Just saying. 1000 people means nothing. Report on this when they poll 100,000 people in 15 major cities. That might give a better representation.
Another poster who has no idea of how a poll is done in modern times. Do yourself a favor and google "gallup" and do some actual research to see how inaccurate your opinion is.
No it's not. He was talking about 3G and you pulled up a voice map. Check the end of the url you provided. Here is a comparison of AT&T and Verizon's coverage that I found with a simple google search:
Here is trumptman's original statement.
"Third, traveling between major metro areas, AT&T has mostly 2G coverage anyway. I mean I can't even believe you are making this point with a straight face. AT&T basically has islands of 3G coverage and all the roads connecting them are blanketed in crappy 2G."
From the map, that is completely, 100% accurate. If anyone is spreading "total, flat out lies" it is you - slyly substituting a voice map when the discussion was about data. Nice try.
From the map, that is completely, 100% accurate. If anyone is spreading "total, flat out lies" it is you - slyly substituting a voice map when the discussion was about data. Nice try.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
You’re using that out of context. The main focus of all publicly traded companies are profits. Jobs statements are a way to ensure and continue to get profits by expanding, not by acting like a monopoly. There has to be a tipping first, hence his use of the word “conjecture”.
What I quoted was not out of context. You made the analogy that smart phones and computers are similar in that Apple doesn't need to have the largest market share to get what is most important - profits. Steve's quote shows that he thinks Apple made significant mistakes in the late 80s. His plan was not to have Apple be the most profitable PC maker but with only 5% of the market. He has shown what his goals are with the iPod. To take the premium market first and then at the "critical juncture" go for market share. Apple doesn't just want profits and they don't just want market share - they want both.
With the iPod Apple has shown that they're willing to take lower margins to keep their monopoly (or close to it). Their ASP on an iPhone is around $600, but they sell an iPod Touch for 1/3 to 1/2 of that, with the only real difference being the addition of a cellular radio. The margins are much lower on their iPods then their iPhones but they seem happy with not ceding the market to MS or Sony if they didn't maintain lower margins.
Side note: I think the comparison of Apple to Dell or HP only is only a half-truth. Apple makes the hardware and OS. If you really want to make a valid comparison, compare Dell's profits plus the profits MS makes on the computers Dell sells and then compare them to Apple's profits only on their computers, leaving out profits on everything else. Apple may still be more profitable, but not by nearly as much.
Quote:
Originally Posted by solipsism
Do you really think that making a cheap phone that can be completely subsidized by the carrier or costs under $99 without a contract is what Jobs was talking about? If so, then why aren’t tehy doign that? Do you really think Dell going for marketshare with profit-less $400 PCs is what Jobs was talking about? If so, then why aren’t they doing this?
The reason is the tipping point for tier takes time. Think of it as a pyramid with expensive, low volume items on top and inexpensive, high volume items on the bottom. Also think of each price segment as a different “market”. Let’s say it’s separated by $100 with the Macs. As we’ve seen with the Macs their notebook market reached its tipping point a year or two ago and they all dropped in price. They average selling price is now lower than it was but they are also making more profits from it. This is NOT a guaranteed causal relationship and raising the price isn’t as easy as dropping it.
With the iPhone, there are a couple things that can happen. Apple can make a cheaper iPhone, but the carriers might still subsidize it the same way pocket the difference, or Apple can make additional iPhone models. Note that they did this with the iPod only after the tipping point had been reached.
I don't think making a "cheap phone" is what Jobs was talking about. Remember, your original reply regarding market share was about Android taking the crown from the iPhone. The reason that has happened isn't that Android phones are significantly cheaper. The Droid X and Droid 2 are both $200 on contract, same as the iPhone. And the "BOGO" offers that are always mentioned here are over, and have been over for a few months. Yes, you can get $99 Android phones, but you can get a $99 iPhone too. The reason is that Android is on Verizon and iPhone is on AT&T. The move that needs to be made is to sell the iPhone on Verizon, not make a cheaper phone. Eventually an iPhone Nano might make sense, but we're not there yet.
Quote:
Originally Posted by solipsism
Apple does look to be nearing that tipping point, but it’s hard to tell as the iPhone is still sold out for weeks and still not released on all viable countries yet. Again, if the magical answer is marketshare then they wouldn’t have released to a single carrier in the US, they would have released a CDMA version along with a GSM version, they would have released many models at once to cover all types of buyers, and all the handset vendors that are now focusing on a select high-end models would never have had to follow Apple’s lead.
