Dell's iPhone Killer rejected by carriers as too dull

Posted:
in iPhone edited January 2014
After signaling its intent to follow Apple's wildly successful iPhone into the smartphone business, Dell's first attempts to produce a phone have been rejected by the carriers for being too dull and lacking enough differentiation to stand out in a competitive environment, according to a report.



A research note published today by Kaufman Bros. analyst Shaw Wu said that Dell's new prototypes, capable of running both Windows Mobile or Google's Android, simply didn't interest the carriers.



Mobile service providers either want basic phones they can sell for free (as the majority of LG units do) or headline grabbing models that can stand out and hopefully pull new subscribers from rivals, such as AT&T's iPhone 3G, Verizon Wireless' BlackBerry Storm, T-Mobile's Android G1, or Sprint's hopeful Palm Pre.



"From our conversation with supply chain and industry sources," Wu wrote, "it appears that it ultimately came down to lack of carrier interest and small subsidies, making it difficult for Dell to make a profit. In our view, the last thing Dell needs is to enter another money losing business as it seeks to preserve its operating margins of 5%-6%.? Wu noted that those figures compares with HP's 11% margins and Apple and IBM at 15%.



Wu said Dell is ?going back to the drawing board in designing a cell phone with more differentiation,? that could ?likely involve vertical integration of some sort including software and/or services.?



"PC guys are not going to just figure this out"



Dell's failure to successfully step from the commodity PC business into the mobile handset market should come as no surprise, as smartphones requires expertise in software platform development, consumer design savvy, and portable device engineering, all things Dell has never demonstrated any proficiency in.



That calls to mind the quote from Palm CEO Ed Colligan, who said ?PC guys are not going to just figure this out. They?re not going to just walk in." He was specifically referring to Apple, which did "just walk in" with the iPhone launch, but carried with it a half decade of experience with the iPod and decades of experience in maintaining successful software platforms building highly customized hardware.



Some pundits have speculated that Dell may need to buy its way into smartphones, citing Palm as a target. Palm is struggling to release its new webOS and the Palm Pre as the first phone to use it. As sales of its aging Treo line collapse, Palm has been kept afloat only by millions of new venture capital injected by Elevation Partners. Were Dell to buy Palm and inherit the webOS, it would come at the expense of Windows Mobile and Android, both of which are trying to line up new licensees.



Smartphone shakeout



Microsoft is being hit particularly hard, with two of its top names from last year (Samsung and Sony Ericsson) abandoning Windows Mobile for the Symbian OS in their new flagship phones demonstrated at this year's Mobile World Congress, leaving Microsoft's main licensees LG (which also has plans to sell Android phones) and HTC (which makes 80% of the phones that use Microsoft's mobile OS, but is similarly planning Android phones and is apparently losing its business of building phones for Palm).



The smartphone market's ability to resist collapse during difficult economic times, paired with the shrinking global market for PCs, has already sent other PC makers scrambling to enter the phone business, including Acer, Asustek and Lenovo. However, the tough competition for attention in a complex market that requires building relationships with the carriers who control the retail sale of phones through service plan subsidies is not going to allow PC makers to "just walk in," as Colligan stated.



Long time phone makers Motorola and Sony Ericsson are in big trouble, with little to excite new buyers and mounting pressure to catch up with Apple's App Store, its vertical MobileMe cloud sync offerings, and its sophisticated software development tools. Even market leading Nokia is having trouble announcing plans to maintain the pace of Apple in the areas of software updates; API and development tools; and music, video, and mobile software and gaming offerings.
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Comments

  • Reply 1 of 50
    quadra 610quadra 610 Posts: 6,756member
    No surprise.



    Dell is just another generic junk-box maker. So what else is new.
  • Reply 2 of 50
    e1618978e1618978 Posts: 6,075member
    They should give up, or buy palm.
  • Reply 3 of 50
    roos24roos24 Posts: 170member
    My short observation is that Apple's timing, whether smart or lucky, could not have been better.



    Jan
  • Reply 4 of 50
    melgrossmelgross Posts: 33,334member
    It's going to be difficult to catch up.



    The only thing that a Dell has going for it is the fact that it doesn't have to come up with its own OS and SDK. The problem for it is that none of those OS's and SDK's are equal the the iPhone OS and SDK.



    Android has promise, but it's still pretty rough, and the SDK is even rougher. There's nothing else out there that competes on the OS level at all right now.



    Win Mobile 6.5 is no improvement over 6.0, other than it can look somewhat like the iPhone GUI. Ver. 7, unless MS is scrambling to re-write it, is not supposed to be too much of an improvement over that.



