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Tag: Apple

Why VR Could be as Big as the Smartphone Revolution

Technology in the 1990s and early 2000s marched to the beat of an Intel-and-Microsoft-led drum.

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via IT Portal

Intel would release new chips at a regular cadence: each cheaper, faster, and more energy efficient than the last. This would let Microsoft push out new, more performance-hungry software, which would, in turn, get customers to want Intel’s next, more awesome chip. Couple that virtuous cycle with the fact that millions of households were buying their first PCs and getting onto the Internet for the first time – and great opportunities were created to build businesses and products across software and hardware.

But, over time, that cycle broke down. By the mid-2000s, Intel’s technological progress bumped into the limits of what physics would allow with regards to chip performance and cost. Complacency from its enviable market share coupled with software bloat from its Windows and Office franchises had a similar effect on Microsoft. The result was that the Intel and Microsoft drum stopped beating as they became unable to give the mass market a compelling reason to upgrade to each subsequent generation of devices.

The result was a hollowing out of the hardware and semiconductor industries tied to the PC market that was only masked by the innovation stemming from the rise of the Internet and the dawn of a new technology cycle in the late 2000s in the form of Apple’s iPhone and its Android competitors: the smartphone.

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via Mashable

A new, but eerily familiar cycle began: like clockwork, Qualcomm, Samsung, and Apple (playing the part of Intel) would devise new, more awesome chips which would feed the creation of new performance-hungry software from Google and Apple (playing the part of Microsoft) which led to demand for the next generation of hardware. Just as with the PC cycle, new and lucrative software, hardware, and service businesses flourished.

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But, just as with the PC cycle, the smartphone cycle is starting to show signs of maturity. Apple’s recent slower than expected growth has already been blamed on smartphone market saturation. Users are beginning to see each new generation of smartphone as marginal improvements. There are also eery parallels between the growing complaints over Apple software quality from even Apple fans and the position Microsoft was in near the end of the PC cycle.

While its too early to call the end for Apple and Google, history suggests that we will eventually enter a similar phase with smartphones that the PC industry experienced. This begs the question: what’s next? Many of the traditional answers to this question – connected cars, the “Internet of Things”, Wearables, Digital TVs – have not yet proven themselves to be truly mass market, nor have they shown the virtuous technology upgrade cycle that characterized the PC and smartphone industries.

This brings us to Virtual Reality. With VR, we have a new technology paradigm that can (potentially) appeal to the mass market (new types of games, new ways of doing work, new ways of experiencing the world, etc.). It also has a high bar for hardware performance that will benefit dramatically from advances in technology, not dissimilar from what we saw with the PC and smartphone.

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via Forbes

The ultimate proof will be whether or not a compelling ecosystem of VR software and services emerges to make this technology more of a mainstream “must-have” (something that, admittedly, the high price of the first generation Facebook/Oculus, HTC/Valve, and Microsoft products may hinder).

As a tech enthusiast, its easy to get excited. Not only is VR just frickin’ cool (it is!), its probably the first thing since the smartphone with the mass appeal and virtuous upgrade cycle that can bring about the huge flourishing of products and companies that makes tech so dynamic to be involved with.

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Android Bluetooth (Smart) Blues

Readers of this blog will know that I’m a devout Fandroid, and the past few years of watching Android rise in market share across all segments and geographies and watching the platform go from curiosity for nerds and less-well-off individuals to must-support platform has been very gratifying to see.

Yet despite all that, there is one prominent area in which I find iOS so much better in that even I – a proud Fandroid venture capitalist – have been forced to encourage startups I meet with and work with to develop iOS-first: support for Bluetooth Smart.

LogoBluetoothSmart

In a nutshell, Bluetooth Smart (previously known as Bluetooth Low Energy) is a new kind of wireless technology which lets electronics connect wirelessly to phones, tablets, and computers. As its previous name suggests, the focus is on very low power usage which will let new devices like smart watches and fitness devices and low power sensors go longer without needing to dock or swap batteries – something that I – as a tech geek — am very interested in seeing get built and I – as a venture capitalist — am excited to help fund.

While Bluetooth Smart has made it much easier for new companies to build new connected hardware to the market, the technology needs device endpoints to support it. And therein lies the problem. Apple added support for Bluetooth Smart in the iPhone 4S and 5 – meaning that two generations of iOS products support this new technology. Google, however, has yet to add any such support to the Android operating system – leaving Bluetooth Smart support on the Android side to be shoddy and highly fragmented despite many Android devices possessing the hardware necessary to support it.

To be fair, part of this is probably due to the differences in how Apple and Google approached Bluetooth. While Android has fantastic support for Bluetooth 4.0 (what is called “Bluetooth Classic”) and has done a great job of making that open and easy to access for hardware makers, Apple made it much more difficult for hardware makers to do novel things with Bluetooth 4.0 (requiring an expensive and time-consuming MFi license – two things which will trip up any startup). Possibly in response to complaints about that, Apple had the vision to make their Bluetooth Smart implementation much more startup-friendly and, given the advantages of using Bluetooth Smart over Bluetooth Classic, many startups have opted to go in that direction.

The result is that for many new connected hardware startups I meet, the only sensible course of action for them is to build for iOS first, or else face the crippling need to either support Android devices one at a time (due to the immaturity and fragmentation in Bluetooth Smart support) or get an MFi license and work with technology that is not as well suited for low power applications. Consequently, I am forced to watch my chosen ecosystem become a second-class citizen for a very exciting new class of startups and products.

I’m hoping that at Google I/O this year (something I thankfully snagged a ticket for :-)), in addition to exciting announcements of new devices and services and software, Google will make time to announce support for Bluetooth Smart in the Android operating system and help this Fandroid VC not have to tell the startups he meets to build iOS-first.

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A “Fandroid” Forced to Use an iPhone 4 for Two Weeks

I recently came back from a great two week trip to China and Japan. Because I needed an international phone plan/data access, I ended up giving up my beloved DROID2 (which lacks international roaming/data) for two weeks and using the iPhone 4 my company had given me.

Because much has changed in the year and a half since I wrote that first epic post comparing my DROID2 with an iPhone 4 – for starters, my iPhone 4 now runs the new iOS 5 operating system and my DROID2 now runs Android 2.3 Gingerbread — I thought I would revisit the comparison, having had over a year to use both devices in various capacities.

Long story short: I still prefer my DROID2 (although to a lesser extent than before).

So, what were my big observations after using the iPhone 4 for two weeks and then switching back to my DROID2?

  • Apple continues to blow me away with how good they are at
    • UI slickness: There’s no way around it – with the possible exception of the 4.0 revision of Android Ice Cream Sandwich (which I now have and love on my Motorola Xoom!) – no Android operating system comes close to the iPhone/iPad’s remarkable user interface smoothness. iOS animations are perfectly fluid. Responsiveness is great. Stability is excellent (while rare, my DROID2 does force restart every now and then — my iPhone has only crashed a handful of times). It’s a very well-oiled machine and free of the frustrations I’ve had at times when I. just. wished. that. darn. app. would. scroll. smoothly.
    • Battery life: I was at or near zero battery at the end of every day when I was in Asia – so even the iPhone needs improvement in that category. But, there’s no doubt in my mind that my DROID2 would have given out earlier. I don’t know what it is about iOS which enables them to consistently deliver such impressive battery life, but I did notice a later onset of “battery anxiety” during the day while using the iPhone than I would have on my DROID2.
  • Apple’s soft keyboard is good – very good — but nothing beats a physical keyboard plus SwiftKey. Not having my beloved Android phone meant I had to learn how to use the iPhone soft keyboard to get around – and I have to say, much to my chagrin, I actually got the hang of it. Its amazingly responsive and has a good handle on what words to autocorrect, what to leave alone, and even on learning what words were just strange jargon/names but still legitimate. Even back in the US on my DROID2, I find myself trying to use the soft keyboard a lot more than I used to (and discovering, sadly, that its not as good as the iPhone’s). However:
    • You just can’t type as long as you can on a hard physical keyboard.
    • Every now and then the iPhone makes a stupid autocorrection and it’s a little awkward to override it (having to hit that tiny “x”).
    • The last time I did the iPhone/DROID comparison, I talked about how amazing Swype was. While I still think it’s a great product, I’ve now graduated to SwiftKey(see video below) not only because I have met and love the CEO Jonathan Reynolds but because of its uncanny ability to compose my emails/messages for me. It learns from your typing history and from your blog/Facebook/Gmail/Twitter and inputs it into an amazing text prediction engine which not only predicts what words you are trying to type but also the next word after that! I have literally written emails where half of my words have been predicted by SwiftKey.

       

