Apple, Inc. iPad is obliterating Samsung, Google's Android in tablet profits

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  • Reply 121 of 146
    exilusexilus Posts: 2member

    Quote:


    Revenue alone does not solve problems. If your expenses exceed revenue, you're not going to be in business very long. If you have low margins, that's not a good thing either because not only are you less capable of weathering a revenue decline but also, you have less money to reinvest in the business. 



     


    Things get different when you have 150G$ in bank (i don't know the exact number). If they stopped making/selling devices but continued to pay all their employees, they would will have money left 30 years from now. 

  • Reply 122 of 146
    rjc999 wrote: »
    There used to be a number of successful, vertically integrated Unix vendors, in fact, more vertically integrated than Apple, because they actually made their own CPUs, motherboards, storage, everything. They all got crushed by "unprofitable" Linux.

    Actually, Microsoft managed to obliterate the UNIX vendors in the 90s with extremely crappy, but vastly more user-friendly solutions (and we all know who they stole the UI/UX from). They just grabbed the corporate world. Where do you think Microsoft gets it's more then $20 billion per quarter? At present they are a total failure in the consumer market, yet they get massive revenues, and since they are a software products company (selling licenses), most of it is profit.

    Do not get me wrong, I'm a fan of Linus Torvalds, but a state-of-the-art kernel is not enough for a good OS, never was. Android, for example, is a massive amount of excrements on top of this kernel.

    The success of Linux is mainly based on the ASP loophole in the GPL. In short, while a lot of companies like Google tout their love for the Open Source, their significant products (like Google Search, Google Mail servers, etc.) are nowhere to be found as open source projects - exactly what the GPL was trying to prevent in the first place. But they lo-o-o-o-ove Open Source!

    A great example of Google's double standards is Big Table - their implementation of the patented Map-Reduce algorithm. There is an open source version, but it is different from their internal implementation. That is not against the GPL, but is obviously against the philosophy behind the Open Source Initiative.

    In short, Google dances around the GPL, making use of each and every single one of its weaknesses.
    rjc999 wrote: »
    Microeconomics 101, the long run in a competitive market is for prices to trend towards marginal cost.

    Microeconomics 101 uses (extremely) simplified models in order to be able to explain general trends in economics to beginners. Nor Microeconomics 101, neither Macroeconomics 102 are of any use to describe real world cases.

    The competitive market drives prices down for one or more products only when they are pretty much the same. That would be the case with the competitive market for Android tablets. They are almost the same, having insignificant differences (mostly the name of the vendor). So, they compete on price. That is, they are pretty much engaged in a race to the bottom (now, that's a nice example for an ECO 101 course, but Apple has no place in it).
    rjc999 wrote: »
    Competition is supposed to drive down prices, if you're deliberating cheering for one company to win everything and set monopoly prices, you're a moron.

    And I thought that competition should drive innovation ... Who knew we fight to have cheap s**t?!
  • Reply 122 of 146
    drblankdrblank Posts: 3,385member

    Quote:

    Originally Posted by abazigal View Post


    The padfone actually struck me as a pretty innovative product. The only downside is that the phone has a rather short battery life, as you are expected to continuously recharge it from the tablet component.



    Whatever. I thought it's a dumb product.  Did you see how thick that thing is?  It's NOT thin at all. Can you use it as a pad and a phone at the same time?  I personally think that ALL mobile devices should have the option of having a voice/data chip set inside to be a phone/cellular data because they are a mobile device.   I know Samsung is starting to add that on their tablets.  The only thing is could they all be tied to the same phone number because sometimes you only want to carry around one device, so I would want them tied to the same phone number and which ever one I answer the others stop ringing.

  • Reply 124 of 146
    drblankdrblank Posts: 3,385member

    Quote:

    Originally Posted by capasicum View Post









    Actually, Microsoft managed to obliterate the UNIX vendors in the 90s with extremely crappy, but vastly more user-friendly solutions (and we all know who they stole the UI/UX from). They just grabbed the corporate world. Where do you think Microsoft gets it's more then $20 billion per quarter? At present they are a total failure in the consumer market, yet they get massive revenues, and since they are a software products company (selling licenses), most of it is profit.



    Do not get me wrong, I'm a fan of Linus Torvalds, but a state-of-the-art kernel is not enough for a good OS, never was. Android, for example, is a massive amount of excrements on top of this kernel.



    The success of Linux is mainly based on the ASP loophole in the GPL. In short, while a lot of companies like Google tout their love for the Open Source, their significant products (like Google Search, Google Mail servers, etc.) are nowhere to be found as open source projects - exactly what the GPL was trying to prevent in the first place. But they lo-o-o-o-ove Open Source!