    Symbian is old, and has been driven about as far as it can be without a major overhaul, that might obsolete whatever programs are out there.



    The Palm Pre's OS only allows HTML 5 and Java applets similar to Apple's widgets for the Dashboard. No SDK at all, of course. And so far at least, no chance of writing apps using any of the Pre's APIs. Not so hot, as people will find out once it's released.



    So where will Dell and other PC makers go to?



    Apple is in a market all by itself right now. Some of the biggest news is the new control functionality offered by BT, WiFi, and far more importantly, the Apple Dock connector.



    This has been overlooked to a great extent by the press and others, but is likely the most significant new feature of the platform.



    There is no way that Dell, or any other manufacturer at this time, or in the near future at least, can duplicate the importance of that.
  • Reply 5 of 50
    tofinotofino Posts: 697member
    I love that quote almost as much as the one where balmer poo-pooh's the iphone...
  • Reply 6 of 50
    gqbgqb Posts: 1,934member
    Quote:
    Originally Posted by Roos24 View Post


    My short observation is that Apple's timing, whether smart or lucky, could not have been better.



    Jan



    True to some extent, but Apple made its own timing. Without the disruption of the iPhone, do you think you'd be seeing the droves of (junk) black glass-faced 'touch' copycat phones? We'd still be punching chicklets and trying to get java craplets to work.
  • Reply 7 of 50
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by melgross View Post


    It's going to be difficult to catch up.



    The only thing that a Dell has going for it is the fact that it doesn't have to come up with its own OS and SDK. The problem for it is that none of those OS's and SDK's are equal the the iPhone OS and SDK.



    I knew they would do something like this but I don't see the point. Except for the capacitance touchscreen the iPhone HW is pretty standard in it's capabilities. It's the SW that is making it work. I guess with the smartphone market growing so fast that even a very small partition of the market could be a financial gain for Dell.



    Quote:

    The Palm Pre's OS only allows HTML 5 and Java applets similar to Apple's widgets for the Dashboard. No SDK at all, of course. And so far at least, no chance of writing apps using any of the Pre's APIs. Not so hot, as people will find out once it's released.



    I wonder if you can really call it a background app if you just have WebKit running different webpages locally. I would think that Apple will also use HTML5's local storage on the iPhone. Can we expect them to make WebKit run in the background for Palm Pre-like background apps (as well as the notification service for real apps)?
  • Reply 8 of 50
    Quote:
    Originally Posted by melgross View Post


    It's going to be difficult to catch up.



    Apple is in a market all by itself right now. Some of the biggest news is the new control functionality offered by BT, WiFi, and far more importantly, the Apple Dock connector.



    This has been overlooked to a great extent by the press and others, but is likely the most significant new feature of the platform.



    There is no way that Dell, or any other manufacturer at this time, or in the near future at least, can duplicate the importance of that.



    I agree completely. Apple's SDK is by far the best in the mobil phone market. The addition of the Apple Dock Connector is HUGE! People will now be able to hook their iPhones up to printers and h many other different types of devices. All other phones barley have the ability to communicate with other devices, let alone the means for software developers harness that ability
  • Reply 9 of 50
    Quote:
    Originally Posted by solipsism View Post


    I knew they would do something like this but I don't see the point. Except for the capacitance touchscreen the iPhone HW is pretty standard in it's capabilities. It's the SW that is making it work.



    Also, Apple knows how to put all of the hardware into a small beautiful package. Dell is no good at conserving the space insider their products, and most of their devices look...blah
  • Reply 10 of 50
    melgrossmelgross Posts: 33,334member
    Quote:
    Originally Posted by solipsism View Post


    I knew they would do something like this but I don't see the point. Except for the capacitance touchscreen the iPhone HW is pretty standard in it's capabilities. It's the SW that is making it work. I guess with the smartphone market growing so fast that even a very small partition of the market could be a financial gain for Dell.



    It's more than that. Apple's hardware is elegant. That's very important in a consumer product. You can't overlook that. It's not the dinky features other phones may offer that makes the hardware sophisticated and useful. We've seen many people post here about how few people use those features that appear on many other phones.



    So, it's nice that the features exist, but that doesn't make the device sophisticated, or advanced.



    Many functions of other phones that have special chips and such will be done in software on the iPhone once a sharper camera is added, as seems likely this summer.



    My other point of the post was to point out that the most important part of the hardware/software interface is that dock.



    I can see a vast number of areas in which the iP/iT will completely dominate. Where other manufacturers will simply be left in the dust.



    That alone makes a major difference. Too many writers have poor imaginations, so we don't see too much written about this yet.



