In the FT this week, John Gapper debunks some of the hype around Google’s business and development model (Google’s open battle with Apple, John Gapper, Financial Times, January 6 2010 [Shared bookmark]. He writes:
The contest [between Apple and Google] appears to pit not only two companies but two approaches to business. On one side is Apple, a secretive endeavour that is seemingly wedded to old, closed ways of competing; on the other side is Google, a champion of open source software and open systems… Yet Apple is not as closed as Google portrays it, and nor is Google as open… This is, of course, like Microsoft’s drive to commoditise hardware during the 1970s and 1980s… Apple lost to Microsoft in desktop computing in the 1980s because it did not grasp the true value of openness… [Will this] be repeated in mobile… Apple has not pursued a fully closed strategy with the iPhone, but has been tactically pragmatic… One thing both Apple and Google have learned is that a solely proprietary strategy has flaws, just as one of pure openness does.
Gapper is correct to play down the difference in open-ness between Google and Apple. Google is as secretive as the next major corporation – about its mobile and every other strategy – and shouldn’t be embarrassed about that. But he is wrong about the dynamics of the personal computer industry, and the parallels he draws with the mobile Internet.
It wasn’t Microsoft that commoditised hardware, as Gapper claims, but Compaq, then Dell – building on IBM’s ‘accidental’ open platform – and Apple suffered for being closed and unable to take advantage of hardware economies of scale and industry advances. And he is incorrect in claiming its approach to software was closed. The products that made the Macintosh were almost all third party: Aldus PageMaker, Adobe Ilustrator then Photoshop and, of course, Microsoft Word then Excel. (Until recently Apple had little success in software: from HyperCard to FileMaker it made interesting and good, but irrelevant, products.)
Apple’s early success was in making the personal computer usable, and a pleasure to use. But in the corporate world – the key battleground between it and Microsoft – these characteristics were almost disadvantages. Windows was a good enough graphical user interface that didn’t encourage white collar workers to be too creative, and it could be controlled by the IT department – the real customer for PCs in that realm – who ensured it was anything but open to users. (I considered some of these dynamics in my review of Insanely Great: The Life and Times of Macintosh, the Computer that Changed Everything by Steven Levy: see Down to Earth, World Link, March/April 1994.)
The dynamics around the mobile Internet are different. Gapper quotes Henry Blodget on Apple repeating its mistake by selling a “tightly controlled, fully integrated hardware and software device”. However, these devices are purchased not by IT departments but by real people, who do care about usability and pleasure of use. This can be better guaranteed today by Apple’s semi-open, end-to-end approach (which also better controls viruses and ‘malware’). Apple also focuses on all aspects of design, and always has, where Google in its early years had no designers on its staff, and still doesn’t prioritise it.
Apple, and Steve Jobs, have their strategic flaws, but repeating the failed Macintosh strategy isn’t one of them.
In his Above the Crowd piece Android or iPhone? Wrong Question Bill Gurley argues that:
Users won’t switch in mass from the iPhone to the Android. It’s the other 3.95 billion cell phone users that are highly likely to consider Android a step up from their current feature phone… Android will be the choice of the masses, and with its sleek design and non-compromising price point, Apple will rule the high end… Android gives every Korean, Taiwanese, and Chinese manufacture whoever wanted to approach these markets a huge head-start… it is Google that is attempting to be the Microsoft of the smartphone market [and] Apple is well positioned to be the “Apple” of the smartphone market
This of course raises the question of cost, which many have argued undermined Apple’s Macintosh in the consumer market. Apple did develop low cost Macintosh models, but the drive to computing in the home largely being work-driven (not least supplying ‘free’ software) facilitated Windows entry there too. In the i-era, Apple has launched iPods that cover almost every market segment. This approach may also work for mobile Interent devices too.
More generally, we need to re-state and update our understanding of information technology adoption patterns, and find better ways to tie our journalism and analysis to them.