Categories

The last feature phone

During the last 12 months 31 million American phone users abandoned the use of feature phones. During the last 24 months over 60 million switched. Over 550k users are switching every week and this rate of switching has not changed much since late 2009.

Screen Shot 2013-01-03 at 1-3-3.26.17 PM

Screen Shot 2013-01-03 at 1-3-3.26.24 PM

Some of this switching has to do with demand for smartphone services but some of it is also due to a decreasing supply of non-smart phones. The shelf space being allocated to smartphones is nearing 100%. My single sampling of a Wal-Mart store shows the following data:

Screen Shot 2013-01-03 at 1-3-4.11.18 PM

Looking at individual carriers, AT&T ranged one feature phone and 7 smart SKUs. Verizon’s ratio was 2:8 and T-Mobile’s was 4:5.

T-Mobile has been lagging in smartphone adoption and as they transition in 2013 it’s possible that the AT&T ratio of 12% shelf space dedicated to feature phones will become the norm for the US. And as the US goes, the world will follow.

With shrinking shelf space comes an accelerated decline in the product category. It may not come in 2013, and perhaps not by 2014 but it’s quite possible that by 2015 the last feature phone will make its appearance in the US.

  • Dekker

    The fact that Android 2.2 and 2.3 phones are still being sold today, suggests that the transition from feature phones to smart phones is perhaps not as complete as it might seem. Also, the market for Android 4.0/4.1 Apps is consequently quite a bit smaller than the headline Android numbers suggest. All very interesting stuff.

    • http://profiles.google.com/simon.hibbs Simon Hibbs

      Indeed, it seems many Android phone owners use them in the same way as feature phones – just using the built-in apps, and those not very often.

      I wouldn’t have called it this way. If you’d asked me in 2006 what was most likely, I’d have thought an Apple device with limited but highly integrated functionality built in would be a natural for the company. In fact that’s what Steve Jobs wanted – he was personally against allowing in third part developers.

      I’d have pegged Google and Microsoft as the most likely creators of a more flexible device with rich third party app ecosystem. Yes I know both Android and WP devices are flexible and do have high levels of customisability, perhaps even more so than the iPhone, but in practice iPhone users make greater use of the flexibility they have and many, perhaps most users of competing devices use the power they have very little. I know how we got here and the forces at work each step of the way, but still the outcome is a curious one.

      • obarthelemy

        Actually, it’s fairly easy to understand, because an iPhone costs several times what a cheap Android handset does. People who get an iPhone have a reason to do so, either technical, which implies they *will* use features, or ego, which also implies they will make efforts to show of their hardware and skills.

        People who don’t really care about either, and who just want a way to check email/twitter/FB, consume media and play a game or two, self-select into buying cheap phones because there’s no need to spend 500+ USD for that.

        I’m planning on getting a cheap Android phone for my elderly parents and sister this year, because that’s exactly their use case. An iPhone or top-end Android phone would be entirely wasted on them, except for the camera. They probably won’t even get a data contract, and make do with wifi, which they do have at home, at work, and most places they go… but not during the actual trip inbetween.

        Also, the built-in apps are mostly good enough. I used to tweak my phones a lot, insist on CyanogenMod, specifc email/dlna/video/… apps… After a lot of configuring devices for other people, I’ve found that stock stuff is quite good, and that hacking is more of an ego-boost to boast of your mad skillz than actual necessary to get a good experience, except for some very specific tweaks and apps (widgets, rss reader…)

      • exNeXT

        iPhone 4S is $47 at Walmart. Your elderly parents might like one.

      • obarthelemy

        1- I’m assuming that’s with a contract. How much per month for 2yrs ? So your total cost is $47+24xyour_monthly_contract_price .

        2- Mine is $200+24x$0.They get 2hrs voice+100 texts and national wifi for free since their GSM provider is also their ADSL provider, and they don’t need data.

        => I’m betting your “cheap” iPhone costs more than $1,500 more than what I’m planning to spend.

        3- An off-contract iP4S is $673 in my country. That’s a whole new ballpark compared to $200 for a midrange Android handset (rated 4* out of 5* by the major national review site, iP4S is a 5* though ^^). Even its top-end contemporary GS2 (5*) is “only” $450, 33+% cheaper… I’d still be spending $450+ more than I intend, more than 3x my budget.

        4- Is there an alternative shell similiar to Big Launcher (https://www.youtube.com/watch?v=JO78enRWlTU) for iOS devices ?

        5- is there a free offline GPS app w/directions ?

        In the end, you’re suggesting I pay a lot more, for less functionnality and ease of use. No thanks !

      • Sacto_Joe

        Wow. Less functionality. In your dreams, obarthelemy.

      • ymelehtrabo

        What would his elderly parents do with with an off-contract phone?

        It’s actually quite amusing to read the lies Google shills tell these days.

      • blueseeker

        H’uh ? In Europe most of the phones are bought off-contract! I bought only unlocked phones since I remember. I keep the old price plan from my operator and I just change the SIM to my new phone. I have unlimited internet for 6 euros base plan + 3.5 euros an extra-option /VAT included (250MB full speed then there’s a speed cap – but it’s enough for IM, voIP and web-pages).

        I don’t see a reason why should I pay 30 euro/ip4 or 50euros/ip5 per month for a little more minutes/messages/data that I really don’t use.

      • MarkS2002

        They would use their two hours of phone time and check their email and check news headlines, listen to their old Rolling Stones and take and swap pictures. I presume if they needed more minutes they would buy them. That’s what we do here in retirement town and for someone who is looking for a digital camera and iPod replacement, they will likely get years of use out of it, as long as they have a computer to store their pictures and iTunes (or whatever). Personally, in spite of the 4s likely being free later this year, the monthly math is daunting, so I am still better off tossing the iPad in a bag if I need tunes on my walk and swapping it for a mini if I decide I need a camera. My last feature phone still fits fine in my pocket.

      • obarthelemy

        They won’t have 2/3G, but they will have wifi 90+% of the time. As I said (and I will repeat), they get
        1- a much nicer screen, both much bigger and more contrasted
        2- a much nicer UI (“Big Launcher”), they’re really struggling even with the Contacts feature of their dumphone, because the screen and keys are small and dim
        3- email in their pocket instead of at their desk. I’ve seen them just wait in front of the PC when waiting for new pics of the grandkids…
        4- GPS, with offline directions
        5- a camera
        6- usable SMS/texts feature, same issue as the Contacts.

        It’s quite amusing how some people can’t seem to understand there are several ways to take advantage of new devices.

      • Walt French

        Apple got about $50 billion worth of free consulting when developers roundly booed Jobs telling them to do HTML. Now, maybe it was just because the developers’ SDK wasn’t ready, and Apple always meant to go wide with it. But if they weren’t sure before the meeting (2007 WWDC?), they had to have been afterwards.

    • stefn

      When Google gave away the Android OS to both manufacturers and telcos, it also surrendered control over upgrades. Not sure why. As a result, Android OS version updates lag way behind iOS. As of December, less than 7 percent of Android devices were upgraded to Jelly Bean, 5 months after its arrival. So, yes, why hurry to upgrade apps to Jelly Bean? By comparison, 60 percent of iOS users got iOS 6 within 1 month; 25 percent in 1 week. Obviously developers jumped to work on iOS app updates. Another developer consideration: Over 4,000 distinct Android models have been introduced to market. Imagine the support issues.

      • Datsond

        Not sure why Google away Android and surrendered all control over upgrades? That’s easy. At the time Google had ZERO credibility in the industry and therfore they were not in any position to make any deamands what so ever.

