Windows 8 and the Cost of Complexity

The WSJ – and prevailing wisdom – blames two factors for the decline of PCs: PCs have become “good enough,” lengthening the replacement cycle, and more and more time is being spent on tablets and other appliance-like devices.

However, I don’t think these factors are independent; it’s not just that tablets occupy more of a user’s time, but that by doing so they make any performance issues on one’s PC less pressing simply because you use it less. To put it another way, users are likely to have a higher standard for their primary computing device than they are a secondary one; as PCs become secondary devices for more and more people the standard for “good enough” becomes lower and lower.

Ben Thompson has been on a kick as of late talking about his Chromebook, but I believe he hits the nail on the head with the title of the article.  However I have to disagree with his statements above.  I don't believe it's that PC's are good enough because they are now secondary devices, I believe most people were using their computers to do things that are better served in the tablet form-factor.  

People have been using computers to do email, browse the web, go to Facebook.  Most people who owned computers were not using them up to their full capabilities and didn't need all the complexity that is inherent in a PC Operating System, Mac or Windows.  Most people just want to be able to do a few things on a computer and it has to be very easy.  While I am very computer literate, I love my iPad because it is totally simple.  I enjoy the simplicity because I just don't have the time to tinker.  So the iPad model solves problems for all levels of users.  

The downturn in the PC industry is simply because a technology (product) came out that made it easier to do what users wanted to do.  If the iPad was more complex (like Android or a Chromebook), we would not have seen this downturn in PC sales.  

“It’s Just A Big iPod Touch”

I emailed my mother a series of questions about her usage of the iPad. Her response was illuminating:

So yes, I like the iPad, but I miss a keyboard. I don’t like this touchpad. But I use it now in place of my old computer. I go on Pinterest. But I am having a few issues (as usual). It just shuts down and the Apple appears on the black screen. Must be that I’m using it too much? I use it for email, Facebook, and checking things out. Love you. Xoxox

Sent from my iPad

I’m not 100 percent sure this is the perfect response from an “average” iPad user of a certain age, but I’d bet it’s pretty close. “Miss a keyboard.” “I go on Pinterest.” “Email.” “Facebook.” “Checking things out.”

Pricing and Apple

A lot has been made about pricing after this weeks event.  I saw three different groups of controversies this week, two involving Apple and one involving Tweetbot.  I think all three are interesting case studies in pricing in the hardware and software section.   

The iPad pricing was the most controversial thing coming out of the event.  Again it stems from every industry pundit wanting Apple to price their products to maximize market share.  Apple isn't in the business of maximizing market share, they are in the business of creating the best products and having quality over quantity.  As John Gruber stated this week:

As for pricing overall, I think concerns that iPads are “too expensive” are overblown. The same was said last year, and the year before that. The tech and business press frequently compare iPads’ prices and specs to those of high-end Android-based competitors — from Samsung, Google, and Amazon — and find the iPads lacking. How many pieces were written last year arguing that the iPad Mini, with its non-retina display and $329 starting price, was incongruously overpriced compared to Nexus and Kindle Fire devices with retina-caliber pixel densities and prices under (sometimes well under) $300?

But where these comparisons go awry is when they are conflated with tablet market share numbers showing Android devices, as a whole, making significant gains. As Benedict Evans argued this week, the rise in Android tablet sales has not been driven by the high-end would-be-iPad-competitors from Amazon, Google, and Samsung, but by profoundly cheap “$75-$150 black generic Chinese Android tablets” that are seemingly used primarily for video consumption. Evans calls them “the featurephones of tablets”, and argues they compete with televisions just as much, if not more, as they do with iPads.

The iPad does not have competition in the way that the iPhone does. Tens of millions of people use high-end Android phones — largely Samsung’s — in much the same way iPhone users use theirs. There just aren’t that many people — yet? — using Kindle Fires, Galaxy Tabs, Nexuses, or Surfaces as alternatives to the iPad. Thus the massive discrepancies between the iPad’smarket share and usage share numbers.

As John argues, even the market share argument is not a fair one compared to phones or PC's.  The Android tablets eating the market share of the iPad are not customers that Apple is interested in serving.  Apple is interested in customers that interact with their devices in meaningful ways; browsing the internet, purchasing legal content, listening to music, playing games.  Apple is not interested in customers that only browse YouTube or watch bootlegged movies.  These are not customers who will continually buy high-end Apple products, purchase apps to stay in the ecosystem.  These customers will also cost much more to service.  The hidden secret behind Apple's success is their service through the Apple stores.  Imagine even more customers coming through that channel.  Apple is building a high-end experience from purchase to consumption to service.   

