Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.
Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.
There came a point where cellphones got so powerful they were basically little computers, so it should have been predictable that the computer companies would try to take over at that point.
And companies like LG and Samsung at least should have seen it coming, since they make the components, and could see their power increasing exponentially. It is the job of the top brass to notice such trends, not the fellow in the cubicle, so it's right that the CEO take responsibility.
I get that the iPad is the pinnacle device and there is no iPad 2 specs in which to compare, but internally these companies don?t seem to be trying to get in front of Apple? and that makes a sad panda.
I'm sure this kind of stuff happens all the time in many countries, but not in such a brazen overt manner that the Korean conglomerates built themselves over the past 4 decades or so.
.....
I believe Apple is working feverishly in China to develop alternate sources and it’s also why Apple’s been acquiring chip design companies and may very well be looking into their own manufacturing. Samsung and LG are aware of this too. They need to fill the chip and display factories with orders for their own phones and tablets before Apple (along with Dell, HP and other PC makers that they'll also be competing against) pulls out completely by going to alternate sources. That may take years, but they both know that it’s inevitable and they’re all racing against time right now. Does Apple pull out first when Samsung/LG still need Apple’s orders or do they win the race and lock out Apple when Apple still needs the components?
Yes, Apple's board had some balls to let SJ go off on what at the time must have been a massive tangent . Apple to enter the portable music business, who would have thunk? Sony ruled that and everyone knew that back then.
Perhaps as he was on his second coming he got some slack LOL.
Probably. The computers weren't selling for shit at that point, and he proposed that they transition the company away from computers and towards Consumer Electronics.
Apple plays hardball but that's the nature of this ruthless cutthroat tech industry: it's kill or be killed and Apple's got some mighty competition out there.
Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.
Apple did not "gut the entire cellular phone industry". They are not even one of the top five companies.
Nokia is doing no worse than the two darlings of the Android world.
(I tried digging up the LG numbers, but it's hard to tell the exact profit for their mobile phone division. I expect the number was negative though.)
I was basing my assessment on QtQ and YoY net profit trends, not what they are at right now. For example, in the last three quarters Moto was down $291M, then up $26M, then up $162M, whilst Nokia appears to be plunging farther and farther down.
It?s like running a foot race where you turn around in a cul-de-sac. The runners may be at the same point along along a line but if they are headed in different directions the meaning of their same relative placement along that line means two very different things. This example isn?t perfect as Moto, HTC, Nokia and even Apple can do a 180 turn or stop dead at any time.
Apple did not "gut the entire cellular phone industry". They are not even one of the top five companies.
Calm down.
True, if we're only talking about number of units sold. Apple is not even close to being in the top 5. But if we look at the EBIT (earnings before interest and taxes) of the major phone vendors, Apple has indeed come out of nowhere in '07 to take over. Here's a look at the profits of the major phone companies since '07:
Here's a pie chart breakdown of the profits share:
If we're just talking profits, I'd say that qualifies for "gutting" the entire cellular phone industry. The CEO's of the largest and the third largest phone suppliers being replaced in a matter of weeks means how big the stakes are.
The dilemma facing the likes of Samsung and LG as well as all the other current Android phone makers is the coming wave (more like a tsunami) of super cheap Android phones from a virtual army of Chinese phone companies. I mean, the market (especially in Asia and China in particular) is going to get flooded with these generic commodity Android phones. How does Samsung and LG differentiate their phones from these super cheap Chinese phones that will steadily move upstream? The Chinese consumer electronics companies will use the same strategy and tactics that Samsung and LG used against the likes of Sony, Panasonic, Toshiba, Sharp, etc.
Samsung has to keep moving further upstream and their only chance of maintaining relevance is developing their own OS platform. It's exactly the same reason HP acquired Palm. The only way to differentiate will be vertical integration and offering the entire ecosystem from top to bottom - yes, exactly the business model that Apple has. It has to be about the software platform, the integration, the services, security, the apps, the content, etc. This will be the "mind and soul" of the product. The hardware is "flesh and blood" but without the mind and soul, it's just a piece of plastic and metal.
It's funny how the competition and industry pundits and analysts denigrate Apple for its closed and tightly controlled "walled garden" platform, but that's what everyone would really like to offer if they could. Obviously, the two companies that have the resources to at least give this a try are Samsung and HP. Both are humungous (soon well over $120 billion in annual revenues) and offer a lot of other products that can fit in the ecosystem they design from top to bottom. In the future, these two behemoths will be Apple's biggest competitors in the converging tech and consumer electronics industry - Samsung more on the consumer side and HP in the tech/IT side.