I agree the magical answer isn't just market share - it is both profits and market share. But Google has taken away the luxury Apple had to move slowly. Whether they stole Apple's inventions or not - and I think they did - as we learned in the 80s and 90s, being right and first doesn't always matter. It is well past time for Apple to release a CDMA phone to counter Google and address more than 1/3 of the US market.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
The ads have been up for months. If they were inaccurate, AT&T would have sued. Oh wait - they did. You know what the suit was about? Not that the maps were inaccurate, but that they didn't also show AT&T's 2G coverage also.
The ads have been up for months. If they were inaccurate, AT&T would have sued. Oh wait - they did. You know what the suit was about? Not that the maps were inaccurate, but that they didn't also show AT&T's 2G coverage also.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
I guess you'd rather complain about the source and then ignore the fact that I linked directly to the AT&T coverage maps on the AT&T website.
I double checked and it appears Safari kicks them back to the default map but they work in Firefox.
It says you are from the midwest so here it is for the midwest.
The iPhone is truly the best cell phone ive ever seen, but it is married to the worst carrier in the United States.
I own an iPhone 3GS and used to live in an area with excellent AT&T coverage. Whenever I travelled, though, my signal was crappy at best. I never had this problem with Verizon, ever.
I made a decision then to jump ship to Verizon should the iPhone become available with them and not be horribly locked down with Verizon crapware.
As it turns out, I moved to an area with zero AT&T service and had to switch to Verizon, but instead of getting a Droid phone, I got a crappy txting phone to bide my time until the iPhone comes out for Verizon. Even if I have to pay the full price for the handset, I will be among those getting a Verizon iPhone, whenever it comes out.
It turns out John Gruber of Daring Fireball stated the same thing I do, but more succinctly. Perhaps his comment on the issue will convince you that the "critical juncture" is important for growth, not simply to grow marketshare at all costs.
Quote:
The key bit: ?At the critical juncture [?], when they should have gone for market share, they went for profits.? I think this encapsulates Jobs?s philosophy since taking over Apple in 1997. Take the high end of the market first, establish a brand and presence, then steadily start to expand.
It turns out John Gruber of Daring Fireball stated the same thing I do, but more succinctly. Perhaps his comment on the issue will convince you that the "critical juncture" is important for growth, not simply to grow marketshare at all costs.
I agree with you on this. It is not just about growing market share at all costs. But that is a component of growth. The other important component is profits. In your original post you seemed to only concentrate on profits. But profits is not enough - it takes both to truly grow, as Jobs outlined in the original quote. As I said before, the best example of a company taking both market share and profits is Apple with the iPod. Their make a healthy amount of money but have lower margins than they do on the iPhone to protect their 70%+ market share.
I think where we are really disagreeing is when that "critical juncture" is. With the original quote, Jobs said it was the late 80s for computers. Remember that was before Windows 3.1 and well before Windows 95. You think we are arriving at this tipping point or critical juncture now. I think it was passed a year ago - before the threat of Android truly materialized last fall with the original Droid.
"While a poll of 100 people will be more accurate than a poll of 10, studies have shown that accuracy begins to improve less at about 500 people and increases only a minor amount beyond 1,000 people."
That's how polling is done. So when the article says that a significant number of people will jump ship from AT&T for Verizon and Android may be hurt, they're using actual scientifically proven data collection techniques.
Acting like their numbers are off when they're actually following a proven method makes you look bad, not them.
Or so polling marketing goes... The science of polling methodology is still very much in question, by leagues of people far more intelligent than forum idiot 1 & forum idiot 2. You won't hear much of this from pollsters, because it shoots their product in the foot, and makes for a bad sell to companies looking to commission a poll.
Pollsters however do know that by publisizing the results of a poll, they can jedi mind-trick the weaker minded into taking a result for granted. Who commissioned the poll? Typically polls are commissioned for a certain result... which is the 'real' correct proven method regarding polls. It's not like this company is conducting a poll for a fun way to waste their time and money. Welcome to the real world. Get a clipboard, go out and ask 1000 people in front of a Best Buy if they would wait to upgrade to a Microsoft iPhone, and I'll bet you $100 that it swings up to 60%. Then conduct the same poll about Verizon, but include the normal iPhone price, and i'll bet you another $100 that it swings down to 10%.