The iPad also hasn't shown that it needs to come down in price.  Would I like an iPad mini retina for $329?  Yes I would, more than $399.  Is that $70 going to change my buying decision?  Nope.  What I am debating is the same thing John Gruber is debating in his article, which one to buy?  Or maybe both with T-Mobiles new pricing plan for cellular versions of these iPads.  

The second big pricing move from Apple is software pricing.  Where as the hardware pricing is being criticized, the software pricing is being applauded.  Everyone is saying it's an attack on Microsoft.  Look out Google.  

I look at it as a couple of different strategies at play.  First and foremost I believe it is a retention play on the part of Apple.  So much is made of their ecosystem in iOS and now I believe it just adds to that arsenal onto the Mac as well.  If all the software is free in the Mac ecosystem, then it makes the purchase price of a Mac more palatable.  It also prevents customers from jumping ship onto the PC.  The iPad also becomes a creation device on par with a PC.  And for free!  

The second part of this strategy is innovation.  When the customer base is moving ahead with Apple, the newest innovations in software are propagated throughout the ecosystem and everyone is using and showing it off.  This also makes for a compelling reason to choose Apple first for developers.  If the Mac can have the upgrade cycle that is seen in iOS, developers will be able to move their software forward without worrying about backward compatibility.  

The last big pricing controversy is Tweetbot.  They released their popular twitter client for the iPhone this week and they created a whole new app and charged for it.  Of course the world is a worse place because of this.  Someone had to forego their coffee at that price.  

Why has the world forgot the software model just a few short years ago.  You bought a piece of software, the next year a new version would come out, you would go to the store and buy a whole new version of the software.  Oh ya, this cost $50 every year.  If you didn't perceive the version was worth the new price, you forego the years version and kept using the old version.  This is what the market should be. 

So much is made of free software these days.  The problem is this ruins the business for many independent developers because they are playing a different game than the people offering free software.  The free software providers are either trying to be purchased by Google or Facebook, or they are the Apples and Googles of the world and these companies are using the software as a "loss leader" or a strategy to sell more hardware or advertising.  

I believe more developers should take the Tweetbot approach in the App stores.  Charge for new software every year, it's only a few dollars now.  This approach is much better than the freemium model pervasive now.  It also makes developers make the product they have a passion for much better.  If Tweetbot and others continue to give out free upgrades, these products become worse over time.  Why?  There are a set number of hours in a day.  Those hours have to be spent on something that will return on the time investment.  If Tweetbot never brings in more revenue, it doesn't make sense to spend time working on it, so it becomes stagnant.  Under the Tweetbot model, it makes sense to work on Tweetbot because that innovation can produce revenue in the future, which is why they are in business.  Hopefully more software developers start charging more often for their software and we see even more innovation in return.

School in the Post PC Era

My 10 year old daughter had a paper due recently on the Cherokee Indians.  We happened to be traveling to San Jose on the weekend before the paper was due, so we didn't have much time to do the research and write the paper.  Afternoon flight on Friday, packed weekend, late night flight on Sunday back to Vegas. 

While in the air on the way to San Jose my daughter was doing research on the internet on an iPad.  As she found sites with interesting information on The Cherokee Indians, she copied and pasted the information into the Notes app.  She did this for 3 different sites. 

On Sunday, we were delayed for an hour in the airport, where my daughter opened up a Macbook Air.  The notes were all synced to the Mac and she started on her paper and finished it on the plane ride home. 

I wish I had the technology Apple is putting together when I was in school.  The ability to take a device to school and do research and everything transfers to the main computer when writing the paper is something that will make school and amazing experience for young children.  

The Myth of Steve Jobs Constant Breakthroughs

For every great leap forward Apple ever made, it accomplished at least as much through small steps that made its products easier, faster, thinner, lighter, more polished and/or more useful. Apple’s most important products may have been the game-changers, but its best products, always, have been those that benefited from smart, evolutionary improvements. And as far as I remember, Jobs never seemed guilty about the profits they brought.

Super article.  Why does everyone want to put a fork into Apple and call them done?  The product they put out on Friday is so superior to every smart phone out there.  Incremental or not, they are still innovating.  

The items in our new iPhone 5s' are the foundation for their next jumps.  The M7 processor is the beta test for a wearable technology.  The 64-bit A7 chip is the baseline to take over TV and move the low end laptop computer world into the modern era.  

Remember, the time between the iPod and the iPhone was 6 years.  The iPod led the way to develop the iPhone.  Without the iPod, there probably never would have been an iPhone.  You can argue the iPad was an incremental improvement on the iPhone.  

So Apple is ready for their next disruption, we just have to realize we are already using it.  When the next disruption comes out, you can bet it has many of the technologies in the current phones.