     


     


     


    Have you read what Miguel de Icaza said about Linux? He's the guy that started GNOME and is a LONG time BIG Linux developer.  He basically trashed Linux because it's too fragmented and incompatible and just a mess. What does he use now?  OS X.  He basically thinks that OS X killed Linux.


     


     


    The hardcore Linux fans like it because it's FREEEEEEEEEEE.....  I know some high end animation guys use Linux because they have the apps to do high end animation projects, but maybe that Mari being moved to OS X and the new Mac Pro might change that.   There some visual things Linux might cool at, but it's mostly looks.  Yeah, it's fast and fairly stable. Or at least it's supposed to be. But there are things it just doesn't do and there are too many mainstream apps that just don't run on it.  It's great for servers, but I wouldn't recommend it as a desktop OS unless there was some VERY specific app that was only available on Linux.  But I think this Open Source is mostly for college students having an OS to do specific projects with and it's used for specialty hardware where the mfg builds a hardware product and they specific functionality from an OS that's not a desktop computer, but requires a computer/OS integrated into something that's locked down and only the hardware mfg does modifications, but's VERY specific in what it does.  MIdas Consoles have a high end digital console built around Linux, but they also have an iPad app that works with an iPad.

  • Reply 125 of 146
    vvswarupvvswarup Posts: 336member

    Quote:

    Originally Posted by rjc999 View Post


    For 20 years people shipped PCs with razor thin margins and almost no one made money except for Dell/HP/IBM selling into the enterprise market. You can keep pushing the narrative that profit == success, but eventually computing platforms get commoditized. There used to be a number of successful, vertically integrated Unix vendors, in fact, more vertically integrated than Apple, because they actually made their own CPUs, motherboards, storage, everything. They all got crushed by "unprofitable" Linux.


     



     


    In business, profit does equal success. That's the objective of a business. Markets will become saturated, leading to commoditization. Smart, well-run businesses anticipate this trend and plan an exit strategy before commoditization takes hold fully. 


     


    But commoditization can be delayed. The Wintel business model was doomed to commoditize PCs from day one. OEMs were buying the OS from the same vendor and the CPU from one of two vendors (Intel or AMD). Those two are the most important elements of the PC. As a result, OEMs were robbed of the ability to differentiate their products. That is a recipe for commoditization. 


     


    In short, as long as sufficient avenues exist for differentiating one's product, commoditization is not a risk. 


     


     


    Quote:





    Microeconomics 101, the long run in a competitive market is for prices to trend towards marginal cost. The writing is on the wall and Wall Street knows it. It's absurd the way people cheerlead overpaying super-high margins to Apple, who then doesn't even reinvest the profits back into innovation, but is sitting on the cash, distributing it to investors, or buying back stock. This might sound great for investors, but it doesn't sound good for consumers.


     


    Is this really what you want, to pay a 39% margin? Do you want into a car dealership and negotiate with the sales agent to pay MSRP or above?


     


    Competition is supposed to drive down prices, if you're deliberating cheering for one company to win everything and set monopoly prices, you're a moron.





     


    How did Apple not reinvest the profits back into innovation? And Apple had no choice but to distribute the cash back to investors. We're not talking $10-20 billion. We're talking $100+ billion in cash. Apple had made every possible effort to make strategic investments with the cash hoard. Their cash hoard grew like an overflowing toilet. Apple simply had to make distributions. 


     


    And I have a question for you. Do you think about Microsoft's margins when you buy a Microsoft product? I hope you know that their gross margins are 74% (per Yahoo! Finance). By comparison, Apple's growth margin is 38%. So I ask you again. Do you think about Microsoft's massive margins when you buy their product?

  • Reply 126 of 146
    abazigalabazigal Posts: 114member
    drblank wrote: »
    <div class="quote-container"> <span>Quote:</span> <div class="quote-block"> Originally Posted by <strong>abazigal</strong> <a href="/t/158867/apple-inc-ipad-is-obliterating-samsung-googles-android-in-tablet-profits/80#post_2373565"><img alt="View Post" class="inlineimg" src="/img/forum/go_quote.gif" /></a><br /> <br /> <p> The padfone actually struck me as a pretty innovative product. The only downside is that the phone has a rather short battery life, as you are expected to continuously recharge it from the tablet component.</p> </div></div><p> Whatever. I thought it's a dumb product.  Did you see how thick that thing is?  It's NOT thin at all. Can you use it as a pad and a phone at the same time?  I personally think that ALL mobile devices should have the option of having a voice/data chip set inside to be a phone/cellular data because they are a mobile device.   I know Samsung is starting to add that on their tablets.  The only thing is could they all be tied to the same phone number because sometimes you only want to carry around one device, so I would want them tied to the same phone number and which ever one I answer the others stop ringing.</p>

    Just so we are clear, I am talking about the padfone (the 3-in-1 phone / tablet / laptop hybrid) and lot the fonepad (the 7inch phablet phone which yes, I find to be absolute rubbish).
  • Reply 127 of 146


    Excellent analysis of press bias.



