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Android vs. iPhone — Who Wins In 2011?
Hugh Pickens writes "Philip Elmer-DeWitt writes in Fortune Magazine that Apple and Google have two very different strategies in the competition shaping up in 2011 between Android and iPhone. According to the conventional wisdom as espoused by Don Dodge, a Developer Advocate at Google, both Apple and Google will win because they are playing different games. Android will win the market share battle, but Apple will generate bigger profits. 'Apple goes for the high end of the market where they can charge high prices and enjoy great profit margins. Apple has been successful with this strategy multiple times, and will do it again with iPhone,' writes Dodge adding that Google's strategy with Android is to generate revenue streams from mobile search and advertising. Another Google employee, Tim Bray, sees things differently and says he won't be surprised if Apple ships a cheap iPhone and if this time next year, dirt-cheap iPhones were competing against Androids that push the user-experience lever farther than Apple. 'There's nothing fundamental in Android that would get in the way of a industrial-design and user-experience rock-star team, whether at Google or one of the handset makers, testing the hypothesis that these things are central to Apple's success.'"
I meant to comment earlier, but my iPhone alarm didn't go off.
eop
Am I part of the core demographic for Swedish Fish?
Based on my experience with both Android phones and iPhones, here's how I see it:
Do you want something that "just works" out of the box, but with somewhat limited customization options? Do you want something that's dead simple and requires little to no learning to use? Get an iPhone.
Do you like to be able to modify every little facet of your phone, right down to the hardware it runs on? Do you not mind a small learning curve if it means more flexible overall operation? Get an Android phone.
They both have their place...it all comes down to your preferences and needs.
Living With a Nerd
Symbian rocks!
he won't be surprised if Apple ships a cheap iPhone
Well, if there's one thing Apple itself has proven, it's that there is a real market segment that will pay more for a better product and won't just go for the cheapest product in the niche. Therefore, I predict this strategy will fail.
And before someone uses the 'f' word, Apple's traditional customers have been loyal for a reason - they've delivered quality and real, practical utility in exchange for the price paid. If someone else can come along and do the same thing, then we'll find out how much all these boys really are fans of Apple. I'm one, and I don't care whose logo is on the damn thing, if it's a gem, I'll save up for it rather than pay less to have some rickety piece of crap now. Just like I've done for 20 years with my personal computers.
I can see the fnords!
I had a rather chauvanist father, and among other black pearls of wisdom, he offered me this: "At some point or another every woman becomes a whore. It can work for you sometimes, but in the long run it will not."
Now, with my wife as proof, I've found that this is not true about women.
However, with Apple and Google as proof, I'm becoming convinced it's true about corporations.
I can see the fnords!
iPhone owner here. I use it all the time & develop for it, but Android simply has more & less expensive options. You can get Android on virtually every carrier and you can get them 2 for $99. The iPhone is only on AT&T, and even AT&T runs advertisements for Android phones. Apple's saving grace is that the iOS also runs on the iPod Touch & iPad. Android wins if by winning you mean continues to increase in market share, but Apple will continue to turn a handsome profit off of the iPhone, which I'm sure is their only real concern.
Taking guns away from the 99% gives the 1% 100% of the power.
IMHO Android would have been a non-starter if the iPhone had been available to all carriers (GSM & CDMA both) and not restricted to AT&T. A lot of people (myself included) passed on iPhones for the sole reason of refusing to use AT&T. Android currently suffers from too much product fracture. Too many different customer experiences based on vendor customization, and so much different hardware it's hard for developers to test everything, as well as hard to use newer, better APIs because older OS versions, whose updates are controlled by the carriers and may or may not happen, don't have them.
Michael J.
Root, God, what is difference?
I have been sick to death of advertising for pretty much all my adult life. I think it's a horrible shame to name so many of our modern points of interest after corporations. I hate how everything must be branded, and I especially hate how tasteless it all is. Product placement sucks. Most of all I'm just blown away at how I have to pay for the carrier to bring the advertisements to me.
