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Apple is not the Microsoft of mobile

Analysis Industry fears seem overblown, for now
Mon May 31 2010, 13:07

THIRTY YEARS AGO every new model of desktop computer was a new system. It might run the same operating system as other machines but you could never be sure if it would run the same applications. So each new computer had to have its own set of software, or at least tweaked and tested versions of existing code.

Then along came the IBM Personal Computer (PC). There was nothing special about the hardware but IBM was the superpower of computing and software developers gravitated to the machine, with its operating system from the little-known Microsoft. Almost accidentally, the IBM PC became the standard platform the industry desperately needed, projecting Microsoft into a position that eclipsed even IBM itself in the PC software market.

The early PC was not mentioned at the Open Mobile Summit in London last week but its spectre haunted the event, held by chance during the run-up to the UK launch of Apple's Ipad. Apple, which is the opposite of open, was not at the conference but many of its competitors in the mobile industry were and they spent much of their time talking about their fruit themed rival.

Underlying much of the discussion was the fear that Apple, which famously resisted the PC tide, could by wondrous irony end up doing a Microsoft by cornering infant mobile computing. Minds were concentrated by an overblown claim from the US that Apple had already become bigger than Microsoft.

The parallel with the early days of the PC is clear. Mobile software developers have the same problem of trying to cater for a multiplicity of platforms, and they know they have a ready market with Apple just as their predecessors knew they could not go wrong targeting the IBM PC.

windsorAnd, as Nomura global technology specialist Richard Windsor pointed out, there is nothing special technologically about the hardware in Apple's Iphone. "The value is in the software and the [user interface]," he said, echoing a point made last month by UK patent lawyer Andrew MacKenzie.

Windsor warned that Nokia, one of the sponsors of the summit, can take cold comfort from the fact that its handsets vastly outsell the Iphone. In the first quarter of this year Nokia shipped 107 million handsets, generating $9.4 billion in revenue, compared with Apple's 8.75 million units and $5.3 billion revenue. Apple with its high-margin smartphones made $1.6 billion profit compared with Nokia's $1.1 billion, despite having a tenth of the sales.

Five years ago most mobile software developers were targeting the Symbian operating system, which Nokia has now made available as open source code. "Now almost every developer I talk to is focussing first on Apple," said Windsor, though he conceded that this might change with the release of Symbian 4 later this year

Of the other mobile platforms, he said Windows Phone 7 is struggling to interest vendors, RIM's Blackberry is way behind Apple on consumer user experience, and Google's Linux-based Android is gaining momentum but hitting fragmentation issues.

Windsor said it has been recognised for years that a closed proprietary system like Apple's can get to market faster but that the opportunity for open systems is always greater. "The problem is that if it takes too long for the open platform to gain traction the proprietary system can become a de facto standard. There is a risk that Apple will make a mockery of the open-source community by doing this," he said.

"I don't think we are there yet and I think the market is big enough [to prevent it]. But if the trend we are seeing at the moment continues then it is something that is possible," Windsor concluded.

The parallels with the early IBM PC only go so far, of course. The PC became a standard only because the hardware architecture was open, allowing anyone to clone and eventually improve it. Anyone trying that with an Iphone would soon have Apple lawyers (or even Jobsworth policemen) breathing down their neck. This will limit the device's market impact - walled gardens are never going to cover the globe, even when designed by Apple.

And we now have the web browser, which is inherently cross-platform and can bypass issues of platform fragmentation. Jon von Tetzchner, co-founder of the company that develops the Opera browser, claimed that applications running within browsers are as good as those running native. He did not convince everyone but it is surely true that any performance hit you get in a browser will become insignificant as computing power increases.

Several delegates at the conference were using Ipads, a reminder that mobile computing is not restricted to handsets. The industry has yet to get the measure of this class of device and tends to regard it as divorced from the handset market, though whether people will want both a smartphone and a slate is by no means clear.

The expectation is that in the fairly near future people will use mobile devices of some kind as their primary way of consuming content currently delivered as paper-based newspapers and magazines. Apple is setting the pace here, hosting several publications on the Iphone and Ipad, but this is not an easy market to corner.

Alisa Bowen, a senior vice-president at publishers Thompson Reuters said, "We want our content to be ubiquitous. I'm not bothered about one platform over the other." And she pointed out that the cost of adapting delivery for different platforms is nothing compared to the cost of "keeping the printing presses running".

There are signs too that people are using emerging new devices in ways that may impact the sales and use of smartphones. More than one speaker mentioned preliminary research showing a major use of Ipads was by women keeping up with social networks while watching TV.

Emma Lloyd, director of mobile at bSkyb, said she envisaged such devices being used as a secondary screen enabling customers to control their TV and video recorder and discover new content to watch on the big screen.

Nokia appears to have an eye on this market with the Linux-based Meego platform that it is developing with Intel. Meego is designed for use in set-top boxes and TVs as well as mobile devices.

So Apple is not having everything its own way and mobile evolution has a long way to go. As Jim Zemlin, president of the Linux Foundation said, "We are in the first five minutes of a very long game." µ



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