All this says is that 333 people somewhere want a iPhone on Verizon... meaningless because they obviously don't want an iPhone enough to pay for one now, hence they are outside the relevant customer pool and their 'opinion' is worth exactly how much money they are currently spending on it. Verizon customers pre-sort themselves into a lower priced segment of the mobile phone biz, they care more about low price than high performance, and that's typically a market Apple doesn't chase.
Sorry to torpedo the polling love-fest, but you guys really need to stop spending your saturday afternoons defending known marketing tricks as gospel. Sheesh.
I agree with you on this. It is not just about growing market share at all costs. But that is a component of growth. The other important component is profits.
My implication was that you can?t sustain increased profits without growth. That doesn?t have to be marketshare growth as the market could get defined or change the way ?marketshare game? as we saw with the emergence of Netbooks hurting Apple?s marketshare despite record YoY growth in unit sales and overall profit.
In other words, growing your market accessibility once you reached a saturation point. If you are outgrowing the market as a whole your marketshare will also grow, but this is a secondary metric and last on the list of viable measurements for a successful company. It?s a component for comparing your growth to the entire market, not your growth YoY or your profits YoY.
BTW, when I mention profit, I?m not talking about profit per unit. That WILL almost certainly drop as you expand with lower cost products. I?m referring to profits as a whole for the entire quarter. What Apple did wrong was to focus on profits per unit, not on profits per quarter. If more profits means expanding with a cheaper model or another model then you do it. I think we can agree on that.
It's just a matter of time before the iPhone expands to other carriers. I think Apple will try to follow the iPod model of domination. The iPhone opened the smartphone door and their foot is still stuck there. When their contract with ATT is up they'll expand to all carriers. I'm on Verizon and can't wait till the iPhone is available. I dumped ATT years ago way before smartphones because of dropped calls and it didn't work at my house. If I'm wrong then I'm looking at an Android phone, Droid X or Incredible, for now.
What I quoted was not out of context. You made the analogy that smart phones and computers are similar in that Apple doesn't need to have the largest market share to get what is most important - profits. Steve's quote shows that he thinks Apple made significant mistakes in the late 80s. His plan was not to have Apple be the most profitable PC maker but with only 5% of the market. He has shown what his goals are with the iPod. To take the premium market first and then at the "critical juncture" go for market share. Apple doesn't just want profits and they don't just want market share - they want both.
Apple did make significant mistakes in the 80's. Steve was not saying that Apple needed to have a dominant market share. As Apple currently does not have a dominant computer market share, but they are the most profitable computer company on the planet.
The MP3 market is totally different from PC or mobile phones. Apple came upon a lucrative opportunity and took advantage. Soon there won't even be much of an MP3 market.
Quote:
I don't think making a "cheap phone" is what Jobs was talking about. Remember, your original reply regarding market share was about Android taking the crown from the iPhone. The reason that has happened isn't that Android phones are significantly cheaper. The Droid X and Droid 2 are both $200 on contract, same as the iPhone. And the "BOGO" offers that are always mentioned here are over, and have been over for a few months.
The Droid x nor Droid 2 are not selling in the same volume as the iPhone. Not everyone is buying an expensive Droid phone, there are really cheap Droid phones available that people are buying.
Quote:
I agree the magical answer isn't just market share - it is both profits and market share. But Google has taken away the luxury Apple had to move slowly. Whether they stole Apple's inventions or not - and I think they did - as we learned in the 80s and 90s, being right and first doesn't always matter. It is well past time for Apple to release a CDMA phone to counter Google and address more than 1/3 of the US market.
Seeing that Apple is selling the Macintosh under the same business model as it always has. Seeing as the Macintosh is selling well and highly profitable for Apple, what lesson exactly did we learn from the 80's and 90's that you are point to?
My implication was that you can?t sustain increased profits without growth. That doesn?t have to be marketshare growth as the market could get defined or change the way ?marketshare game? as we saw with the emergence of Netbooks hurting Apple?s marketshare despite record YoY growth in unit sales and overall profit.
