Archives for category: Platforms

You hear a lot about the different kind of advertising—TV, radio, billboards, search, mobile, social, banner, pop-overs, and so on—but, after looking at ads on all platforms, I think we can reduce the taxonomy down to just four kinds.

Four types of advertising:

Type 1: “Yellow Pages”

Customers are actively looking for something because they want to buy it. They want several options — but not too many — to allow them to compare, and for the results to be: locally available to them, show prices, give links to more information. Their priorities (not necessarily in this order) include: price, fastest, best, available here, size/colour/etc.

Other examples: classified ads, Google search results, product comparisons, professional services listings, etc

More info

Type 2: “Coca Cola”

Shows the brand, typically in a fairly passive way, so that later, when the person wants to purchase that type of product, they recognise that brand and preferentially choose it. (They may even actively seek out that brand.)

Other examples: banner advertising, sports team sponsorship, business name signs outside business premises, logos on clothing, etc.

More info

Type 3: “Catalogues”

When the advertiser advertises another company or another company’s product to try to use that company’s brand awareness.

Other examples: Retailers that put popular brand name/products prominently in their advertisements, the little “Powered by” logos on some web sites, “Authorised resellers of…” etc.

More info

Type 4: “Garage Sale”

An event that the person doesn’t know about but, once they’re told about it, may interest them.

Other examples: new product announcements, spruikers outside stores, sales and special offers, bands & sporting events, exhibitions/shows, etc.

More info

“Serendipity”

As well as the above, sometimes things happen serendipitously, eg. you were talking to your friend about their amazing vacation in Italy, and then you see an ad for cheap holidays in Italy. Normally you wouldn’t have been interested, but you’ve just been talking about it, so you are. But, even though you’ve been talking about it, you wouldn’t have gone looking for cheap holidays. But when the two happen together, you’re interested enough to follow up.

Note that, of the four types, the first three do not depend on knowing about the customer. In fact, Type 2 is really aimed at everyone, without regard to their demographics. Type 1 advertising can benefit from things like knowing the customer’s location, but it does not rely on this. It is only the fourth type that really benefits from knowing more about the customer.

I go into each of the four types in more detail in separate posts.

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In the PC era, everyone (except Apple) ran the same operating system (OS) and, therefore, the same software. So PC manufacturers could only differentiate themselves based on one or more of: hardware specs, price, etc.*

This mentality has carried over into the smartphone (and, now, tablet) arena. However, these areas are different from the PC world because these devices don’t all run the same OS, and, therefore, don’t all run the same software. It’s actually the software that people want; it’s the software that allows people to do what they want, whether it’s update their status on Facebook, check their mail, play Angry Birds, or whatever.

This is why app stores are so important, and why attracting developers to write software for a particular OS is so important.

Apple obviously gets it; they should, they’ve been here before. The other phone manufacturers don’t, perhaps because they weren’t competing on software in the “feature phone” era. And the PC manufacturers, such as Dell, HP and Lenovo, that are trying to compete in this area, still seem to be operating as if the OS/software combination was available to all.

Maybe HP, with their acquisition of Palm, gets it too.

As for Microsoft and Google? Google thinks it is in Microsoft’s PC position, and Microsoft thinks it should be, and one day will be.

But no-one is likely to end up with a Microsoft-like share of the smartphone/tablet/ebook/music player market. The general consensus seems to be that three or four OSs will share domination for the foreseeable future.

* Ok, not all PCs ran the same software—there were minimum specs for the newest software at any one time—but you know what I mean.

Apple must be relishing the prospect of all those so-called “iPad Killers” coming to market.

While self-designated pundits talk about how all this choice will overwhelm poor little lonesome Apple, when consumers actually try these devices out in stores, they realise that, despite some impressive specs, the actual experience is not really what they are looking for.

The real competition is more that the various others compete against each other: a Samsung Android device, for example, versus a HTC Android device. Then all these Android devices compete against Microsoft’s devices for the attention of the manufacturers.

 

In order to have a “platform,” you need more than just an OS.