      • Datsond

        Considering the available choices from all the established industry players, the nature of Google’s “No strings attached” offer is the only thing that made them worth considering.

      • stefn

        Consider: Apple’s credibility was close to zero when it produced the iPhone. No way it would have separated its core software abd hardware decisions. Google will spend the rest of the decade trying to knit them back together.

      • Luis Alejandro Masanti

        I think that Apple’s main concern was the User Experience, so it needed the control over the full stuff, specially actualization of the soft.
        This is what Google did not understand. Google wanted the click in the ads to sell your soul to the advertisers-

      • stefn

        Really Apple’s whole history precluded the possibility it would separate software and hardware.

      • Luis Alejandro Masanti

        You are right, but this time it also included “other partners” (AT&T) in the mix. We must remember that Apple began practicing “software update” in electronic form previous to the iPhone.

      • enyibinakata

        Apple was already an established consumer electronics company. The Newton was ahead of its time as far as PDA’s is concerned .The iPod really put Apple on the map. Apple had already kind of tested the mobile waters with a Motorola collabo in form of Rokr music phone.

        http://en.wikipedia.org/wiki/Motorola_Rokr

        Google had no track record of electronics at this point, zilch, nada.

      • stefn

        The Newton established nothing in CE; it was a hobby not a business. The Moto deal was a nonevent. The iPod was viewed as a one hit wonder. The iPhone was a revolution, viewed as Apple’s ignorant and arrogant reach by competitors and friends. Apple didn’t drop Computer from its name until 2007. That’s when it felt it could publicly stake a claim in CE. In fact, making computers for the rest of us is still its mission and its heart blood. But Apple learned to camouflage computers by making its high tech also high touch, making them small and shiny, and running tons’o’fun through them.

      • obarthelemy

        Or just maybe because it’s not that important, or even, a bad idea ?

        – On the hardware front, Smartphones are leading-edge for 6 months, still somewhat current for 2 years, and relics after that. OS upgrades, even for Apple, can only be done during those 2 years. Smartphones have not yet reached the maturity of PCs, which you can use for 5yrs without missing out on too much stuff.

        – On the consumer front, not having upgrades does not diminish what you get, it locks you out of new stuff. The power user market is pissed off, but I doubt the general public cares much.

        – On the OEM front, that creates a nice differentiating factor. Want the latest OS ? Get the latest model !

        – The one big issue is devs, which have to contend with a fragmented user base. Most apps are not that impacted though, and Google is providing libs to back-port new 4.x functionality to 2.x.

        I also think things will progressively calm down, and the pace of innovation slow down. Google focused on time-to-market initially, and only recently have had the opportunity to take a step back and try to make things more modular/flexible for the long term. Handling of wildly differing display resolutions and ratios for example, is already done in a much nicer way in Android than in iOS. Also, Google are slowly prying some of their own apps/extensions out of the basic OS, so they can be upgraded on their own via the PlayStore.

      • Tatil_S

        “On the consumer front, not having upgrades does not diminish what you get, it locks you out of new stuff. ”
        Yeah, there is no value in getting new features or better performance. Not a big deal…

      • http://twitter.com/M_Gauche James King

        ” Handling of wildly differing display resolutions and ratios for
        example, is already done in a much nicer way in Android than in iOS.” – obarthelemy

        This is a double-edged sword that I addressed on another forum. Google’s use of scaling to address different resolutions makes it almost impossible to guarantee that any program, particularly those that run on tablets, has the exact same user experience across devices. I think it is one of the main reasons there aren’t many tablet specific applications for Android. The advantage that Apple provides by offering a limited number of resolutions for which to program is that it guarantees that the user experience will be consistent across its entire mobile hardware ecosystem. That isn’t the case for Android. Once you reach tablet sizes, diversity in screen resolution becomes a major issue that scaling can’t fully address.

      • TheBigApple

        Interesting thoughts. And if true, significant, as these seem to be fundamental attributes of the respective operating systems. But for people like me who are relatively ignorant regarding computer science, could you elaborate a little on this…a little more detail? Thanks.

      • http://twitter.com/M_Gauche James King

        The metaphor that I’ve used to describe the difference in scaling a UI vs. coding one for a fixed resolution is that scaling is like trying to perform interior design on a room that routinely changes size. It will look good at certain sizes but, as it expand or contracts, elements will not be aligned properly. The couch may end too close to the coffee table, the TV may end up too far from the couch, etc. Designing for fixed resolutions is like having fixed dimensions for a room. Once the elements are set, you don’t have to worry about them not being in place relative to each other.

      • obarthelemy

        You’re right: targetting a single resolution, is easier on the devs, and requires 0 specific support from the OS, since different resolutions = different apps and that’s it.

        It does have disadvanatges too though
        1- devs must do x versions of the apps, one for each rez
        2- customers must buy x versions, too
        3- it makes supporting different screen sizes more cumbersome. As far as I know, Apple only offers 3 (1024×768, 2048×1596, and whatever the iP5 has) vs 10+ on the android side. Specifically, that’s a barrier to Apple offering video-optimized ratios (16:9), whereas android is present at both the 4:3, 16:9 and 16:10 ratios, among others.
        4- it makes supporting new resolutions harder. I don’t know how many apps support the iP5 yet, whereas Android supports any new rez as soon as a new device comes out

      • stefn

        “not having upgrades does not diminish what you get, it locks you out of new stuff.”
        Do you read what you write?

      • obarthelemy

        Well, it doesn’t. Same as GM releasing a new car does not make your current car any less than it was when you bought it: It doesn’t actually take anything away from what you had before, it just doesn’t give you the new stuff.

        Got it now ?

      • stefn

        By definition old cars cannot get the new stuff; old devices can, unless you want to rationalize not getting the new stuff.

      • Walt French

        Google never surrendered control because it never had any.

        Apple’s iPhone featured a long development cycle during which Apple designed every feature, including integrating it into its then-well-developed customer support system. Cingular, which was suffering from its acquisition of “old” AT&T, was in no position to build out a software- and customer-support system, so Apple would’ve easily negotiated that feature.

        I think the Verizon/Google story is almost the opposite: Verizon quickly saw how iPhone-type smartphones would take all the high-end users, and needed to get a product on its shelves stat. Verizon helped design the first Droid, then wrote the specs for all the following ones: what features, price levels, etc. Google was suddenly in the right place at the right time and had to ramp up its OS — the first Androids were kinda awful — and the OHA business setup to deliver, as Google has said, into this “surprising” success.

      • stefn

        You said it: Verizon was in a huge hurry. That’s leverage. But Google probably never thought to test it, given its own ambitions. Google was just as worried about the iPhone as Verizon.

      • Walt French

        Look to the history of Verizon’s involvement. They jumped on Android, creating their own related branding (Droid), etc., to counter the belatedly-realized threat that AT&T/Apple posed. Chose the macho marketing theme, etc. Android only came to AT&T, Sprint & T-Mo much later.

        I personally believe without Android, Verizon would’ve gone to Nokia in a serious way. And without Verizon, Android would be struggling with a low market share, which maybe would’ve given Symbian, Palm, Microsoft and RIM a chance.

      • Tatil_S

        Let’s not rewrite history. Palm might have been an option, but all Nokia had at the time was Symbian, which had been around for a long while, but it had not taken off in the US or launched a real smartphone revolution outside the US, so Verizon did not really have the option to go with Nokia. Blackberry already had a wide name recognition, but it hit its ceiling and it was not in any shape to compete with iPhone. Neither was Windows Mobile. Verizon did not go with Android as a favor, it did not have much of a choice. These three were bound to crash and burn with or without Verizon’s support.