     


     


  • Reply 128 of 146
    Dan. Excellent article. This is the sort of journalism that The FT & WSJ should be undertaking, with detailed factual analysis and logical entertaining copy. Rather than the sycophantic drivel that Bloomberg and most of the tech blogs are outputting. Keep up the good work.
  • Reply 129 of 146
    I really enjoyed your article on a subject that I always suspected. Well researched. Thank's for your efforts. It's nice to see that real journalism is still alive and well! Kudos on a superb article.
  • Reply 130 of 146

    Quote:

    Originally Posted by broadbean View Post



    rjc999, there's a job for you at the DoJ. Unless you already worked there.


     


    He is already being employed by Samsung.

  • Reply 131 of 146
    drblankdrblank Posts: 3,385member

    Quote:

    Originally Posted by vvswarup View Post


     


    In business, profit does equal success. That's the objective of a business. Markets will become saturated, leading to commoditization. Smart, well-run businesses anticipate this trend and plan an exit strategy before commoditization takes hold fully. 


     


    But commoditization can be delayed. The Wintel business model was doomed to commoditize PCs from day one. OEMs were buying the OS from the same vendor and the CPU from one of two vendors (Intel or AMD). Those two are the most important elements of the PC. As a result, OEMs were robbed of the ability to differentiate their products. That is a recipe for commoditization. 


     


    In short, as long as sufficient avenues exist for differentiating one's product, commoditization is not a risk. 


     


     


     


    How did Apple not reinvest the profits back into innovation? And Apple had no choice but to distribute the cash back to investors. We're not talking $10-20 billion. We're talking $100+ billion in cash. Apple had made every possible effort to make strategic investments with the cash hoard. Their cash hoard grew like an overflowing toilet. Apple simply had to make distributions. 


     


    And I have a question for you. Do you think about Microsoft's margins when you buy a Microsoft product? I hope you know that their gross margins are 74% (per Yahoo! Finance). By comparison, Apple's growth margin is 38%. So I ask you again. Do you think about Microsoft's massive margins when you buy their product?



     


    The Anti-Apple crowd just makes up excuses to hate Apple and it's due to they have some underlying psychological problem.

  • Reply 132 of 146


    DED is talking about Android market fragmentation, and this article from The Verge shows graphically just how bad it is.

    http://www.theverge.com/2013/7/30/4570582/android-fragmentation-graphics-july-2013

     

  • Reply 133 of 146
    radarthekatradarthekat Posts: 3,898moderator


    For RJC999:


     


    Future history:  I remember that day back in December of 2024 when the women of the world suddenly all realized that a plastic shopping bag that you bring your groceries home in can provide the same utility as a Coach or Gucci bag.  Saved us men a lot of money on holiday gifts after that.  And later, around Valentines Day 2026 I think it was, when women realized that a shiny bubble is a shiny bubble and they all asked for cubic zirconium that year.  Put some smiles on our faces, I can tell you.  And then it was our turn.  Women are usually far ahead of the curve versus men, so it was no surprise that it took us a few more years before we had our own revelations.  It was the 2033 spring new automobile season when we all found ourselves jamming the Honda and Kia dealerships.  No more of those overpriced BMWs and Porches.  What was the sense; the Civic will get you to work and back just like a 3-series.   Why pay all that extra money?  After that it was a quick trip to utility utopia.  We had finally reached enlightenment as a species.


     


    Or not!

  • Reply 134 of 146
    Price does not equal Value. Not a principal overlooked by the millions of Apple users.
  • Reply 135 of 146
    v5vv5v Posts: 1,357member

    Quote:

    Originally Posted by DesDizzy View Post



    This is the sort of journalism that The FT & WSJ should be undertaking [...] Rather than the sycophantic drivel that Bloomberg and most of the tech blogs are outputting.


     


    No one would EVER accuse Daniel of being a sycophant. An Apologist maybe. Perhaps a fanboy. Possibly even a zealot. But not a sycophant.


     


    image


     


    (No offense Mr. DED. Just poking ya in the ribs.)

  • Reply 136 of 146
    msh88msh88 Posts: 1member
    Wow..after a year of hearing noise, nonsense and pure anger at the best run company across the globe (look at the balance sheet, profit margins, market share, halo effect and innovation) someone has finally printed the whole truth and nothing but facts..Daniel I can promise you one thing you will not be invited on CNBC (or other financial media circuses) because it does not fit in with their hype agenda.Nice work..keep spreading the truth it always wins out..
  • Reply 137 of 146
    snovasnova Posts: 1,281member
    For RJC999:

    Future history:  I remember that day back in December of 2024 when the women of the world suddenly all realized that a plastic shopping bag that you bring your groceries home in can provide the same utility as a Coach or Gucci bag.  Saved us men a lot of money on holiday gifts after that.  And later, around Valentines Day 2026 I think it was, when women realized that a shiny bubble is a shiny bubble and they all asked for cubic zirconium that year.  Put some smiles on our faces, I can tell you.  And then it was our turn.  Women are usually far ahead of the curve versus men, so it was no surprise that it took us a few more years before we had our own revelations.  It was the 2033 spring new automobile season when we all found ourselves jamming the Honda and Kia dealerships.  No more of those overpriced BMWs and Porches.  What was the sense; the Civic will get you to work and back just like a 3-series.   Why pay all that extra money?  After that it was a quick trip to utility utopia.  We had finally reached enlightenment as a species.


