Apple fanboi faithful must be having mass cases of the vapours with the news that Android sales are eating everyone’s lunch:
I’ve written before that I think Google has been running a long game aimed against the telecomms carriers’ preferred strategy of customer lock-in, and executing on that game very well. Against the iPhone, its strategy has been a classic example of what the economist Clayton Christensen called “disruption from below” in his classic The Innovator’s Dilemma. With the G-1, Google initially competed on price, winning customers who didn’t want to pay Apple/AT&T’s premium and were willing to trade away Apple’s perceived superiority in “user experience” for a better price. Just as importantly, Android offered a near-irresistible deal to the carriers: months, even years slashed off time-to-market for a state-of-the-art cellphone; a huge advantage in licensing costs; and the illusion (now disintegrating) that said carriers would be able to retain enough control of Android-powered devices to practice their habitual screw-the-customer tactics.
In Christensen’s model, a market being disrupted from below features two products, sustaining and disrupter, both improving over time but with the disruptor at a lower price point and lesser capabilities. Typically, the sustaining company will be focused on control of its customers and business partners to extract maximum margins; on the other hand, the disruptor will be playing a ubiquity game, sacrificing margin to gain share. The sustaining company will gold-plate its product in order to chase high-end price-insenstive customers; the disruptor will seek out price-sensitive low-end customers.
I have to admit, I didn’t see this coming . . . I thought Google was mistaken to put so much development effort into the mobile phone market. I was clearly wrong about that.
In the smartphone market I have been expecting a disruptive break that would body-slam Apple’s market share, but I expected it to be several quarters in the future and with a really fast drop-off when it happened. Instead, it looks like Apple took a bruising in 4Q 2009 and has failed to regain share in 1Q 2010 while Android sales continued to rocket. Android hammered market-leader Blackberry just as badly, a fact which has gooten far less play than it probably should because the trade-press loves the drama of the Apple-vs.-Google catfight so much.
What actually seems to be going on here is that Android is successfully disrupting both Apple and Blackberry from below; together they’ve lost about 25% of market share, not enough to put Android on top but close enough that another quarter like the last will certainly do that.
I’ve heard several comments from folks that Apple’s iPhone sales are probably lower because of the widespread interest in the “next” iPhone model, which is likely to be announced in the next few weeks. Apple has followed this pattern since introducing the original iPhone, but there’s no rule saying they can’t break the pattern.
I’ll be interested in the announcement, as I’ll have a year left in my Rogers contract, so if the next iPhone isn’t a block-buster, I’ll be considering other options for when I’m out of contract.
I cannot believe that you did not quote the best line from the article:
Dude. You’re slipping.
Comment by Lickmuffin — May 11, 2010 @ 13:04
Nope. Deliberate ploy to lure an unsuspecting commenter out of the woodwork.
I figured you’d latch on to that line.
Comment by Nicholas — May 11, 2010 @ 13:11
I’d feel a bit better about the Droid platform if everyone – and I mean everyone I know who bought one has had trouble with it. One guy’s been through three of them in the last two weeks, and the rest have had multiple software/hardware issues.
One big fandroid keeps telling me how wonderful his is, but I haven’t seen it work consistently for more than ten minutes since the day he got it.
I think they rushed the release a bit…
Comment by cirby — May 11, 2010 @ 18:23
Actually, I don’t know anyone who owns an Android-based phone. Let me correct that — unlike Apple fanbois, I don’t know anyone who is so overwhelmed with love and devotion for his or her smartphone that they need to bring it to everyone’s attention all the time.
That is, an Android-based smartphone is just a smartphone. An iPhone is a religious icon.
Comment by Nicholas — May 12, 2010 @ 08:53