I pay about $80 per month for cable TV, and all the channels are ad-laden; it is standard for each hour of programming to contain 20 minutes of advertisements. Now, DVR technology has allowed us to skip those commercials if you're willing to watch the program on a time delay. But doing that costs extra. A few years ago I used an old PC as a homebrew DVR and it didn't cost anything above a small investment in hardware and software, but nowadays things are so locked down the only realistic option is to rent the box and pay for the "service" from the provider. So, as I see it, I'm getting screwed from every direction.
The content itself is laden with product placement, it's subsidized further by being 33% pure commercial advertisements, I have to pay to bring the crap-laden content to my TV, and I have to pay more to filter out some of the noise.
The internet is rapidly heading in the same direction. You can't view a lot of content without turning on scripting and flash, and the scripting and flash bring advertisements that cannot be blocked. I'm paying an ISP to bring the crap in for me, and the services that offer to sell me access to the content still won't promise to remove all the advertising if I do so.
So, with my iPhone, at least it's not loaded with advertisements. Of course it brings in the Internet ads for me, but it blocks the invasive ones and I bless the iPhone for the lack of flash. But at least for the most part I'm getting fair value for the service I pay for: I make and receive phone calls and text messages, and neither are subsidized by advertisement.
So, to me, the iPhone wins. I don't care about the openness and inexpensiveness of Android if it means everything I do with my phone is partially paid for by advertisement. I'm not going to pay a carrier for voice and data service so that they can use that pipe to shove ads in my face every time I pick up my phone. It's just ridiculous.
I'm starting to believe that our society will end not in natural disaster or nuclear armageddon. Instead, the signal-to-noise ratio of all our communications will drop so low that our culture and our future just disintegrate.
Fun with Anagarams! LADS HOST, SHALT DOS. HAS DOLTS. AD SLOTHS, HATS SOLD. ASS HO, LTD.
Quote FTFA:
"There's nothing fundamental in Android that would get in the way of a industrial-design and user-experience rock-star team, whether at Google or one of the handset makers"
Nothing fundamental in Android, no. Except the solid design/UI-experience from Apple doesn't have anything to do with technology, but rather with the whole company structure and culture. I don't think that can be emulated by putting together "an industrial-design and user-experience rock-star team" and then planting it at Google or HTC or Samsung or whatever.
8 of 13 people found this answer helpful. Did you?
"There's nothing fundamental in Android that would get in the way of a industrial-design and user-experience rock-star team, whether at Google or one of the handset makers, testing the hypothesis that these things are central to Apple's success."
There is that little annoying thing called "you don't rule the world" that will get in the way of those rock stars. The problem isn't that you can't build an awesome UI experience on top of Android. No, the problem is that you dont HAVE to build an awesome UI experience on top of android. And with that, anyone selling apps has to cater to all the dirt cheap handsets (that sell in droves) and at the same time work with the high end handsets with "rock star" UIs.
And as we all know by now, a UI gets kind of boring without a slew of cool new apps to run on it. I am not saying there wont be cool apps for Android phones, nor am I saying there wont be cool android phones for years to come. But the notion that anyone working on Android phones should bother building a "rock star" UI is, at face value, pretty stupid.
p.s. to any Android apologists who want to come by and snipe at me for being an apple fanboy: I dont like apple products, and I own an android phone.
One manufacturer makes iPhone, many make Androids. It seems like an easy question to me.
And I'm a nerd, dammit, not a marketer or MBA. Why should I care who gets the most profits or market share? When did the Ferengi take over slashdot? I don't care how it sells, I care how it works.
Free Martian Whores!
I mean, there is no doubt that Android will be on more devices sold. With uncounted devices from uncounted companies and carriers this is to be expected.
What's interesting is if there will be *one* model of an Android phone that will sell better than the iPhone. If the iPhone will stay the best selling smartphone in 2011, well, it's still the bestselling smartphone.
