So here's the paradox: if more open platforms promote innovation that benefits everyone, why is Apple so dominant, and why aren't the more innovative, open platforms running circles around Apple?
So here's the paradox: if smaller oil companies promote innovation that benefits everyone, why is Standard Oil so dominate, and why aren't the more innovative, smaller firms running circles around them?
Repeat ad nasuium for your favorite monopoly/duopoly.
Currently. one of the big dogs needs to make a big misstep in order for a smaller company to come in and win. Like car companies being complacent and Tesla seizing the opportunity. Electric cars had been around for a while, hobbyist putting them together but no capital to compete with Ford/GM. Now that Tesla has shown there is a path forward, look at all the capital that has gone to create new car companies.
Apple is not a phone or computer company. They are a luxury brand that is functional. Trying to compete with Apple is like trying to compete with Disney; you cant just be putting out a cartoon movie, you have to have the theme parks, the toys, the cruises. Maybe you can pull it off, but not very likely.
> if smaller oil companies promote innovation that benefits everyone,
They didn't. Standard Oil was cheaper, faster, easier, higher quality, more consistent.. why use anybody else? They weren't being manipulative, they weren't strongarming competition, they just made the best product and everybody wanted it. What's wrong with that?
I'm not really sure what is wrong with that, but the US Supreme Court seemed a bit troubled by it. There's a reasonably well cited summary on Wikipedia:
More accurately it was the United States government which was troubled by it and prosecuted Standard Oil under the Sherman Antitrust act. Their case before the Supreme Court would have been Standard Oil’s final appeal (note how the prior is United States vs Standard Oil Co. of New Jersey but it flips when it comes before the Supreme Court).
In an adversarial court system, it’s worth keeping in mind that while the Court is who you need to convince, the Court is not your adversary.
On the off chance you’re not making a joke, the story is fascinating and far more nuanced than that. This is one of my favourite biographies and worth a read if you haven’t already!
Several billion dollars is the minimum initial investment cost to compete in this space, to deal with all the patents and legal and regulatory to make your own phone with its own marketplace. If I don't use an iPhone my non-technical family members can't conveniently share photos with me the only way they know how. My friends can't AirDrop me videos. Apple has ensured its products won't interop well with non-Apple products.
...and it hasn't occurred to you to wonder why all of your friends want Apple devices?
There'a a lot to dislike about Apple. But your friends know that airdrop will always work between each other. If Merlin appeared and made airdrop interoperable with your device... Your friends would leave Apple, because all of those experiences would become as fragmented and unreliable as open ecosystems are.
100% cool to hate Apple and wish regulatory doom on them. But don't think that Apple customers will be thankful. They will move to the next closed ecosystem that offers vertical integration and better UX. Because that's what they want.
KDE Connect works as well as airdrop between iOS and Desktop Linux and Android, and isn't a unintrospectable proprietary protocol. (Which is to say honestly it's spotty, but so is Airdrop. It's the underlying Bluetooth that's at fault with both.)
Even then, Apple could choose to let their protocol be reimplimentable by others but they've chosen very explicitly not to. They've locked it down with Apple signatures that can't be used by competitors. As you pointed out, it's a competitive advantage for them to lock others out, so they have. It's working, but it's gross. We can dream about better, but for now, no buying books on the Kindle/Amazon app on your iphone, or buying video off Google Play on your iphone, or Chromecasting AppleTV to your Chromecast (just buy an Apple TV like you're made of money).
I think it has a lot to do with costly signalling - Apple has focused on being the luxury option. That's what a lot of people really want; the closed ecosystem and UX are secondary concerns.
Luxury is just one of their offerings. They are one of the few companies where the "cheap" version of their products is just last years. This is actually super nice and speaks not only to how they're not purely luxury but how they make stuff that lasts a long time.
I don't mean to imply that's it's all bling and no substance - their build quality is indeed generally very good but that's part of it isn't it? Good build quality is a luxury these days, especially in tech.
How is something a “luxury” that is owned by over 50% of the American market?
Since it is easy to pay for a phone on an installment plan, anyone making $15-$20 a hour can pay for one with two hours a month. Even your typical fast food restaurant has to pay that much these days to attract workers.
If I walk into a store and buy the average Android phone for $300 on a no interest 24 month installment plan from T-mobile , I will be paying $12/month.
If I buy a midrange iPhone 13, it’s $24.95 a month.
That’s not even mentioning an iPhone SE that is still faster than high end Android phones for $429 or $17.95 a month.
And that “luxury” iPhone 8 (circa 2018) will have a better resale value and will get OS update for years still runs the latest OS and the iPhone 5s (circa 2013) has had a security update in the last year.
