Benedict Evans in his post Unbundling innovation: Samsung, PCs and China compared the smartphone industry to the PC industry where value began to be hollowed out and the market became commoditised.
Evans claims that this is already happening to Samsung. Part of the challenge is that so much of the design of the hardware layer in phones comes from reference designs by component manufacturers like Qualcomm and reference design work done by manufacturers like Foxconn. Globalisation outsourced hardware design innovation, a plus side of this is that there is a whole eco-system in southern China that can support anyone who wants to make a branded handset building on experience gained working with major technology brands.
As he quite rightly points out some businesses are looking to take control of their business by building beyond hardware and into the service stack.
A number of manufacturers put their own UI over Android like HTC’s Sense UI and Huawei’s Emotion UI. Whilst these contributed to a handset personality, they didn’t provide differentiation. Facebook even tried to get in on the act with Facebook Home, but the user experience left something to be desired according to reviewers.
Manufacturers tried to add applications in their phones, which competed with Google’s own application stack. At the present time, no Android manufacturer has come up with a killer application for their brand of phone, mainly because they replicated Google’s efforts and with the exception of Samsung, the application wouldn’t be sufficiently ubiquitous – particularly if it was some sort of communications platform like say Whatsapp.
Meanwhile, Google hasn’t been sitting quietly on the sidelines but has been using its power within the community to exasperate commoditisation by combatting manufacturers efforts at software customisation. This process has been rolled further into the Android efforts with strict guidance on Android Wear devices. All of this may feel quite similar to Microsoft Windows around about the time of their dispute with Netscape.
Deeper innovation requires a fork in the Android OS and a break with some if not all of the services. This break has been forced on Chinese manufacturers anyway as consumers wouldn’t be able to access Google’s maps, email or search. Which is the reason why Xiaomi’s MIUI, Jolla’s Sailfish OS and CyanogenMod have an opportunity to work with phone manufacturers.
However, the ironic aspect of this is that any of these platforms became too successful they would wield as much power as Google does at the moment.
A sweet spot for hardware manufacturers would be a hetreogenuous OS environment, all of which will run Android-compliant applications. In order for this to work, you would need an equivalent of POSIX compliance for Unix-type operating systems for these mobile OS’ and a way of ensuring that platform innovation didn’t ossify either the OS or the internet services supporting it.
Where does Apple fit into all this?
Could the HTC One have been built without manufacturers having invested in milling machines after the introduction of the iPhone 5 aluminium monocoque chassis? Apple’s process innovations / popularisation of production techniques opens up opportunities for the wider Android community. This is because of Apple’s focus on materials innovation as well full integration of the services and software stack.
This lends weight to a viewpoint that Apple has in some respects has become a ‘fashion brand’ as one of my colleagues put it, think a watchmaker rather than say a fashion house like Louis Vuitton and the analogy has a certain amount of merit. This also implies that when thinking about the iPhone the value decision lifts itself out of the economic rational actor. However there are also shifting costs. You don’t buy a DSLR camera, you buy into a system since the camera needs lens in order to work. Applications (particularly paid for applications) play a similar role, as do services. There is an inherent switching cost away from iPhone, this is lower when switching platform from Andrioid to iPhone and practically none existent for many users upgrading their Android handsets.
So in many respects Apple sits apart from this in the same way that the Mac sat within, yet apart from the PC industry.
Back in the mid-1990s Microsoft missed out on the web as a nascent platform. In fact the first edition of The Road Ahead that Bill Gates wrote alongside Nathan Myhrvold and Peter Rinearson saw the Internet as one of the “important precursors of the information highway…suggestive of [its] future” (p. 89); he noted that the “popularity of the Internet is the most important single development in the world of computing since the IBM PC was introduced in 1981” (p. 91) but “today’s Internet is not the information highway I imagine, although you can think of it as the beginning of the highway“, the information highway he envisioned would be as different from the Internet as the Oregon Trail was to Interstate 84.
One reviewer noted that
World Wide Web receives just four index citations and is treated as a functional appendage of the Internet (rather than its driving force)
And for a while Netscape had a clear run at the browser market, building up to one of the largest IPOs ever. One of the things that made Netscape so dangerous was that the browser became the gateway to applications like sales orders, email or looking up a database and the browser became an operating system substitute. It no longer mattered so much if you had a Mac or a PC. The browser and web effectively became middleware.