Do you think the smartphone market has been redefined, like it was for PCs with netbooks? I don't. Even if you can get an old Android phone with 1.6 on it for "free," you still have to pay the data plan every month. I think consumers are smart enough to recognize the true cost of these phones and can tell that a $99 iPhone with an $80 service plan is not really different from a "free" Android phone with an $80 service plan.
Quote:
Originally Posted by solipsism
In other words, growing your market accessibility once you reached a saturation point. If you are outgrowing the market as a whole your marketshare will also grow, but this is a secondary metric and last on the list of viable measurements for a successful company. It?s a component for comparing your growth to the entire market, not your growth YoY or your profits YoY.
BTW, when I mention profit, I?m not talking about profit per unit. That WILL almost certainly drop as you expand with lower cost products. I?m referring to profits as a whole for the entire quarter. What Apple did wrong was to focus on profits per unit, not on profits per quarter. If more profits means expanding with a cheaper model or another model then you do it. I think we can agree on that.
Pretty much agree with everything here. Customers willing to switch carriers to AT&T to get the iPhone appears saturated. The great majority of upgraders from what I've seen already own an iPhone.
The only thing I would add is that Apple is not selling the iPhone in a vacuum. Competitors,notably Android and even WM7, have to be factored in to Apple's decision making. Comparing Apple's market share to these competitors is valid and I don't think it is secondary. Every Incredible and Droid X that HTC and Motorola sell is a lost iPhone sale, which translates into lost profits and lost market share. Apple needs to do what it can to stop this hemorrhage to Android. Apple appears to recognize this. Without Android I don't think a CDMA iPhone would be in the cards.
I think consumers are smart enough to recognize the true cost of these phones and can tell that a $99 iPhone with an $80 service plan is not really different from a "free" Android phone with an $80 service plan.
Yes psychologically for a consumer "free" is very different from a $99 dollars.
Quote:
Customers willing to switch carriers to AT&T to get the iPhone appears saturated. The great majority of upgraders from what I've seen already own an iPhone.
Seeing as AT&T keeps activating more iPhone's every quarter. You really want to make the argument that most of those iPhone's are from current iPhone users? Do you have any sales data to support that argument?
Quote:
The only thing I would add is that Apple is not selling the iPhone in a vacuum. Competitors,notably Android and even WM7, have to be factored in to Apple's decision making. Comparing Apple's market share to these competitors is valid and I don't think it is secondary. Every Incredible and Droid X that HTC and Motorola sell is a lost iPhone sale, which translates into lost profits and lost market share. Apple needs to do what it can to stop this hemorrhage to Android. Apple appears to recognize this. Without Android I don't think a CDMA iPhone would be in the cards.
I don't think you really understand how business works. What you've said above is not at all in alignment with reality or any way resembles what companies do to be successful.
I was an iPhone 3G user until I moved to an area that ATT doesn't serve well. Now I have a Droid on Verizon and I will drop it the second an iPhone is available on Verizon (or T-Mobile for that matter, whoever gets it first).
Apple did make significant mistakes in the 80's. Steve was not saying that Apple needed to have a dominant market share. As Apple currently does not have a dominant computer market share, but they are the most profitable computer company on the planet.
The MP3 market is totally different from PC or mobile phones. Apple came upon a lucrative opportunity and took advantage. Soon there won't even be much of an MP3 market.
I see you've ignored what I've already posted on this, so I'll say it again. It is not clear that Apple is the most profitable computer company on the planet. They are more profitable than Dell and HP, but they are nowhere near Microsoft. Factor in MS's profits on Dell or HP computers and you get a very different story.
Quote:
Originally Posted by TenoBell
Seeing that Apple is selling the Macintosh under the same business model as it always has. Seeing as the Macintosh is selling well and highly profitable for Apple, what lesson exactly did we learn from the 80's and 90's that you are point to?
If you think Jobs and the Macintosh team were busing their asses working 20 hour days in 1983 for 5% of the global computer market you're dreaming. I'll leave you to figure out the "lesson" from Steve's quote, because obviously he thinks Apple fucked up in the 80s. If you can't apply that to other situations, that's your problem.
Comments
Just saying. 1000 people means nothing. Report on this when they poll 100,000 people in 15 major cities. That might give a better representation.
Another poster who has no idea of how a poll is done in modern times. Do yourself a favor and google "gallup" and do some actual research to see how inaccurate your opinion is.