Samsung has stated on their latest annual report of where they intend to be in 2020. Samsung's goal is to reach $400 billion in revenues and become one of the top 5 most admired companies and global brands by that time. The stated goal is nothing less than to become the most dominant tech and consumer electronics company in the world. But, of course, they have one major obstacle standing in their way: Apple. The other obstacles like HP, LG, Sony, Panasonic, Nokia, and Toshiba won't be easy either but none are quite as formidable as Apple. Why? Because Apple owns their own platform and ecosystem. That's the crown jewel that Samsung and HP would love to own as well but it only seems like a pipe dream right now.
As China and India continue to grow and mature, we'll see a mind-boggling flood of cheap devices and services based on the so-called "open" platforms like Android. Even Samsung will have to retreat to the top of the hills to avoid the drowning. There is no way Samsung can fight off this onslaught from China and India. Samsung will have to innovate, add value, offer outstanding customer service, differentiate, and do all these other things that Apple is known for. In essence, they have to become like Apple. But that's the problem. Apple already exists. Samsung has no choice but to take Apple head-on and beat Apple at its own game. They have to define what "Samsung" means in the same way people have a very good idea of what Apple means.
I look at Apple's so-called "walled garden" and closed ecosystem like a planned gated community. It's clean, neat, organized, safe, convenient and is easy to get around in. It may not have everything of downtown city, but at least we are sheltered from the chaos, fragmentation, traffic, crowdedness, confusion, crime, disease, etc. What the Android and Windows crowd doesn't get is that there's a significant chunk of the population that are willing to pay more for that more "exclusive" and closed ecosystem user experience as long as Apple provides everything they need.
The only question is how big can this gated community get? Is it 10%, 20% or even more? What's for certain is that Apple still has long, long ways to go to just get to 10%. And, of course, it will be the top tier of the market. I can easily envision Apple eventually becoming its own ISP and wireless carrier as well as manufacturing virtually all of its goods abroad and perhaps even here in the US. There's that old saying: "If you want to do it right, you've got to do it yourself!"
Comments
Damn.
These hardware execs are dropping like flies.
Makes you wonder why they got into the job in the first place
Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.
There came a point where cellphones got so powerful they were basically little computers, so it should have been predictable that the computer companies would try to take over at that point.
And companies like LG and Samsung at least should have seen it coming, since they make the components, and could see their power increasing exponentially. It is the job of the top brass to notice such trends, not the fellow in the cubicle, so it's right that the CEO take responsibility.
I get that the iPad is the pinnacle device and there is no iPad 2 specs in which to compare, but internally these companies don?t seem to be trying to get in front of Apple? and that makes a sad panda.
I'm sure this kind of stuff happens all the time in many countries, but not in such a brazen overt manner that the Korean conglomerates built themselves over the past 4 decades or so.
.....
I believe Apple is working feverishly in China to develop alternate sources and it’s also why Apple’s been acquiring chip design companies and may very well be looking into their own manufacturing. Samsung and LG are aware of this too. They need to fill the chip and display factories with orders for their own phones and tablets before Apple (along with Dell, HP and other PC makers that they'll also be competing against) pulls out completely by going to alternate sources. That may take years, but they both know that it’s inevitable and they’re all racing against time right now. Does Apple pull out first when Samsung/LG still need Apple’s orders or do they win the race and lock out Apple when Apple still needs the components?
Thanks for your insights, Alex. Much appreciated!
Damn.
These hardware execs are dropping like flies.
Makes you wonder why they got into the job in the first place
Well, we know what flies are attracted to...
Yes, Apple's board had some balls to let SJ go off on what at the time must have been a massive tangent . Apple to enter the portable music business, who would have thunk? Sony ruled that and everyone knew that back then.
Perhaps as he was on his second coming he got some slack LOL.
Probably. The computers weren't selling for shit at that point, and he proposed that they transition the company away from computers and towards Consumer Electronics.
It makes perfect sense.
Apple plays hardball but that's the nature of this ruthless cutthroat tech industry: it's kill or be killed and Apple's got some mighty competition out there.
But Apple has no competition!
Who could have predicted years ago when the iPhone was introduced that Apple would single-handedly gut the entire cellular phone industry? Incredible what has happened and what continues to happen on a daily basis.
Apple did not "gut the entire cellular phone industry". They are not even one of the top five companies.
Calm down.
Damn.
These hardware execs are dropping like flies.
The reason is simple: software.
I hope LG, Nokia and others can figure out how to be successful in this market. Motorola and HTC seem to have figured it out so I’m hopeful.
