Piper says G1 to have 'little or no impact' on iPhone
While both Apple and Google appear to be emerging as pioneers in the mobile computing space, the iPhone sports a year-long head start over the Android-based G1 handset introduced Tuesday, and is unlikely to see any lost sales as a result, says investment bank Piper Jaffray.
"To use a baseball analogy, when Apple comes out with a product, they try to hit homeruns, but Google's Android strategy is swinging for base hits," analyst Gene Munster wrote in a reactionary research note. "Today's announcement in itself does not change anything, however, if over the next 2 years Google has many similar small announcements, it will become a greater threat to the iPhone."
One feature that may help differentiate the new G1 handset from the iPhone out of the gates is its physical QWERTY keyboard, according to the analyst. He noted that iPhone adoption has been "slightly hampered" by the reluctance of some consumers to adapt to a touchscreen keyboard.
Another key element that may work to Google's favor exists in its 'open' approach to the Android operating system, which which means developers can modify the
operating system and develop third-party applications on the platform for free. The open nature of the software also means that Android can be quickly modified to run on many devices from the broad majority of mobile carriers.
In contrast, Apple has chosen a closed iPhone platform where developers cannot modify or enhance the operating system, and third-party developers must pay a nominal fee to belong to a developer group and submit applications to Apple for approval on the App Store. The iPhone OS will also only run on Apple-branded devices.
"This differentiation will allow for Google to expand Android widely and quickly, but Apple can control the quality more effectively," Munster said. "In the end, wide availability and high quality are both critical. Apple has improved international availability of the iPhone dramatically over the last several months, and the quality of the hardware and the software are high."
Both the iPhone and G1 feature desktop class web browsers built around Apple's WebKit framework, making them the first two mobile handsets that offer a 'useful' mobile browsing experience, in the analyst's view. He also noted that both devices offer a mobile marketplace for music and media -- the iPhone features the iTunes Wi-Fi Store, while the G1 has direct access to the Amazon MP3 store.
The key differences are that the Amazon store offers 100 percent unprotected DRM-free tracks, whereas the iTunes store only offers unprotected tracks from one of the major record labels, EMI. There's still a catch, however, in that iPhone users can easily plug a pair of headphones into there handset to listen to purchased music, whereas G1 users will be unable to do the same without a USB adapter, given the HTC-developed handset lacks a traditional headphone jack.
Yet another difference between the iPhone and G1 is their target audience. T-Mobile and Google said earlier in the day that the G1 is geared primarily towards consumers and families. Apple on the other hand has made strides in recent months to push iPhone adoption in the Enterprise. Most notably is the iPhone's new support of Microsoft Exchange -- a technology unsupported on the G1.
Overall, Munster recommended that investors buy shares of Apple as a play in the growing mobile space.
"While the G1 is a legitimate competitor with the iPhone, we believe it will have little or no impact on near-term iPhone sales," he said.
"To use a baseball analogy, when Apple comes out with a product, they try to hit homeruns, but Google's Android strategy is swinging for base hits," analyst Gene Munster wrote in a reactionary research note. "Today's announcement in itself does not change anything, however, if over the next 2 years Google has many similar small announcements, it will become a greater threat to the iPhone."
One feature that may help differentiate the new G1 handset from the iPhone out of the gates is its physical QWERTY keyboard, according to the analyst. He noted that iPhone adoption has been "slightly hampered" by the reluctance of some consumers to adapt to a touchscreen keyboard.
Another key element that may work to Google's favor exists in its 'open' approach to the Android operating system, which which means developers can modify the
operating system and develop third-party applications on the platform for free. The open nature of the software also means that Android can be quickly modified to run on many devices from the broad majority of mobile carriers.
In contrast, Apple has chosen a closed iPhone platform where developers cannot modify or enhance the operating system, and third-party developers must pay a nominal fee to belong to a developer group and submit applications to Apple for approval on the App Store. The iPhone OS will also only run on Apple-branded devices.
"This differentiation will allow for Google to expand Android widely and quickly, but Apple can control the quality more effectively," Munster said. "In the end, wide availability and high quality are both critical. Apple has improved international availability of the iPhone dramatically over the last several months, and the quality of the hardware and the software are high."
Both the iPhone and G1 feature desktop class web browsers built around Apple's WebKit framework, making them the first two mobile handsets that offer a 'useful' mobile browsing experience, in the analyst's view. He also noted that both devices offer a mobile marketplace for music and media -- the iPhone features the iTunes Wi-Fi Store, while the G1 has direct access to the Amazon MP3 store.
The key differences are that the Amazon store offers 100 percent unprotected DRM-free tracks, whereas the iTunes store only offers unprotected tracks from one of the major record labels, EMI. There's still a catch, however, in that iPhone users can easily plug a pair of headphones into there handset to listen to purchased music, whereas G1 users will be unable to do the same without a USB adapter, given the HTC-developed handset lacks a traditional headphone jack.
Yet another difference between the iPhone and G1 is their target audience. T-Mobile and Google said earlier in the day that the G1 is geared primarily towards consumers and families. Apple on the other hand has made strides in recent months to push iPhone adoption in the Enterprise. Most notably is the iPhone's new support of Microsoft Exchange -- a technology unsupported on the G1.
