In discussions of the iPad, I’ve seen comments along the following lines:

The only problem is getting consumers to understand what being open means…and care. Where Apple’s iPad will be restricted to running approved applications from the iTunes App Store – a business model that has raised flags when Apple’s app overlords blocked popular, rival apps from their store (most notably, Google Voice) – the model has proved incredibly successful for the Cupertino-based company. The iPhone OS is the most popular smartphone OS in the world with Google’s mobile Android OS trailing further behind.

This article actually takes a more critical look at Apple and the iPad, but I hear it more frequently from Apple-boosters that point to the fact that the iPhone came out of nowhere and became the number one such-and-such in the world. I’ve fallen in the same trap by referring to Apple’s entry into the smartphone market as “domination” without the appropriate qualifications.

The rise of the iPhone is nothing short of phenomenal no matter how you look at it. It’s done wonders in terms of getting people to talk about smartphones and getting people to demand more from their smartphones. It’s not inconceivable that, given time, they will be the worldwide leader. God help us all. But right now, their marketshare is not remarkably impressive and is only a couple notches above that of the Macintosh computers. There are two big differences, though. They’re not just “losing” the desktop marketshare wars, but (a) they are being dominated by a single entity and (b) they’ve not demonstrated the ability to climb out of their hole in any meaningful capacity. In the case of smartphones, neither of these really apply. The smartphone market leader, Nokia, is losing ground quarterly and right now their OS only controls half of the marketshare. So they’re not in Nokia’s shadow on smartphones the way that they are in Microsoft’s on desktops and because the market is so segmented, they’re not losing out on application development nearly as much because developers can’t just develop for one platform and then call it quits the same way that they can with desktops and Windows.

So there’s reason to believe that Apple can eventually get there, if that’s what they want. In the world of desktops, they’ve simply decided that OS marketshare isn’t that important. When they had the opportunity to release their OS generically, they passed. That seems similar to their plans with the iPhone except that with the iPhone there is even less incentive to because they already have strong enough market presence and buzz so that application developers are falling all over themselves to support it. So it seems likely that they will keep pressing forward, though it’s starting to seem less likely that talk of opening their OS to multiple cell carriers is going to come to fruition.

It’s notable that they dug in their heels with AT&T with the iPad. That doesn’t mean that they won’t open the iPhone up to Verizon and others when the time comes. It’s possible that the plan is to open up both the iPhone and the iPad eventually but during a product’s release it makes sense to go with a single carrier. But it does demonstrate that for all of the complaints about AT&T, Apple does not appear to have any regrets. The model worked for them even if it came at the expense of marketshare. To be blunt, all of the optimism about Apple opening up the iPhone is based on the belief by Apple people that (a) opening it up would be a good thing and (b) Apple does good things.

But right now, they are only domination a specific place in the market: Extensive mobile web using non-business consumers within the United States. The business market is still dominated by Blackberry and though perhaps fleetingly, Nokia and their Symbian OS has a strong margin in the worldwide market. The problem for Nokia is that their attempts to break into the US market in a meaningful way. All of their connections with carriers on dumbphones has surprisingly failed to translate into high-profile arrangements for smart phones. And even internationally they’re faltering.

This provides a great opportunity for Apple and its competitors. Symbian’s fall, unless it’s reversed, will provide a tremendous void. There is a vacancy for a standard. My head tells me that it’s unlikely that a device as limited in variation as the iPhone is going to be able to fill it. It seems far more likely that Google’s Android, which is not dependent on a single manufacturer or limited variation of form factors, seems well-positioned to do so. Or it’s possible that with the release of Microsoft Windows Mobile that they will be able to apply the formula that won the desktops wars to smartphones as well. Or perhaps Nokia will rebound and figure out what they’re doing wrong, assisted by the fact that other manufacturers use Symbian as well. Or RIM, which follows a formula most similar to Apple’s, is just flexible enough to gain more ground in the consumer-grade market. My nightmare, of course, is that none of this will happen and that people will simply accept the iPhone as the standard simply because it is already perceived as being such.