  • Notifications in iOS are terrible.
    • A huge issue for me: there is no notification light on an iPhone. That means the only way for me to know if something new has happened is if I hear the tone that the phone makes when I get a new notification (which I don’t always because its in my pocket or because – you know – something else in life is happening at that moment) or if I happen to be looking at the screen at the moment the notifications shows up (same problem). This means that I have to repeatedly check the phone throughout the day which can be a little obnoxious when you’re with people/doing something else and just want to know if an email/text message has come in.
    • What was very surprising to me was that despite having the opportunity to learn (and dare I say, copy) from what Android and WebOS  had done, Apple chose quite possibly the weakest approach possible. Not only are the notifications not visible from the home screen – requiring me to swipe downward from the top to see if anything’s there — its impossible to dismiss notifications one at a time, really hard (or maybe I just have fat fingers?) to hit the clear button which dismisses blocks of them at a time, even after I hit clear, I’m not sure why some of the notifications don’t disappear, and it is surprisingly easy to accidentally hit a notification when you don’t intend to (which will force you into a new application — which wouldn’t be a big deal if iOS had a cross-application back button… which it doesn’t). Maybe this is just someone who’s too used to the Android way of doing things, but while this is way better than the old “in your face” iOS notifications, I found myself very frustrated here.
  • selectionCursor positioning feels a more natural on Android. I didn’t realize this would bug me until after using the iPhone for a few days. The setup: until Android’s Gingerbread update, highlighting text and moving the caret (where your next letter comes out when you type) was terrible on Android. It was something I didn’t realize in my initial comparison and something I came to envy about iOS: the magnifying glass that pops up when you want to move your cursor and the simple drag-and-drop highlighting of text. Thankfully with the Gingerbread update, Android completely closes that gap (see image on the right) and improves upon it. Unlike with iOS, I don’t need to long-hold on the screen to enter some eery parallel universe with a magnified view – in Android, you just click once, drag the arrow to where you want the cursor to be, and you’re good to go.
  • No widgets in iOS. There are no widgets in iOS. I can see the iOS fans thinking: “big deal, who cares? they’re ugly and slow down the system!” Fair points — so why do I care? I care because widgets let me quickly turn on or off WiFi/Bluetooth/GPS from the homescreen in Android, but in iOS, I would be forced to go through a bunch of menus. It means, on Android, I can see my next few calendar events, but in iOS, I would need to go into the calendar app. It means, on Android I can quickly create a new Evernote note and see my last few notes from the home screen, but in iOS, I would need to open the app. It means that on Android I can see what the weather will be like from the homescreen, but in iOS, I would need to turn on the weather app to see the weather. It means that on Android, I can quickly glance at a number of homescreens to see what’s going on in Google Voice (my text messages), Google Reader, Facebook, Google+, and Twitter, but on iOS, I need to open each of those apps separately. In short, I care about widgets because they are convenient and save me time.
  • Apps play together more nicely with Android. Android and iOS have a fundamentally different philosophy on how apps should behave with one another. Considering most of the main iOS apps are also on Android, what do I mean by this? Well, Android has two features which iOS does not have: a cross-application back button and a cross-application “intent” system. What this means is that apps are meant to push information/content to each other in Android:
    • android-sharing-500x500If I want to “share” something, any app of mine that mediates that sharing – whether its email, Facebook, Twitter, Path, Tumblr, etc – its all fair game (see image on the right). On iOS, I can only share things through services that the app I’m in currently supports. Want to post something to Tumblr or Facebook or over email in an app that only supports Twitter? Tough luck in iOS. Want to edit a photo/document in an app that isn’t supported by the app you’re in? Again, tough luck in iOS. With the exception of things like web links (where Apple has apps meant to handle them), you can only use the apps/services which are sanctioned by the app developer. In Android, apps are supposed to talk with one another, and Google goes the extra mile to make sure all apps that can handle an “action” are available for the user to choose from.
    • In iOS, navigating between different screens/features is usually done by a descriptive back button in the upper-left of the interface. This works exactly like the Android back button does with one exception. These iOS back buttons only work within an application. There’s no way to jump between applications. Granted, there’s less of a need in iOS since there’s less cross-app communication (see previous bullet point), but when you throw in the ability of iOS5’s new notification system to take you into a new application altogether and when you’re in a situation where you want to use another service, the back button becomes quite handy.
  • And, of course,  deluge of the he-said-she-said that I observed:
    • Free turn-by-turn navigation on Android is AWESOME and makes the purchase of the phone worth it on its own (mainly because my driving becomes 100x worse when I’m lost). Not having that in iOS was a pain, although thankfully, because I spent most of my time in Asia on foot, in a cab, or on public transit, it was not as big of a pain.
    • Google integration (Google Voice, Google Calendar, Gmail, Google Maps) is far better on Android — if you make as heavy use of Google services as I do, this becomes a big deal very quickly.
    • Chrome to Phone is awesome – being able to send links/pictures/locations from computer to phone is amazingly useful. I only wish someone made a simple Phone-to-Chrome capability where I could send information from my phone/tablet to a computer just as easily.
    • Adobe Flash performance is, for the record, not great and for many sites its simply a gateway for advertisements. But, its helpful to have to be able to open up terrible websites (especially those of restaurants) — and in Japan, many a restaurant had an annoying Flash website which my iPhone could not open.
    • Because of the growing popularity of Android, app availability between the two platforms is pretty equal for the biggest apps (with just a few noteworthy exceptions like Flipboard). To be fair, many of the Android ports are done haphazardly – leading to a more disappointing experience – but the flip side of this is that the more open nature of Android also means its the only platform where you can use some pretty interesting services like AirDroid (easy-over-Wifi way of syncing and managing your device), Google Listen (Google Reader-linked over-the-air podcast manager), BitTorrent Remote (use your phone to remote login to your computer’s BitTorrent client), etc.
    • I love that I can connect my Android phone to a PC and it will show up like a USB drive. iPhone? Not so much (which forced me to transfer my photos over Dropbox instead).
    • My ability to use the Android Market website to install apps over the air to any of my Android devices has made discovering and installing new apps much more convenient.
    • The iOS mail client (1) doesn’t let you collapse/expand folders and (2) doesn’t let you control which folders to sync to what extents/at what intervals, but the Android Exchange client does. For someone who has as many folders as I do (one of which is a Getting Things Done-esque “TODO” folder), that’s a HUGE plus in terms of ease of use.

To be completely fair – I don’t have the iPhone 4S (so I haven’t played with Siri), I haven’t really used iCloud at all, and the advantages in UI quality and battery life are a big deal. So unlike some of the extremists out there who can’t understand why someone would pick iOS/Android, I can see the appeal of “the other side.” But after using the iPhone 4 for two weeks and after seeing some of the improvements in my Xoom from Ice Cream Sandwich, I can safely say that unless the iPhone 5 (or whatever comes after the 4S) brings with it a huge change, I will be buying another Android device next. If anything, I’ve noticed that with each generation of Android, Android devices further closes the gap on the main advantages that iOS has (smoothness, stability, app selection/quality), while continuing to embrace the philosophy and innovations that keep me hooked.

(Image Credit – Android text selection: Android.com) (Image Credit – Android sharing: talkandroid.com)

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Two More Things

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A few weeks ago, I did a little farewell tribute to Apple CEO and tech visionary Steve Jobs after he left the CEO position at Apple. While most observers probably recognized that the cause for his departure was his poor health, few probably guessed that he would die so shortly after he left. The tech press has done a great job of covering his impressive legacy and the numerous anecdotes/lessons he imparted on the broader industry, but there are a few things which stand out to me which deserve a little additional coverage:

  • Much has been said about Jobs’s 2005 Stanford graduation speech: it was moving the first time I read it (back in 2005), and I could probably dedicate a number of blog posts to it, but one of the biggest things I took from it which I haven’t seen covered as much lately was the resilience in the face of setbacks. Despite losing his spot at the company he built, Jobs pushed on to create NeXT and Pixar. And, while we all know Pixar today as the powerhouse behind movies such as Toy Story and Ratatouille, and most Apple followers recognize Apple’s acquisition of NeXT as the integral part of bringing Jobs back into the Apple fold, what very few observers realize is that, for a long time, NeXT and Pixar were, by most objective measures, failures. Despite Steve Jobs’s impressive vision and NeXT’s role in pioneering new technologies, NeXT struggled and only made its first profit almost 10 years after its founding – and only a measly $1 million despite taking many tens of millions of dollars from investors! If Wikipedia is to be believed, NeXT’s “sister” Pixar was doing so poorly that Jobs even considered selling Pixar to – gasp – Microsoft as late as 1994, just one year before Toy Story would turn things around. The point of all of this is not to knock Jobs, but to point out that Jobs was pretty familiar with setbacks. Where he stands out, however, is in his ability and willingness to push onward. He didn’t just wallow in self-pity after getting fired at Apple, or after NeXT/Pixar were forced to give up their hardware businesses – he found a way forward, making tough calls which helped guide both companies to success. And that resilience, I think, is something which I truly hope to emulate.
  • One thing which has stuck with me was a quote from Jobs on why he was opening up to his biographer, Walter Isaacson, after so famously guarding his own privacy: “I wanted my kids to know me … I wasn’t always there for them, and I wanted them to know why and to understand what I did.” It strikes me that at the close of his life, Jobs, one of the most successful corporate executives in history, is preoccupied not with his personal privacy, his fortune, his company’s market share, or even how the world views him, but with how his kids perceive him. If there’s one thing that Steve Jobs can teach us all, its that no amount of success in one’s career can replace success in one’s personal life.

(Image credit)

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Web vs native

imageWhen Steve Jobs first launched the iPhone in 2007, Apple’s perception of where the smartphone application market would move was in the direction of web applications. The reasons for this are obvious: people are familiar with how to build web pages and applications, and it simplifies application delivery.

Yet in under a year, Apple changed course, shifting the focus of iPhone development from web applications to building native applications custom-built (by definition) for the iPhone’s operating system and hardware. While I suspect part of the reason this was done was to lock-in developers, the main reason was certainly the inadequacy of available browser/web technology. While we can debate the former, the latter is just plain obvious. In 2007, the state of web development was relatively primitive relative to today. There was no credible HTML5 support. Javascript performance was paltry. There was no real way for web applications to access local resources/hardware capabilities. Simply put, it was probably too difficult for Apple to kludge together an application development platform based solely on open web technologies which would get the sort of performance and functionality Apple wanted.

But, that was four years ago, and web technology has come a long way. Combine that with the tech commentator-sphere’s obsession with hyping up a rivalry between “native vs HTML5 app development”, and it begs the question: will the future of application development be HTML5 applications or native?

There are a lot of “moving parts” in a question like this, but I believe the question itself is a red herring. Enhancements to browser performance and the new capabilities that HTML5 will bring like offline storage, a canvas for direct graphic manipulation, and tools to access the file system, mean, at least to this tech blogger, that “HTML5 applications” are not distinct from native applications at all, they are simply native applications that you access through the internet. Its not a different technology vector – it’s just a different form of delivery.

Critics of this idea may cite that the performance and interface capabilities of browser-based applications lag far behind those of “traditional” native applications, and thus they will always be distinct. And, as of today, they are correct. However, this discounts a few things:

  • Browser performance and browser-based application design are improving at a rapid rate, in no small part because of the combination of competition between different browsers and the fact that much of the code for these browsers is open source. There will probably always be a gap between browser-based apps and native, but I believe this gap will continue to narrow to the point where, for many applications, it simply won’t be a deal-breaker anymore.
  • History shows that cross-platform portability and ease of development can trump performance gaps. Once upon a time, all developers worth their salt coded in low level machine language. But this was a nightmare – it was difficult to do simple things like showing text on a screen, and the code written only worked on specific chips and operating systems and hardware configurations. I learned C which helped to abstract a lot of that away, and, keeping with the trend of moving towards more portability and abstraction, the mobile/web developers of today develop with tools (Python, Objective C, Ruby, Java, Javascript, etc) which make C look pretty low-level and hard to work with. Each level of abstraction adds a performance penalty, but that has hardly stopped developers from embracing them, and I feel the same will be true of “HTML5”.
  • Huge platform economic advantages. There are three huge advantages today to HTML5 development over “traditional native app development”. The first is the ability to have essentially the same application run across any device which supports a browser. Granted, there are performance and user experience issues with this approach, but when you’re a startup or even a corporate project with limited resources, being able to get wide distribution for earlier products is a huge advantage. The second is that HTML5 as a platform lacks the control/economic baggage that iOS and even Android have where distribution is controlled and “taxed” (30% to Apple/Google for an app download, 30% cut of digital goods purchases). I mean, what other reason does Amazon have to move its Kindle application off of the iOS native path and into HTML5 territory? The third is that web applications do not require the latest and greatest hardware to perform amazing feats. Because these apps are fundamentally browser-based, using the internet to connect to a server-based/cloud-based application allows even “dumb devices” to do amazing things by outsourcing some of that work to another system. The combination of these three makes it easier to build new applications and services and make money off of them – which will ultimately lead to more and better applications and services for the “HTML5 ecosystem.”

Given Google’s strategic interest in the web as an open development platform, its no small wonder that they have pushed this concept the furthest. Not only are they working on a project called Native Client to let users achieve “native performance” with the browser, they’ve built an entire operating system centered entirely around the browser, Chrome OS, and were the first to build a major web application store, the Chrome Web Store to help with application discovery.