These are all perceptions of status created by the marketing of these global companies.
Saying Apple is luxury is kinda like saying an Applebee’s is luxury - only because there is a cheaper McDonald’s across the street. Phones are definitely status symbols but their ceiling is relatively low.
That being said, in my country iPhones are a much more of a status symbol because everyone really is poorer. Scoffing at Apple’s pricing is the norm here.
Globally, an interesting question is what happens if you take a date to McDonald's. Living in America, that's gonna be the end of your date. Meanwhile, it depends on where in the rest of the globe you're talking about. There are plenty of places in the world where that's a decent, if not high status place to take a date. (There are also non-America places where it's not, mind you.) (A McDonald's-date index would be a fascinating bit of sociology research.)
So are people going to AppleBees only for “status” and not because the food is actually better than McDonalds?
Not everyone wants a $60 Blu R1 HD for $70 no more than everyone wants to eat off the $1 menu at McDonalds. Many people find the entire Android ecosystem janky.
I don’t know what a “Blu R1” is so I can’t bother to go off with you on that tangent. But my point was only that all of these products are designed and priced for global-scale mass consumption. Apple isn’t a Michelin-star restaurant. They’re about as much better as that difference in price is.
I said "the luxury option", not that owning an iPhone is a luxury. Most people will spend whatever they can to get the look they want. Look at their advertising - it's much more about style than features - or notice how you can often tell when someone owns a pair of AirPods because they never take them off. Apple tech is as much about making a fashion statement as it is about the functionality.
They may now have over 50% US smartphone market share but that's only recently the case; however they've had the lion's share of the money for a long time.
So 50% plus of Americans only buy a phone because of the “look”?
Bluetooth headphones and not taking them off has been a thing since they first became popular. Even before that as far back as the Walkman people have walked around with headphones.
Maybe "premium" would be a better word than "luxury"? Apple are trying to be the premium option and people like showing off the premium items they own (which is referred to in scientific circles as 'costly signalling').
Again have you ever thought that something is “premium” based on its feature set and how well it works - not just to impress people?
The difference is that you can buy an iPhone for $17-$25/month compared to $4-$12/month for an Android phone. It’s like going to McDonalds and choosing not to eat off the value menu.
Over 50% of the market including my 80 year old mom are not buying iPhones to impress people.
What does that advert say? We have the best sound quality? We have the most storage? We have the best value for money? None of those things - it says you should buy this because it will make you look cool.
I didn't say every single person who buys an iPhone is just trying to look cool. But that is first and foremost how they sell their products.
> But your friends know that airdrop will always work between each other
The funny thing is, I've literally heard my friends muttering to each other in the car that their airdrop isn't working. Unfortunately most people aren't quite so understanding if an open source equivalent ever breaks for any reason, even if it's just as reliable on average.
> Your friends would leave Apple, because all of those experiences would become as fragmented and unreliable as open ecosystems are.
The reasons for that are also anticompetitive.
Open standards that are not battlegrounds can simply work and be implemented easily. TCP, SSH, BGP, and thousands more work basically flawlessly no matter who is building the software.
So how’s the consumer UX for BGP? Your parents like it ok?
Ingredients can be standardized and commoditized. Apple uses the standard networking protocols (mostly), normal stainless steel formulations, typical interconnects for their display controllers.
But a product, in the sense of something a person decides to buy and someone sits in front of and uses, cannot be standardized while providing a good user experience. That’s literally the truth under the “better mousetrap” saying: people will throw money at you if you make something better, and therefore different, from what’s in the market today.
Yes, differentiating your products is anti-competitive, in the sense that you’re trying to get people to buy your products instead of someone else’s. But it is also fiercely competitive, in the sense that you are competing for business.
The critical insight here is that purchasers value UX over the benefits of standardized, commoditized, undifferentiated products. You can legislate and regulate to prohibit differentiation, but left to their own devices that is not what people want.
The consumer UX for BGP is awesome. It’s invisible.
To fix your argument, let’s pick one that end-users actually interact with: HTTP.
The UX for raw HTTP is pretty rough, and very few people could even use it without at least a refresher on the commands. However, since HTTP is standardized, anyone can make an application with excellent UX and even applications that have excellent UX for specific markets (devs, visually impaired users, non-technical boomers, non-technical millennials, etc). This is typically what people are arguing for: let companies compete at the application level and keep the underlying technologies as open standards.
It's not abusive to build really good experiences for your customers and it's not a mystery why they don't waste their resources developing for the competition.
So? There are ample ways to share a video that aren't based on single-platform features.