But as of Q2 of last year, the most recent data I can find, the Symbian OS holds 50%, Blackberry 21%, iPhone 14%, Windows Mobile 9%, and Android 3%. In other words, the iPhone is closer to Windows Mobile than it is even the Blackberry. I’ve found Q3 numbers by manufacturer (from which you can inexactly get market position from OSes that are on devices from manufacturers that choose one OS and stick with it – iPhone and Blackberry, though not Android or Windows Mobile). Apple does better there, commanding 17%, but they’re still behind Nokia (40%) and Blackberry (20%). Notably, the Blackberry and iPhone grew at roughly the same pace between 2008 and 2009. So there is perhaps reason to be hopeful.


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9 Responses to The iPhone Is Not #1

  1. web says:

    Apple’s business model, in the computer world, is selling $1000 of hardware for $2500. Seriously.

    Much the same for the iPhone. The iPhone is at its best when jailbroken, but Apple actively attacks the jailbreaking community. Were it not for having managed to cultivate a very cultish, fanatical group of users, Apple would have died its rightful death (or been pushed into wider-market behavior) long ago.

  2. trumwill says:

    Some might argue that they make $1000 hardware worth $2500 with their superior OS. I do know a number of non-culties that like their Mac a great deal for its stability and seemless use. I’d consider it myself were it not for (a) my thrift and (b) the lack of selection and range.

    The iPhone may be at its best when jailbroken, but even without the jailbreak it is good enough to have gotten significant market penetration even among non-Apple people. As someone that really doesn’t like its prison/jailbreak model, I find that aggravating. But it’s hard to argue with their success. A lot of people seem to like closed systems, sadly.

  3. web says:

    2.Some might argue that they make $1000 hardware worth $2500 with their superior OS.

    Given that they were selling $1000 hardware for $2500 when they were selling System 7, 8, and 9… I’m sorry. Even OSX (which is just a BSD/nix ripoff with a pretty front-end) can’t make it possible for me to say that statement with a straight face.

    A lot of people seem to like closed systems, sadly. Until someone gives them a better alternative. Like jailbreaking.

  4. trumwill says:

    Given that they were selling $1000 hardware for $2500 when they were selling System 7, 8, and 9… I’m sorry. Even OSX (…) can’t make it possible for me to say that statement with a straight face.

    Back before OSX, it was a tough sell. But OSX sold a lot of people who aren’t particularly Mac people. They’ve managed to expand “Mac people” to include more people and even a lot of folks that don’t own Macs have a lot nicer things to say about them.

    (which is just a BSD/nix ripoff with a pretty front-end)

    The front-end is what makes it worthwhile for a lot of people. I find it limiting but for them it’s easy to use. That they ripped it off of BSD makes no real difference to the enduser.

    And Apple, moreso than its competitors, offers a complete product. You get more software included, you get more consistent hardware components with better assurance that it will be supported and that it will cooperate with other components. For a lot of people, this is worth the extra cost. I’m glad they found the computing system that’s right for them.

    For every one of those upsides, there is a downside, of course. But if the upsides matter to you and the downsides are irrelevant to what you do, then it may well be a package worth buying.

    I’m perfectly cool with that, provided that their preferences don’t make my life more difficult. Since Mac is comparatively a small part of the market, it doesn’t. If anything, it has the benefit of a little thinktank for ideas that Microsoft can rip off later, if they’re worthwhile. Harder to feel the benefits with the iPhone, even though a number of the ideas they’ve had are making other phones better, because while they don’t dominate the smartphone industry, they are still grabbing enough marketshare to make it more difficult for a smartphone system I would want from gaining any traction.

    Until someone gives them a better alternative. Like jailbreaking.

    Jailbreaking is not the preference for most people. In my opinion, jailbreaking is for people that want to own an iPhone but should instead be joining me in finding an alternative (with a company that’s not at war with consumer industriousness). But most iPhone users are like my sister-in-law. They seem to like their sandbox.