While it remains to be seen if any of these initiatives will end up successful, this is definitely a compelling view of how the technology ecosystem evolves, and, putting on my forward-thinking cap on, I would not be surprised if:

  1. The major operating systems became more ChromeOS-like over time. Mac OS’s dashboard widgets and Windows 7’s gadgets are already basically HTML5 mini-apps, and Microsoft has publicly stated that Windows 8 will support HTML5-based application development. I think this is a sign of things to come as the web platform evolves and matures.
  2. Continued focus on browser performance may lead to new devices/browsers focused on HTML5 applications. In the 1990s/2000s, there was a ton of attention focused on building Java accelerators in hardware/chips and software platforms who’s main function was to run Java. While Java did not take over the world the way its supporters had thought, I wouldn’t be surprised to see a similar explosion just over the horizon focused on HTML5/Javascript performance – maybe even HTML5 optimized chips/accelerators, additional ChromeOS-like platforms, and potentially browsers optimized to run just HTML5 games or enterprise applications?
  3. Web application discovery will become far more important. The one big weakness as it stands today for HTML5 is application discovery. Its still far easier to discover a native mobile app using the iTunes App Store or the Android Market than it is to find a good HTML5 app. But, as platform matures and the platform economics shift, new application stores/recommendation engines/syndication platforms will become increasingly critical.

I can’t wait :-).

(Image credit – iPhone SDK)

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Farewell, Mr. Jobs

imageGoogle acquiring Motorola and HP dropping its PC/tablet hardware businesses not enough news for you? Late last Thursday, another jawdropper hit the tech industry when Apple announced that visionary CEO Steve Jobs was stepping down.

The tech industry is now awash with commentary about Jobs’ legendary leadership which was not only instrumental in the creation of Apple as a company, but took it from a distant laggard in the computing space to pioneering technology powerhouse today. This is particularly impressive given the degree to which Apple’s leadership structure (warning: full article behind paywall, but well worth a read if you are interested in how corporate organizations work) concentrates authority in the hands of the CEO – meaning, yeah, Apple’s success really *is* because of Steve, whereas in a lot of other companies its only partially due to the CEO.

While I’ve definitely picked a side in the Google vs Apple war, even this “fandroid” has to admit a certain sadness that Jobs is leaving. A very small part of it comes from the fact that I’m an Apple shareholder and find it near impossible to find anyone that has the same vision and execution skills to replace him. A much larger part comes from the fact that Jobs played a huge role in shaping the technology industry for the better:

In any event, I salute you, Mr. Jobs for a remarkable career and an incredible legacy.

DISCLAIMER: I own Apple shares

(Image credit)

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HP 2.0

The technology ecosystem just won’t give me a break – who would’ve thought that in the same week Google announced its bold acquisition of Motorola Mobility, that HP would also announce a radical restructuring of its business?

For those of you not up to speed, last Friday, HP’s new CEO Leo Apothekar announced that HP would:

  • Spend over $10 billion to acquire British software company Autonomy Corp
  • Shut down its recently-acquired-from-Palm-for-$1-billion WebOS hardware business (no more tablets or phones)
  • Contemplate spinning out its PC business

hpRadical change is not unheard of for long-standing technology stalwarts like HP. The “original Hewlett Packard”, focused on test and measurement devices like oscilloscopes and precision electronic components was spun out in 1999 as Agilent, one of the tech industry’s largest IPO’s. It acquired Compaq in 2001 to bolster its PC business for a whopping $25 billion. To build an IT services business, it acquired EDS in 2008 at a massive $14 billion valuation. To compete with Cisco in networking gear, it acquired 3Com for almost $3 billion. And, to compete in the enterprise storage space, it bought 3PAR after a furious bidding war with Dell for $2 billion. But, while this sort of change might not be unheard of, the billion dollar question remains: is this a good thing for HP and its shareholders? My conclusion: in the long-run, this is a good thing for HP. But how they announced it was very poor form.

Why good for the long-run?

  • HP needed focus. With the exception of the Agilent spinoff and the Compaq acquisition, all the “bold strategic changes” that I mentioned happened in the span of less than 3 years (EDS: 2008, 3com: 2009, Palm and 3PAR: 2010). Success in the technology industry requires you to disrupt existing spaces (and avoid being disrupted), play nicely with the ecosystem, and consistently overachieve. Its hard to do that when you are simultaneously tackling a lot of difficult challenges. At the end of the day, for HP to continue to thrive, it needs to focus and not always chase the technology “flavor of the week.”
  • HP had a big hill to climb to be a leading consumer hardware play. Despite being a very slick product, WebOS was losing the war of the smartphone/tablet operating systems to Google’s Android and Apple’s iOS. Similarly, in its PC business, with the exception of channel reach and scale, HP had no real advantage over Apple, Dell, or rapidly growing low-cost Asian competitors. It’s fair to say that HP might have been able to change that with time. After all, HP had barely had time to announce one generation of new products since Palm was acquired, let alone had time for the core PC division to work together with the engineers and user experience folks at Palm to cook up something new. But, suffice to say, getting to mass market success would have required significant investment and time. Contrast that with…
  • HP as a leading enterprise IT play is a more natural fit. With its strong server and software businesses and recent acquisitions of EDS, 3Com, and 3PAR, HP already has a broad set of assets that it could combine to sell as “solutions” to enterprises. Granted, there is significant room for improvement in how HP does all of this – these products and services have not been integrated very well, and HP lacks the enormous success that Dell has achieved in new cloud computing architectures and the services success that IBM has, to name two uphill battles HP will have to face, but it feels, at least to me, that this is a challenge that HP is already well-equipped to solve with its existing employees, engineering, and assets.
  • Moreover, for better or for worse, HP’s board chose a former executive of enterprise software company SAP to be CEO. What did they expect, that he would miraculously be able to turn HP’s consumer businesses around? I don’t know what happened behind closed doors so I don’t know how seriously Apothekar considered pushing down the consumer line, but I don’t think anyone should be surprised that he’s trying to build a complete enterprise IT stack akin to what IBM/Microsoft/Oracle are trying to do.

With all that said, I’m still quite appalled by how this was announced. First, after basically saying that HP didn’t have the resources to invest in its consumer hardware businesses, Apothekar turns around and pays a huge amount for Autonomy (at a valuation ten times its sales – by most objective measures, a fairly high price). I don’t think HP’s investors or the employees and business partners of HP’s soon-to-be-cast-aside will find the irony there particularly amusing.

Adding to this is the horrible manner in which Apothekar announced his plans. Usually, this sort of announcement only happens after the CEO has gone out of his way to boost the price he can command for the business units he intends to get rid of. In this case, not only are there no clear buyers lined up for the divisions HP plans to dump, the prices that those units could command will be hurt by the fact that their futures are in doubt. Rather than reassure employees, potential buyers, customers, and partners that existing business relationships and efforts will be continued, Apothekar has left them with little reason to be confident. This is appalling behavior from someone who’s main job is to be a steward for shareholder value as he could’ve easily communicated the same information without basically tanking his ability to sell those businesses off at a good valuation.

In any event, as I said in my Googorola post, we definitely live in interesting times :-).

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Googorola

I would lose my tech commentator license if I didn’t weigh in on the news of Google’s acquisition of Motorola Mobility. So, without further ado, four quick thoughts on “Googorola”:

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  • This is a refreshingly bold move by Google. Frankly, I had expected Google to continue its fairly whiny, defensive path on this for some time as they and the rest of the Android ecosystem cobbled together a solution to the horrendous intellectual property situation they found themselves in. After all, while Android was strategically important to Google as a means of preventing another operating system (like Windows or iOS) from weakening their great influence on the mobile internet, one could argue that most of that strategic value came from just making Android available and keeping it updated. It wasn’t immediately obvious to me that it would make dollars-and-cents sense for Google to spend a lot of cash fighting battles that, frankly, Samsung, HTC, LG, and the others should have been prepared to fight on their own. That Google did this at all sends a powerful message to the ecosystem that the success of Android is critical to Google and that it will even go so far as to engage in “unnatural acts” (Google getting into the hardware business!?) to make it so.
  • It will be interesting to observe Google’s IP strategy going forward. Although its not perfect, Google has taken a fairly pro-open source stance when it comes to intellectual property. Case in point: after spending over $100M on video codec maker On2, Google moved to make On2’s VP8/WebM codec freely available for others to integrate as an alternative to the license-laden H.264 codec. Sadly, because of the importance of building up a patent armory in this business, I doubt Google will do something similar here – instead, Google will likely hold on to its patent arsenal and either use it as a legal deterrent to Microsoft/Apple/Nokia or find a smart way to license them to key partners to help bolster their legal cases. It will be interesting to see how Google changes its intellectual property practices and strategy now that its gone through this. I suspect we will see a shift away from the open-ness that so many of us loved about Google.
  • I don’t put much stock into speculation that Motorola’s hardware business will just be spun out again. This is true for a number of reasons:
    1. I’m unaware of any such precedent where a large company acquires another large one, strips it of its valuable intellectual property, and then spins it out. Not only do I think regulators/antitrust guys would not look too kindly on such a deal, but I think Google would have a miserable time trying to convince new investors/buyers that a company stripped of its most valuable assets could stand on its own.
    2. Having the Motorola business gives Google additional tools to build and influence the ecosystem. Other than the Google-designed Nexus devices and requirements Google imposes on its manufacturing partners to support the Android Market, Google actually has fairly little influence over the ecosystem and the specific product decisions that OEMs like Samsung and HTC make. Else, we wouldn’t see so many custom UI layers and bloatware bundled on new Android phones. Having Motorola in-house gives Google valuable hardware chops that it probably did not have before (which will be useful in building out new phones/tablets, new use cases like the Atrix’s (not very successful but still promising) webtop, its accessory development kit strategy, and Android@Home), and lets them always have a “backup option” to release a new service/feature if the other OEMs are not being cooperative.
    3. Motorola’s strong set-top box business is not to be underestimated. Its pretty commonly known that GoogleTV did not go the way that Google had hoped. While it was a bold vision and a true technical feat, I think this is another case of Google not focusing on the product management side of things. Post-acquisition, however, Google might be able leverage Motorola’s expertise in working with cable companies and content providers to create a GoogleTV that is more attuned to the interests/needs of both consumers and the cable/content guys. And, even if that is not in the cards, Motorola may be a powerful ally in helping to bring more internet video content, like the kind found on YouTube, to more TVs and devices.
  • There is a huge risk from Google mismanaging the ecosystem with this move. Although some of Google’s biggest partners have been quoted as being supportive of this deal, that could simply be politeness or relief that someone will be able to protect them from Apple/Microsoft that’s talking. Google has intelligently come out publicly to state that they intend to run Motorola as a separate business and don’t plan on making any changes to their Nexus phone strategy. But, while Google may believe that going into this (and I think they do), and while I believe that Android’s success will be in building a true horizontal platform rather than imitating Apple’s vertical model, the reality of the situation is that you can’t really maintain something as an independent business completely free of influence, and that the temptation will always be there to play favorites. My hope is that Google institutes some very real firewalls and processes to maintain that independence. As a “fandroid” and as someone who is a big believer in the big opportunities enabled by Android, I think the real potential lies in going beyond just what one company can do, even if its Google.

Regardless of what happens, we definitely live in interesting times :-).

(Image credits)

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Streaming Music Lockers

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I was lucky enough to receive early access to Google’s Music Beta service, the new streaming music service Google announced at their recent Google I/O event. It’s a service that’s fairly similar to Amazon’s Cloud Drive and the streaming service which Apple is rumored to be announcing soon. I’ve used the service for about two weeks, and I have to confess I’m confused as to why everyone is so excited about this.