That is, of course, a total, flat out lie.
http://www.wireless.att.com/coverageviewer/#?type=voice
No it's not. He was talking about 3G and you pulled up a voice map. Check the end of the url you provided. Here is a comparison of AT&T and Verizon's coverage that I found with a simple google search:
Here is trumptman's original statement.
"Third, traveling between major metro areas, AT&T has mostly 2G coverage anyway. I mean I can't even believe you are making this point with a straight face. AT&T basically has islands of 3G coverage and all the roads connecting them are blanketed in crappy 2G."
From the map, that is completely, 100% accurate. If anyone is spreading "total, flat out lies" it is you - slyly substituting a voice map when the discussion was about data. Nice try.
From the map, that is completely, 100% accurate. If anyone is spreading "total, flat out lies" it is you - slyly substituting a voice map when the discussion was about data. Nice try.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
You’re using that out of context. The main focus of all publicly traded companies are profits. Jobs statements are a way to ensure and continue to get profits by expanding, not by acting like a monopoly. There has to be a tipping first, hence his use of the word “conjecture”.
What I quoted was not out of context. You made the analogy that smart phones and computers are similar in that Apple doesn't need to have the largest market share to get what is most important - profits. Steve's quote shows that he thinks Apple made significant mistakes in the late 80s. His plan was not to have Apple be the most profitable PC maker but with only 5% of the market. He has shown what his goals are with the iPod. To take the premium market first and then at the "critical juncture" go for market share. Apple doesn't just want profits and they don't just want market share - they want both.
With the iPod Apple has shown that they're willing to take lower margins to keep their monopoly (or close to it). Their ASP on an iPhone is around $600, but they sell an iPod Touch for 1/3 to 1/2 of that, with the only real difference being the addition of a cellular radio. The margins are much lower on their iPods then their iPhones but they seem happy with not ceding the market to MS or Sony if they didn't maintain lower margins.
Side note: I think the comparison of Apple to Dell or HP only is only a half-truth. Apple makes the hardware and OS. If you really want to make a valid comparison, compare Dell's profits plus the profits MS makes on the computers Dell sells and then compare them to Apple's profits only on their computers, leaving out profits on everything else. Apple may still be more profitable, but not by nearly as much.
Do you really think that making a cheap phone that can be completely subsidized by the carrier or costs under $99 without a contract is what Jobs was talking about? If so, then why aren’t tehy doign that? Do you really think Dell going for marketshare with profit-less $400 PCs is what Jobs was talking about? If so, then why aren’t they doing this?
The reason is the tipping point for tier takes time. Think of it as a pyramid with expensive, low volume items on top and inexpensive, high volume items on the bottom. Also think of each price segment as a different “market”. Let’s say it’s separated by $100 with the Macs. As we’ve seen with the Macs their notebook market reached its tipping point a year or two ago and they all dropped in price. They average selling price is now lower than it was but they are also making more profits from it. This is NOT a guaranteed causal relationship and raising the price isn’t as easy as dropping it.
With the iPhone, there are a couple things that can happen. Apple can make a cheaper iPhone, but the carriers might still subsidize it the same way pocket the difference, or Apple can make additional iPhone models. Note that they did this with the iPod only after the tipping point had been reached.
I don't think making a "cheap phone" is what Jobs was talking about. Remember, your original reply regarding market share was about Android taking the crown from the iPhone. The reason that has happened isn't that Android phones are significantly cheaper. The Droid X and Droid 2 are both $200 on contract, same as the iPhone. And the "BOGO" offers that are always mentioned here are over, and have been over for a few months. Yes, you can get $99 Android phones, but you can get a $99 iPhone too. The reason is that Android is on Verizon and iPhone is on AT&T. The move that needs to be made is to sell the iPhone on Verizon, not make a cheaper phone. Eventually an iPhone Nano might make sense, but we're not there yet.
Apple does look to be nearing that tipping point, but it’s hard to tell as the iPhone is still sold out for weeks and still not released on all viable countries yet. Again, if the magical answer is marketshare then they wouldn’t have released to a single carrier in the US, they would have released a CDMA version along with a GSM version, they would have released many models at once to cover all types of buyers, and all the handset vendors that are now focusing on a select high-end models would never have had to follow Apple’s lead.