      • Walt French

        Let’s not rewrite my comments, either. I never cited the also-ran manufacturers as alternatives that Verizon could’ve gotten behind. I merely said that had Android not taken off so quickly, they might have had time to respond to the smartphone revolution.

        Although Motorola, Google and Verizon worked closely on the first Droid, the final product branding was “Verizon” and “Droid” — Motorola was known but took the back seat. Had Verizon partnered with Nokia, Nokia’s lack of US brand recognition or distribution would have been a minor impediment to Verizon creating a proprietary alternative to the then-exclusive AT&T/Apple deal.

      • Tatil_S

        Symbian could not hold its ground in places where it had large market share and where Nokia had much better brand name recognition and distribution network. It was losing market share rapidly, even before Elop pulled the plug on it. Why would Verizon’s support make a difference in a country where it did not have all these advantages to begin with? Verizon’s support must have certainly accelerated Android adoption in the US, but I am not sure it had that much of an effect on Android taking off all over the world. I still say claiming that Symbian lacking a deep pocketed carrier partner in one country, where it never made inroads in the past when the competition was lackluster, had a big impact on losing against Android globally is a rewriting history.

      • Sacto_Joe

        “…but I am not sure it had that much of an effect on Android taking off all over the world.”

        Again, that’s not what Walt French is saying. He’s not “rewriting history”, he’s positing a “what if”. He’s allowed to do that.

      • Sacto_Joe

        I think there’s some truth in what you say, but it doesn’t negate Walt’s premise. His point is what would have happened WITHOUT ANDROID. What would have Verizon done then! and which phone maufacturers were in the best position to repond to the paradigm shift Apple initiated?

    • obarthelemy

      Or it means android 2.x is “good enough”: it runs a browser, email, twitter, facebook, rss, games, a camera… It might also mean people choose price, hardware features… over OS version.

      A phone is not only a fashion accessory: it’s also (mostly) here todo a job. Android 2.x probably does that job well enough for 0-20% of the cost of this year’s latest model. Same as WinXp is still good enough for many PC users. And last season’s shoes still OK to walk with.

      • Frank Vaughn

        I’ve tried to use a 2.x phone. Not a good web experience. The latest web usages stats weigh heavily towards Apple, and this is probably the reason why. Is there a way to get Web Stats broken down by Android OS version? That would be interesting.

      • Frank Vaughn
      • http://www.facebook.com/bob.arker.731 Bob Arker

        let’s explain this graph: Android overall web usage is still lower than Apple’s, and this may be because most people who buy android phones are still using them as feature phones.

        The 2.x android graph is higher than the 4.x simply because more people buy the cheap android phones that come with 2.x.

      • http://twitter.com/frankvaughn Frank Vaughn

        I was very surprised that 2.3 usage was even equal to 4.0, let alone bigger. It is really not a great user experience. Anyone here use 2.3?

      • Walt French

        @obarthelemy wrote, “A phone is …also (mostly) here todo a job.”

        Smart idea. Let’s shove it thru a meatgrinder that economists are enamored of, that of the “marginal buyer” who is right on the cusp between a simple, cheap featurephone, and a smartphone: more powerful, but demanding more money, a steeper learning curve and babysitting such as app downloads and more frequent battery charging.

        Whether this buyer gets heads or tails, he’s basically indifferent between spending $50 or $60 per month to have mobile internet access (and maybe, better games), or not. That same money could easily get you DSL and a nice PC or tablet, so the marginal buyer is in one of three situations: (1) having cash vs adding a mobile PC as an option; (2) having cash vs having a first personal PC; and (3) considering whether his first PC is mobile & eentsy or fixed and windows complex/capable.

        (Note that “phone” doesn’t factor in either scenario, because by definition, both feature- and smart-phones are phones. Pretty much ditto, “camera,” etc.)

        Methinks #1 drove most early smartphone sales, and there may be a fair tail. It seems unlikely that the motivation to buy one’s first PC would line up desktop vs mobile, so scratch that. The job to be done is now largely #2, providing a first personal device for young people or previous computerphobes to get online. Many of these will be very price-sensitive, while others will want to know they’ll be able to manage their devices without a whole lot of expertise.

        Android 2.2 was the first version that had the speedup from JIT and while it’s almost 3 years old, I imagine that almost all apps work fine on it, if only because newer features seem relatively modest. People retiring these devices will assume that any newer phone is much faster; they might switch brands but seem much less likely to switch platforms.

        None of this suggests that the basic terms of competition is changing sharply. Apple will do well as long as it doesn’t seem much pricier and as long as it keeps up a perceived ease-of-use or quality edge; Android will do well as either an inexpensive brand or as the device for a MOTU (power-user).

      • obarthelemy

        1- demanding more money: a little bit at purchase time (off contract feature phone: $50; 4″ Android: $200), and where I live nowhere near what you quote for service, unlimited everything incl. data is $20/mo, with 1GB for $10, and if you have a sedentary lifestyle (say, elderly, or with kids), you can get 80-90% connectivity with just wifi for $0/month.
        2- a steeper learning curve: no. Android’s contacts list, SMS, MMS, phone and email is as easy as featurephones, easier even.
        3- and babysitting such as app downloads: no, once setup by the famous techie nephew (or son/brother in my case ^^), app updates are transparent
        4- and more frequent battery charging: yes, every night, which isn’t too onerous.

        So basically, the minimum cost for going from featurephone to entry-level android is a one-off $150, and that’s it. Gets you email, skype, IM,… in your pocket instead of at your desk, and apps (games, FB, twitter…), and a nicer UI (Big Launcher, for the tech-averse). Where I live most people already have a PC, so the decision is tablet vs smartphone. Smartphone w/o contract is a bit cheaper, though a respectable Android tablet can be had for $200, either the 7″ Nexus or a 10″ on sale for $50 more.

        Importantly, an Android smartphone also replaces a GPS, with a free navigation app (navfree, works offline). The phone pretty much pays for itself that way. Though navfree doesn’t compare to high-end GPS (you need Google Maps and a data connection for that), it does serve its purpose.

        I’m also under the impression that even cheap smartphones’ cameras are superior to featurephones’ but I haven’t checked, I might be wrong.

        Indeed, I think pricing is starting to come into play more, at least In France, where 75% of last quarter’s phone purchases were off-contract. The midrange market is exploding, giving rise to a cottage industry of rebranding Chinese imports, switching them to French, and offering a warranty… Most people won’t shell out $500+ for a smartphone. That price transparency is starting to hurt Apple: an iP5 is 35-65% more expensive than a GS3 depending on Flash size, let alone low-end offerings. And the ease of use argument is being diluted both by features (NFC is starting to come into play, interoperability already is, widgets…) and by Android’s progress on that score. The 3 criteria on which the iP5 is unchallenged are very small size, very nice looks, and peripherals (docks mainly). There is a market for design-oriented, expensive phones, and it’s all Apple’s. I don’t see it being more than 10-20% of the total market though. same as for PCs.

      • http://twitter.com/M_Gauche James King

        “And the ease of use argument is being diluted both by features (NFC is
        starting to come into play, interoperability already is, widgets…) and
        by Android’s progress on that score.”

        The only people who seem to think Android is catching up to iOS in usability are people who use Android devices. I use a Galaxy Nexus with the latest version on Android and it is by no means as easy to use as an iPhone. Quite frankly, not even close. That isn’t to say that Android is poorly designed but it is simply not in the class of the iPhone when it comes to usability. Having some background with usability design, I don’t make that assessment from an uneducated position.

