Mobile Forward

A Search for Another Run-Time Model

Benedict Evans, in his blog post titled “Mobile is not a neutral platform”:

Really, what we see here is a search for another run-time. We had the web, and then we added apps, and now we look for another. Notifications? Siri/Now? Messaging (as forWeChat in China)? Something else? But each of the previous run-times lacked search, discovery and acquisition as a fundamental part of the architecture – they had to be added later (and arguably that’s still not there with apps). On Facebook’s desktop platform, in contrast, both halves were there almost from the beginning. The next run-times on mobile might have both halves too.

Related to the notion that the importance of the homescreen is diminishing.

Intel Working on an iPhone Modem: New Chatter

Mark Sullivan, for VentureBeat:

Intel now has a thousand people or more working to outfit a 2016 iPhone with its lauded 7360 LTE modem chip, sources say. If all goes well, Intel may end up providing both the modem and the fabrication for a new Apple system on a chip. […]

Apple may dual-source the LTE modems in its new iPhones from both Intel and Qualcomm. Today, Qualcomm’s 9X45 LTE chip is baked into all iPhone modems. […]

One source said Intel needs a small army of people on the Apple account because of the importance of the project to Apple’s future in the mobile market, because of the complexity of the project, and because Apple is a demanding client with an extremely popular phone.

You can be sure this modem meets a lot of Apple’s specific requirements, especially in terms of power. If any other OEMs purchase the same (or similar) part from Intel, they may benefit from some of those attributes, but not from all. When you’re as effective and important as Apple, you can shape product requirements in a way that helps you stay ahead of commoditization, even if others can technically buy the “same” part.

Sullivan’s sources also speculate that Apple may, eventually, integrate this modem into the system-on-a-chip (SoC). At that point, the combined function, power, and performance characteristics (of the modem alone) will be difficult for others to emulate.

Microsoft Pushes Deeper Into Hardware

Shira Ovide, for The Wall Street Journal:

The string of announcements underscores Microsoft’s accelerating push into computing hardware over the past three years, starting with the first Surface tablet model in 2012. Mr. Nadella has said developing hardware would be crucial to Microsoft’s ability to keep pace with rapid changes in consumer technology.

The best work Microsoft (and ex-Nokia staff) has done in years. I’m really happy for Microsoft and its employees.

Interesting Words by Xiaomi CEO Lei Jun

I’m not a fan of Xiaomi but, at one level, it’s been interesting to witness the system of activities the company has assembled to help it compete. (Though with minimal profit, I would add.) And I’m always curious to hear how different leaders speak about competing.

With that in mind, here are some notable excerpts from Li Yuan’s Q&A with Xiaomi CEO Lei Jun, in The Wall Street Journal:

We’ll need to try our best to be successful in a few emerging markets in a big way. […] Our business model isn’t about how many phones we sell. We can’t monetize unless we become a highly influential player in a country or a region. […] we want to sell to 10% to 20% of the population in India and other big countries. Then we’ll have the influence of a huge media organization and the opportunity to monetize in various ways. […]

China’s smartphone industry is in elimination games now. […] It’s unbelievable that there are still a few dozen phone companies in China now. […]

In the past you made a phone, hoping to sell it to billions of users in the world. Now you can’t think in this way. You’ll have to design different phones for different crowds in different scenarios. […]

Almost all our users are young, so we might have influence on 20% to 25% of the young population. They watch TV, listen to music and read books and news. Xiaomi provides all of these. Doesn’t this make Xiaomi a huge content channel? Each day, our users use their phone 115 times and spend four and half hours on their phones. Just imagine what a powerful broadcast platform I have!

It’s thought-provoking to hear Lei Jun speak about Xiaomi’s business model. Note, however, that we hear about Xiaomi’s success in smartphones, but we don’t really hear about any sort of success in content – in terms of Xiaomi innovation or Xiaomi profitability – even though Lei Jun cites content as the ultimate aim of the business model.

By the way, I highlighted his views on “different phones for different crowds” because, as the smartphone market reaches maturity, we are seeing, and will continue to see, attempts to create job-specific or user-specific devices. Apple, as a maker of general-computing devices, has always created smartphones that are asymmetrical to this, because apps and solid all-around hardware allow for a multitude of specialized uses. But other companies, being relatively stronger in hardware than they are in software, find (hope) that this sort of micro-segmentation is a degree of freedom they can exploit.