Let me be clear: I think the service works perfectly fine. I, of course, have some complaints. The web interface, at least not to my knowledge, doesn’t provide a simple way to play or queue individual songs without queuing up the next song in the list. There can also be an awkward buffering pause at the start of playback (although I’ve noticed the software intelligently pre-caches the next song in the list) which can also be a little annoying. And, on my super-slow connection, it took two days to upload my music collection (whereas its been rumored that Apple will simply identify the song and pull it from its own collection). But, overall, I’ve been impressed with the quality. The quality of the playback across all of my devices (including my smartphone even when its not on WiFi) is good, and the ability to easily sync playlists across all of my devices is a nice touch. The free music. The instant playlists and integration with my Android devices are also thoughtful touches.

But my confusion has nothing to do with whether or not the service works: its whether or not this service is actually all that valuable to a large swath of users. While I have a relatively large music collection, I (and I’m willing to bet most people) don’t add to that collection all that often. When you couple that with the fact that storage is pretty cheap (as anyone who bought a USB stick and looked at the prices again 6 months later has noticed), it makes it easy to manage your music collection between your computer and your phone with iTunes or Windows Media Player without Apple or Google or Amazon going through the hassle of setting up an elaborate cloud setup.

For someone like me with four separate devices (a personal laptop, a work laptop, a DROID2 smartphone, and a tablet), this becomes a little more interesting as synching between all four can be a pain, but I don’t know how many people fall into that category. And, even if they did, music services like Mog, Spotify, and Grooveshark offer essentially the same thing – streaming music – except without the limitations of what’s in your own music collection.

Obviously, there are things Amazon, Google, and Apple are doing which are better than good-old-fashioned-manual-synching and what the Mogs/Spotifys/Groovesharks of the world have built. And, if its not clear yet, I do think these services are cool and valuable. But my view here is that they’re not so much better to justify all the hype.

Of course, I have yet to see Steve Jobs’ announcement… maybe his reality distortion field will set me straight :-).

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Apple TV Disassembled

My good friend Joe and I spent a little amount of time last week disassembling an Apple TV, on a personal level to both take a look inside as well as to get a sense of what folks at companies like iSuppli and Portelligent do when they do their teardowns. I was also asked to take a look at how prominent/visible a chip company in the portfolio of my venture capital employer is inside the Apple TV.

I apologize for the poor photo quality (I wasn’t originally planning on posting these and I just wanted to document how we took it apart so that I knew how to put it back together). But, if you bear with me, here’s a picture of the Apple TV itself before we “conducted open heart surgery” (it fits in the palm of your hand!):

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Here is the what it looks like after we pry off the cover (with a flathead screwdriver or a paint wedge thing) – notice how thick the edges of the device are. This is important as I have nothing but sympathy for the poor engineers who had to design the infrared sensor and “blaster” for the remote such that it was powerful enough to penetrate that wall (but cheap enough/energy efficient enough for Apple to include it).

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I’m not exactly sure what the pink is, but my guess based on how “squishy” it was, is that it is some sort of shock absorber to help protect the device. Unscrewing the outermost a set of screws (two of which are hidden under the shock absorber), we finally get at the circuit board at the heart of the device:

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Using tweezers, we removed one of the connectors (I assumed it linked the chips on the board with the power supply) allowing us to detach the board from the enclosure:

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We then had to remove the pesky electromagnetic shield (the metallic cover for most of the board), unveiling the chips inside (unfortunately, I didn’t take a picture of the opposite side of the board where you would actually see the Apple A4 chip):

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To give a little perspective on the size of those chips, here is the board next to the original device (which, by the way, fits in the palm of your hand):

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Cool, isn’t it? (At least Joe and I thought so Smile)

As for reflections on the process:

  • It’s a lot simpler than you would expect. Granted, we didn’t tear down a mobile phone (which is sealed somewhat more securely – although Joe and I might for kicks someday Smile), but at the end of the day, much of the “magic” is not in the hardware packaging, but in software, in the chips, or in the specialized hardware (antenna, LCD).
  • With that said, it’d probably be pretty difficult to tear down a device without someone knowing. The magic may not be in the packaging, but ODMs/EMSs like Foxconn have built a solid business around precision placement and sealing, and human hands are unlikely to have the same precision (or be able to remove/replace an EMI shield without deforming it Smile).
  • Given how simple this is, I personally believe that no tech analyst worth his or her pay should be allowed to go on without either doing their own teardown or buying a teardown from someone else. It’s a very simple way to understand how chip companies will do (just look at the board to see if they are getting sales!), and it’s a great way to get an understanding of what the manufacturing cost, design process, and technological capabilities of a device are.

 

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Linux: Go Custom or Go Home

In a post I wrote a few weeks ago about why I prefer the Google approach to Apple’s, I briefly touched on what I thought was one of the most powerful aspects of Android, and something I don’t think is covered enough when people discuss the iPhone vs Android battle:

With Google[’s open platform strategy], you enable many suppliers (Samsung, HTC, and Motorola for starters in the high-end Android device world, Sony and Logitech in Google TV) to compete with one another and offer their own variations on hardware, software, services, and silicon. This allows companies like Cisco to create a tablet focused on enterprise needs like the Cius using Android, something which the more restrictive nature of Apple’s development platform makes impossible (unless Apple creates its own), or researchers at the MIT Media lab to create an interesting telemedicine optometry solution.

imageTo me, the most compelling reason to favor a Linux/Android approach is this customizability. Too often, I see people in the Linux/Android community focus on the lack of software licensing costs or emphasize a high-end feature or the ability to emulate some Windows/Mac OS/iOS feature.

But, while those things are important, the real power of Android/Linux is to go where Microsoft and Apple cannot. As wealthy as Microsoft and Apple are, even they can’t possibly create solutions for every single device and use case. iOS may work well for a general phone/tablet like the iPhone and iPad, but what about phones targeted for the visually impaired? What about tablets which can do home automation? Windows might work great for a standard office computer, but what about the needs of scientists? Or students? The simple fact of the matter is neither company has the resources to chase down every single use case and, even if they did, many of these use cases are too niche for them to ever justify investment.

Linux/Android, on the other hand? The open source nature allows for customization (which others can then borrow for still other forms of customization) to meet a market’s (or partner’s) needs. The lack of software licensing costs means that the sales needed to justify an investment goes down. Take some recent, relatively high-profile examples:

Now, none of these are silver bullets which will drive 100% Linux adoption – but they convey the power of the open platform approach. Which leads me to this, potentially provocative conclusion: the real opportunity for Android/Linux (and the real chance to win) is not as a replacement for a generic Windows or Mac OS install, but as a path to highly customized applications.

Now I can already hear the Apple/GNOME contingent disagreeing with me because of the importance of user experience. And, don’t get me wrong, user experience is important and the community does need to work on it (I still marvel that the Android Google Maps application is slower than the iPhone’s or my inability to replace Excel/Powerpoint/other apps with OpenOffice/Wine), but I would say the war against the Microsoft/Apple user experience is better fought by focusing on use-case customization rather than trying to beat a well-funded, centrally managed effort.

Consider:

  1. Would you use iOS as the software for industrial automation? Or to run a web server? No. As beautiful and easy-to-use as the iOS design is, because its not built as a real-time operating system or built for web server use, it won’t compete along those dimensions.
  2. How does Apple develop products with such high quality? Its simple: focus on a few things. An Android/Linux setup should not try to be the same thing to all applications (although some of the underlying systems software can be). Instead, different Android/Linux vendors should focus on customizing their distributions for specific use-cases. For example, a phone guy should gut the operating system of anything that’s not needed for a phone and spend time building phone-specific capabilities.

The funny thing is the market has already proven this. Where is Linux currently the strongest? I believe its penetration is highest in three domains: smartphones, servers, and embedded systems. Ignoring smartphones (where Android’s leadership is a big win for Linux) which could be a special case, the other two applications are not particularly sexy or consumer-facing, but they are very educational examples. In the case of servers, the Linux community’s (geeky) focus on high-end features made it a natural fit for servers. Embedded systems have heavily used Linux because of the ability to customize the platform in the way that the silicon vendor or solution vendor wants.

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Of course, high levels of customization can introduce fragmentation. This is a legitimate problem wherever software compatibility is important (think computers and smartphones), and, to some extent, the Android smartphone ecosystem is facing this as more and more devices and phone manufacturer customizations (Samsung, HTC, and Motorola put out fairly different devices). But, I think this is a risk that can be managed. First, a strong community and support for industry standards can help limit issues with fragmentation. Take the World Wide Web. The same website can work on MacOS and Windows because the HTML is a standard that browsers adhere to — and the strength of the web standards and development community help to reduce unnecessary fragmentation and provide support for developers where such fragmentation exists. Secondly, the open source nature of Linux/Android projects means that customizations can be more easily shared between development teams and that new projects can draft off of old projects. This doesn’t mean that they become carbon copies of one another, but it helps to spread good customizations farther, helping to control some of the fragmentation problems. Lastly, and this may be a cop-out answer, but I believe universal compatibility between Linux-based products is unnecessary. Why does there have to be universal compatibility between a tablet, a server, and a low-end microcontroller? Or, for that matter, between a low-end feature phone and a high-end smartphone? So long as the customizations are purpose-driven, the incompatibilities should not jeopardize the quality of the final product, and in fact, may enhance it.

Given all this, in my mind, the Android/Linux community need to think of better ways to target customizations. I think its the best shot they have at beating out the larger and less nimble companies which make up their competition, and of living up to its full potential as the widely used open source operating system it can be.

(Comic credit – XKCD) (Image credit)

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fbPhone

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This past weekend, a TechCrunch article caught the tech blogosophere off guard with an interesting claim:

Facebook is building a mobile phone, says a source who has knowledge of the project. Or rather, they’re building the software for the phone and working with a third party to actually build the hardware. Which is exactly what Apple and everyone else does, too.

The question is, does a Facebook phone platform (or, fbPhone to borrow the i/g prefix style corresponding to Apple and Google) make sense for Facebook to pursue?

On the one hand, Facebook is rapidly becoming an “operating system” of sorts for the web. According to Facebook’s statistics page, Facebook has over 550K active applications developed on it and over 1 million additional third party websites which have integrated in some fashion with this monumental platform. But, beyond sheer numbers, Facebook’s platform passes what I consider to be the true “is it a real platform” test that Windows, Linux, and Mac OS have passed: it has the ability to sustain a large $100M+ software company like Zynga (which has been estimated to generate over $800 million in annual revenues), capable of now spending enormous amounts on R&D and sales & marketing (and even of experimenting with its own rival gaming platform). This is something which, to my knowledge, the iPhone and Android ecosystems have yet to achieve.

Given its status as an “operating system” for web developers, there is certainly some value Facebook could gain from expanding into the mobile operating system sphere. It would make the Facebook experience more sticky for users who, once they step away from their computers, can only interact with the most basic Facebook features (pictures, notifications, news feeds) by making it easier for developers to truly view Facebook (mobile and desktop) as one application platform.

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On a strategic level, Facebook probably also sees potential dangers from Google and Apple’s control of the underlying smartphone software platforms. This control could transform Apple’s very shoddily constructed music “social networking service” Ping and Google’s thus-far unsuccessful attempts, as per its usual business strategy, to weaken Facebook’s dominant position in the social web into a serious threat to Facebook’s long-term position.

