So
the new iPhone 5 is out. Despite its less satisfying native maps application
(and uncharacteristic apologies from Tim Cook), the review and reception have
been stellar and is now widely claimed as the best smartphone in the industry. Apple
had made a strategic decision to enter the smartphones industry with the debut
of iphone, in a market where incumbents such as RIM with a popular Blackberry
line for largely enterprise users claimed the interim victor of the then
nascent smartphone market. The advent of smartphone, while initially seemed
like a natural evolution from past basic and feature phones drastically changed
the landscape of the digital world. Smartphone is not an extension of a phone,
but an evolution of netbook with the addition of phone function that puts a
small computing device, web-connected, no less in many pockets. With the help
of applications, this makes web and connectivity ever more important in our
daily lives and forces traditional industries to adapt to the changing
behaviour of the consumers and enterprises.
Traditional
retailers should be ready to combat Amazon and its price comparison function,
which make retailers compete on something more such as services, ambience, etc.
than just the price tag. Intermediaries industries, as I call it, includes
industries such as real estate and travel, and are subject to large scaled
disruption in their business model when the access to information becomes no
further than one’s pocket. The advent of smartphones will disrupt many
industries – a concept well summarized by Joe Kraus, a partner at Google
Ventures. Kraus predicts that “in five to 10 years, your smartphone will
replace your car,” implying smartphone’s deep impact on change in consumer
behaviour. Companies such as Uber is already hard at work to make his
prediction a near term reality.
So
who is winning the battle to dominate the smartphone market? The popular answer
would be Apple with its invincible iphone series, and I don’t disagree.
However, in the long run, because smartphones market is too broad and important
of a market to miss out on, intense and bloody competition to gain a foothold
will likely to ensue, and despite its track record, there is no guarantee that
Apple will continue to stay on top. Google for one has created a mobile OS that
makes it the most formidable competitor in the smartphones industry. And
despite my respect for Apple’s ecosystem, I am believer of a more open system
and that in the end, large numbers have a good chance to prevail. If Google can
maintain the minimum interoperability of the Android system, (which may not be
the case already) Android could become the most powerful competition to Apple.
Are
tablets just larger smartphones? While the technology behind them is similar,
they belong in two categories serving different purposes. Tablets, with larger
screen allows for a much smoother execution of productivity applications and
for reading/viewing contents. Therefore,
tablets are functionally closer to notebooks and computers than smartphones.
Again, Apple was the innovator in this product category by virtually creating
it by introducing the iPad. While some maintain a view that iPad is just a larger
iPhone and that it is really a “toy”, iPad enabled a unique medium for content
consumption as well as creation and further decreased the necessity of a
desktop or notebook computer. Understanding the implication of a new product
category and its potential, many companies including HP and Dell are jumping
into the tablets business, with minimal foothold. Despite intensifying
competition, I believe that the winner in the tablet market will continue to be
Apple thanks to its robust ecosystem that supports numerous developers and
content creators.
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