I'm totally expecting the prices for smartphones spiralling down. An unlocked Android smartphone for $99 with no contract should be possible. It will have crappy battery life, a crappy touchscreen and a crappy camera, though.
I pay about $80 per month for cable TV
Or rather, you already have your solution: dump cable TV.
Hint: (1) Change your credit card number before you make the call. (2) When they demand an explanation, you're selling the house and moving out of the country.
This is a strange treatise to write, because I could just as easily swap all occurrences of Android/iPhone and just as many people would be nodding their head along with me.
The pleasure you get out of using a device is a matter of preference/familiarity. This has little to do with Apple either, as I actually wanted an iPhone for the longest time until I actually got one in my hands and started messing around with it. The allure of it went away pretty quickly, but I'm still having lots of fun with my android phone.
It sounds like your choice was completely right on for your preferences, and that's a good thing, but to generalize yourself to the entire population of smartphone users is a bit silly.
I'm much happier because of specific things the phone can do, which required a jailbreak on the iPhone or was otherwise just blocked off. That said, I do think the iPhone has an advantage still. This will be with non-technical users who want to do some technically involved things, and don't want to troubleshoot or customize their phones.
To extrapolate a bit from my experience to the market at large, I think this does put Apple in a very good position. Basically Android's success will depend on the hardware manufacturers such as Samsung, Motorola etc. and how well they adapt the Android OS to their phones. Mine's still crashing at odd moments. Like I said I'm happy with it - but if I didn't need specific things the Droid X makes possible I'd probably prefer the latest iPhone.
The Invisible Hand of the Free Market is what punches workers in the nuts.
Agreed. The good thing about Apple's strategy (good for them, that is, you don't necessarily have to agree that it's good for buyers, even though I personally think it is), is that they target their products specifically at the group of buyers they know will appreciate exactly those attributes of their products they spend the most time on: ease of use, polish (both in terms of software and hardware), longevity (in terms of planned obsolesence). Affordability is not one of these attributes, and people getting iPhones instead of Androids get what they expected from the product, which explains the high customer satisfaction rates.
Meanwhile, Android handset manufacturers mainly target the demographic that wants to save money on their phone, ie: they want it to be cheap, or at least: cheaper than comparable alternatives. Sure enough Android is also great if you are a geek, and sure enough there are also high-end Android phones that are as expensive as the iPhone, but they constitute a pretty minor subset of all Android buyers. The problem with this tactic is that to make money using this strategy, means you have to sell lots of phones, and to do that, you have to introduce lots of new models, to get people to replace their phones faster. You also have to cut down production costs which means making design compromises. Eventually this will hurt Android as a platform and it will hurt customers, because there will be many crappy Android phones on the market, and many phones will end up unsupported within a year. Someone who gets burned by a crappy Android phone will choose something different next time.
I don't think the Google model is sustainable in the long run, and will seriously limit the usefulness of the Android platform. Not because it is a bad platform, but because too many buyers will have a negative experience with their purchase, but also because the insane variety of brands, specifications and OS versions will mean developers will never be able to achieve the same baseline quality level in their apps without having to shut out a very large part of Androids installed base. This will be very confusing and frustrating for end-users who expect to get their phone, go on the Android market, install stuff, only to find out their phone doesn't handle the application, or because the quality is abysmal. Apple got it right with their single-model-1-year-update-cycle, sure, it means you have less choice if you want an Apple phone, but at least you can be pretty sure you won't run into any surprises if you try to use it they way you expect it to work.
This last paragraph is exactly why I find the statement in the article by this guy named Tim Bray pretty stupid. Even if one or two vendors introduced phones that are better than the current iPhone in terms of hardware (such phones are already on the market) *and* software (Android is almost there), you'd still have only a few handset models, which combined will sell only a fraction of what the iPhone sells, and will never get individual marketshare big enough for developers to spend enough time extracting all their capabilities from the hardware and software. Most developers will go for a set baseline much lower than the current iPhone model, just to make sure they target a sufficiently large installed base. That way, the ecosystem of Android apps will always be one or two years behind iOS.