    Quote:

    I wonder if you can really call it a background app if you just have WebKit running different webpages locally. I would think that Apple will also use HTML5's local storage on the iPhone. Can we expect them to make WebKit run in the background for Palm Pre-like background apps (as well as the notification service for real apps)?



    Who knows?



    It just seems to me that having HTML 5 and Java applets running in the background are just a very basic technology. There is only so much you can do with that, as it doesn't touch the OS in any way. No getting into the functionality of the OS. No API's etc. No SDK.



    No big, complex programs at any level. I'd like to see a complex, graphically intense game for the Pre like some that are already on the iP/iT.



    Will we see an SDK in the future ala Apple? Again, who knows?
  • Reply 11 of 50
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by melgross View Post


    Many functions of other phones that have special chips and such will be done in software on the iPhone once a sharper camera is added, as seems likely this summer.



    As pointed out on another thread, if a 3rd-party thinks there is a market for a really nice digital camera for the iPhone they can make one that connects to the iPhone. It would be big and ugly for to have a 1" lens with 10Mpx attached but to some this might be a good thing.



    The iPod attachments became obscene with so many pointless items. Now we'll have a real OS using that connector. I think the business sector will see a huge boost in this area, not just consumer. Those PoS devices are pretty poor devices for the price. I would think that the major companies have already seen the potential of creating a PoS CC reader and SW. Or an IR scanner or whatever. For longevity on WiFi you are fine for a day, unless the attachment needs plenty of power. If so then a built in battery pack.



    I look forward to the strange devices that will be coming.iPod dock toiletpaper holders need not apply.
  • Reply 12 of 50
    SpamSandwichSpamSandwich Posts: 33,407member
    This story is rife with grammatical errors. It should be revised or it will never be picked up by the mainstream press.
  • Reply 13 of 50
    melgrossmelgross Posts: 33,334member
    Quote:
    Originally Posted by eddiecorwin View Post


    I agree completely. Apple's SDK is by far the best in the mobil phone market. The addition of the Apple Dock Connector is HUGE! People will now be able to hook their iPhones up to printers and h many other different types of devices. All other phones barley have the ability to communicate with other devices, let alone the means for software developers harness that ability



    Printers are just the beginning!



    Let's look at the area of health. Apple showed a beginning to that the 17th with a glucose monitor.



    But it's far more than that.



    Tens of millions of people in the US go to health clubs two, three, four, or even, for some seven days a week



    Tens of millions more in Europe. Possibly a couple hundred million around the world!



    What happens there? Most people use some heavy duty industrial build machine. so what happens with them?



    You go to the machine. Cancel out the old readings. You then punch in a workout, as best as the machine will allow. You start it up and do your thing for whatever time you set, or just decide.



    You then go to the next machine, and repeat. You may do some aerobics, or other exercise, possibly running or swimming.



    After that, you take a shower, go home, and do it over a day or two later.



    Great, right? You can even put an ipod on and listen to music.



    BUT, now it can be completely different in what you get out of it.



    All machines will have an iP/iT dock. You will have a BT sensor.



    You go to a machine, press a sensor on your wrist, or chest.



    You plug the iP/iT into the dock. The machine turns on, and a program on your iP/iT comes on. It has all of your settings programmed in. You start your exercise.



    While working out, your heart rate, breathing, perspiration and other stress conditions are being monitored and input to the program. If stress levels in any area move, the machine compensates in its program of exercise speed, or level to keep pace. If any monitored area begins to move out of normal levels, the machine will know it, and a message will be on the screen, and the machine will slow down. You exercise will end on the machine when programmed levels of stress have been reached.



    You remove the device, and go to the next machine where the same thing happens.



    All the while the iP/iT will be looking at the total levels of stress as your time progresses, and will let you know if there is a problem.



    If anything is wrong, an alert will be sent to your doctors computer or iP/iT.



    The same thing is true when you run or swim.



    Getting on the scale at the beginning, end, or anywhere between would have the reading added, and the time stamped, as everything else would be.



    When you get home, you can review how you did, comparing it to all the other days from the past year, or whatever. Any anomalies can easily be seen anywhere.



    Anything special will be in the program as well such as your glucose readings if needed, or medicines, or even diet.



    You can be monitored when you sit at home, or are sleeping, if the doctors requires that from you.



    This is just, if you can believe it, the BASIS of what could be done. Far more could be added. You would never be further from care, if you need it, then a phone connection. Athletes could monitor their needs better than even at the test centers they use.