I realised last year that messaging services like KakaoTalk, WeChat and LINE were moving beyond messaging to becoming something more. By becoming platforms they could provide a richer experience to users, the integrate:
Gaming
A blogging-type platform
Payments
Social commerce
Travel information
This looks eerily close to Netscape’s web of middleware positioning in the mid-1990s. Ted Livingston, CEO of Kik outlined just this scenario in an article on the messaging landscape for Techcrunch last week.
Where this gets interesting is when think about what this means for the likes of Google’s Android operating system or Microsoft Windows phone, where the raison d’être of these operating systems is as a gateway to web services (and an audience for mobile advertising). The more functionality that happens inside the messaging application, the less opportunity there is for the likes of Google and Microsoft to direct the consumer towards their advertising inventory.
It corrodes the very reach Google tried to achieve by having its own smartphone operating system and competing with Apple. Google is already under assault in the operating system itself as Chinese vendors like Xiaomi and Oppo alongside Amazon have customised their own operating systems based on Android. Google services are not provides on a third of Android devices sold already, messaging applications as a platform exasperate the situation further.
The web as we know it was built on a set of underlying technologies which enable information transport. Not all information is meant to reside in a website to be surfed or queried. Instead much of the information we need relies on context like location, weather or the contents of your fridge. Web technologies provided an lingua franca for these contextual settings and like most technological changes had been a long time in coming.
You could probably trace their origins back to the mid-1990s or earlier, for instance the Weather Underground published Blue Skies; a gopher-based graphical client to run on the Mac for the online weather service back in 1995. At this time Apple were working on a way of syndicating content called MCF (Meta Content Framework) which was used in an early web application called Hot Sauce.
Hot Sauce was a web application that tendered a website’s site map in a crude 3D representation.
A year later PointCast launched its first product which pushed real-time news from a variety of publications to a screen saver that ran on a desktop computer.
The key thing about PointCast was it’s push technology, covered in this edition of the Computer Chronicles
The same year that PointCast launched saw the launch of the XML standard: markup language that defines a set of rules for encoding documents in a format that is both human-readable and machine-readable. This meant that there was a template to provide documents and stream information over the web.
Some of the Apple team responsible for MCF had moved to Netscape and worked on ways of importing content from various media outlets into the my.netscape.com portal; they created the first version of RSS (then called RDF) in 1999. The same year, Darcy DiNucci coined the term web 2.0; whilst this is associated with the rise of social networks, it is as much about the knitting of websites: the provision of services online, integration between websites taking data from one source and melding it with another using a web API formatted in an XML type format or JSON – which does the same job.
By the early noughties applications like Konfabulator (later Yahoo! Widgets) launched their first application to ‘put a skin on any information that you want’.
Major web properties started to license their content through APIs, one of the critical ideas that Flickr popularised was that attribution of the data source had its own value in content licensing. It was was happy to share photos hosted on the service for widgets and gizmos so long as users could go back through the content to the Flickr site. This ability to monetise attribution is the reason why you have Google Maps on the smartphone.
So you had data that could be useful and the mechanism to provide it in real time. What it didn’t have so far was contextual data to shape that stream and a way of interfacing with the real world. In parallel to what was being driven out of the US on the web, was mobile development in Europe and Asia. It is hard to understand now, but SMS based services and ringtones delivered over-the-air to handsets were the big consumer digital businesses of their day. Jamba! and their Crazy Frog character were consumer household names in the mid noughties. It was in Europe were a number of the ingredients for the next stages were being created in meaningful consumer products. The first smartphones had been created more as phones with PDAs attached and quicker networks speeds allowed them to be more than glorified personal information managers.