Overall, Munster recommended that investors buy shares of Apple as a play in the growing mobile space.
"While the G1 is a legitimate competitor with the iPhone, we believe it will have little or no impact on near-term iPhone sales," he said.
Comments
He has no clue...h can't see into the future.
Yeah, but they just reaffirmed their $250 target, so what else is he going to say...
He has no clue...h can't see into the future.
No one can, but his argument seems reasonable. The Android OS is lacking a lot of software features the iPhone users take for granted. Presumably since the hardware is fairly advanced it will catch up, but really this should be termed the "First Developer's Release" of the Android phone, not a 1.0 product.
Besides, at 70.1M subscribers for AT&T in the US alone (vs. 28.7M for T-Mobile) and the iPhone available in 40 countries worldwide, Android isn't going to scratch the iPhone's market share this year. As the article says, though, maybe version 2.0 or 3.0 or 4.0 could get interesting, especially if their much-vaunted openness leads to a vibrant developer community. (Some developers prefer openness to making lots of money, which is what Apple's offering right now...)
Multiple handsets of all different types on different carriers with multiple payment plans over time will be the key. And by then there will be many more apps.
I hope Apple is not dumb enough to under estimate Android's potential.
Sure it has its problems and its having a small humble beginning. But android is designed to grow as a market exponentially. I really hope this gives Apple something to worry about because this is going to for them to keep coming out with hot products and services to stay ahead of the game.
And thats good news for us consumers.
The phone looks clunky to me...I dunno.
The cell phone contract is a winner: $35 per month vs. $90 per month if you insist on an iPhone.
And the 3 MegaPixel camera is already better than the 2 MegaPixel camera of the iPhone.
Given the well documented shortcomings of the iPhone and the poor service of the cell phone operators who sell it, it's a no-brainer to see that Android is a winner.
Apple and Steve Jobs are repeating the mistakes they made with the original Mac:
a) overpricing;
b) exclusivity (no licencing to competitors);
c) in house development (no open source, no third party developpers, unless approved);
d) secrecy and unpredictability of the development of new features (They come if and when they do, don't ask for them).
As a result of Steve Jobs' vision for the iPhone, Apple will once again waste its competitive early advantage.
The cell phone contract is a winner: $35 per month vs. $90 per month if you insist on an iPhone.
Don't forget to add at least $30.00 for a voice plan to that $35.00 data plan.
By the way, WebKit is not apples. http://webkit.org/ apple has a version of the open source engine.
http://en.wikipedia.org/wiki/WebKit#History
Android is a combination of Windows and Linux, operating on every phone, but free and open source.
The cell phone contract is a winner: $35 per month vs. $90 per month if you insist on an iPhone.
And the 3 MegaPixel camera is already better than the 2 MegaPixel camera of the iPhone.
Given the well documented shortcomings of the iPhone and the poor service of the cell phone operators who sell it, it's a no-brainer to see that Android is a winner.
Apple and Steve Jobs are repeating the mistakes they made with the original Mac:
a) overpricing;
b) exclusivity (no licencing to competitors);
c) in house development (no open source, no third party developpers, unless approved);
d) secrecy and unpredictability of the development of new features (They come if and when they do, don't ask for them).
As a result of Steve Jobs' vision for the iPhone, Apple will once again waste its competitive early advantage.
There is no evidence of a mistake yet. This is not the same thing.
Google and Apple are not at war and never will be, in fact Google's CEO in jest suggested publicly that they would , in the future merge.
Apple's got a huge jump on all and will maintain the standard and bar because it always has been the innovator and oracle of the pc world.
I can't wait to have some a hacker in his mom's basement have the unfettered ability to have his p0rn application available to millions of Android users without checks or balances.
Can't wait for the open source car. Reliability and safety? Haha.
When I eavesdrop in the Apple Store I hear people excitedly explaining to wives, roommates and parents what the features are - and getting it wrong. Don't underestimate the large number of people who are far more interested in what colors the iPhone comes in.
I don't see the Google Phone as much of a threat at this point. But that could surely change down the road. How long until someone is running Android on an iPhone??
Google should have picked one of the big boys to play with rather than the guy who hopes his coverage will grow because we buy the latest toy.
Guess you have to take some of the crap (T-M) to catch the big fish (Deutsche Tele).
In the end maybe it will be good competition.
And words simply can't describe how I feel about a USB headphone jack!
</sarcasm>
This is solely because T-Mobile and AT&T want to keep their own music stores at $2 and up/song that they sell to suckers with other handsets.
The other thing is that the T-Mobile G-Phone doesn't enable just any application you may want. Good luck trying to get a tethering application or a VOIP application into any app store that T-Mobile let's you access.
And don't think that the OS being open-source will help you. T-Mobile will work hard to make sure you can't change the firmware in your handset to any other firmware than what T-Mobile wishes to provide to you.
Don't forget to add at least $30.00 for a voice plan to that $35.00 data plan.
Exactly. And don't forget to add that unless you live in one of the very exclusive 18 areas where T-Mobile has 3G, that data is also EDGE speed.