    My hope is that somebody will put together an attractive alternative that’s simple and smooth enough for people like my sister-in-law but also allows people like us not to have to engage in battle with our electronics.

  5. web says:

    That they ripped it off of BSD makes no real difference to the enduser.

    The problem is, they are providing an implementation of a Free (as in, there are multiple other variants of the BSD family that are available to the public for $0) and arguing that their “front-end” add-on, which itself also steals a scary amount of code from other open-source projects, is worth a $1500 price-premium.

    you get more consistent hardware components with better assurance that it will be supported and that it will cooperate with other components.

    Strike that. You get “more consistent” hardware components, supported for a very short lifespan (avg 3 years before they start dropping your hardware) defined as “when Apple decides to outmode you”, and at the cost of being INcompatible with 95% or better of commercial components.

    Apple are big proponents of the proprietary lock-in… so much so that they are a major reason that Firewire failed (it was viewed as proprietary to Apple, and so most companies went USB instead).

    In my opinion, jailbreaking is for people that want to own an iPhone but should instead be joining me in finding an alternative (with a company that’s not at war with consumer industriousness). But most iPhone users are like my sister-in-law. They seem to like their sandbox.

    The jailbreak statistics I’ve seen indicate that better than 50% of all iPhones are jailbroken, despite Apple’s screwing around making you “update” and then “re-jailbreak” repeatedly. That puts users like your sister-in-law in the minority…

  6. trumwill says:

    The problem is, they are providing an implementation of a Free (as in, there are multiple other variants of the BSD family that are available to the public for $0) and arguing that their “front-end” add-on, which itself also steals a scary amount of code from other open-source projects, is worth a $1500 price-premium.

    It’s not a problem if people are willing and happy to pay for it. They are. Of course, they’re getting more than that for the price premium, but I would guess that’s still a large part of it.

    On a sidenote, that they made “stolen” Open Source products usable and successful is actually itself quite remarkable.

    (avg 3 years before they start dropping your hardware)

    Three years is not unreasonable for an “appliance” computer. It’s the same sort of thing for laptops. You hope that you can get more use out of them than that, and often you can, but after that you’re sort of on your own. I can make my desktops last forever by swapping out components and all that. But having that kind of flexibility comes at a cost. It’s a cost that I am happy to bear, but others are not.

    Beyond which, old Apples do tend to stick around. Apple boosters are always bragging about Apple’s retaining resale value. I could not personally care less about resale, but it still speaks relatively well of the product if it can be resold.

    defined as “when Apple decides to outmode you”, and at the cost of being INcompatible with 95% or better of commercial components.

    People like you and I care about this, but for people that don’t like to scout their components, it’s not that big of a deal. The more ignorant of computers one wants to be, the more appealing that sort of thing is.

    Apple are big proponents of the proprietary lock-in… so much so that they are a major reason that Firewire failed

    Yeah… and they failed. Sometimes, they succeed. Proprietary technology usually isn’t desirable, but sometimes it’s accepted.

    The jailbreak statistics I’ve seen indicate that better than 50% of all iPhones are jailbroken (…) That puts users like your sister-in-law in the minority…

    I find that exceptionally unlikely. The first two results of a quick googling of the subject gives two numbers below 7% (6.7 and 6.9).

  7. ecco says:

    I’d just like to say that living in the apple ecosystem is very easy. Sure you agree to pay a price premium, but once you do you don’t have to worry about much. It’s not for everyone, but then it’s not forced on everyone. Also, having run BSD, OSX is just alot easier; worth the price really. But then I can see how someone else could come to a different conclusion.

  8. trumwill says:

    Ecco, I’m not sure that sort of reasonableness has any place in a blog discussion about Macs and PCs :).

  9. rob says:

    But then I can see how someone else could come to a different conclusion.

    This kind of talk doesn’t belong on the internet at all. Won’t someone think of the children?

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