        The reality is that Blackberry had grown to occupy the area that feature phones occupy but the consistent bashing by stock shorters and tech pundits in the U.S. caused RIM to crater in North America. Blackberries still have positive user growth pretty much everywhere except the U.S. The bottom line is that markets, particularly U.S. ones, don’t value diversity of options. In the attempt to sensationalize, the media brands things as “cool” or “uncool” rather than “useful” or “non-useful.” It’s apparent that most people aren’t using phones very differently than they always have. I think a phone with a simple but elegant OS that allows people to do their 10 most common tasks would be just as successful as a mobile OS with a comprehensive ecosystem. But “conventional wisdom” says otherwise.

      • obarthelemy

        I’m using Android myself, but regularly mess around with the iDevices of people around me. What’s giving me difficulties:

        1- No fixed back button. There’s is always some button to go back, not always called the same, not always in the same place, actually not always on-screen (you need to scroll a bit). Unless you know the app by heart, that’s a constant pain.
        2- no fixed menu button. Ditto as for the back button. Very reminiscent of the “right mouse button” issue. You’ve got to hunt for it, you’re never quite sure you’ve looked at all the apps’ menus…
        3- No widgets. My home screen is basically all widgets: new mails, the day’s+tomorrow’s schedule, and if there’s room for them, new rss feeds.
        4- hard to get stuff on and off it. Unless you’re into the whole “mac, iTunes, special cables, special app” scene, you can’t get stuff onto and off an iDevice.

        I’d be interested in what you find hard about Android, as a counterpart ?

      • http://twitter.com/M_Gauche James King

        I have no issues with your criticisms of iOS. I never claimed it was perfect, only more intuitive than Android. I obviously can’t do a complete UI comparison in this forum but compare the Setting in iOS vs those in Android. The breadth and depth of Android’s settings are daunting to say the least. I’m sure there are settings I still haven’t found in Android.

        As for widgets, they tend to offer very little information relative to screen real estate. Even Google has realized that its Notifications area is more useful for providing snippets of information as opposed to using widgets. I almost never use widgets in Android so I find their value limited.

        Most importantly, most system wide functions can generally only be performed one way in iOS. Even in instances where it is less efficient, it is generally more learnable.

      • Jeff G

        I had a Droid 2 Motorola for 1.5 years and switched to iPhone. I can’t be as specific as you were about where buttons are and aren’t, but I can tell you that in my experience the iPhone for ease of use, blows the doors of the Droid.

        Further, since I already owned an iPad (My first ever Apple product, purchased in May 2011) the whole experience was magnificent.

        I had written a book on Pages, designed slides how presentations on Apple Keynote and begun to learn and use Numbers spreadsheet. When all those docs magically appeared on my iPhone, and started synching effortlessly…I was stunned. I had tried various document experiences on droid, and always been a PC guy, but my conversion to Apple world became fast and furious. Have not spent a single penny on an MS product since and never going back to Droid.

        Fixed menu button? Back space button? I have no idea how those could possibly relate to any real world usage issue…

      • Tatil_S

        I’ve used a Blackberry for two weeks during an overseas trip. It was not easy to do 2 common tasks with it, let alone 10 and its OS is far far away from being elegant. If it was simple and elegant only with limited functionality, RIM would not be in this mess.

        Tech pundits bashed plenty of iPhone and iPad releases, but sales did not crater in North America. Blackberry is years behind the times. As NA population has relatively high income, it does not have to put up with it, unlike people in many other places where BB sales are growing. Blaming the media for corporate failures is a tired old game.

      • http://twitter.com/M_Gauche James King

        “Tech pundits bashed plenty of iPhone and iPad” – Tatil_S

        I really can’t argue with a statement that is disingenuous by nature. It’s one thing to not like a product, another to continuously provide negative press regardless of the circumstance.

        If you don’t believe that the media influences perceptions, you may want to check Apple’s current stock price. It is still the same company with the same strengths but it has lost over 25% of its stock value in the last six months, much of that due to negative press. So you have a prime example for you right there.

        Another issue I have with your response is the strawman you set up to knock down. I never claimed that Blackberry OS was elegant. However, I do think Blackberries fill a useful niche in the tech landscape. More competition and price pressure is always good for consumers. Distilling the current mobile landscape to iOS and Android has homogenized the mobile market in a way that is ultimately harmful.

      • Tatil_S

        Let’s not bring in stock price into the argument, as you have no proof that media coverage is responsible for the drop in share price. Apple stock price went through the roof during bad coverage periods in the past, so it would be “disingenuous” to claim that it is making a difference now.

        Your argument was BB market share dropping like a rock due to tech pundits. There is a cottage industry of bashing Apple products, yet that does not seem to affect consumers all that much in the end. Why should BB more susceptible? Besides, BB Playbook got plenty of good press before it was released. I’ll leave that up to you to decide whether that was due to tech pundits desperate to talk positively about an iPad competitor or some other incentive structure.

        In any case, even if BB was perfectly suitable for some low price limited functionality niche, I doubt it could save RIM with or without tech media cheering it on, as its cost structure does not seem to be tailored for making devices sold at such price points. People just did not like it in North America enough to buy it, despite all those “$50 for two” deals.

      • http://twitter.com/M_Gauche James King

        “Let’s not bring in stock price into the argument, as you have no proof that media coverage is responsible for the drop in share price.” – Tatil_S

        When the only factor that has changed is the press coverage, I’d say that, if it is not “proof,” it is a smoking gun at least.

        Don’t like the Apple example? Great, I’ll just use RIM. The recent favorable press has caused RIM’s stock price to double, though little has changed in its the business dynamic.

        BTW: http://www.nizkor.org/features/fallacies/burden-of-proof.html

        “Apple stock price went through the roof during bad coverage periods in the past, so it would be “disingenuous” to claim that it is making a difference now” – Tatil_S

        This is a completely false statement so it can’t even be addressed. The overwhelming amount of Apple press has been favorable for the last decade, since the original iMac.

        “There is a cottage industry of bashing Apple products, yet that does not seem to affect consumers all that much in the end.” – Tatil_S

        See above. If you are going to make up facts, they can’t be addressed.

      • Tatil_S

        You might want to take a look at Gruber’s Claim Chowder posts or Macworld’s Macalope articles to see examples of serial Apple bashings over the last few years before accusing me of making things up. If you think the last few months of press coverage is an aberration, you are wildly mistaken or misinformed.

        Where was the negative coverage before and just around when BB marketshare started dropping? (If media is causing it to fail, it should precede RIM’s NA crash and burn, doesn’t it?) Please link to some stories in PC World, CIO, New York Times, CNN, Forbes, Engadget etc from 2010 and 2011. I can assure you, there were tons of positive articles, all the way from “iPhone is not secure, enterprise will not leave RIM” to “physical keyboard is essential” to any number of generally positive reviews of new BB phones or the Playbook tablet. Your memory is very selective.

      • http://twitter.com/M_Gauche James King

        This is a burden of proof fallacy, which is why I linked to the definition. If I supposedly can find negative articles to support my assertions, you supposedly can find positive articles to refute me. I have already provided two real-world examples.

        Since this is the second logical fallacy in which you have engaged, this exchange is done.

        As for Gruber and MacWorld, we are talking about a few articles amongst thousands. Gruber in particular has been a Mac advocate for a long time and his “claim chowder” is a holdover from when Apple was failing as a company (pre-Jobs return). You are presenting information out of context.

      • Tatil_S

        You provided one positive press clipping that you claim has increased RIM share price. That is not nowhere near evidence that RIM’s troubles are due to media’s negative coverage.