I agree the magical answer isn't just market share - it is both profits and market share. But Google has taken away the luxury Apple had to move slowly. Whether they stole Apple's inventions or not - and I think they did - as we learned in the 80s and 90s, being right and first doesn't always matter. It is well past time for Apple to release a CDMA phone to counter Google and address more than 1/3 of the US market.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
The ads have been up for months. If they were inaccurate, AT&T would have sued. Oh wait - they did. You know what the suit was about? Not that the maps were inaccurate, but that they didn't also show AT&T's 2G coverage also.
http://www.engadget.com/2009/11/03/a...-for-that-ads/
The ads have been up for months. If they were inaccurate, AT&T would have sued. Oh wait - they did. You know what the suit was about? Not that the maps were inaccurate, but that they didn't also show AT&T's 2G coverage also.
http://www.engadget.com/2009/11/03/a...-for-that-ads/
PS - every time I look at this map, it makes me wonder what in the hell I was doing spending $100 a month an this company. What a pathetic joke.
You are basing your argument on a map advertisement put out by Verizon with no supporting documentation and you claim it is 100% accurate? It's true and accurate just because Verizon published it in a newspaper ad? Aren't you one of those who constantly complain about Apple's advertising being misleading? Who's pulling the wool over whose eyes? You have apparently swilled a little too much KoolAid from Big Red.
I guess you'd rather complain about the source and then ignore the fact that I linked directly to the AT&T coverage maps on the AT&T website.
I double checked and it appears Safari kicks them back to the default map but they work in Firefox.
It says you are from the midwest so here it is for the midwest.
http://www.wireless.att.com/coverage...38871875&sci=3
Dark blue is 3G. Light blue is 2G. Lots of light blue.
If that doesn't work then:
lat=40.022953125
lon=-91.638871875
I own an iPhone 3GS and used to live in an area with excellent AT&T coverage. Whenever I travelled, though, my signal was crappy at best. I never had this problem with Verizon, ever.
I made a decision then to jump ship to Verizon should the iPhone become available with them and not be horribly locked down with Verizon crapware.
As it turns out, I moved to an area with zero AT&T service and had to switch to Verizon, but instead of getting a Droid phone, I got a crappy txting phone to bide my time until the iPhone comes out for Verizon. Even if I have to pay the full price for the handset, I will be among those getting a Verizon iPhone, whenever it comes out.
No kidding, a 1,000 people? What a joke, a 'sample' is being generous.
This all about pushing the poll to your agenda
my feel for the rumors is the CDMA iPhone is for china
and t-mobile gets the first non AT&T iPhone
look at all the work apple does w tmobile parent
remember those ads by VZ putting ip4 down
and SJ just forgives
apple can make money from tmobile which has an incentiveto grow
VZ is probably getting a sweet heart deal from google
why feed the beast
What I quoted was not out of context. [?]
It turns out John Gruber of Daring Fireball stated the same thing I do, but more succinctly. Perhaps his comment on the issue will convince you that the "critical juncture" is important for growth, not simply to grow marketshare at all costs.
The key bit: ?At the critical juncture [?], when they should have gone for market share, they went for profits.? I think this encapsulates Jobs?s philosophy since taking over Apple in 1997. Take the high end of the market first, establish a brand and presence, then steadily start to expand.
It turns out John Gruber of Daring Fireball stated the same thing I do, but more succinctly. Perhaps his comment on the issue will convince you that the "critical juncture" is important for growth, not simply to grow marketshare at all costs.
I agree with you on this. It is not just about growing market share at all costs. But that is a component of growth. The other important component is profits. In your original post you seemed to only concentrate on profits. But profits is not enough - it takes both to truly grow, as Jobs outlined in the original quote. As I said before, the best example of a company taking both market share and profits is Apple with the iPod. Their make a healthy amount of money but have lower margins than they do on the iPhone to protect their 70%+ market share.
I think where we are really disagreeing is when that "critical juncture" is. With the original quote, Jobs said it was the late 80s for computers. Remember that was before Windows 3.1 and well before Windows 95. You think we are arriving at this tipping point or critical juncture now. I think it was passed a year ago - before the threat of Android truly materialized last fall with the original Droid.