The first phone that pulled all the requisite ingredients together was Nokia’s N95 in early 2007, it had:
A good enough camera that could interact with QRcodes and other things in the real world
Powerful enough hardware to run complex software applications and interact with server-side applications
A small but legible colour screen
3G and wi-fi chipsets which was important because 3G networks weren’t that great (they still arent) and a minimum amount of data network performance is required
A built-in GPS unit, so the phone ‘knew’ where it was. Where you are allows for a lot of contextual information to be overlaid for the consumer: weather, interesting things nearby, sales offers at local stores etc
All of these ingredients had been available separately in other phones, but they had never been put together before in a well-designed package. Nokia sold over 10 million N95s in the space of a year. Unfortunately for Nokia, Apple came out with the iPhone the following autumn and changed the game.
It is a matter of debate, but the computing power inside the original iPhone was broadly comparable to having a 1998 vintage desktop PC with a decent graphics card in the palm of your hand. These two devices set the tone for mobile computing moving forwards; MEMs like accelerometers and GPS units gave mobile devices context about their immediate surroundings: location, direction, speed. And the large touch screen provided the canvas for applications.
Locative media was something that was talked about publicly since 2004 by companies like Nokia, at first it was done using laptops and GPS units, its history in art and media circles goes back further; for instance Kate Armstrong’s essay Data and Narrative: Location Aware Fiction was published on October 31, 2003 presumably as a result of considerable prior debate. By 2007 William Gibson’s novel Spook Country explored the idea that cyberspace was everting: it was being integrated into the real-world rather than separate from it, and that cyberspace had become an indistinguishable element of our physical space.
As all of these things were happening around me I was asked to speak with digital marketers in Spain about the future of digital at the end of 2008 when I was thinking about all these things. Charlene Li had described social networks as becoming like air in terms of their pervasive nature and was echoed in her book Groundswell.
Looking back on it, I am sure that Li’s quote partly inspired me to look to Bruce Lee when thinking about the future of digital, in particular his quote on water got me thinking about the kind of contextual data that we’ve discussed in this post:
Don’t get set into one form, adapt it and build your own, and let it grow, be like water. Empty your mind, be formless, shapeless — like water. Now you put water in a cup, it becomes the cup; You put water into a bottle it becomes the bottle; You put it in a teapot it becomes the teapot. Now water can flow or it can crash. Be water, my friend.
Lee wrote these words about his martial arts for a TV series called Longstreet where he played Li Tsung – a martial arts instructor to the main character. Inspired by this I talked about the web-of-no-web inspired by Lee’s Jeet Kune Do of ‘using no way as way‘.
In the the slide I highlighted the then new points of interaction between web technologies and platforms with the real world including smartphones, Twitter’s real-world meet-ups, the Wii-controller and QRcodes.
A big part of that context was around location aware applications for instance:
Foursquare-esque bar and shop recommendations
Parcel tracking
Location based special offers
Pay-per-mile car insurance
Congestion charging
Location-based social networking (or real-world avoidance a la Incognito)
Mobile phone tour guides
And that was all things being done six years ago, with more data sets being integrated the possibilities and societal implications become much bigger. A utopian vision of this world was portrayed in Wired magazine’s Welcome To The Programmable World; where real-world things like getting your regular coffee order ready happen as if by magic, in reality triggered by smartphone-like devices interacting with the coffee shop’s online systems, overlaid with mapping data, information on distances and walking or travel times and algorithms.
What hasn’t been done too well so far has been the interface to the human. Touch screen smartphones have been useful but there are limitations to the pictures under glass metaphor. Whilst wearable computing has been experimented with since the early 1970s and helped in the development of military HUDs (head-up diplays) and interactive voice systems, it hasn’t been that successful in terms of providing a compelling experience. The reasons for this are many fold:
Battery technology lags semiconductor technology; Google Glass lasts about 45 minutes
The owner needs to be mindful of the device: smartphone users worry about the screen, Nike Fuelband wearers have to remember to take them off before going and having a swim or a shower
Designs haven’t considered social factors adequately; devices like Google Glass are best matched for providing ‘sneak information’ just-in-time snippets unobtrusively, yet users disengage eye contact interrupting social interaction. Secondly Google device doubles as a surveillance device antagonising other people
Many of the applications don’t play to the devices strengths or aren’t worth the hassle of using the device – they lack utility and merit
That doesn’t mean that they won’t be a category killer wearable device or application but that they haven’t been put on the market yet.