Your Phone’s Homescreen is Dead

Zachary Seward, for Quartz:

If nothing else, it’s fair to say the part of iOS that most people consider its nucleus is quickly being pushed aside.

Astute observation. Across smartphones, that’s been the point of Siri, “Okay Google”, Moto voice, lockscreen widgets, homescreen widgets, various OEMs’ “today” views, and other similar conveniences for quite some time. But, now, with Google Now on Tap and iOS 9 improvements to Siri (suggestions, always-on “Hey, Siri”) that trend is even stronger. Smartwatches, too, are promoting the idea, and capability, of using your smartphone’s homescreen less than ever.

The Smartphone is *the* Computer

Good words by Matthew Panzarino, for TechCrunch:

Here’s a thought that I’ve been having more and more lately: the smartphone isn’t just a computer, it’s the computer.

Somehow, unbelievably, humans have stumbled onto the computing paradigm that is going to define how we interact with the systems of the world relatively early in the technological timeline. Whether we call it a smartphone or not in the future and whether it shrinks or grows, the concept of a personal computer that contains what we are, digitally, and can act as the central ‘processor’ to a host of companion devices like desktop terminals and wearables is here to stay.

If you accept this premise, then it makes sense to imagine a world where there are various pieces of purpose built hardware orbiting around our ‘central processing unit’ that are all suited to various tasks. We walk up to a terminal and confirm our identity and it streams information from a device that links our identity, our place and our information together securely to let us immediately work.

Xiaomi Launches “Mi Mobile”, Offers 3GB Data for Under $10

Nirave Gondhia, for Android Authority:

Xiaomi has continued its expansion into all-things-consumer with the launch of its MVNO network “Mi Mobile” in China. The first OEM to launch a carrier, Xiaomi’s mobile network is offering 3GB of LTE data for RMB 59 – which is under $10 – if you sign up to a monthly plan.

Xiaomi is “commoditizing its complements”1. It’s likely (re-) selling data at near what it cost to buy it from the carrier (China Unicom). This sort of thing was bound to happen, and it’s no surprise that an OEM that’s focused on smartphone market share above short-term profitability would be the first major OEM to do this. The carrier still gets paid, but other OEMs feel competitive pressure. At least that’s the intent. Let’s see how this fares.

With every ultra-low-margin phone and service Xiaomi launches, the odds that it will excel in any one area (except device unit volume) diminish. How would it fund high performance? One might argue that, with a large installed base, it could profit from selling content and services. The problem, however, is that the quality and demand, and therefore the profitability, of Xiaomi’s content and services remains uncertain. And by “uncertain”, I really mean “average”.

____

1. Thanks to Rene Ritchie for ingraining “commoditize your complements” into my head. And, of course, the author of that line, Joel Spolsky. He coined the idea, and other insights, here. Good read.

Monday Assorted Links

1. Following Apple’s Lead, Samsung Plans Its Own Phone Leasing Program, Cutting Out Carriers

2. Quick Charge 3.0 explained: what you need to know.  Nice overview.

3. Sprint confirms report that it will sell the Apple Watch from Sep 25, other carriers likely

4. Volkswagen’s Cheating Scandal Is Costing Them  Bourree Lam, for The Atlantic:

The potential fine is quite large, but that’s not the only thing of the ordinary about this recall: Volkswagen deceived not just regulators, but customers too—many of whom bought these vehicles precisely because they wanted clean diesel cars.

5. First driverless pods to travel public roads arrive in the Netherlands

Report: LG will Supply Foldable Display to a “Global Business in the US”

Matthew Benson, for Android Authority:

Korean IT site etnews has stated that not only has “LG Display [started] mass-producing foldable display products” but “it decided to supply its foldable display products to a global business in the U.S. and started its preparation to produce them.”

The source goes on to explain that “It is likely [LG’s] first customer will be a global software (SW) business, and this business’s goal is to challenge Samsung Electronics’ and Apple’s strongholds in high-end Smartphone market with foldable Smartphones.” […]

The report also reiterated the belief that Samsung plans to introduce a foldable smartphone in January 2016, and added that LG’s business partner is “also planning to release its products at the similar time.”

