Long Term Strategies vs. Short Term Market Share

Android users are not as active and engaged with online activities as iOS users are. And when companies from start-ups to established players decide which platforms to target with their apps, their web services, and their marketing campaigns, they’re going to go where the eyeballs are. If you follow where the money should be going, it should be focused on Apple.

Which creates a virtuous circle of engagement. People develop their tools for iOS because iOS users are more engaged and easier to monetise.

There is definitely a difference between Android and iOS users.  This brings up interesting points when talking about different business strategies.  When having products, engagement and return loyalty are things that create a sustainable business.  Samsung is selling a plethora of products and in volume, however if the customers are not engaging in the platform and are purchasing items through the Google Play store, Samsung has nothing to hold onto customers when their contracts come up.

This is similar to what we saw with the PC industry.  Because the platform was owned by Microsoft and all the programs and files could easily be switched from machine to machine, the manufacturers had nothing to compete with.  So when there is no differentiation, businesses compete on price and volume.  When that happens everyone loses except the consumer.  However, the consumers gain is only short lived because the products they are buying are becoming cheaper and cheaper and over time they last a lot shorter than the products they purchased before.  

I believe this is what we will see pan out in the cell phone space outside of the US.  Also, you have already seen this in the tablet space.  Because no one can compete with the iPad on a product and experience level, the market has already taken a nose-dive in pricing to gain market share.  The problem with this is the experience delivered to the customer.  These companies are taking a short term gain and will be losing these customers when they are ready to buy again because their experience is subpar.  

This will be fun to watch.  Hopefully we will see much more innovation in the years to come, instead of just relying on Android as a competing platform and everyone racing to the bottom on price. 

Creating Baselines

On Monday Apple introduced a brand new iOS, version 7. While it didn't change the basics of the operating system, it created a new starting point. I call this a baseline. The point in which things will be measured against. The standard if you will.

Baselines are very important to measure your business. I always want to come in to an organization, create a new baseline and innovate from that point. Once innovation has slowed and opportunities start to become scarce, a new baseline must be formed to build the next great iterations. Without the foundation, a house cannot be made.

Apple has created their new foundation on which to build upon. Some don't like it, some love it. In time it will be like second nature and we won't be able to remember when the interface wasn't like this. All companies eventually have to create new baselines, even ones as insanely successful as Apple. This should be embraced, because it takes courage to throw away and start new. The alternative is to slowly fade into mediocrity.

Google, destroyer of ecosystems

The truth is this: Google destroyed the RSS feed reader ecosystem with a subsidized product, stifling its competitors and killing innovation. It then neglected Google Reader itself for years, after it had effectively become the only player. Today it does further damage by buggering up the already beleaguered links between publishers and readers. It would have been better for the Internet if Reader had never been at all.

I think the conversation here is what free does to ecosystems.  When businesses as big as google offer free services, they are killing the value of said services.  When the value of a service is perceived to be 0, it effectively puts everyone out of business who has to make money from a similar service.  Then, because a big company is making no money from the service and every company eventually starts looking for ways to improve bottom-line, they cut the service because it is nothing but a cost.​

I think we see this with the tablet market, even though tablets are being sold and not given away for free, they are being sold at a loss to gain market share.  Eventually that devalues the market for tablets and nobody wins.  The tablet makers who have the market share eventually get tired of selling at a loss and stop innovating and the tablet makers making money will get out of the business because they can't compete.  Of course Apple is more than likely the anomaly in this situation.​

Content providers on the internet already went through this.  They have now seen giving content away for free has devalued the content and trying to charge after the fact remains difficult to say the least.  ​

In my humble opinion I would like to see businesses compete on innovation instead of price (or lack of price).  In this case, everyone wins.  The best services, products and content survive and the companies that are producing them will be around for a long time because they are making profits.  Everybody wins.  Good for the customer, good for the business.