So, there are obvious benefits to Facebook in pursuing the platform route. However, I think there is an even more obvious downside: its HARD to build a mobile phone operating system. The TechCrunch article points out that Facebook has hired a number of the top mobile/tablet OS developers in the industry – while this means that its not impossible for Facebook to build a phone platform, its a long shot from building a full-fledged operating system. Assuming Facebook wants to build a phone, its unlikely to take the Apple route and build one monolithic phone. Like Google, Facebook’s business model is built around more user engagement, so a Facebook phone strategy would more likely be centered around getting as many users and phones possible to plug into Facebook.

The path towards such a phone platform (rather than single phone) requires many complicated relationships with carriers, with middleware providers, with hardware manufacturers, and with regulatory bodies (who are not too keen on Facebook’s privacy policies right now), not to mention deep expertise around hardware/software integration. Compare the dates for when Google and its wide swath of partners first announced the Open Handset Alliance (November 2007) to when the first Android phone was available (October 2008). A full year of committed development from industry giants HTC (hardware), Qualcomm (silicon), T-Mobile (carrier), and Google – and that’s assuming the alliance got started on the day that the project was announced and that partners like Verizon/Motorola/Samsung/ARM/etc did absolutely nothing.

From my perspective, Facebook has three much more likely (albeit still difficult) paths forward given the benefits I mentioned above for having its own mobile phone platform:

  • Build another “Open Handset Alliance” with the ecosystem: This is the only route that I see for Facebook to take if it wants its own, strong foothold in the mobile platform space. The challenge here is that the industry is not only tired of new platforms, but is also not likely to want to cede as much control to Facebook as they did to Google and Apple (and potentially Microsoft when it rolls out its Windows Phone 7 OS). This makes the path forward for Facebook complicated at best and, even when successful, requires it to compete against very well-established operating systems from Google & its partners and Apple.
  • Pull a HTC/Motorola and build a layer on top of or modify an open OS like Android or MeeGo: This, to me, makes the most sense. It eliminates the need for Facebook to invest heavily in hardware/network/silicon capabilities for deep phone platform development, and it also allows Facebook to leverage the application and ecosystem support that Android and MeeGo command (provided they don’t make too many modifications). Instead, Facebook can focus on building the tools and features that are most relevant to its own business goals. The downside to this, though, is that Facebook loses a fair amount of control over the final user experience and still has to play nice with the phone manufacturers, but these are things it would have to do no matter what strategy it picked
  • Just build a more complex mobile app which can support Facebook apps: This is the path of least resistance but leaves Facebook at the greatest mercy of Apple and Google, as well as forces Facebook to keep up with phone proliferation (iPhone 3G vs iPhone 3GS vs iPhone 4 vs DROID vs DROID 2 vs DROID X vs…)

Bottom-line: I don’t know if Facebook is even thinking about a bold mobile platform strategy, but if it is, I doubt it comes in the form of a full-fledged fbPhone. To me, it makes a lot more sense to stay the course and build more a sophisticated app in the short-term and, if needed, figure out ways to integrate rich user interface/development tool layers on an open operating system like Android or MeeGo.

(Image credit) (Image credit)

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Addendum to iPhone/DROID2

Having written a long treatise on how the DROID 2 and iPhone 4 stack up against one another, I thought it would be good to add another post on where I thought both phones were deficient in the hopes that folks from the smartphone industry would listen intently so that my next phone choice is more clear. Note: I’ve focused this list on things that I think are actually do-able, rather than far-off wishes which are probably beyond our current technology (e.g., week-long battery life, Star Trek-like voice commands, etc):

  • Usage profiles: One of the biggest pains with using smartphones is that they are a pain to customize. The limited screen real-estate and the difficulty of relying on keyboard shortcuts means that settings are buried under multiple menus. This is fine if you really only use your phone in one way, or if you only need to change one or two sets of settings. It is not useful if, like me, you want your phone to act a specific way at work but a fairly different way in the car, or in the home. In that case, both Android and iPhone are severely lacking. The Android Tasker app allows me to create numerous profiles (I’ve created a in-car, in-meeting, at home/office profile and separate profiles for weekends and weeknights with regards to notifications and email sync) – and so is well worth the $6 price – but it is not as elegant of a solution as if it were integrated into the OS, exposing additional functionality.
  • Seamless computer-to-phone: Because smartphones have small screens, weak processors, and semi-awkward input interfaces, there are some things (i.e., research, making presentations/documents, crunching, etc) which I prefer to do on a larger computer.  This doesn’t mean, however, that I want my smartphone to be a completely separate entity from my computer. Quite the opposite – what I really want to see happen is a more seamless integration of computer and phone. At the most basic level, it means I want my bookmarks/browser history/favorite music easily synced between phone and computer. On a more sophisticated level, it means I want to be able to read/edit the same material (from the same place I left off) regardless of where I am or what device I’m using. If I’m running an application on my PC, I want to be able to pick up where I left on in a reduced-screen version of that application on my phone. Google’s Chrome-to-Phone, Mozilla’s Firefox Sync, and applications like DropBox just barely scratch the surface of this – and if someone figured out a highly effective way to do this (it would probably be Apple, Google, or Microsoft), they’d instantly have my business.
  • Email functions: Honestly, guys. Why is it that I cannot: (a) sort my email oldest to newest or (b) create new folders/labels from within your mail application? Blackberry could at least do (a).
  • Every app/screen should support landscape mode: This is one of my biggest pet peeves (more so with the iPhone than the DROID). Why is it that the homescreen of these devices doesn’t support landscape view (the DROID2 does but only if I pull the keyboard out)? Why is it that the iPhone App Store, Yelp, and Maps apps don’t support landscape mode? And why is it that I can’t lock the iPhone in landscape mode, but only in portrait mode? Apple, how about, instead of reviewing iPhone apps for what you deem to be “inappropriate content”, you force developers to support both portrait and landscape mode?

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Droid 2 vs iPhone

If this is the first time you’ve visited my blog, thank you for coming. Feel free to subscribe to this blog with the buttons on the right. You may also be interested in my comparison of Firefox vs Chrome.

imageI recently came out very positive on Google in a comparison of Google’s and Apple’s respective business models and product philosophies, but the post itself was very high-level and theoretical. So, I decided to write another post: this time on how the differences I mentioned before translate when comparing products?

I recently dropped my Blackberry and got Motorola’s new Droid 2 phone (on Verizon). Earlier this month, my company also happened to provide me with Apple’s iPhone 4 (on AT&T). Having played around with the devices and relied on them heavily for over a week, I decided to make a comparison of the two, not only to help myself think through how I’d use the devices, but also to help anyone out there considering a smartphone (warning: this post is LOOOONG):