You need at least:

An Operating System

Main players: iOS, Android, Symbian, Bada, Windows Phone 7, PalmOS

  • A stable OS under constant improvement

Developers:

Platforms imply the ability to create software, which means convincing developers to devote time/resources to developing for that platform. In practice, individual developers will probably support no more than 2-3 platforms, and many will develop for only 1. Some apps/developers are “required” for the platform to be viable (or at least taken seriously), e.g. Facebook, Twitter, etc.

Developer tools: IDE, supported language(s), frameworks, shared code repositories, documentation, tutorials, training courses, sample code,

  • One or more programming languages
  • Developer APIs
  • Developer documentation
  • One or more developer IDEs
  • A library of frameworks for common use cases
  • A way to deploy applications
  • Ideally, a way for developers to be paid for their applications/work. These days, that means an app store.

Applications:

For sales to work, some form of DRM is implicit. For advertising to work, large distribution is implicit. The store must include ability for developers to “sell” free apps,

  • A core of useful standard applications
  • A store for customers to find and buy/get new applications, preferably an easy, consumer-friendly way

Devices:

If you can’t convince manufacturers to put your OS on a device, it won’t get sold. The platform needs to support multiple form factors without making it too difficult for developers to create apps that work across those forms.

  • Devices that run the OS, and related apps, at usable speed
  • A reference design for devices with minimum requirements and assumed capabilities
  • Devices at an affordable price for the target users
  • A defined way for peripherals to extend the device’s capabilities, and/or interface with the device

Customers:

For Apple (iOS), the customers are the users and, for iPhone, the Telcos. For RIM (Blackberry), HP/Palm (PalmOS), Nokia (Symbian), and Samsung (Bada), the customers are the Telcos. For other OS providers (Android and Windows Phone 7), the customers are the handset manufacturers. 

Thoughts on HTML5 and the Future of the Web

Someone needs to build an SDK for building rich HTML5 web pages.

Adobe does this now for traditional HTML with Photoshop and ??? and, to some extent, Flash.

Other examples are SproutCore, Sencha or jQuery Mobile. [280 North – are they now part of Motorola?]

Microsoft and Adobe would be good candidates to do this, but don’t seem to be doing it: Microsoft is not even talking about it; Adobe has talked about it, but hasn’t yet delivered (and doesn’t seem to be fully committed).

Opportunity for a small player to get big by coming out with a good quality offering.

Wildcard is Apple – they have said HTML5 is an accepted way to develop for iDevices, and they have put together iAd Producer and Dashcode, which could be the bases for a proper HTML5 IDE.

Steve Jobs has reportedly said that he wants OSX to start up as quickly as iOS, and has got the MacBook Air to get very close. And they advertise the Air as [the “future of laptops”]

Google touts instant startup times as one of the selling points of its Chrome OS.

It seems like this is going to set the bar for all computers: they should start up instantly.

Windows, working on its variety of hardware configurations from third-party manufacturers, is going to find this extremely difficult to match. They will probably try to “fake it” by doing a lot of things in the background while presenting the appearance of instant startup, but this is likely to result in annoyances/frustrations as users try to actually do things during this period and realise that they’ve been punk’d. (Especially if they have used an iPad/MacBook Air/Chrome OS device, and can compare their experience there.)

What is going to happen with iOS and iOS apps on iPhone vs iPad?

Assume that the iPad will have an annual update in around March  each year, and that the iPhone continues its annual update around June/July. Also assume that, as each updated device is announced, it will be accompanied by software updates – both OS and app updates.

Does this mean that, when the iPad is announced, it will have both OS and app updates the will not be available on the iPhone? And then, a few months later, the iPhone not only gets these updates but other new features as well? (I’m assuming that Apple would want to announce some new surprise software features when it announces the iPhone.) And the iPad gets updated with these new features too.

I can’t think of any other way this would work. It effectively means, though, that some features that could be announced for the iPad will be delayed just so they can be touted as new features for the iPhone.

There could be some features that are, and are designed to be, iPad-specific, e.g. the iWork suite of apps. There could similarly be iPhone-specific apps.