    Or not!

    That was creative and enjoyable read. I was thinking you we're going to say men found a way to replace the need for women with an inexpensive device called the Google Girlfriend for $35 with 2 months free subscription to NetFriend. It combines technologies from Google Glass, Google Android, Google autonomous car, Google Virtual Hangouts and Google Play powered by the Google Services cloud . You don't even need physical input devices anymore, all controls are virtual via your enhanced organic multi-touch screen on a Google Moto XXX Smarter-than uPhone and the Google Chrome-Mirror browser.

    In the process, Google fixes the world overpopulation problem. Apple shutters "FaceTime" and "Find My Friends" services. AT&T, Verizon and all other carrier drop all voice services due to lack of demand, dedicating all available bandwidth to "Broad"-band. However, Facebook continues to do just fine, finding that the majority of their user base being female that mostly only socialize with other females (Who knew?). Consumers finally fall in love and show loyalty to Google products, because they believe Googles products LOVE them back.

    In the summer of 2034, Google changes their motto to "Making products for profit is evil" and sues Samsung based on two key Motorola patents utilized by Google Girlfriend. The "always listening to you" and "flick your wrist gesture" patent dating back to the 2013 Moto X phone and subsequently finally perfected on the 2032 Moto XXX smart-than uPhone (19 years later).

    In the winter of 2035, Amazon, Google and many news organizations merge with partial share ownership by the US Government; creating a new super monopoly called "Buy n Large (BnL)". Shortly after this Apple licks its wounds and moves to Ireland. The BnL DoJ forces Samsung to settles with Google. BnL DoJ settlement results in Samsung promising to build and advertise only smart phone under the Google trademark for exclusive sale via Amazon.

    In the fall of 2040, the majority of the human race decides to leave the planet Earth because it has piled up with trash due to the consumers' insatiable need to buy cheaply made "not for profit" disposable electronics goods (with free Amazon shipping!!!* ).

    In the winter of 2040, Google finally achieves 90% market share on Earth. Google fans are given one free* month of service for Google Girlfriend for their loyalty. 3 months later Google cancels the Google Girlfriend service on Earth with no explanation. Remaining Earth inhabitants stage protests against Google saying they "got screwed". Google responds back by shutting off the protester's Google Internet service and removing evidence of protests from Google Search engine. Programs the protestor's Google autonomous cars to drive off the nearest bridge next time they want to go for a "Drive". Media continues to be oblivious to any wrong doing. Steve Jobs turns over in his grave in disgust.
  • Reply 138 of 146
    poksipoksi Posts: 482member

    Quote:

    Originally Posted by drblank View Post


    Any company that's stupid enough to sell a product called PADFONE or FONEPAD is a company to stay from....  They can't make up their mind.    That introduction to the PADPHONE was comical.  It was so cheesy...   It's a pad, it's a phone. PADFONE!!!  Totally ridiculous.  They made about 6% net profit.  Probably because of the PADFONE!!!


     


    This is hilarious.



     


    It's not even hilarious, it's actually embarrassing. In our country we say that what is the smart man shame is an idiots proudness.

  • Reply 139 of 146
    drblankdrblank Posts: 3,385member

    Quote:

    Originally Posted by poksi View Post


     


    It's not even hilarious, it's actually embarrassing. In our country we say that what is the smart man shame is an idiots proudness.



    I thought the presentation was hilarious.  The CEO is JOHNNY, instead of Jony.  Did you catch that?    Also his mannerisms and the cheesiness was so freaking priceless. PADFONE!!!! YES!

  • Reply 140 of 146
    It is also the case that Samsung has been outflowing cash like broken dam in relentless promotion, including saturation advertising and subsidizing in-store Best Buy areas that are four times the size of Apple's. This is a huge gamble in attempting to literally buy a large presence in the marketplace; but this will only work in the long term if the vendor doing it has both compelling products and an ecosphere worth committing to. I think Samsung lives with a morbid fear that if they reduce the outflow, the customer commitment won't be there, such that their whole effort would have been for nothing, depleting their corporate surplus in the process. Like a drug addict, this may lead to more-more-more spending to try to stave off a feared reality.
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