  1. Neither phone is better, they’re different. In the same way that there is no one “best” car or one “best” significant other for all people, I would have to say the “best” phone for a person is the phone that has the right features/attributes for that person and makes the appropriate tradeoffs. In the case of DROID 2 vs. iPhone 4, each has their share of weaknesses, and each has their share of strengths and they will match different people’s needs and preferences.
  2. There’s still plenty of room for both products to improve. I think the “fanboys” on both sides seem to have missed out on this point – in their desire to tout one as superior to the other, they seem to have forgotten that both devices have more than their fair share of weaknesses. In fact, I’d say my dominant impression of both devices is more around “this needs to improve” rather than “this is awesome”.
  3. I’ve got a lot of more detailed commentary below, but my basic  impression of Android vs iPhone is very much like the comparison I drew in my post on Google vs Apple: the DROID 2 feels like a device where a bunch of engineers decided to cram a ton of “cool features” into a phone whereas the iPhone 4 feels like a device that was architected to support one particular user experience (but not others) as seamlessly as possible. What does that mean in terms of a direct comparison? In order of importance (to how I use the phone):
    1. Typing – Typing is extremely important to me as my main goal for smartphone is to let me write and respond to emails on the go. Given my years with the Blackberry’s famous high-quality keyboard, I was expecting to hate the iPhone 4’s soft keyboard. Much to my (pleasant) surprise, I actually got to be quick enough with it that speed did not become an issue. However, a few things plagued me. First, I absolutely hate the placement of the backspace key – its not where I expect it to be (having been trained by QWERTY computer keyboards) and is just close enough to the “m” that I hit it when I’m typing quickly. Secondly, the iPhone interface doesn’t actually support a landscape interface mode in all applications (i.e. the App Store) – which forces me to use a much more constrained portrait keyboard which slows me down. Finally, as good as the iPhone soft keyboard is, because there’s no good way to position your fingers or to “feel” when keys have been pushed, soft keyboards intrinsically force you to think more about how to type than a hard keyboard than otherwise. Enter the DROID 2. It has a hard keyboard which although not quite as good as a Blackberry’s (the keys seem oddly spaced to me, and they are more stiff than “springy”), still lets me position my fingers and type without thinking so much about how I’m typing.
      imageIn addition to the hard keyboard, the DROID 2 also supports Swype, a very cool (and fast) way to type on a soft keyboard where, instead of typing keys consecutively, you simply drag your fingers to the letters that you’re trying to type. There’s a little bit of a learning curve (in terms of learning how to punctuate and do double-letters), but once you get over that initial hump, I think the average person can get to a faster speed with Swype than they can just pecking at keys. In my mind, the DROID 2 wins hands down on typing.
    2. Exchange support – If you want a smartphone that can function as a work device, you need to support Exchange and you need to support it well. Both the iPhone and Android claim support for Microsoft Exchange with push synchronization. While I have some quibbles with the iPhone’s mail interface, there’s no denying that the iPhone’s Exchange support is seamless and fast. I have never had to think about it. And, on occasion, the iPhone would even notify me of emails before my computer received them! The DROID 2, on the other hand, is a different story. While the Exchange sync works most of the time, there have already been two occasions where the sync was broken and the device would think that a message I had already read was a new message. The sync is also significantly slower – requiring me to wait (sometimes up to 10 minutes) before an email that has already showed up on the iPhone and the desktop shows up through the DROID 2’s sync feature. I don’t know if this is because Motorola/Google introduced some intermediate layer in between the Exchange and the phone, but the iPhone 4 wins hands down on Exchange support.
    3. Google integration – I use a ton of Google services (Gmail, Google Calendar, Picasa, Google Reader, Google Voice, Google Maps, etc.) so integration with Google services is a key criteria when picking a phone. While the iPhone has an excellent interface to Google Maps (which puts the Android’s standard maps interface to shame in terms of smoothness and speed), its inability to do very much beyond basic synchronization with Gmail and Google Calendar and only webapp access to Google Voice makes its integration with Google on par with the Blackberry’s. On the other hand, is it  any surprise that Google services integration works best on a phone which runs a Google operating system? You can make calls using Google Voice as if it weren’t even there. You can easily apply and remove labels on and search through your Gmail seamlessly (without the semi-awkward IMAP interface). You can even access your personal online search history through Google Maps and Google Search. DROID 2 wins this one by a wide margin.
    4. image Attachment file format support – its not enough to be able to access email, a good work device should be able to handle the PDFs, Powerpoints, Word documents, and images that are likely embedded. Motorola had a stroke of genius by preloading the Quick Office application onto each DROID 2. But, while this app does a very good job of opening files, it not being integrated into the DROID 2’s email applications gives it a disadvantage compared to the iPhone’s in-line and integrated attachment viewer. Combine this with the DROID 2’s inexplicable inability to open certain image types in email and there is a distinct, albeit slight, advantage on file format support for the iPhone 4.
    5. Customization – I’m very particular about how I use my devices. As a result, I want to be able to customize the heck out of something. While the iPhone gives you some basic customization options (i.e., do you want to hear a sound when a new email comes in?), it doesn’t give you much beyond that (i.e., what sound do you want to hear when a new email comes in? would you only like to hear a sound if its gmail rather than exchange? would you like to hear a different sound for gmail and exchange?) On the other hand, the DROID 2 provides remarkable customization capability. Granted, some of the choices can be difficult to find, but the ability to customize so many things (including the ability to embed live, functional widgets on your home screen and not just functionless shortcuts) and to install apps like Tasker which let you customize even deeper is a big differentiator for the Android platform.
    6. UI responsiveness/slickness – Smartphones are expensive. They consume a lot of battery power. So when a device feels sluggish, I can get annoyed. The iPhone is, simply put, amazingly slick. No choppiness when you scroll or swipe. Great responsiveness. No odd user interface defects. While Google’s Android has made remarkable strides since its earliest incarnation, it still doesn’t come close to matching Apple’s user interface polish – the most shameful example of which, in my opinion, is the Android Google Maps’ sluggish multitouch support when compared to Apple’s. Come on guys, ITS YOUR OWN APP!
    7. Notifications – I don’t know a single person who likes the iPhone’s primitive notification system. Its overly intrusive. It can only display one particular message at a time. And, there’s no way for someone to get the history of all their recent notifications. And, as a Blackberry user who used to rely on a small LED indicator to unobtrusively inform him when something new happened, the iPhone’s lack of any way of notifying its owner that something has happened without activating the screen just strikes me as stupid. The DROID 2 is FAR ahead of Apple here.
    8. Network – I have mixed feelings here. On the one hand, I would  say that the call quality I’ve experienced on the DROID 2 has lagged what I experienced on the iPhone 4. Furthermore, my DROID 2 seems to have schizophrenic reception – I sometimes amuse myself by watching my signal indicator go from full bars to just one bar, all while sitting on my desk leaving the phone completely alone. The other side to this story, though, is that this experience quality has been primarily driven by an odd pocket of bad Verizon coverage in my girlfriend’s apartment – our calls from almost everywhere else have been very good. Also, despite my DROID 2’s signal indicator fluctuations, I have not yet observed any actual impact on my connection speed or call quality. When you combine this with the fact that my iPhone struggles to get signal where I work and in Napa (where I just came back from a wedding) but my DROID 2 had minimal issues, I have to say that DROID 2/Verizon beats out iPhone 4/AT&T.
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    9. Ability to turn off 3G – The two main things that burn out a smartphone’s battery are the display and the wireless connection. While its a pain to reach that particular menu item on the iPhone 4, Apple’s product does make it possible to turn off the 3G connection. Shockingly, despite all the customization, the DROID 2 does not provide this option. The iPhone 4 wins here.
    10. Turn-by-turn navigationThe DROID 2 has it. The iPhone doesn’t. And, believe me when I say this is: it is an AMAZING feature and completely displaces the need for a GPS device. I don’t drive places I’m unfamiliar with often enough for this to be higher in the priority list, but lets just say it saved my butt on my recent trip to Napa. DROID 2 wins here.
    11. Access to Bluetooth – In California, you cannot talk on a cell phone while driving without a Bluetooth headset. So, quick-and-easy access to Bluetooth settings is a feature of considerable importance to me. With the iPhone, the ability to turn Bluetooth on and off and change settings is buried beneath several layers of settings. The DROID 2’s pairing process is not only faster (although this is only by ~10-20 seconds), the ability to customize the home screen means I can embed widgets/links to quickly and easily toggle Bluetooth without diving through settings. DROID 2 wins here.
    12. image Chrome-to-Phone – DROID 2 has it. iPhone 4 doesn’t. This is a very cool browser extension which lets you send links, text messages, and maps to your phone straight from Chrome (or the Firefox clone of it). When I first heard about it, I wasn’t especially impressed, but its become a very useful tool which lets me send things which would be useful while on-the-go (especially directions). DROID 2 wins here.
    13. Absence of pre-loaded bloat – This is something where Apple’s philosophy of getting full control over the user experience pays off. The iPhone 4 does not come with any of the bloatware that we’ve come to see in new PCs. That means that the apps that run on my iPhone 4 are either well-designed Apple utilities or apps I have chosen to install. My DROID 2? Full of crapware which I neither want nor am I able to install. Thankfully, I’m able to remove them from my homescreen, but it annoys me that Verizon and Motorola have decided that preloading phones is a great way to generate additional revenue. The iPhone wins hands down here.
    14. Camera – To be perfectly honest, I hate both the DROID 2 and the iPhone 4’s cameras. With the iPhone 4, I find it pretty awkward to shoot a picture using the soft keyboard to both zoom in and out and take the shot. While the DROID 2 has obvious physical buttons to use for zoom and to take the shot, it has a lackluster flash and I found it more difficult to take steady pictures than I did with the iPhone 4. It also captures video at a lower resolution than the iPhone 4. In the end, though, I’d have to say that awkward use of the camera trumps bad flash photography and poorer video resolution: iPhone wins here.
    15. image Flash support – DROID 2 has it. iPhone doesn’t. This means no more stupid boxes on web pages which haven’t made the plunge into HTML5 video (because Firefox and IE don’t support it yet) or activating another application to watch YouTube videos. Does it burn battery? Yes. But its not like I’m watching it non-stop, and there are definitely some sites which you can’t visit without Flash. DROID 2 wins here.
    16. Voice control – Google recently unveiled its Voice Actions for Android application which allows you to perform all sorts of commands without ever typing a thing. While the Google search app on iPhone and apps like Siri have supported voice-based web searches, they don’t provide access to the wealth and depth of functions like email, text messaging (although, sadly, it does not yet seem to support Google Voice-based-SMS), calling up the map application, or controlling the music player that Google’s does. Granted, Google seems to still have issues understanding my girlfriend’s name is “Sophia” and not “Cynthia”, but the DROID 2’s voice-control functionality is way ahead of the iPhone 4’s and adds a lot of convenience when you are on-the-go.
    17. File management – Apple’s iTunes software works great as an MP3 player. I’m not so sure how I feel about it as the ultimate gateway to my mobile phone for pictures and applications. It also irks me that, because of iTunes, there is no obvious way to access or modify the directory structure on an iPhone 4. The DROID 2, however, looks and acts just like a USB drive when its connected to a computer. It even comes with a file manager app with which you can use to go through its file system innards from within the phone. If you are fine with the inability to specify your own organization structure or to use a phone as portable storage, then this is wash. But, if you value any of those things, then the DROID 2 has Apple’s iPhone 4 beat.
    18. Not proprietary hardware – You cannot remove/upgrade an iPhone’s internal storage. You cannot charge or sync with an iPhone without using its proprietary cable. This is great if you never want to upgrade your device’s storage capabilities, never want to slot its memory into another device, and never lose cables. But, if you ever want to do any of the first two or inadvertently do the last, then you’re better off with DROID 2.
    19. Display – One of the features I was most impressed with during the iPhone 4 announcement was the Retina Display: a screen with a resolution so high it was said to be at/near the limit of human detection. I can honestly say it works as advertised – the resolution on an iPhone screen is incredible. However, as I rarely use applications/websites where that resolution is actually necessary, its value to me is not that high (although the increased contrast is a nice touch). With that said, though, it is a nice (and very noticeable) touch and is definitely something where the iPhone 4 beats out the DROID 2.
    20. Device “feel” – The two devices have comparable screen sizes, but the DROID 2 has significantly greater thickness. The iPhone feels like a crafted piece of art. It feels metallic. Substantial. The DROID 2 feels like a thick piece of plastic. This doesn’t really impact the functioning of the device, but the iPhone 4 is definitely nicer to hold and look at and feels a lot sturdier.

    So where does that leave us? If you’re keeping score, I noted 12 things which (in my opinion) favor DROID 2 and 8 things which favor iPhone 4. As I mentioned before, which device you would prefer strongly depends on how you weight the different things mentioned here. If you value work-horse text entry, customization, and Google integration a lot (like I do), then the DROID 2 is probably the phone that you’ll want. If you value the Exchange/attachment support and UI slickness more, then the iPhone 4 is a better bet. And, there’s definitely room for disagreement here. If you think my assessment of Bluetooth support and notifications are off, then that could be ample reason to pick Apple.

Hopefully this was informative for any reader deciding what phone to get (even if they’re considering something which isn’t even on the list!). I’ll probably follow this post with a few thoughts on where I’d like to see the Apple and Google platforms go next – but until then, happy smartphone-ing!

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Why I Favor Google over Apple

image Many of my good friends are big fans of Apple and its products. But not me. This good-natured difference in opinion leads us into never-ending mini-debates over Twitter or in real life over the relative merits of Apple’s products and those of its competitors.

I suspect many of them (respectfully) think I’m crazy. “Why would you want an inferior product?” “Why do you back a company that has all this information about you and follows you everywhere on the internet?”

I figured that one of these days, I should actually respond to them (fears of flamers/attacks on my judgment be damned!).

imageFirst thing’s first. I’ll concede that, at least for now, Apple tends to build better products. Apple has remarkable design and UI sense which I have yet to see matched by another company. Their hardware is of exceptionally high quality, and, as I mentioned before, they are masters at integrating their high-end hardware with their custom-built software to create a very solid user experience. They are also often pioneers in new hardware innovations (e.g., accelerometer, multitouch, “retina display”, etc.).

So, given this, why on earth would I call myself a Google Fanboi (and not an Apple one)? There are a couple of reasons for it, but most of them boil down basically to the nature of Google’s business model which is focused around monetizing use rather than selling a particular piece of content/software/hardware. Google’s dominant source of profit is internet advertising – and they are able to better serve ads (get higher revenue per ad) and able to serve more ads (higher number of ads) by getting more people to use the internet and to use it more. Contrast this with Apple who’s business model is (for the most part) around selling a particular piece of software or hardware – to them, increased use is the justification or rationale for creating (and charging more for) better products. The consequence of this is that the companies focus on different things:

  • image Cheap(er) cost of access – Although Apple technology and design is quite complicated, Apple’s product philosophy is very simple: build the best product “solution” and sell it at a premium. This makes sense given Apple’s business model focus on selling the highest-quality products. But it does not make sense for Google which just wants to see more internet usage. To achieve this, Google does two main things. First, Google offers many services and development platforms for little or no cost. Gmail, Google Reader, Google Docs, and Google Search: all free, to name a few. Second, Google actively attacks pockets of control or profitability in the technology space which could impede internet use. Bad browsers reducing the willingness of people to use the internet? Release the very fast Google Chrome browser. Lack of smartphones? Release the now-very-popular Android operating system. Not enough internet-connected TV solutions? Release Google TV. Not enough people on high-speed broadband? Consider building a pilot high-speed fiber optic network for a lucky community. All of these efforts encourage greater Web usage in two ways: (a) they give people more of a reason to use the Web more by providing high-value web services and “complements” to the web (like browsers and OS’s) at no or low cost and (b) forcing other businesses to lower their own prices and/or offer better services. Granted, these moves oftentimes serve other purposes (weakening competitive threats on the horizon and/or providing new sources of revenue) and aren’t always successes (think OpenSocial or Google Buzz), but I think the Google MO (make the web cheaper and better) is better for all end-users than Apple’s.
  • Choice at the expense of quality – Given Apple’s interest in building the best product and charging for it, they’ve tended to make tradeoffs in their design philosophy to improve performance and usability. This has proven to be very effective for them, but it has its drawbacks. If you have followed recent mobile tech news, you’ll know Apple’s policies on mobile application submissions and restrictions on device functionality have not met with universal applause. This isn’t to say that Apple doesn’t have the right to do this (clearly they do) or that the tradeoffs they’ve made are bad ones (the number  of iPhone/iPad/iPod Touch purchases clearly shows that many people are willing to “live with it”), but it is a philosophical choice. But, this has implications for the ecosystem around Apple versus Google (which favors a different tradeoff). Apple’s philosophy provides great “out of the box” performance, but at the expense of being slower or less able to adopt potential innovations or content due to their own restrictions. image Case in point: a startup called Swype has built a fascinating new way to use soft keyboards on touchscreens, but due to Apple’s App Store not allowing an application that makes such a low-level change, the software is only available on Android phones. Now, this doesn’t preclude Swype from being on the iPhone eventually, but it’s an example where Apple’s approach may impede innovation and consumer choice – something which a recent panel of major mobile game developers expressed concern about — and its my two cents worth that the Google way of doing things is better in the long run.
  • image Platforms vs solutions – Apple’s hallmark is the vertically integrated model, going so far as to have their own semiconductor solution and content store (iTunes). This not only lets them maximize the amount of cash they can pull in from a customer (I don’t just sell you a device, I get a cut of the applications and music you use on it), it also lets them build tightly integrated, high quality product “solution”. Google, however, is not in the business of selling devices and has no interest in one tightly integrated solution: they’d rather get as many people on the internet as possible. So, instead of pursuing the “Jesus phone” approach, they pursue the platform approach, releasing “horizontal” software and services platforms to encourage more companies and more innovators to work with it. With Apple, you only have one supplier and a few product variants. With Google, you enable many suppliers (Samsung, HTC, and Motorola for starters in the high-end Android device world, Sony and Logitech in Google TV) to compete with one another and offer their own variations on hardware, software, services, and silicon. This allows companies like Cisco to create a tablet focused on enterprise needs like the Cius using Android, something which the more restrictive nature of Apple’s development platform makes impossible (unless Apple creates its own), or researchers at the MIT Media lab to create an interesting telemedicine optometry solution. A fair response to this would be that this can lead to platform fragmentation, but whether or not there is a destructive amount of it is an open question. Given Apple’s track record the last time it went solo versus platform (something even Steve Jobs admits they didn’t do so well at), I feel this is a major strength for Google’s model in the long-run.
  • image(More) open source/standards – Google is unique in the tech space for the extent of its support for open source and open standards. Now, how they’ve handled it isn’t perfect, but if you take a quick glance at their Google Code page, you can see an impressive number of code snippets and projects which they’ve open sourced and contributed to the community. They’ve even gone so far as to provide free project hosting for open source projects. But, even beyond just giving developers access to useful source code, Google has gone further than most companies in supporting open standards going so far as to provide open access to its WebM video codec which it purchased the rights to for ~$100M to provide a open HTML5 video standard and to make it easy to access your data from a Google service however you choose (i.e., IMAP access to Gmail, open API access to Google Calendar and Google Docs, etc.). This is in keeping with Google’s desire to enable more web development and web use, and is a direct consequence of it not relying on selling individual products. Contrast this with an Apple-like model – the services and software are designed to fuel additional sales. As a result, they are well-designed, high-performance, and neatly integrated with the rest of the package, but are much less likely to be open sourced (with a few notable exceptions) or support easy mobility to other devices/platforms. This doesn’t mean Apple’s business model is wrong, but it leads to a different conclusion, one which I don’t think is as good for the end-user in the long run.

These are, of course, broad sweeping generalizations (and don’t capture all the significant differences or the subtle ones between the two companies). Apple, for instance, is at the forefront of contributors to the open source Webkit project which powers many of the internet’s web browsers and is a pioneer behind the multicore processing standard OpenCL. On the flip side, Google’s openness and privacy policies are definitely far from perfect. But, I think those are exceptions to the “broad strokes” I laid out.

In this case, I believe that, while short-term design strength and solution quality may be the strengths of Apple’s current model, I believe in the long run, Google’s model is better for the end-customer because their model is centered around more usage.

I will leave you with another reason to love Google: Google ads have helped save princesses.

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Decade of Moore’s Law

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I’ve mentioned Moore’s Law in passing a few times before. While many in the technology industry see the concept only on its most direct level – that of semiconductor scaling (the ability of the semiconductor industry, so far, to double transistor density every two or so years) – I believe this fails to capture its true essence. It’s not so much a law pertaining to a specific technology (which will eventually run out of steam when it hits a fundamental physical limit), but an “economic law” about an industry’s learning curve and R&D cycle relative to cost per “feature”.

Almost all industries experience a learning curve of some sort. Take the automotive industry – despite all of its inefficiencies, the cost of driving one mile has declined over the years because of improvements in engine technology, the building of the parts, general manufacturing efficiency, and supply chain management – but very few have a learning curve which operates on the same speed (how rapidly an industry improves its economic performance) and steepness (how much efficiency improves given a certain amount of “industry experience”) as the technology industry which can rely not only on learning curves but disruptive technological changes.

One of the best illustrations I’ve seen of this is a recent post on MacStories comparing a 2000 iMac and Apple’s new iPhone 4:

2000 iMac 2010 iPhone 4
Processor 500 MHz PowerPC G3 CPU 1 Ghz ARM A4 CPU
RAM 128MB 512MB
Graphics ATI Rage 128 Pro                             (8 million triangles) PowerVR SGX 535              (28 million triangles)
Storage 30GB Hard Drive 32GB NAND Flash
Weight 34.7 pounds 4.8 ounces

Although the comparisons are not necessarily apples-to-apples, they give a sense of the speed at which Moore’s Law progresses. Amazing, no?

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Microsoft surprise attack!

If you’ve been following the tech news, you’ll know that iPhone-purveyor Apple has launched a patent infringement lawsuit against HTC, one of the flagship (Taiwanese) phone manufacturers partnered up with Google and Microsoft to push Android and Windows phones. While HTC may be the company listed on the lawsuit, it was fairly clear that this was a blow against all iPhone imitators and especially against Google’s Android mobile phone (which was recently reported to have generated more mobile web traffic in the US than the iPhone).

But, as I’ve pointed out before, the lines between enemy and friend are murky in the technology strategy space. It would seem that Microsoft may have just thrown HTC (and hence the Android platform and other would-be iPhone-killers) a surprise lifeline:

REDMOND, Wash. — April 27, 2010 — Microsoft Corp. and HTC Corp. have signed a patent agreement that provides broad coverage under Microsoft’s patent portfolio for HTC’s mobile phones running the Android mobile platform. Under the terms of the agreement, Microsoft will receive royalties from HTC.

The agreement expands HTC’s long-standing business relationship with Microsoft.

“HTC and Microsoft have a long history of technical and commercial collaboration, and today’s agreement is an example of how industry leaders can reach commercial arrangements that address intellectual property,” said Horacio Gutierrez, corporate vice president and deputy general counsel of Intellectual Property and Licensing at Microsoft. “We are pleased to continue our collaboration with HTC.”

Bolding was, of course, my doing.

Why? Other than to just make us ask “why?” I have no idea, but I’d conjecture its a combination of three things:

  • Sizable royalty stream: Microsoft is an intellectual property giant. But, given Microsoft’s tenuous and potentially weakening position in mobile phones, they have probably been unable to fully monetize their own intellectual property. Why not test the waters with a company who is already friendly (HTC is a leading supplier of Windows Mobile phones), who desperately needs some intellectual property protection, and is churning out Android phones as if its life depended on it? And, if this works out, it opens the doorway for Microsoft to extract further royalties from other Android phone makers as well (and its even been suggested ominously that perhaps Microsoft is using this as an intellectual property ploy against all Linux systems as well).
  • The enemy of my enemy is my friend: Apple is the Goliath that Windows, Blackberry, Symbian, WebOS, and Android need to slay. Given Microsoft’s unique advantage from being the leading PC operating system, one potentially feasible strategy would be to simply stall its competitors from building a similar position in the mobile phone space (like by helping Android take on Apple) and, when Microsoft is nice and ready, win in mobile phones by moving the PC “software stack” into the mobile phone world and creating better ties between computers (which run Microsoft’s own Windows operating system) and the phone.
  • HTC probably made some fairly significant concessions to Microsoft: I’m willing to bet that HTC has either coughed up some extremely favorable intellectual property royalty/licensing terms or has promised to support Microsoft’s Windows Phone 7 series in a very big way. Considering how quickly HTC embraced Android when it was formerly a Windows-Mobile-only shop, its probably not a stretch to believe that there were probably active discussions within HTC over whether or not to drop Microsoft’s faltering platform. An agreement from HTC to build a certain number of Windows phones or to align on roadmap would be a blessing for Microsoft who likely needs all the friends it can get to claw back smartphone market share.

Obviously, I could be completely wrong here (its unclear if Microsoft can even provide HTC with sufficient legal “air cover” against Apple), but the one thing that nobody can deny is that tech strategy is never boring.

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Apple to buy Intrinsity?

I recently read an interesting rumor off of tech blog Ars Technica that Apple has acquired small processor company Intrinsity – who’s website is, as of the time of this writing, down.

imageIn the popular tech press, very few self-professed gadget fans are aware of the nuances of the chip technology which powers their favorite devices. So, first question, what does Intrinsity and why would Apple be interested in them? Intrinsity is a chip design company known for its expertise in making existing processor designs faster and more efficient. They’ve been retained in the past by ATI (the graphics chip company which is now part of AMD) to enhance their GPU offering, Applied Micro (formerly AMCC) to help speed up their embedded processors, and more recently were used by Samsung (and presumably Apple) to speed up the ARM processor technology which powers the applications on the iPhone and the iPad.

Second question, then, would Apple do it? Questions about Apple are very difficult to answer – in part because of the extreme amount of hype and rumor surrounding them, but also because they tend to “think different” about business strategy. Normally, my intuition would say that this deal is unlikely to make much sense. I’ll admit I haven’t looked at the deal terms or Intrinisty’s finances, but my guess is Intrinsity has a flourishing business with other chip companies which would probably be jeopardized by Apple’s acquisition (especially now that Apple is itself sort of a chip design company and will probably want to de-emphasize the rest of Intrinsity’s activities). An acquisition like this could also be risky as Apple’s core strengths lie in building and designing a small number of well-integrated hardware/software products. While most analysts suspect that Apple contributed a huge amount to the design of the Samsung chip that’s currently in the iPhone, Apple is unlikely to have a culture or set of corporate processes that match Intrinsity’s, and I suspect nursing a chip technology group while also pushing the edge on product design and innovation at some point just becomes too difficult to do (which may partially explain the exodus of PA Semi, Apple’s other chip company purchase, engineers post-acquisition).