Samsung Foldable Smartphone Chatter

From GforGames.com:

As some of you might recall, back in March, a Samsung Display official was quoted saying that “the commercialization of foldable smartphones will be possible in 2016”. A couple of months or so later, the guys over at SamMobile revealed that Samsung is working on a new prototype codenamed “Project Valley” or “Project V”, with a unique design and a foldable dual screen. […]

According to a leakster with in-depth knowledge regarding Samsung’s plans and the industry, in general, Samsung might unveil the fabled Project Valley foldable smartphone next January. The handset is allegedly undergoing testing […].

There’s a saying in the military: “early reports are often wrong”. 10x if you don’t know the source. But, it’s interesting to monitor the chatter on this. If Samsung does unveil a device, it could range from a demo (to show off Samsung Display’s latest capability) to a high-tier product. Generally, as the mobile industry looks to advance smartphones beyond glass rectangles, this looks to be one of the most promising directions. It if works well, at a reasonable price, it helps alleviate the standing tension between display size and pocket-ability. And it makes a broader range of proportions and products possible. Apple has shown some interest, too.

Walt Mossberg: It’s Time to Free the Smartphone

Great piece by Walt Mossberg, executive editor at The Verge and editor at large of Re/code:

It’s time for U.S. mobile carriers to focus on being first-class networks, not second-rate retailers and app developers. […]

It’s time to treat the smartphone like any other computing device, to leave the selling and supporting of them to the Best Buys, the Apple stores, the Amazons.

Apple, the country’s most important smartphone maker, took a huge step toward this future last week. It announced that it would sell new iPhones under its own installment plan, which will include a warranty — cutting out the carrier.

Very well said. On one point, though, I do have a different perspective: I think US carriers can’t afford not to sell devices. They sell devices because that promotes the use of their offering, i.e., network (coverage, quality, speed), rate plan features, and customer support. If Carrier A stops selling but Carrier B doesn’t, the latter will soon have more consumers. That’s because no one else except Carrier A will work as hard to ensure that its advantages are well represented at the point of sale. Why is that important? Without that, Carrier A can’t afford to keep investing in its offering. Basically, when a product requires a high level of R&D or capital expenditures, if you don’t control the way its presented and communicated to the consumer, you put that investment at risk. And in the case of wireless service, missing an opportunity to present your product to a customer might result in losing their business – and their family’s – for years. Want an example of another company that invests a lot in developing its products and wants to manage the way they’re presented at the point of sale? Apple.

Monday Assorted Links

1. Microsoft to launch Surface Pro 4 and new phones at October 6th event Looking forward to this.

2. Microsoft Cortana May Come to Cyanogen

[Cyanogen CEO] McMaster revealed that Cyanogen is working with Microsoft to deeply integrate Cortana into the next version of Cyanogen OS. This is key to catapulting Cyanogen into the mass market, he asserts […].

3. Xiaomi teases upcoming news or products which will “Solve the most important problem in Life”

In the comments for that post, many users are guessing that Xiaomi might be launching “Xiaomi Loans”.

4. Obstacles Xiaomi Needs to Overcome Decent list.

The Secret to Apple’s Success: Steady Improvement

Charles Arthur, for The International Business Times:

Apple’s strategy: parsimoniously dole out useful features to keep people on an upgrade staircase that never quite ends by always having something a little better around the corner. Or quite a lot better […]. […]

A few months ago, I mapped the hardware and software features Samsung has added over the generations to its Galaxy S line, from the original through the S2, S3 and so on. My expectation was of a gradually rising list; instead I found regression. The most obvious is the waterproofing, removable battery and swappable SD card that the S5 offered, and the S6 has forgone. […]

By contrast, I cannot find a single example of a hardware or integrated feature Apple has removed in the iPhone’s history.

I would have said “incrementally”, rather than “parsimoniously”, but I agree with the broader point: Apple keeps moving forward, steadily. Samsung, less so. (See this related post about Samsung, highlighting some of its performance issues.)