BusinessInsider published an interesting article about Samsung, the Tizen mobile operating system and Apple. Some of the assertions in the article looked over certain facts about Tizen.
What is Tizen?
Tizen is a mobile operating system based on Linux, in this respect it shares common ground with Firefox OS, Ubuntu for smartphones and Google’s Android operating system. It has gone through a number of iterations to become what it is today. Tizen can trace its development back to Intel and Nokia’s separate efforts to develop a next generation Linux-based mobile operating system. Both companies had put their weight behind WiMax rather than LTE for fourth generation mobile networks so merging their offerings into one distribution could help move things along. The merged product became Meego. Samsung merged their LiMo mobile Linux effort with Meego to create Tizen. Tizen also gained components from Samsung’s Bada operating system.
BusinessInsider assumes that Tizen is a Samsung thing
Whilst Samsung is the lead in Tizen, and has some of the technology wrapped in onerous licences, Tizen has attracted support from other vendors. The Tizen Association includes Fujitsu and Huawei as rival vendors. Huawei is one of the largest Chinese mobile phone vendors, so competition for Samsung at the low and mid-range of it’s market.
Tizen is a premium product
Tizen could be a premium product and it could be a source of differentiation based on the user experience and performance of the software with the hardware. At the moment however it may not look that way, Tizen on phones looks suspiciously like Android on a Samsung phone. Which is interesting given that a number of Samsung challengers like HTC, Huawei and Oppo are pushing the user experience differentiation further with varying degrees of success
Secondly, the code merged in from the Bada framework was not designed for premium handsets, however you could argue that it would perform better since it was leaner on high performance devices.
What I think is more interesting about Tizen is its apparent husbanding of computing resources; the Samsung Gear 2 watch has a battery life that is reported twice to three times as long as the original Samsung Galaxy Gear. Given the size of the device, an appreciable amount of this change must be due to optimisation work that Samsung did on the Tizen operating system running on the Gear 2 compared to what it had to work with in Android on the Galaxy Gear.
As Steve Jobs said back in 2005 when discussing Apple’s move from PowerPC to Intel processors, computing was moving from performance improvements to a more nuanced performance per Watt improvements. Battery technology, in particular power density and improved battery formulations does not move at a particularly fast pace in comparison to say microprocessor design, solid state or disk storage and display design. This is the reason why Google Glass has a battery life that allows roughly 45 minutes of continuous usage.
You husband power in the product through taking a holistic approach to engineering power-saving in both the software and the hardware; it involves tight integration and control over both factors. Tizen gives Samsung more of this control than it currently enjoys with Android. This control could also help Samsung harden the security of phones for the enterprise, however Tizen isn’t unique in this regard and the defence industry has decided to go down the route of securing Android itself; a great example of this is Boeing’s Black Phone
Tizen and Google
As margins become tighter on handset manufacturers Google looks like it is likely to make more money from Android users than they will. It is the reason why both Apple and Xiaomi have a combined services and hardware sales model so that they gain from the lifetime of the consumer usage rather than just the device sale. Secondly Google is being seen as increasingly using its monopolistic power against handset manufacturers in tactics that look reminiscent of the relationship between PC manufacturers and Microsoft.
In order for Samsung to break from Google it would need to build or integrate various services; just a few years ago Samsung was considered to have the whip hand in its relationship with Google over the Android operating system and the purchase of Motorola was partly seen as a hedge against this power.
BusinessInsider suggested that Google’s sale of Motorola’s handset business to Lenovo could be read as a perception that Google feels it no longer needs that hedge and that Samsung couldn’t build services that would threaten Google. Samsung don’t seem to have achieved this so far, but that doesn’t mean that they couldn’t do it in the future.
Tizen is interesting, particularly Samsung’s mastery of power management, Samsung also possesses deep pockets, for instance it could buy Jolla outright and gain a better looking operating system whilst still retaining Tizen’s compatibility with Android applications. Tizen isn’t a mobile only operating system but could be extended into Samsung’s brown and white goods product ranges and the new product categories opening up around the ‘web of no web’ from wearables to smarter out-of-home and retail marketing.
Probably one of the best presentations on software development that I have seen in a good while. What comes out is the lack of rigor and science around software engineering research.