How’s this going to work?

Imagine if Apple went to each of its telco partners (AT&T, O2, T-Mobile, and all the others throughout the world) and said something like, “We’re about to bring out a new product, and we want it to have 3G (or even 4G) data-only access, and we want it to run on your network.”

I’m pretty sure the telco’s reaction would be, “Great! Where do we sign? How soon can we roll this out?”

So Apple continues, “We want to build the SIM card into the product itself, and we’ll activate it for the customer when they connect it to iTunes, as they do now for iPhones and iPads…”

“Ah, we’d really like for it to be one of our SIMs. Why can’t you put one of our SIMs in? That’d be simpler.”

“No, we want to roll this product out world-wide, and don’t want to be mucking around with different SIMs for each telco, just a single SIM built into the device. So we see it as an Apple SIM which would run on your network.”

“Um, this device: it’s not an iPhone, is it?“

“No, this is a new device. It will be data-only device. No voice minutes or SMS.”

“Ok. We’d prefer our SIMs in this device, but it’d be ok if it’s an Apple SIM. How much data would this device use?”

I would expect Apple to have an answer to this question, but I don’t know. It would be a reasonably high amount, possibly more than the 200MB per month that seems to be the world-wide amount most telcos offer as their base for smartphones.

“And how many devices do you expect to sell?”

Again, I would expect Apple to have an answer for this. They could probably have country-specific numbers rather than telco-specific numbers and would allow the telcos to fight each other for market share within the country.

Then Apple drops the bomb: “Given the number of devices we expect to sell, and the amount of data we expect each device to use each month, we’d like to pre-purchase [n]GB of data from you for these devices. At wholesale rates, of course.”

This is the important bit; instead of customers buying minutes or data from the telcos, and therefore being the telcos’ customers, Apple would buy the data at wholesale rates from the telcos, and sell them to Apple’s customers at retail rates along with the devices.

Apple would be making the telcos an offer they would find very hard to refuse—a commitment to buy huge amounts of data each month, from a reliable, cashed-up customer—but it would take away the telcos’ retail customers. They’d be swapping sales of data at retail prices for sales of that same data at wholesale prices.

The device, of course, would be an iPod Touch with a built-in SIM card, which makes it identical to an iPhone. But, instead of using the existing voice and SMS/MMS network, it would use the internet. It would use FaceTime for voice and/or video calls, iMessage for messaging, and the normal data for apps.

If Apple added functionality to FaceTime similar to Skype’s SkypeIn and SkypeOut, these new devices could call any phone in the world, and do it at similar rates to Skype, i.e. at much cheaper rates than the telcos charge, especially for long-distance and international calls. It could do something similar for SMSs.

For customers, it would mean they could buy a device from Apple, either directly or via its many retail channels, and never have to deal with a telco. During the activation process, they could optionally get a phone number (or be given the option of porting their existing number, where that is available). iDevice to iDevice calls would be free (like Skype to Skype calls). They could be made between these new devices and existing iPod Touches, iPhones and iPads, and Macs. All for free!

To receive calls from other phones, or to call them, they would have to buy pre-paid credits via iTunes. Importantly, though, if they don’t need these—if all their friends have iDevices—they don’t need to spend any more. They just need to pay Apple a monthly subscription for world-wide access to data. This would almost certainly be cheaper than their current telco monthly cost.

It would also allow these iDevices to roam anywhere in the world without roaming data charges, as Apple would have agreements with telcos all over the world. In markets like Europe—where travelling a relatively short distance can put you in another country, and expose you to fairly high call/SMS/data costs—this would be a very attractive selling point.

Apple, of course, would only have to pay for data over the telco network; as these iDevices all have wifi built in, and use wifi whenever it is available, use of these devices in places where wifi is available (such as at home and work, for many people) would not cost Apple anything.

With the release of Safari 5, Apple has added two very interesting things, Reader and extensions, both of which directly attack Google’s main (some would say only) business – web-based advertising.