    I'm sure everyone can think of far more than this, in almost every area. I can think, offhand, of a bunch for auto trips.
  • Reply 14 of 50
    Quote:
    Originally Posted by melgross View Post


    It's going to be difficult to catch up.



    I agree that Dell would have an awful hard time considering they don't have any of the core competencies required for this market.



    Quote:
    Originally Posted by melgross View Post


    The Palm Pre's OS only allows HTML 5 and Java applets similar to Apple's widgets for the Dashboard. No SDK at all, of course. And so far at least, no chance of writing apps using any of the Pre's APIs. Not so hot, as people will find out once it's released.



    Locally hosted HTML and JavaScript apps shouldn't pose too much of a performance hit compared to native object code. Many strides have been made in scripting languages in recent years to the point that there is only a fractional speed difference in compiled code these days. I look forward to seeing what the end result looks like.



    The Pre will have an open SDK (i.e. Use any of your favorite development tools instead of being constricted to Mac only XCode). The API is implemented using a JavaScript framework called Mojo to interact with services (the phone's features).
  • Reply 15 of 50
    melgrossmelgross Posts: 33,334member
    Quote:
    Originally Posted by gwarf420 View Post


    I agree that Dell would have an awful hard time considering they don't have any of the core competencies required for this market.







    Locally hosted HTML and JavaScript apps shouldn't pose too much of a performance hit compared to native object code. Many strides have been made in scripting languages in recent years to the point that there is only a fractional speed difference in compiled code these days. I look forward to seeing what the end result looks like.



    The Pre will have an open SDK (i.e. Use any of your favorite development tools instead of being constricted to Mac only XCode). The API is implemented using a JavaScript framework called Mojo to interact with services (the phone's features).



    Mojo is by no means the same as a real SDK. It's more like what can be done with Dashboard, not much more.
  • Reply 16 of 50
    Quote:
    Originally Posted by melgross View Post


    You go to a machine, press a sensor on your wrist, or chest.



    You plug the iP/iT into the dock. The machine turns on, and a program on your iP/iT comes on. It has all of your settings programmed in. You start your exercise.



    While working out, your heart rate, breathing, perspiration and other stress conditions are being monitored and input to the program. If stress levels in any area move, the machine compensates in its program of exercise speed, or level to keep pace. If any monitored area begins to move out of normal levels, the machine will know it, and a message will be on the screen, and the machine will slow down. You exercise will end on the machine when programmed levels of stress have been reached.



    You remove the device, and go to the next machine where the same thing happens.



    All the while the iP/iT will be looking at the total levels of stress as your time progresses, and will let you know if there is a problem.



    If anything is wrong, an alert will be sent to your doctors computer or iP/iT.



    The same thing is true when you run or swim.



    Getting on the scale at the beginning, end, or anywhere between would have the reading added, and the time stamped, as everything else would be.



    When you get home, you can review how you did, comparing it to all the other days from the past year, or whatever. Any anomalies can easily be seen anywhere.



    Anything special will be in the program as well such as your glucose readings if needed, or medicines, or even diet.



    Kind of like Apple's personal fitness trainer patent(AppleInsider)?
  • Reply 17 of 50
    Dell produces something dull. Just like their stock price.



    Quote:
    Originally Posted by AppleInsider View Post


    After signaling its intent to follow Apple's wildly successful iPhone into the smartphone business, Dell's first attempts to produce a phone have been rejected by the carries for being too dull and lacking enough differentiation to stand out in a competitive environment, according to a report.



    A research note published today by Kaufman Bros. analyst Shaw Wu said that Dell's new prototypes, capable of running both Windows Mobile or Google's Android, simply didn't interest the carriers.



    Mobile service providers either want basic phones they can sell for free (as the majority of LG units do) or headline grabbing models that can stand out and hopefully pull new subscribers from rivals, such as AT&T's iPhone 3G, Verizon Wireless' BlackBerry Storm, T-Mobile's Android G1, or Sprint's hopeful Palm Pre.



    "From our conversation with supply chain and industry sources," Wu wrote, "it appears that it ultimately came down to lack of carrier interest and small subsidies, making it difficult for Dell to make a profit. In our view, the last thing Dell needs is to enter another money losing business as it seeks to preserve its operating margins of 5%-6%.? Wu noted that those figures compares with HP's 11% margins and Apple and IBM at 15%.



    Wu said Dell is ?going back to the drawing board in designing a cell phone with more differentiation,? that could ?likely involve vertical integration of some sort including software and/or services.?



    "PC guys are not going to just figure this out"



    Dell's failure to successfully step from the commodity PC business into the mobile handset market should come as no surprise, as smartphones requires expertise in software platform development, consumer design savvy, and portable device engineering, all things Dell has never demonstrated any proficiency in.



