity, and all people can’t afford Apple.
The planet is also so big that the margin challenge being solved with portfolio subsidies (e.g. from other businesses such as ads, media or operator subscription) doesn’t sound like a long-term solution. Hence, I tend to think it is more likely that a budget tier player(s) come(s) along whose skill, DNA and culture is operating with small margins and high volumes.
windsorr
January 2, 2013 at 4:01 pm
Agree….the low cost vendors are like Whack-a-mole. One gets hit and another two pop up to take its place. The guys who bankroll this lot need their heads examined!
tatilsever
January 2, 2013 at 8:18 pm
“Android begins to lose share to Microsoft. […] If Microsoft can execute, I believe that Android users could easily be enticed to switch.”
Nice, a prediction that can never turn out incorrect. If MS wins marketshare, you’d be prophetic, if MS falters, well, they did not execute, not your fault. 🙂
windsorr
January 2, 2013 at 9:36 pm
could easily be wrong….so far Windows 8 is been really poor..far worse than I expected,,,and frankly I dont think it has anything to do with execution…executoin to date on W8 has been OK…..However the last 16 years of endless false starts and high managment turnover are exactly that.
tatilsever
January 3, 2013 at 9:48 pm
What part of Win8 execution was OK? Cramming an OS interface that emphasizes touch into keyboard and mouse environments or the half hearted porting of Office to touch based tablets, requiring a keyboard before its main selling point (i.e. free Office) becomes useful or the illegible menus and too small to touch buttons in very high resolution (i.e. high end) tablets, as MS could not be bothered to optimize UI for one big growing product segment?
windsorr
January 4, 2013 at 1:32 pm
getting it to market when it said it would with the features that it said it would have. what you are moaning about is design not execution. thats another discussion entireley 🙂