Thoughts on Apple’s September Event

By any measure, Wednesday’s keynote was a blockbuster, in the range of the announcements and the degree of product advancement. Here are my initial thoughts:

Apple Watch

  • The Hermés custom watch face increases the odds we’ll see third party faces in the next one or, at most, two years.
  • New gold finish, available at the $349/99 Apple Watch Sport price point. Previously, the only gold-colored option was the (real gold) 18K Apple Watch Edition version, starting at $10,000. At $349/99, the new gold finish one will likely sell millions.
  • On the question of “are there too many SKUs?” When SKUs demand a duplication of R&D, or add complexity to marketing or the point of sale, they’re usually not worth it. In this case, the underlying product (R&D) is the same. And, to-date, the marketing and point of sale presentation appear to be effective. So, any complexity risk (including on the supply chain side) appears worth it. These SKUs add the color/finish/material variety that a personal product requires in order to become mainstream quickly. I’m not saying that will happen, but variety, in this case, may help.
  • I have little doubt that the product, the colors and bands, the distribution channels, and the marketing will drive high initial Apple Watch unit sales. The key issue, one where we might not have insight for several more months, remains sustained use: consumers continuing to use the Apple Watch, at the rate Apple would like.

iPad Pro

  • My recent slides explaining why the iPad needed to get bigger.
  • Apple continues its recently-intensified pursuit of professional users. And remember, “professional” doesn’t just mean “corporate office/desk” – it includes creative pros, field workers, etc.
  • Note how Apple won the hearts of consumers with the iPad, and is now ready to win the minds of businesses. Microsoft Surface essentially tried the reverse (in part to avoid challenging Apple head-on in the consumer market), but that approach hasn’t worked well.
  • It was promising, seeing new, more powerful iPad apps (e.g., for more intense video editing or design). I love Apple’s line “[for] tasks you’d never consider doing on a PC”. Huge multi-touchable space + Apple Pencil = more post-PC possibilities than ever before.
  • If you need the larger display, power, and stylus capability, the iPad Pro is worth the price delta over the iPad.
  • Microsoft was definitely on the right track with Surface/keyboard/stylus. But iPad Pro execution may be better (display size & responsiveness, pencil precision and utility, focused OS, many form-factor-optimized apps, TouchID, and raw CPU and GPU power). Let’s see.
  • About the stylus/pencil: it’s about precision cursor control; when a fingertip can’t be effective. And it’s optional.
  • Absent: mouse support and a file explorer – both useful if you’re a pro. iOS 9 has cursor control but, likely due to time constraints, that wasn’t demonstrated. The iOS 9 cursor control appears to work best when iPad is flat, or at least at a shallow angle. When it’s at the angle intended for keyboard use, it’s not clear how useful it would be.
  • By the way: this is the first instance of an iOS device charging another device (the Apple Pencil). More to come? (Imagine iPad charging the iPhone, if you’re in a pinch.)

iPad Line-up

  • Apple’s iPad line-up is now fairly broad: iPad mini 2, iPad mini 4, iPad Air, iPad Air 2, iPad Pro. No doubt, the aim is to address as many consumers as possible, in terms of capability and price points. Will it make for a complex line-up, especially when consumers consider storage levels and price points? It’s possible.
  • Apple continues to use the Apple SIM (soft SIM) in the iPads. The question is, will they come to the iPhone?