If Apple invents a way to do some thing X between two of its users, that's great. That's a platform advantage. There's no legal or moral standing that allows us to insist that they open that to other platforms.
But the result will suck. Sure you can do it but you'll be competing against Apple and Samsung who have invested billions and have the results to show for it. And you'll also end up as a system integrator because millions doesn't buy you your own chips so you'll be at the whim of the other companies investing billions like Qualcomm.
How much does it take? I’ve pondered this a few times over the years for various business ideas, so yeah, I’m genuinely asking in a non snarky way… what does it cost to do an OEM phone ?
I’m referring to the millions and of course cost per unit go down depending on how many units you commit to.
The hardest part is dealing with manufacturers and suppliers. In the US, building phones this way is not as popular as building vertical market hardware for kiosks and special putouse devices.
You choose your screen size. memory, SOC etc. It’s been awhile. But I spent a few years working in field services during the transition from companies using Windows CE to Android for industrial ruggedized devices.
Still pretty pricy, but it’s a lower bar than most people probably think it is if the comments here are anything to go by.
Does make me wonder if there’s anyone out there playing middleman and doing a white label service at an even lower price point, they eyeball the market for design trends and OEM some generic phone designs and then sell them on to smaller shops like small MVNOs that don’t have a few million to spare doing a complete OEM phone of their own.
There have been white label phone manufactures since the original Windows CE based phones. HTC use to manufacture close to 80% of Windows CE phones sold by different brands.
Well the web is a much more open platform that surely promotes innovation and benefits everyone. In aggregate, the web and it's myriad of open and free protocols is indeed running circles around Apple. So much so, Apple cannot exist without them.
Apple did what they do, but their stuff is locked to their phones.
Google made their OS free for everyone. So now a phone maker can spend a HUGE amount of money building an OS and getting apps, or they can just use Android. Spending the money to not use Android looks like a folly.
Except Google trained everyone Android comes with the Play Store.
So either a phone maker has to contribute to Google’s stranglehold on the non-Apple smartphone market, making themselves a commodity, or skip including Google services and consumers won’t accept it.
So we’re now at a place where even if an alternate OS could get applications somehow, I can’t imagine any company being willing to put the money into developing it. Only a state like China could in an attempt to force Android out of their market.
Huh? Apple is a hardware company that built an OS, Google was a software company, that wanted devices to run its OS.
There is no comparison here with origins, since they formed an alliance to actually bring out the OS to multiple devices.
Because network and chicken / egg effect obviously ?
Because an open platform would need first to convince hundred millions of developper to port their App on their platform just to exist.
And the cost does not justify the benefits of that "an open platform" brings.
Apple and Google knows that very well and abuse of it.
Just as a side note I would add: There were a time where Internet explorer was a de-facto (shitty) Monopoly everywhere with terrible consequences.
Technological Freedom and the ability to have the choice brought us Firefox. It tools 10 years of competition to get there.
And The result was a better web for everybody.
Apple with its App store makes a Firefox style scenario impossible: they do decide of the life and death of everything on their platform. Including, ironically, the Web browser.
You're right, it couldn't possibly be that Apple has a superior product (iPhone/iOS) compared to Android's fragmented, poorly supported, borderline bad implementations.
The original question was "why is Apple so dominant?" and the response was basically "they have a lot of network effects helping them" which, while true, ignores the possibility that they are so dominant because they have great products that people want to use and will pay a large premium to use.
Vertical integration, including hardware production. Apple has the capital to buy Foxconn's and the rest of their supplier's exclusive output on the new process for years. Open source just doesn't have the money to compete in kind with those kind of exclusivity agreements in place. Not enough people want a 3 year old phone with shittier specs that costs more than a new phone, with incomplete software that can't be used as a daily driver.
Android is more dominant across the world, and it turns out that it's just open enough that even more open platforms like mobile Linux have not retained comparable developer mindshare.
In the US however as a result of differing strategy behind text and data costs by telecom providers in the 2000s Apple were lucky that it disincentivised using data for messages, so there wasn't the same internet-based messaging app uptake that took place elsewhere globally and basic SMS remained dominant.
Then when iMessage launched in 2011 telecom providers plans had changed enough so that data wasn't as expensive, so it became seamless to keep using the default iPhone messaging app to talk to everyone.
Not sure what this is arguing besides 'might makes right.' Google's Play Store is more open and more dominant, anyhow. Apple succeeds on the strength of their exclusive hardware.
Apple isn't really dominating outside of the USA. I have no Apple products and have no need for them. Google, Amazon and Microsoft are much harder to avoid.
… yeah exactly. You just named the most valuable companies in the world, after the subject of this article. They do this too, and win way more often than not.