Read this: http://www.msnbc.msn.com/id/3704453/
Here's the most important part:
"While a poll of 100 people will be more accurate than a poll of 10, studies have shown that accuracy begins to improve less at about 500 people and increases only a minor amount beyond 1,000 people."
That's how polling is done. So when the article says that a significant number of people will jump ship from AT&T for Verizon and Android may be hurt, they're using actual scientifically proven data collection techniques.
Acting like their numbers are off when they're actually following a proven method makes you look bad, not them.
Or so polling marketing goes...
Pollsters however do know that by publisizing the results of a poll, they can jedi mind-trick the weaker minded into taking a result for granted. Who commissioned the poll? Typically polls are commissioned for a certain result... which is the 'real' correct proven method regarding polls. It's not like this company is conducting a poll for a fun way to waste their time and money. Welcome to the real world. Get a clipboard, go out and ask 1000 people in front of a Best Buy if they would wait to upgrade to a Microsoft iPhone, and I'll bet you $100 that it swings up to 60%. Then conduct the same poll about Verizon, but include the normal iPhone price, and i'll bet you another $100 that it swings down to 10%.
All this says is that 333 people somewhere want a iPhone on Verizon... meaningless because they obviously don't want an iPhone enough to pay for one now, hence they are outside the relevant customer pool and their 'opinion' is worth exactly how much money they are currently spending on it. Verizon customers pre-sort themselves into a lower priced segment of the mobile phone biz, they care more about low price than high performance, and that's typically a market Apple doesn't chase.
Sorry to torpedo the polling love-fest, but you guys really need to stop spending your saturday afternoons defending known marketing tricks as gospel. Sheesh.
I agree with you on this. It is not just about growing market share at all costs. But that is a component of growth. The other important component is profits.
My implication was that you can?t sustain increased profits without growth. That doesn?t have to be marketshare growth as the market could get defined or change the way ?marketshare game? as we saw with the emergence of Netbooks hurting Apple?s marketshare despite record YoY growth in unit sales and overall profit.
In other words, growing your market accessibility once you reached a saturation point. If you are outgrowing the market as a whole your marketshare will also grow, but this is a secondary metric and last on the list of viable measurements for a successful company. It?s a component for comparing your growth to the entire market, not your growth YoY or your profits YoY.
BTW, when I mention profit, I?m not talking about profit per unit. That WILL almost certainly drop as you expand with lower cost products. I?m referring to profits as a whole for the entire quarter. What Apple did wrong was to focus on profits per unit, not on profits per quarter. If more profits means expanding with a cheaper model or another model then you do it. I think we can agree on that.
What I quoted was not out of context. You made the analogy that smart phones and computers are similar in that Apple doesn't need to have the largest market share to get what is most important - profits. Steve's quote shows that he thinks Apple made significant mistakes in the late 80s. His plan was not to have Apple be the most profitable PC maker but with only 5% of the market. He has shown what his goals are with the iPod. To take the premium market first and then at the "critical juncture" go for market share. Apple doesn't just want profits and they don't just want market share - they want both.
Apple did make significant mistakes in the 80's. Steve was not saying that Apple needed to have a dominant market share. As Apple currently does not have a dominant computer market share, but they are the most profitable computer company on the planet.
The MP3 market is totally different from PC or mobile phones. Apple came upon a lucrative opportunity and took advantage. Soon there won't even be much of an MP3 market.
I don't think making a "cheap phone" is what Jobs was talking about. Remember, your original reply regarding market share was about Android taking the crown from the iPhone. The reason that has happened isn't that Android phones are significantly cheaper. The Droid X and Droid 2 are both $200 on contract, same as the iPhone. And the "BOGO" offers that are always mentioned here are over, and have been over for a few months.
The Droid x nor Droid 2 are not selling in the same volume as the iPhone. Not everyone is buying an expensive Droid phone, there are really cheap Droid phones available that people are buying.
I agree the magical answer isn't just market share - it is both profits and market share. But Google has taken away the luxury Apple had to move slowly. Whether they stole Apple's inventions or not - and I think they did - as we learned in the 80s and 90s, being right and first doesn't always matter. It is well past time for Apple to release a CDMA phone to counter Google and address more than 1/3 of the US market.
Seeing that Apple is selling the Macintosh under the same business model as it always has. Seeing as the Macintosh is selling well and highly profitable for Apple, what lesson exactly did we learn from the 80's and 90's that you are point to?