        As you are the one who claims that negative press about RIM is responsible for its crash in NA market, the burden of proof is on you to show those negative articles from 2010 and 2011. It is my burden of proof to support my claim that Apple had plenty of negative coverage, but came out fairly successful in the market. For example, I remember Antennagate fairly well, but maybe you are too young to do so. Your ignorance aside, there are plenty of claim chowders from the last few years. Here is a couple:

        http://daringfireball.net/linked/2012/01/24/blodget that points to this: http://articles.businessinsider.com/2011-04-02/tech/30089528_1_android-phones-google-s-android-smartphone-market

        http://daringfireball.net/linked/2009/06/23/munster (This is about an article on CNN, quoting Munster)

        http://daringfireball.net/linked/2010/11/30/acer

        http://daringfireball.net/linked/2010/04/20/tomi-ahonen

        http://daringfireball.net/linked/2011/11/10/wilson

        Here is an asymco post about how so many analysts bashing iPad turned out wrong:

        http://www.asymco.com/2011/03/04/flummoxed-again/

        More non-glowing coverage from tech press:
        http://gizmodo.com/5864293/siri-is-apples-broken-promise

        http://news.cnet.com/8301-13579_3-57338360-37/apple-ipad-feels-squeeze-from-fire-air/

        That should be a long enough list to get you started.

      • http://twitter.com/M_Gauche James King

        I’ve already provided proof that you’ve decided isn’t proof. The issue regarding a burden of proof fallacy is that neither you nor I can provide enough “proof” to conclusively support either of our assertions. You provided a handful of articles that only prove that there is SOME bad press re: Apple. That is not conclusive evidence. Do you honestly think I can’t find 3x the articles painting Apple in a positive light? Or that I can’t find at least a dozen articles bashing RIM? It’s a pointless exercise. That’s why I used REAL WORLD examples. The very fact that you are attempting to engage me in a fashion in which it would be impossible to prove either point based on the breadth of material on the Internet proves you are engaging in a logical fallacy.

        As for my experience, I’ve been involved in technology for the better portion of two decades. I have more than enough experience to write intelligently on the topic. You on the other hand seem to have chosen this forum to deal with self-esteem issues.

        I can’t debate that Apple has received bad press. But unless you plan to collect EVERY article on the Internet to prove that the PREPONDERANCE of articles related to Apple has been negative, your point is already lost. As for my assertion re: RIM, you either accept it or you don’t. I don’t mind in either case.

      • Tatil_S

        Yes, nothing says intelligent analysis like a personal attack in the succeeding sentence.

        Your real world example no.1 is one positive stock analysis that you assert to be the reason for RIM’s stock going up. That might be true, but then again the stock may have gone up because another feared delay in BB10 did not come to pass. In any case, how does this apply to drop in NA sales?

        Your second real world example is your assertion that Apple is getting sustained bad press for the first time in long time and this affects its share price. Again, irrelevant to sales in NA, as Apple’s iPhone sales are still growing in NA. Besides, there was bad press from all quarters (CNN, Consumer Reports) during 2010 about AntennaGate. No drop in sales. 2011 brought bad press with a meh response to iPhone 4S and all those articles about Apple’s likely long term decline without SJ, yet that was followed by record sales.

        All I see here is two assertions, one inconclusive, one incorrect. Based on these two real world examples, how do you expect anybody to conclude that RIM’s NA sales drop is for a large extent due to bad press? Why should we ignore the bad press Android gets due to fragmentation and lack of OS updates? Why should ignore the good press that RIM got for Playbook and its hold on IT departments? Why should we ignore your lack of any effort in providing links to any alleged bad press RIM got before its NA sales started tanking?

      • http://twitter.com/M_Gauche James King

        “Your real world example no.1 is one positive stock analysis that you assert to be the reason for RIM’s stock going up.” – Tatil_S

        Strawman. I stated no such thing. I was referencing a PREPONDERANCE of recent good press for RIM’s increase in stock price.

        “Your second real world example is your assertion that Apple is getting sustained bad press for the first time in long time and this affects its share price. Again, irrelevant to sales in NA, as Apple’s iPhone sales are still growing in NA.”

        My example was to show how perception can be altered based on information being presented out of context. Apple’s stock value has dropped greater than 25% as a result of the poor press. The fact that this is the case even though there has been no degradation of its sales (as you have pointed out) shows how the strength or weakness of a company can be amplified simply based of the tone of the press it receives.

        As for RIM’s drop in sales, it showed growth for almost 4 YEARS. While it was losing market share to Android, its overall user base was growing. As I’ve stated in another post, the only two metrics RIM was weak on was marketshare and ASP, both of which were not dire situations. I’ve already stated my case in another post, I won’t rehash it now.

        “Besides, there was bad press from all quarters (CNN, Consumer Reports) during 2010 about AntennaGate. No drop in sales. 2011 brought bad press with a meh response to iPhone 4S and all those articles about Apple’s likely long term decline without SJ, yet that was followed by record sales.”

        As I’ve stated before, unless you can prove CONCLUSIVELY that the overwhelming majority of the press for Apple during this time period was bad, your point is already lost. You are doing the exact same thing you are having a problem with me doing, which is making a statement as fact that is impossible to verify. The difference is that I made my statement with the expectation that people would draw parallels based on everyday events and determine for themselves whether they agreed or disagreed. You on the other hand are treating this matter as if it can be proven one way or the other CONCLUSIVELY. It is IMPOSSIBLE to do such a thing based on the sheer breadth of material. You want to conclude that, because I can not prove my point CONCLUSIVELY, that I am wrong. That is a logical fallacy. The inability for me to prove my point doesn’t make you correct be default. I did not link to an article regarding RIM, I linked to the definition of the Burden of Proof logical fallacy because you had already crossed the line. If I had been able to prove my point conclusively and didn’t, you would have been correct. The problem in this situation is the NEITHER one of us can. The points you are making are false but it is a moot point. Unless you intend to collect EVERY article related to Apple to prove your point, you’ve already failed.

        Now here’s the great part for you … THE SAME APPLIES TO ME. Because I can not CONCLUSIVELY prove my point, you are welcome to disagree. Am I wrong? No. But I don’t have either the tools or time to conclusively prove it. And, in the end, it really isn’t important enough for me to convince you. The evidence is out there if you are willing to find it. If you don’t agree with my premise, that’s fine too.

        What you want to do is prove me wrong. You can’t. You don’t have the tools or time to do it. You want to prove that I’m wrong because I can not CONCLUSIVELY prove my point. You can’t because the nature of the Internet makes it IMPOSSIBLE. And, for that matter, NEITHER CAN YOU. That is why you have engaged in a logical fallacy, because you are setting an expectation that is impossible to fulfill. And the fact that I can’t conclusively prove my point doesn’t automatically make you right.

        The difference between me and you is that I’m not trying to convince you that you are wrong or prove that you are. I’m flat out stating it without the expectation that you can prove otherwise. And if you choose to not accept that, I’m not going to keep arguing with you until you do. I accept the limitations of this forum and engaging in points like this. In the end, there is just too much information. I haven’t been uprated or downrated much on these exchanges, so most people probably accept that this point is a matter of interpretation. That’s the best that can be expected.

        As for my comment regarding your self-esteem issues, maybe you might consider being more respectful. I’m far from “ignorant” on these matters. And you always just have the option of ignoring my posts.

      • ChillOut

        “This is a burden of proof fallacy, which is why I linked to the definition. …Since this is the second logical fallacy in which you have engaged, this exchange is done.”

        These comments are clearly from someone whose arrogance exceeds his ability to make a convincing argument.

        “This exchange is done.” Ooooh….

      • StillKickingButt

        “If you don’t believe that the media influences perceptions, you may want to check Apple’s current stock price. It is still the same company with the same strengths but it has lost over 25% of its stock value in the last six months, much of that due to negative press. So you have a prime example for you right there.”