Windows Phone 7 is interesting because it completes a sort of triad - it's got Apple UI polish and a distinct design sensibility, along with a fully curated app store.
But it's going against Android and competing to be on multiple handset maker devices.
So the question is, can it displace Android? Especially when Google is willing to let carriers adapt Android as the see fit, and Microsoft is not..
The only reason Microsoft has a chance is that they are doing the heavy money bombing runs, paying device makers to support WP7 and paying key application makers (especially game makers) to port stuff to WP7. You'll probably see a lot more higher-end games come to WP7 as a result.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
You can get Android on virtually every carrier
That doesn't really matter that much, especially since that is the same in much of the rest of the world for the iPhone. For the U.S. it matters a lot more - but only really because of Verizon.
But with the Verizon iPhone close at hand, don't you think that eliminates a lot of issues you raised? As for cheap iPhones, they've been selling $99 phones for some time. It's not that vast a difference.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The analyst may not be surprised if Apple ships a cheap iPhone, but I would be. What on earth would make anyone think they would? There's a reason why the "conventional wisdom" is that Apple sticks to the high end of the market - not only has that been their strategy forever, but Steve J. never misses an opportunity to reinforce the idea that it's their strategy. Right now, Apple customers can count on the fact that whatever Apple puts out is at least going to be well-made. If Apple were to make a cheap, crappy iPhone, that friendly customer perception would be out the window - folks that now instinctively by Apple products would become open to persuasion by other companies.
I can't understand why anyone would think Apple would drop a strategy that's made them so much money. Apple can't be Dell, and doesn't want to be.
That should be fairly local though - globally, in places where iPhone is available from few carriers, it doesn't impact the viability of other options at all; quite the contrary, typically.
MediaTek - responsible, among other things, for OEM packages used in inexpensive Shanzhai phones - is releasing solution for Android (previously they were supposedly basically blocked from doing so / from joining Android alliance by Qualcomm); now it will really pick up steam. Yes, the products will be "basic" or smth - but it needs to be only good enough (plus there's a third major smartphone OS around, that pundits like to ignore but should remain a top player for foreseeable future)
One that hath name thou can not otter
I think the definition of expensive on this forum is whatever price Apple charges. Expensive in this space used to mean $600, now you can get a spectacular top of the line iPhone for $299 and less capable units (new) for down to $99.
$229 for a very nice iPod touch or $499 for an iPad? Seems like a pretty good deal to me.
Apple's strategy isn't to charge extra to artificially inflate their brand, but rather to make high quality devices and charge as little as they can for them and still sustain their business and large R & D expense.
The best selling single android phone to date is the original Motorola droid (a high end smartphone). So, I don't think that you can say that the primary target demographic for android phones is "cheap".
God is imaginary
in most of the world, the iPhone is available on lots of carriers. Android is still outselling it in these markets.
as for "product fracture", yes it can bring some troubles. what you fail to mention is that it also brings a huge amount of innovation and competition that is not found in a single vendor, single device platform. basically, all your arguments against android's diversity could be easily applied to a PC vs Mac discussion. It's pretty clear how that battle turned out, and I anticipate a similar result in the smartphone arena. Apple's products will have their niche, but most the world won't really care about them.
-Lod
Consumers.
"To make a mistake is only human; to persist in a mistake is idiotic." Cicero
The seamless integration of Google applications with Android is unbeatable to me. I have Google voice (old Grand Central), and I don't have any advertisement, yet I use it for international calls due to competitive rates. Why do you think everything is search and advertising for them?
The fact the they became successful with those two and managed to provide user services for free, makes me think their strategy. If they had managed to get the 700 MHz spectrum, and started to offer free cellphones and data plans, with some advertisement, would you ever go with them?
The main problem with your mentality, is that you keep comparing Apple and Google, when Apple makes devices and Google provides services. Two very different things.