Firstly, Reader. Reader allows you to read online articles in a continuous, clutter-free view, much like the javascript utility Readability. Reader places an icon prominently in the Address Bar which, when pressed, displays just the text of the article, nicely formatted, in a scrollable “page” overlaid in front of the original page, which it blackens out to de-emphasise it.

As Apple themselves say, “Reader removes annoying ads and other visual distractions from online articles.” [Emphasis added] How does this affect Google? By presenting articles in this way, readers effectively don’t get to see ads and, if they don’t see the ads, they won’t click on them. No clicks equals no money for Google. (As an aside, no clicks also equals no money for Bing or Yahoo, but I think they’re just collateral damage. As for the site’s publisher, who is also affected by this, I’ll get to that in a moment.)

The second thing Apple did was allow third parties to write extensions to Safari. Based on the most popular extensions to other browsers such as Firefox and Chrome, I would expect that two of the more popular extensions will be ad blockers and Flash blockers. (There is already an excellent Flash blocker, ClicktoFlash, for Safari, but I expect that either it or new Flash blockers will be written using the new extension API.) I am sure that Apple is not shedding any tears at the prospect of more people blocking Flash in Safari.

So, adding support for extensions will surely have the same effect as Reader – it will reduce the number of ads being displayed, and therefore clicked on, on web sites seen with Safari – but will be more generalised (i.e. not just article-type pages).

Is this really an “attack”?

Apple must know the effects that both these decisions will have on Google’s ability to effectively display ads, and to monetise the ads that do get displayed. What makes it particularly interesting, though, is that neither is strictly necessary.

You could argue that adding extensions is just bringing Safari up to parity with Firefox, Chrome and IE, all of which have had extensions for a long time. But extensions are a convenience, not a necessity, in a browser; Safari could have continued on without them. There has not been any kind of push recently to have them included in Safari, so it really is Apple’s choice to include them.

Reader is even more of an obvious attack. Readability gives much the same functionality and, as it is a javascript applet, it already worked with earlier versions of Safari. No other browser offers similar functionality out of the box. The decision to make and include it, especially so prominently, is, therefore, a direct attack on Google’s cash cow, in much the same way that Google Docs is a direct attack by Google on Microsoft’s cash cow in MS Office.

The object of the exercise seems to be to reduce the amount of money Google makes. The collateral damage to Microsoft and Yahoo is really of no concern to Apple at all.

But what about web publishers, many of whom rely on ad clicks for revenue? Fortunately (from Apple’s perspective), there are two ways web publishers can still earn money for their work:

  1. They can make an app and sell it on the App Store, and make money directly from sales; or
  2. They can make an app and give it away for free through the App Store, and make money from ads embedded in the app. These ads will, of course, not be affected by the changes to Safari. Publishers can choose Apple’s iAds, or any other ad distribution network, such as Google’s AdMob.

If Apple really is going after Google’s sources of money, though, I’d expect to see some change(s) that would hamstring AdMob. Other ad distribution networks, such as  Millennial Media, AOL/Platform-A’s Third Screen Media , Microsoft’s MSN Ad Network and Jumptap may or may not be collateral damage from any such change but, again, I don’t see Apple shedding any tears about that.

What Now?

Apple has several successful business: its Mac business, iPods and iTunes, the iPhone and its App Store, and now the iPad. Each of these generate significant revenues for Apple, and each faces already-intense competition. It would be hard for Google to attack any of these businesses in a way that existing competitors haven’t.

Google, though, really has only one significant revenue stream, online advertising. Its foray into Android was meant to secure it a foothold for advertising on mobile devices, so that revenue stream would continue on what will undoubtedly be the next major platform for computing – the “next big thing,” if you will.

If we take Steve Jobs at his word and that the relationship between Apple and Google was fine until, “We did not enter the search business. [Google] entered the phone business,” well, Google might end up regretting its decision, and might find to its dismay that it has bitten off more than it can chew.

[Update]: Apple has announced changes to their analytics rules that do, indeed, hamstring AdMob (and MSN Ad Network)