My implication was that you can?t sustain increased profits without growth. That doesn?t have to be marketshare growth as the market could get defined or change the way ?marketshare game? as we saw with the emergence of Netbooks hurting Apple?s marketshare despite record YoY growth in unit sales and overall profit.
Do you think the smartphone market has been redefined, like it was for PCs with netbooks? I don't. Even if you can get an old Android phone with 1.6 on it for "free," you still have to pay the data plan every month. I think consumers are smart enough to recognize the true cost of these phones and can tell that a $99 iPhone with an $80 service plan is not really different from a "free" Android phone with an $80 service plan.
In other words, growing your market accessibility once you reached a saturation point. If you are outgrowing the market as a whole your marketshare will also grow, but this is a secondary metric and last on the list of viable measurements for a successful company. It?s a component for comparing your growth to the entire market, not your growth YoY or your profits YoY.
BTW, when I mention profit, I?m not talking about profit per unit. That WILL almost certainly drop as you expand with lower cost products. I?m referring to profits as a whole for the entire quarter. What Apple did wrong was to focus on profits per unit, not on profits per quarter. If more profits means expanding with a cheaper model or another model then you do it. I think we can agree on that.
Pretty much agree with everything here. Customers willing to switch carriers to AT&T to get the iPhone appears saturated. The great majority of upgraders from what I've seen already own an iPhone.
The only thing I would add is that Apple is not selling the iPhone in a vacuum. Competitors,notably Android and even WM7, have to be factored in to Apple's decision making. Comparing Apple's market share to these competitors is valid and I don't think it is secondary. Every Incredible and Droid X that HTC and Motorola sell is a lost iPhone sale, which translates into lost profits and lost market share. Apple needs to do what it can to stop this hemorrhage to Android. Apple appears to recognize this. Without Android I don't think a CDMA iPhone would be in the cards.
I think consumers are smart enough to recognize the true cost of these phones and can tell that a $99 iPhone with an $80 service plan is not really different from a "free" Android phone with an $80 service plan.
Yes psychologically for a consumer "free" is very different from a $99 dollars.
Customers willing to switch carriers to AT&T to get the iPhone appears saturated. The great majority of upgraders from what I've seen already own an iPhone.
Seeing as AT&T keeps activating more iPhone's every quarter. You really want to make the argument that most of those iPhone's are from current iPhone users? Do you have any sales data to support that argument?
The only thing I would add is that Apple is not selling the iPhone in a vacuum. Competitors,notably Android and even WM7, have to be factored in to Apple's decision making. Comparing Apple's market share to these competitors is valid and I don't think it is secondary. Every Incredible and Droid X that HTC and Motorola sell is a lost iPhone sale, which translates into lost profits and lost market share. Apple needs to do what it can to stop this hemorrhage to Android. Apple appears to recognize this. Without Android I don't think a CDMA iPhone would be in the cards.
I don't think you really understand how business works. What you've said above is not at all in alignment with reality or any way resembles what companies do to be successful.
I was an iPhone 3G user until I moved to an area that ATT doesn't serve well. Now I have a Droid on Verizon and I will drop it the second an iPhone is available on Verizon (or T-Mobile for that matter, whoever gets it first).
Why?
.
Apple did make significant mistakes in the 80's. Steve was not saying that Apple needed to have a dominant market share. As Apple currently does not have a dominant computer market share, but they are the most profitable computer company on the planet.
The MP3 market is totally different from PC or mobile phones. Apple came upon a lucrative opportunity and took advantage. Soon there won't even be much of an MP3 market.
I see you've ignored what I've already posted on this, so I'll say it again. It is not clear that Apple is the most profitable computer company on the planet. They are more profitable than Dell and HP, but they are nowhere near Microsoft. Factor in MS's profits on Dell or HP computers and you get a very different story.
Seeing that Apple is selling the Macintosh under the same business model as it always has. Seeing as the Macintosh is selling well and highly profitable for Apple, what lesson exactly did we learn from the 80's and 90's that you are point to?
If you think Jobs and the Macintosh team were busing their asses working 20 hour days in 1983 for 5% of the global computer market you're dreaming. I'll leave you to figure out the "lesson" from Steve's quote, because obviously he thinks Apple fucked up in the 80s. If you can't apply that to other situations, that's your problem.