        Well, the relevant point to this discussion is that despite the cratering stock price and despite the flood of media negativity about Apple, iPhone is selling tremendously well. Blowout opening in China. Highest U.S. market share ever. That.

      • http://twitter.com/M_Gauche James King

        Apple’s stock price has fallen despite the points you’ve made. That was the relevant point. The only thing that has changed is the media coverage.

      • Walt French

        “The only thing that has changed is the media coverage.”

        Nope, not even close.

        There is a growing set of court decisions showing that Android (especially, Samsung) is surviving even the worst of the Patent Wars. Growing announcements of Nexus and Amazon tablet offerings and maybe even sales that could crimp iPad sales/margins. Some amazingly high-end phone announcements from unlikely names such as ZTE. Rumors and sketchy reports from Apple’s component suppliers of reduced demand.

        I’m not saying these stories don’t get written from a “piling on” perspective, nor am I saying we should take them at face value. I’m just saying that there are many factual-seeming pieces of news that’d justify investors who don’t have better information—that’s almost everybody—becoming less optimistic about the company.

      • http://twitter.com/M_Gauche James King

        No disrespect but aren’t you substantiating my point? These stories are printed and spun in ways to make people think a certain way. Samsung’s business shows very little sign of impacting Apple’s business or profitability. Most of Samsung’s market gains are in the low end, a place Apple doesn’t even compete. If Apple is facing any pressure, it is less competitive and more economic … less disposable income in relation to stagnant wages and increasing living costs. It is still far and away the most innovative tech company in the world.

        As I stated, the only thing that has really changed is the media coverage.

      • StockDoesntMatter

        “Apple’s stock price has fallen despite the points you’ve made. That was the relevant point. ”

        Relevant to whom? To Apple consumers? No. To long-term investors? No. To short-term speculators? Well, they get what they deserve.

      • http://twitter.com/M_Gauche James King

        Relevant because it proves that providing information without context can influence thinking in such a way as that it has a real-world effect, sometimes positive, sometimes negative.

      • TwoIsEnough

        ” More competition, product diversity and price pressure is always good for consumers. ”

        I don’t think so. A reasonable amount of variety is good. But when you’re talking about an enabling technology (e.g., the operating system of smartphones and tablets), having more than two (maybe three) players is counterproductive. Developers of third party software and accessories simply can’t deal with more than that. And having an enabling technology without the third-party layers on top isn’t very helpful.

      • http://twitter.com/M_Gauche James King

        The issue is that proprietary technology prevents interoperability. Provided that there is a reasonable amount of interoperability, competition is a benefit. Granted that isn’t the case in the mobile space.

        As for my original point, RIM already occupies the third space. So my point is still relevant.

      • Walt French

        You’re not the first or only one to look for reasons of Apple’s recent swoon.

        I’m amazed that so many have turned to the “perceptions” story after years of drumbeats about how Android was going to swamp Apple. There’s certainly the argument that Samsung and others have caught up to, and passed Apple in capabilities, often at a much better price, and that would slow Apple’s future growth, on which its price relies.

        My version of that story is that Apple is riding a tiger of disruption that it cannot get off; it must keep innovating or be run over by lower-cost copycats. I’ll spare everybody my personal opinion about how well they’ll succeed, but does anybody doubt that this is a key issue?

        So I don’t worry about the surprisingly unaware analyst community’s comments, nor the drumbeat of news stories about how far Apple’s stock price has fallen. I think the price of AAPL — oh, RIMM, too — is driven by the consensus view about the firms’ specific prospects in our very uncertain economic situation.

        Not by the reports of what the views are.

      • http://twitter.com/M_Gauche James King

        There seems to be this notion that perception did not influence reality re: RIM which I think is preposterous because there are examples of it every day on the Internet. The various memes and viral dissemination of information via that Internet shows the organic nature of how information travels and, sadly, that information does not necessarily need to be fact-based. To claim that RIM could not have been a victim of such viral dissemination or collective group think flies in the face of reality.

        The bottom line is that perception influencing reality, sometimes despite the actual facts, happens every day, especially on the Internet.

      • ApplesJustFine

        “My version of that story is that Apple is riding a tiger of disruption that it cannot get off; it must keep innovating or be run over by lower-cost copycats. I’ll spare everybody my personal opinion about how well they’ll succeed, but does anybody doubt that this is a key issue?”

        Yes. I disagree.

        First, you must specify “key issue” for what?

        The short-term stock price? Probably.

        Prolonged super-high rates of growth? Sure. But who says that doing that is a “key issue”?

        As far as being “run over by lower-cost copycats”, I don’t see why we should believe that will be so. Didn’t happen with the iPod. Expensive Mac’s have been gaining share steadily on Windows cheap stuff for seven years now. And despite the presence already of cheap copycats in the phone and tablet markets, Apple has been growing quite well there.

        Unless you think that smartphones and tablets will not be important devices for many, many years…or that Apple fans will mostly desert Apple for cheap stuff, then I don’t see why Apple can’t do quite well even without some new breakthrough product.

      • Walt French

        In his interesting post, @James King wrote, “consistent bashing by stock shorters and tech pundits in the U.S. caused RIM to crater in North America.”

        And therein I think you’ve got your causality backwards. In 2007, RIM proudly sneered at Apple’s keyless “toys” that were not suitable for adults, and wasted battery life for a large screen and 32-bit CPU. In 2013, RIM will soon have an OS of the same class and the same basic design. In the meantime, BB users who WANTED to have business- or play-customized apps had a tired list to choose from; the company went through a wrenching tech transition and the founders were put out to pasture — not by shorts, who by definition own no shares to vote, but by the Board, in its effort to right the sinking ship.

        It *IS* true that many tech pundits dismissed RIM’s efforts as mere lipstick on an outmoded design, but (1) that’s what they were, and (2) most smartphone buyers get their information from salespeople, friends and co-workers. Even the very conservative Enterprise IT shops, who bear the cost of switching from BB’s proprietary messaging/mail system, have substantially abandoned the platform for more flexible, multi-vendor approaches.

        “It’s apparent that most people aren’t using phones very differently than they always have.”
        This would be true if people were smartly only buying phones that supported the old functions, and not wasting their money on iPhone-type geegaws. But I think this is exactly backwards. I’ve commented elsewhere in this thread to the general idea that people are NOT buying “phones”; they are buying mobile internet and other communications, in devices that have a phone module. This is exactly parallel to how feature phones knocked out PDAs by absorbing their functions, and original BlackBerrys assimilated pagers into their voice/message system.

        Texting and mobile app usage is what’s exploding in growth, while voice minutes appear to be growing much more slowly.

      • http://twitter.com/M_Gauche James King

        ” In the meantime, BB users who WANTED to have business- or play-customized apps had a tired list to choose from….” – Walt French

        I strongly disagree with this point. Those who wanted apps did indeed leave RIM and Blackberry … at reasonable rates of decline in marketshare. RIM posted strong growth in both profits and user base for almost 4 years AFTER the iPhone was introduced. It wasn’t until stock shorters and the tech media took up YOUR VERY POINT that people wanted apps, ergo the Blackberry was “doomed” meme and consistently ran with it that the effects were felt on RIM’s business.

        The bottom line is that people exist at varying levels of tech proficiency. For many, the Blackberry was “just enough” technology. It performed reasonably well at most of the tasks for which people use a phone. It wasn’t until the Blackberry became “uncool” that people started to shed them.