    That calls to mind the quote from Palm CEO Ed Colligan, who said ?PC guys are not going to just figure this out. They?re not going to just walk in." He was specifically referring to Apple, which did "just walk in" with the iPhone launch, but carried with it a half decade of experience with the iPod and decades of experience in maintaing successful software platforms building highly customized hardware.



    Some pundits have speculated that Dell may need to buy its way into smartphones, citing Palm as a target. Palm is struggling to release its new webOS and the Palm Pre as the first phone to use it. As sales of its aging Treo line collapse, Palm has been kept afloat only by millions of new venture capital injected by Elevation Partners. Were Dell to buy Palm and inherit the webOS, it would come at the expense of Windows Mobile and Android, both of which are trying to line up new licensees.



    Smartphone shakeout



    Microsoft is being hit particularly hard, with two of its top names from last year (Samsung and Sony Ericsson) abandoning Windows Mobile for the Symbian OS in their new flagship phones demonstrated at this year's Mobile World Congress, leaving Microsoft's main licensees LG (which also has plans to sell Android phones) and HTC (which makes 80% of the phones that use Microsoft's mobile OS, but is similarly planning Android phones and is apparently losing its business of building phones for Palm).



    The smartphone market's ability to resist collapse during difficult economic times, paired with the shrinking global market for PCs, has already sent other PC makers scrambling to enter the phone business, including Acer, Asustek and Lenovo. However, the tough competition for attention in a complex market that requires building relationships with the carriers who control the retail sale of phones through service plan subsidies is not going to allow PC makers to "just walk in," as Colligan stated.



    Long time phone makers Motorola and Sony Ericsson are in big trouble, with little to excite new buyers and mounting pressure to catch up with Apple's App Store, its vertical MobileMe cloud sync offerings, and its sophisticated software development tools. Even market leading Nokia is having trouble announcing plans to maintain the pace of Apple in the areas of software updates; API and development tools; and music, video, and mobile software and gaming offerings.



  • Reply 18 of 50
    melgrossmelgross Posts: 33,334member
    Quote:
    Originally Posted by gwarf420 View Post


    Kind of like Apple's personal fitness trainer patent(AppleInsider)?



    Yes. That's part of the idea.



    In order to bring that to fruition, the new BT, WiFi, and particularly the Dock Connector must be involved. OS 3 is finally doing that, and filling the last pieces of the puzzle in.
  • Reply 19 of 50
    nofeernofeer Posts: 2,422member
    Quote:
    Originally Posted by Roos24 View Post


    My short observation is that Apple's timing, whether smart or lucky, could not have been better.



    Jan



    enterprise had the blackberry

    THE BUZZ for smartphones from consumers and thus "in" enterprise was

    APPLE AND THE IPHONE they created the buzz, before iphone there was just free phones with limited internet that was fine for very limited view of the web,

    IPHONE and apple UI made usable smartphones THE NEW WAVE

    apple wasn't ahead of the curve they created the curve and the wave.

    but that is what innovation will do, and the also ran to the bottom of cheap PC's like dell created nothing more than commodity level pc's for me if to get a pc i'd go lenovo, or hp



    NOW FOR THE BRILLIANCE OF SJ

    mac+intel+bootcamp cool plus windows if needed as time went by those that used windows still saw it fall off faster and faster, and windowscentric wasn't needed, tech ran around the inertia of MS windows didn't really matter, and people saw MAC as a more and more viable choice



    THEN VISTA HAPPENED----failure pushed more to mac and apple, college students moved to mac and apple and now for generations they won't go back just like detroit vs japanese



    THERE IS NO REASON TO GO BACK

    apple has given people power of what the pc was to do---empower users not enslave them



    integration is apple's forte and others will drift away
  • Reply 20 of 50
    wobegonwobegon Posts: 764member
    Quote:
    Originally Posted by AppleInsider View Post


    Mobile service providers either want basic phones they can sell for free (as the majority of LG units do) or headline grabbing models that can stand out and hopefully pull new subscribers from rivals, such as AT&T's iPhone 3G, Verizon Wireless' BlackBerry Storm, T-Mobile's Android G1, or Sprint's hopeful Palm Pre.



    Wow. Anyone else see what I'm seeing?



    The four major US mobile carriers are now rallying behind four very different smartphones, but with one glaring constant: none are running Windows Mobile. It's not necessarily a big surprise, but seriously, whenever WM 6.5 or WM 7 phones make it to market, who will care with alternatives like these?
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