iPhone

  • Apple essentially embraced installment plan pricing. Phil Schiller: “The simple truth is, on an installment plan, any iPhone you want is pretty affordable”.
    • When expressed in monthly installment terms, the price delta between an iPhone and other phones is fairly small. That’s why the (US) shift to installment pricing hasn’t hurt iPhone unit sales (and may actually have helped).
  • Upgrade program: Appears to be US-only. For about $1 – $1.50 per day (depending on the model), consumers can upgrade their iPhone every 12 months.
    • The upgrade program “isn’t tied to a single carrier” (link). Apple is taking control of more of the buying experience and consumer relationship. It’s not eliminating the need for carriers, but it’s reducing their influence.
    • If a meaningful number of consumers sign up, this effectively shortens the iPhone upgrade cycle and also provides Apple with (trade-in) product that can reach lower price points (e.g. in emerging markets).
    • Android OEMs would likely love to offer a similar upgrade program (think of it as HW-as-a-service). For upgrade plans to work, however, a company needs loyal customers – not just the *mechanics* of a program. Apple has loyalty. Many OEMs don’t. The root cause: undifferentiated products and poor marketing.
  • 3D Touch: Reduces deep dives into apps. Allows for shallow “peek” inside app or fast “pop” into specific action inside the app. Between 3D Touch and related gestures, I’m interested to see how users adopt the UI updates. I’m hoping they’re not too complex. Reserving judgment.
  • Exciting to see progress with Mx co-processor. M9 is low power efficient enough to enable “Hey, Siri” to work even when iPhone is unplugged.
    • Co-processors (“sensor hubs”) are relatively new to mobile devices. They enable the sensors to operate in a low power way, while many of the remaining components idle to conserve power. In this case, the M9 is always listening for the trigger phrase “Hey Siri”, and when it hears it, it can power up additional parts of the iPhone to help it capture, relay, and respond to your request.
  • “Hey, Siri” is now likely to get used 100X more, providing Apple and developers more insight. That should create a virtuous cycle: more use -> better functionality & better 3rd party app support -> more use.
  • Live Photos: Genius. A very tasteful, straightforward, effortless way to increase the enjoyment you can get from a photo. And it’s the default mode. Very powerful. Some apps enable similar functionality. But who wants a separate app or a less certain format?
  • Apple’s drive to gain Android “switchers” continues: it’s launching an Android app to entice and enable Android consumers to make the jump.
  • No iPhone-5C-like model this year. Instead, the iPhone 5S is the lowest-price model. It also appears to be the last 4” iPhone. As I mentioned above, iPhones that are traded in as part of the upgrade program can now be re-sold at lower price points, reducing some of the need for an iPhone-5C-like model.

Apple TV

  • Big leaps forward on every front: interface, device hardware, content, functionality, and developer access.
  • It’s not a hobby any more. It’s a platform. Apple has been telegraphing this shift for years, yet no competitor has launched anything of this caliber.
  • New OS and SDK: tvOS. Impacts of this are yet to be seen, and hold tremendous promise.
  • Why? Because, as Apple says, “Apps are the future of television”. I believe it. Apps and games will expand the purpose and audience reach of Apple TV, and the time spent using it.
  • Roku (nice company, nice products) pioneered apps and games, but Apple TV and the developers who’ll build for it have the ability to take things to a whole new level. Why? Combination of superior hardware, better OS/SDK, better developer base, and the ability to utilize iOS devices.
  • To paraphrase a great Tweet by Zac Cichy:

“Xbox went from games to the TV. Apple TV is going the other way around.”

  • Amazing combo UI: Siri voice control and touch.
  • Universal search with ability to filter. (Congrats to Amazon for debuting universal search; they did little to market it, however.)
  • Search results emphasize, in practice, content over source.
  • Remains to be seen: How effective the UI is for apps like shopping. And whether people want to do that from their couch.
  • Absent: any sort of channel bundle, for now. So why launch now? Here’s the answer, via a great Tweet by Joe Rosensteel:

“I’ve said it before, and I’ll say it again: A box refresh is leverage for future OTT negotiations. US-only OTT concerns? Myopic.”

Google Plans China Return This Fall, Reports The Information

Reuters, relaying the The Information’s scoop:

Google Inc expects to return to mainland China as early as this fall following a five-year absence, tech website The Information reported on Friday.

The company hopes to get Chinese government approval for a China version of its Play store mobile app, The Information reported, citing people familiar with the plan. (bit.ly/1NfthB8)

The tech giant is also planning to extend support of a version of Android for wearable devices in the country, The Information cited one of the people as saying.

China is hard to resist. It’s the biggest smartphone market in the world, in terms of units, and one of the largest, in terms of profit.

If Google does re-enter China, we’ll witness an interesting experiment: a well-funded mobile OS, with minimal app / app store share in this market, attempting to gain a foothold in the midst of thriving local app ecosystems.

If any device OEMs gain (a valid question), who would be most likely? Those without a well-established app ecosystem: Samsung, Huawei, Lenovo. If anyone suffers (again, a valid question), it’ll be a player with an established ecosystem, namely Xiaomi.

Mobile Forward

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