        “Texting and mobile app usage is what’s exploding in growth” – Walt French

        Internet usage notwithstanding, most people use their mobile phones pretty much the way they have always used them, for talking and texting. The tools have changed but the behavior is the same. A platform that allowed people to elegantly perform the 10 most common tasks done on a mobile phone could reasonably survive without an extensive ecosystem. It is the “apps” meme pushed over and over again by people with greater proficiency with technology, many in the tech media, that continues to make people feel as if apps are the driving force in mobile. For that matter, 50% of ALL software sold are games. Build a mobile platform that can play games but elegantly performs only the 10 most common phone tasks and it is still likely that the platform will succeed.

      • tmay

        I’ll post this link with my view that it wasn’t “stock snorters and the tech media” that were the problem:

        http://www.canadianbusiness.com/technology-news/how-management-has-failed-at-rim/

        Stock shorters and tech media have had little or no affect on Apple’s strategic operations. Just build good products seems to be the mantra at Apple, but I’m disinclined to state that for RIM.

      • http://twitter.com/M_Gauche James King

        You *do* understand the irony of using a negative RIM article to refute my assertion that negative press harmed RIM, right?

      • Walt French

        Of course, that particular negative article followed RIM’s widely-perceived failure to be at the forefront of mobile communications.

        I haven’t done a full Granger Causality hypothesis test on negative news vis-à-vis RIM’s quarterly earnings, but this story would seem to be an example of reports being caused by results, not the way you propose.

        More importantly, Horace noted long ago the challenge that RIM faced from the smartphone revolution, and his voice was until recently quite unknown outside of a small circle. I don’t think you want to claim that HE brought down RIM with his observations—it just wouldn’t have any credibility.

      • http://twitter.com/M_Gauche James King

        What flies in the face of your assertion is the strength of RIM’s quarterly earnings. For almost 4 years, RIM showed both strong growth and profits. Only two metrics showed a slowing of RIM’s business: 1) marketshare and 2) ASP, both of which could easily have been explained in relation to the changing smartphone environment. Though Android’s marketshare increased dramatically at the expense of RIM, the overall market was ALSO GROWING. This dynamic was treated as a zero sum game with RIM losing TOTAL SHARE to Android which wasn’t the case. RIM was still GROWING. As for declining ASP, that was simply RIM’s new reality as the new “feature phone.” As its technology was supplanted by newer technology, it was inevitable that it would simply drop further down the technology food chain.

        However, these facts were sensationalized. It was perfectly reasonable that RIM would simply occupy a lower niche yet still be profitable. But that would have meant the stock and tech media had to accept that the RIM of the dizzying stock valuation and sterling reputation as the premier mobile device company had changed. But it wasn’t viewed as a changing of the guard by the media, it was viewed as IMMINENT DEATH. The changing of RIM’s position in the tech landscape was treated as a failure by the company. However, the numbers FOR YEARS did not bear that out, especially in light of a market that was enduring explosive growth overall.

        As for Horace’s assessment, I have been critical of him because much of his analysis on the matter, especially re: marketshare and ASP, served as the ammunition for many of RIM’s most vocal detractors and I feel that it painted a picture that did not entirely present the situation in context. I can’t deny that his analyses are insightful but statistics can be a tricky thing. They don’t always provide context or perspective. In my opinion, I think Horace contributed to matter though I do not think it was his intention. Numbers are cold things … they don’t always tell the full story.

      • Walt French

        James King wrote, “I have been critical of him at times because much of his analysis on the matter, especially re: marketshare and ASP, served as the ammunition for many of RIM’s most vocal detractors and I feel that it painted a picture that did not entirely present the situation in context.”

        The fact that the analysis provided ammo to detractors is of no concern to an unbiased analyst. Meanwhile, you strip ALL evaluation of RIM’s success from the various news items, and expect the company to continue successfully in a market where ALL major players (save Samsung) have been utterly disrupted. To my eye, that shows that you are NOT that unbiased analyst who just wants to understand why RIM is in its current predicament.

        Good luck with your RIM advocacy. Just don’t bother to expect that analysts will pay much attention to it, since you’ve now marked yourself as a biased purveyor of information, deprecating your future trustworthiness.

      • http://twitter.com/M_Gauche James King

        First of all, I neither own RIM stock and have never owned a Blackberry. I’d say that qualifies me as being objective.

        I literally have no dog in the fight.

        “The fact that the analysis provided ammo to detractors is of no concern to an unbiased analyst.” – Walt French

        This is a ridiculous assertion. An INTELLIGENT person understands the power of network effects.

        For that matter, I’ve made no statements regarding RIM’s chances for future success. I’ve provided no analysis regarding RIM’s challenges because I think those are apparent. I wasn’t acting as an “analyst” re: RIM but an observer of the tech and finance media and how its propensity to provide information without context can influence perception. Your rebuttal seems to be that my premise is incorrect even though your responses provide direct contradiction.

        “Meanwhile, you strip ALL evaluation of RIM’s success from the various news items, and expect the company to continue successfully in a market where ALL major players (save Samsung) have been utterly disrupted.” – Walt French

        Strawman. I’ve acknowledged that RIM was in decline. My assertion was that the decline was accelerated and made far worse due to the poor press. Unfortunately, conclusively proving such a thing is almost impossible. But just because something is difficult to prove doesn’t mean that the assertion is irrelevant. Indeed, it outlines the need for responsible news outlets and purveyors of information. Livelihoods were affected when RIM declined. That isn’t a trivial matter. The matter isn’t a zero-sum game where everything balances in the end.

        “To my eye, that shows that you are NOT that unbiased analyst who just wants to understand why RIM is in its current predicament.” – Walt French

        I guess I’m not unbiased, though my “bias” has nothing to do with championing RIM. I’m interested in the markets sorting things out, not the media picking “winners” and “losers.” RIM had enough challenges without fighting group think. Once perception is altered, then a company isn’t just fighting its competitors, it is fighting a MINDSET. This prevents even a company’s best work from being relevant. The mindset now seems to be that whatever RIM produces is “too late.” Since when is innovation too late? But that is the PERCEPTION. I want to see companies win or lose based on the merits, not because it couldn’t overcome peer pressure.

        “Good luck with your RIM advocacy. Just don’t bother to expect that
        analysts will pay much attention to it, since you’ve now marked yourself as a biased purveyor of information, deprecating your future trustworthiness.”

        These forums are to present ideas, analyses and opinions for review. I would expect an UNBIASED analyst to read what I’ve written and determine if that particular idea is one with which they agree or disagree. If I can convince them that I’m correct on any given point, fine. If I can’t, that’s fine as well. But if anyone decides to judge the worth of EVERYTHING I’ve written or will write because they don’t agree with a particular point I’ve made, it clearly shows that THEY are biased.

        It looks like you are the one who is biased.

      • Sacto_Joe

        James, it’s clear from your posting that you are a strong supporter of RIMM and RIM, but the way they managed to maintain market share is writ large in their fundamentals. Three out of the last four quarters showed negative EPS, and its last quarter’s EPS was as flat as the proverbial pancake. I.e., they effectively gave their devices away to maintain their customer base. Now, I have no particular axe to grind vis a vis RIM. In fact, I salute them for having the temerity to come up with their own OS (unlike others we could name). But let’s be honest: All RIM’s eggs are now in the OS 10 basket. They’re “all in”, in gambling parlance. They’ve begged, borrowed, but thankfully not stolen to stay in the game. If they succeed, then they have the chance to eventually turn things around, and I personally wish them well with that. But it’s literally do or die time with them, and even if it’s “do”, it’s going to take time and a lot of “doing” to dig themselves out of the very, very deep hole they’ve put themselves in.