Of course, Apple is not your ordinary technology company, and there are definitely major benefits Apple could gain from this. The most obvious is that Apple can avoid paying licensing, royalty, and service fees to Intrinsity (which can be quite large if Apple continues to ship as many products as it does now) if it brings them in-house. Strategically, if Intrinsity is truly as good as they claim (I’ve read my fair share of rumors that the A4 processor in the iPad was a joint development effort from Samsung, Apple, and Intrinsity), then Apple may also want to take this valuable chess piece off the table for its competitors. Its no secret that major chip vendors like Qualcomm, NVIDIA, Texas Instruments, and Intel see the mobile chip space as the next hot growth area – Apple could perceive leaving Intrinsity out there as a major risk to maintaining its own device performance against the very impressive Snapdragon, Tegra, and OMAP (and potentially Intel Atom) product lines. imageThis is a similar move to what Apple did with its equity stake in Imagination Technologies, the company that licenses the graphics technology that powers the iPhone, the Palm Pre, and Motorola’s Droid. Its widely believed that, had Imagination been willing (and had Intel not also increased its stake in Imagination), Imagination would currently be an Apple division – highlighting Apple’s preference to not license technology which could potentially remain available to its competitors, but to bring it in-house.

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So, in the end, does an Apple-Intrinsity deal make sense? Or is this just a rumor to be dismissed? It’s hard to say for sure (especially without knowing much about Intrinsity’s finances or the price offered), but if Intrinsity has key talent or intellectual property that Apple needs for its new devices, then Apple’s extremely high volume (and thus large payments to Intrinsity) could be the basis for fairly sizable financial benefits from such a deal. More importantly, on a strategic level, Apple’s need to maintain a performance lead over new Android (and Symbian and Windows Phone 7) devices could be all the justification needed for swallowing this attractive asset (note: AnandTech’s preliminary review shows the iPad outperforming Google’s Nexus One on web rendering speed – although how much of this is due to the iPad having a bigger battery is up for debate). Its hard to say for sure without knowing much about how profitable Intrinsity is, how much of its business comes from Apple/Samsung, and what sort of price Apple can negotiate, but there is definitely a lot of reason to do it.

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Speculations on the iPad’s Success

I would lose my tech punditry license if I didn’t speculate on the soon-to-be-released iPad. As a result, I’m going to add a few thoughts to my last post on the what we’ve been able to hear so far on Apple’s widely-hated/awaited device.

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Last time, I gave four reasons why Apple might not choose to enter the tablet industry – insufficient market opportunity, fear of cannibalization, immature technology, and lack of a clear vertical model. Although the existence of the iPad shows that Apple thinks they can overcome all of these challenges, it doesn’t make them any less real. In fact, it is the existence of all of these, plus a few other “wildcards,” which makes it very difficult for this pundit-wannabe to predict how the iPad will do for Apple. Below are 9 things which I think are open questions which will determine how well the iPad will do, as well as my preliminary scoring of how well Apple is positioned on each (on a scale of 1-5). Obviously, take these with a grain of salt as all I’ve seen are the videos everyone else has seen (although I intend to play with my friend Joe’s this weekend when he gets his):

  • image Market opportunity/pricing: The most basic concern is whether or not the iPad is priced appropriately. In my eyes, the iPad is an interesting hybrid eReader/netbook (or smartbook, actually, given its use of an ARM chip rather than a chip based on Intel’s x86 technology), and so, the relevant price comparison for the $500 point is with devices in that range. Currently, the only devices that fit this device niche at around that price are high-end netbooks (i.e., those with NVIDIA’s Ion technology), handhelds (like the Viliv) and eReaders (like Plastic Logic’s Que). Like the iPad, these are all fairly impressive devices with high functionality (partially because most are powered by Intel chips): the question is, is there going to be a big market for them? Given Apple’s brand power, rich app/content store, and smooth UI, I’d give them a pretty decent shot, so 5 out of 5.
  • Usability: Apple is renowned for its sleek and very usable user interfaces. So, on that point alone, Apple will likely get high marks. My point in bringing this up is not whether or not Apple will create a good interface (they most likely will), but whether or not the form factor itself will be usable. The initial iPad marketing blitz highlighted a few use cases such as web browsing, simple office application use, gaming, video watching, and ebook reading. The question is whether or not a flat tablet is particularly well positioned for this. My gut instinct is that the device form factor is great for video watching and web browsing (large screen, multi-touch), but will not be as efficient for applications that involve typing (it looks uncomfortable to hold and type, and I have my doubts on a soft, non-haptic keyboard of that size) or which require the user to hold on to the heavy device for long periods of time (ebook reading). In the end, the usability will depend on the dominant use cases, but I give Apple a 3 out of 5.
  • image Performance/power: Apple has done something very interesting with the iPad. Instead of relying on an external chip provider to make the processor (as they did with the iPhone and their computers), they’ve created an internal design using the chip design team they acquired when they bought PA Semi about two years ago. Most of the industry speculation that I’ve seen suggests that the A4 chip is actually only an optimized version of an older processor technology called Cortex A8, as opposed to the new and much-faster Cortex A9 technology that NVIDIA’s Tegra 2 and Texas Instrument’s OMAP4 chips (which will go into other tablets and smartphones) are based on. Whether or not Apple’s excursion into building its own silicon will result in decent enough performance and power consumption to butt heads with other devices (especially those running on Intel’s Atom processors) remains to be seen. If I were to have to put my foot down, though, I’d guess that the reason Apple still refuses to let multiple applications run at the same time is that the A4’s power/performance aren’t quite perfect, but with such heavy-handed restrictions, the final result will probably be pretty good so I will give Apple a 4 out of 5.
  • Cannibalization: This is less to do with the iPad’s success, and more to do with Apple’s. This is simply the double-bind that Apple faces in releasing a product like the iPad. If it’s too good/cheap, then there’s no reason for people to buy Macs and Macbooks. If it’s not good enough/too expensive, then nobody will buy it. This device has to exist in the sweet spot of performance and pricing. Given the huge demand in netbook/eReader-type devices, I would wager that the vast majority of people really only use their computers for simple web browsing, email, watching videos, uploading photos, and maybe playing a game or two. My guess is that the iPad can probably do all of the above relatively well and, consequently, Apple may have limited flexibility in terms of the iPad’s pricing to limit cannibalization or increase uptake. I will give Apple a 4 out of 5.
  • image Display technology: Apple disappointed me in choosing a fairly ho-hum display technology for the iPad. Granted, this was when I still thought the major use of the “iTablet” was going to be as an eReader, but the choice of a touchscreen IPS LCD display not only limits the battery life of the device but makes it unsuitable for use under direct light. The choice makes sense given Apple’s desire to also pursue applications/movies (which don’t work well with any of the existing alternative display technologies) and the full use of the touchscreen, but may limit Apple’s ability to penetrate as an eReader against more dedicated devices like the Kindle or the Que. However, it does give the iPad a leg up across every other dimension and may be “good enough” for most casual ebook readers. I will give Apple a 4 out of 5.
  • The Flash wars: The iPad’s lack of Adobe’s Flash support has caused many of the tech punditry to view this as a major battle in the war between Flash and the still-under-development HTML5 standard. I’ll explain my views on the subject more deeply in a future post but my take is that we are unlikely to see a clear winner in the battle between Flash and HTML5 in the near-term for several reasons. First, HTML5 is still under development and support for it is mostly preview/experimental. Secondly, Flash is currently installed on almost every single internet-connected computer in the world and will soon be available on Symbian, Blackberry, Android, Chrome OS, and Palm phones. When you combine that with the fact that Flash still supports a number of features a pure HTML5 approach can’t easily duplicate, there’s not only little reason for developers to abandon Flash, there’s little rationale to rapidly build HTML5 replacements for all of their features. While video-centric sites like YouTube and BrightCove have pushed HTML5 alternatives due to the relative ease, non-video Flash use will be more difficult to translate. And, as long as major web applications and features are still built in Flash, then I believe the iPad will suffer in terms of delivering the full web experience that is expected. 2 out of 5.
  • App transferability: One point Apple has tried to sell is that the same iPhone App Store will also work with the iPad. While I think one of the big strengths that Apple can leverage here is the existence of an already-populated App Store, the fact that many companies are racing to put out new iPad apps and the sheer difference in terms of the screen size make me somewhat skeptical of the ability of most iPhone apps to be used effectively on an iPad and vice versa. This is not something which I think detracts from the iPad or Apple’s design process – I believe strongly that different form factors require different applications and interfaces – but, in my opinion, it’s a bigger barrier to the usefulness in the short-run of the iPad than I think many people are realizing. 4 out of 5
  • image Book content: Apple has historically done very well with its vertically integrated model supplying not only the device (e.g., iPhone) and the software (e.g., iPhone OS), but also the content (e.g., the iPhone App Store, iTunes for music). They have continued this tradition with iBooks, Apple’s attempt to pull together a book content store. While the success of this will help the iPad, I don’t view success here as especially critical given the abundance of non-proprietary ebook content and the number of other functions that the iPad is capable of. With that said, I am disappointed that Apple again chose the DRM-content route with regards to its book content store (just as it did at first with its proprietary DRM MP3s on the iTunes store). Given that the eReader functionality is not the critical selling point of the device, I don’t think the inability to port iBooks content to another device will scare off too many iPad buyers (it certainly hasn’t scared away Kindle users yet), but time will tell. 4 out of 5 
  • Competition: This is always the big wildcard. The strategic challenge here for Apple (and its competitors) is that the device category is nested in between two enormous ones (laptops and smartphones) and needs to strike the appropriate balance in terms of performance and price, as well as offer up the right sort of applications, form factor, and content to have a leg up. My guess is that Apple’s big competitors here will fall into three categories: (a) innovative and low-cost Taiwanese netbook manufacturers like Acer and ASUS who will try to undercut Apple on price but have proven themselves to be willing to try all sorts of form factors and software platforms, (b) Amazon who likely views Apple’s content store as a threat to their own ebook and digital music stores and who is likely to expand their Kindle with application capabilities, and (c) Google who not only has control over a massive free and non-proprietary ebook repository, but a book search engine, and freely licenses two operating systems (Android and Chrome OS) for use in the tablet/netbook space. Of course, Apple is no slouch itself and has proven itself able to conquer new segments (cases in point: the iPod and the iPhone), but because the iPad doesn’t seem as imminently disruptive or game-changing as the iPhone and iPod were, I will rank this as 3 out of 5

My rating on every dimension but one with a 3 or better (average: ~3.6) shows that I have a fair amount of confidence in Apple’s ability to overcome individual obstacles to drive the iPad’s success. The real question which I’m still unsettled on is whether or not Apple will successfully overcome all of these. Only time will tell, but if I had to put money on it, I’d say yes.

(Image credit – Apple) (Image credit – Plastic Logic) (Image credit – A4) (Image credit – Apple) (Image credit – Apple)

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Keep your enemies closer

One of the most interesting things about technology strategy is that the lines of competition between different businesses is always blurry. Don’t believe me? Ask yourself this, would anyone 10 years ago have predicted that:

I’m betting not too many people saw these coming. Well, a short while ago, the New York Times Tech Blog decided to chart some of this out, highlighting how the boundaries between some of the big tech giants out there (Google, Microsoft, Apple, and Yahoo) are blurring:

image

Its an oversimplification of the complexity and the economics of each of these business moves, but its still a very useful depiction of how tech companies wage war: they keep their enemies so close that they eventually imitate their business models.

(Chart credit)

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