Profit for Q2 2010:
Motorola: $162 million
HTC: $268 million
Nokia: $385 million
Nokia is doing no worse than the two darlings of the Android world.
(I tried digging up the LG numbers, but it's hard to tell the exact profit for their mobile phone division. I expect the number was negative though.)
Profit for Q2 2010:
Motorola: $162 million
HTC: $268 million
Nokia: $385 million
Nokia is doing no worse than the two darlings of the Android world.
(I tried digging up the LG numbers, but it's hard to tell the exact profit for their mobile phone division. I expect the number was negative though.)
I was basing my assessment on QtQ and YoY net profit trends, not what they are at right now. For example, in the last three quarters Moto was down $291M, then up $26M, then up $162M, whilst Nokia appears to be plunging farther and farther down.
It?s like running a foot race where you turn around in a cul-de-sac. The runners may be at the same point along along a line but if they are headed in different directions the meaning of their same relative placement along that line means two very different things. This example isn?t perfect as Moto, HTC, Nokia and even Apple can do a 180 turn or stop dead at any time.
Apple did not "gut the entire cellular phone industry". They are not even one of the top five companies.
Calm down.
True, if we're only talking about number of units sold. Apple is not even close to being in the top 5. But if we look at the EBIT (earnings before interest and taxes) of the major phone vendors, Apple has indeed come out of nowhere in '07 to take over. Here's a look at the profits of the major phone companies since '07:
Here's a pie chart breakdown of the profits share:
If we're just talking profits, I'd say that qualifies for "gutting" the entire cellular phone industry. The CEO's of the largest and the third largest phone suppliers being replaced in a matter of weeks means how big the stakes are.
Samsung has to keep moving further upstream and their only chance of maintaining relevance is developing their own OS platform. It's exactly the same reason HP acquired Palm. The only way to differentiate will be vertical integration and offering the entire ecosystem from top to bottom - yes, exactly the business model that Apple has. It has to be about the software platform, the integration, the services, security, the apps, the content, etc. This will be the "mind and soul" of the product. The hardware is "flesh and blood" but without the mind and soul, it's just a piece of plastic and metal.
It's funny how the competition and industry pundits and analysts denigrate Apple for its closed and tightly controlled "walled garden" platform, but that's what everyone would really like to offer if they could. Obviously, the two companies that have the resources to at least give this a try are Samsung and HP. Both are humungous (soon well over $120 billion in annual revenues) and offer a lot of other products that can fit in the ecosystem they design from top to bottom. In the future, these two behemoths will be Apple's biggest competitors in the converging tech and consumer electronics industry - Samsung more on the consumer side and HP in the tech/IT side.
Samsung has stated on their latest annual report of where they intend to be in 2020. Samsung's goal is to reach $400 billion in revenues and become one of the top 5 most admired companies and global brands by that time. The stated goal is nothing less than to become the most dominant tech and consumer electronics company in the world. But, of course, they have one major obstacle standing in their way: Apple. The other obstacles like HP, LG, Sony, Panasonic, Nokia, and Toshiba won't be easy either but none are quite as formidable as Apple. Why? Because Apple owns their own platform and ecosystem. That's the crown jewel that Samsung and HP would love to own as well but it only seems like a pipe dream right now.
As China and India continue to grow and mature, we'll see a mind-boggling flood of cheap devices and services based on the so-called "open" platforms like Android. Even Samsung will have to retreat to the top of the hills to avoid the drowning. There is no way Samsung can fight off this onslaught from China and India. Samsung will have to innovate, add value, offer outstanding customer service, differentiate, and do all these other things that Apple is known for. In essence, they have to become like Apple. But that's the problem. Apple already exists. Samsung has no choice but to take Apple head-on and beat Apple at its own game. They have to define what "Samsung" means in the same way people have a very good idea of what Apple means.
I look at Apple's so-called "walled garden" and closed ecosystem like a planned gated community. It's clean, neat, organized, safe, convenient and is easy to get around in. It may not have everything of downtown city, but at least we are sheltered from the chaos, fragmentation, traffic, crowdedness, confusion, crime, disease, etc.
The only question is how big can this gated community get? Is it 10%, 20% or even more? What's for certain is that Apple still has long, long ways to go to just get to 10%. And, of course, it will be the top tier of the market. I can easily envision Apple eventually becoming its own ISP and wireless carrier as well as manufacturing virtually all of its goods abroad and perhaps even here in the US. There's that old saying: "If you want to do it right, you've got to do it yourself!"