        For all these reasons, and probably many more, RIM is far from being much of a competitor to Apple, now or in the forseeable future.

      • Walt French

        In my work I watch short-sellers’ aggregate impact. (I don’t look at RIM, however; I’m not offering any investment advice.)

        As a general rule, stocks that are sold short are subsequently more leveraged to the market (as a market rally squeezes the short-seller just as much as positive company news does), and most importantly, somewhat more likely to deliver subsequent lower earnings growth. The “forensic accounting” types use short sales as an early warning indicator.

        Some of the weakened financials may be due to the negative press generated when shorts announce or “leak” their short positions. But shorts are pretty widely reviled as evil in the popular press; if their actions were deemed as information-free as the regard suggests, short sellers’ announcements would be followed by rallies.

        Again, the specific shorting of RIM may be due to mass hysteria, an evil actor trying to take down a great company or all sorts of other reasons than simply smart stock speculation. But whatever mindless negativity RIM faces, we all see the boosterism from the Canadian government, Canadian analysts, the Board; we shouldn’t claim that mindless positivity isn’t also part of the BlackBerry story.

        And of course, there’s the little problem of the paradigm that is at the root of Asymco.Com: the obvious technological disruption that has taken down Nokia, Palm, Windows Mobile and other top-tier suppliers of the last decade’s great technology.

      • DogWagsTheTail

        “the consistent bashing by stock shorters and tech pundits in the U.S. caused RIM to crater in North America.”

        Your argument is that the tail wagged the dog. Don’t think so. The stock cratered because the business did. Basically always goes that way, except maybe very young start-ups that are solely dependent on equity financing to make it.

      • http://twitter.com/M_Gauche James King

        No it isn’t. RIM had 4 years of positive growth. It’s decline coincided with a preponderance of bad press.

        As for “stock crater(ing) because the business did,” considering Apple has lost 25% of its stock valuation though its core businesses are still excelling, your point isn’t made. There are a lot of factors that drive stock price, press being one of them. To claim otherwise is simply disingenuous.

      • ThingLongTerm

        “As for “stock crater(ing) because the business did,” considering Apple has lost 25% of its stock valuation though its core businesses are still excelling, your point isn’t made. ”

        Well, anyone who has an understanding of the stock market understands that prices will gyrate (sometimes wildly) about the intrinsic value of a business. If Apple is still at similar levels in a year, then maybe you can try that post again. Absent that, the stock price movements over a period of three months are just noise.

      • tmay

        My North American centric version is that my cost for a phone is $2.50 a day, give or take, on a Sprint Unlimited plan with two siblings and a sister in law, two iPhone 5’s, two 4S’s.

        The landline and dsl for my business (machining) is 4 dollars a day, unlimited data, though I don’t have/need a long distance plan. I use Mac’s and PC’s, the latest a Sandy Bridge Mac Mini and refurbished Lenovo D20 Workstation.

        To put things into perspective, I probably spend $40 a day on engineering/manufacturing software subscriptions, and somewhere around $65 a day for all other overhead, not including health insurance.

        I’m pretty frugal otherwise, driving older vehicles with basic liability insurance, though I do spend money on photography / printing as a hobby. Let’s just say $5 a day over time for that.

        Now, I have a friend in the same business, with a 17 yo daughter, and (three other children in their twenties). My friend pays for an iPhone 1 (she won’t give it up), an iPhone 4S and an iPhone 5, on a AT&T unlimited contract for around $9 a day.

        The point of all this isn’t that smartphones and contracts aren’t expensive, just that for many people, the costs of what is considered an essential social device, is a rounding error.

        That’s most likely the reason that few buyers even consider a rational analysis of cost important. Each has already established an intangible value for their desired device.

        Oh, and that daughter; she has developed her texting skills to the point that she can text blind in her hoodie pocket, with just a glance for the responses. I’m told that there are many like her in school.

      • SkimmingIsGood

        As an Apple shareholder, I would be quite happy to have about 1/6 of the mature market in smartphones, with the lion’s share of the wealthiest clients and more active users of “smartphone” features. That will allow plenty of profitability (likely the majority of the market) and will continue to attract the best developer offerings.

      • obarthelemy

        Indeed. I think Apple is in a very nice place.

      • MoreThanAPrettyPhone

        ” The 3 criteria on which the iP5 is unchallenged are very small size, very nice looks, and peripherals (docks mainly). ”

        Well, apparently you’re missing something. Because for business and government use, iPhone is handily beating Android (at least on every single study I’ve seen), and those businesses aren’t making that decision on any of those three criteria.

      • ToSudsidizeOrNot

        “Indeed, I think pricing is starting to come into play more, at least In France, where 75% of last quarter’s phone purchases were off-contract.”

        Price transparency and subsidies. Big issue for the U.S. (which remains the most lucrative market). As long as Verizon and ATT maintain the current paradigm, iPhone will do exceedingly well. As we move further away from diffuse availability of the iPhone in the U.S., it has been steadily gaining on Android, and by some measures would appear to have passed it. Even if the current subsidy arrangement is maintained for a few years (which seems the most likely scenario), many of those iPhone users will have become quite comfortable with iOS and will likely be deeply enmeshed within the Apple ecosystem. So even if/when the day comes that subsidies end, iPhone will likely do better in the U.S. than elsewhere for a long time to come. Nevertheless, iPhone marketshare would certainly suffer to some extent if subsidies end and there is complete price transparency.

      • Walt French

        I guess that’d depend whether you’re looking at wealthy nations or not. A recent US survey suggests* Apple has 50% share in 4Q smartphone sales.

        Different dynamics in different countries, of course.

      • obarthelemy

        I think 2 things come into play regarding pricing:
        1- purchasing power indeed: the iPhone is expensive, even compared to other top-end phones (33-60% more expensive than a GS3)
        2- phone financing habits: some countries hide the phone’s price within the contract (ie, the US), some countries don’t. All countries offer both financing possibilities afaik, but one is usually dominant.

      • Walt French

        Not sure I get your point. I’d never say that price doesn’t matter, but in my country, enough people drive around in high-priced automobiles, and wear expensive clothing, that it obviously is senseless to say that pricing is all that matters.

        PS: the $1500 wool suit that I might like isn’t as good in rain as the $69 hoodie + sweatpants. Not for water-resistance, anyway.

      • StatusSymbol

        “A phone is not only a fashion accessory: it’s also (mostly) here todo a job.”

        Well, an enormous question for Apple going forward is the extent to which the job for which a mobile phone is hired has transcended the typical computing tasks (e-mail, web surfing, gps/mapping, games, etc.) and now includes being a fashion statement and an image-producer to which the user has a high emotional connection. Do not underestimate the importance of this in the consumer market. Obviously, the majority of clothes and cars are purchased with one eye to functionality and another to image/fashion. And look at something like Harley-Davidson motorcycles. There are other motorcycles which could do the job of two-wheel motorized transportation just fine. But for most Harley riders, there simply is no other relevant product.

        Not certain if Apple can/will achieve Harley status. But with something as personal as a mobile phone (always with the user, and virtually always used in the public eye) their chance is as good as ever. I think Apple must really keep this in mind when/if it considers going low-market to win market share. They might win the battle but lose the war if they play that game. Their current strategy with phones of simply selling the prior models at lower prices (rather than producing a “cheap” phone) makes sense in this regard. The experience they have created with their upscale retail locations suits this well, too.

      • Rusy

        Smartphone are getting personal and used as a phone, a fashion item and status symbol especially in Asia where success and status are highly sought by the growing middle class

        Each time I walk through the shopping precincts of Chapel St and Toorak rd ( upper middle class suburbs of Melbourne) where there are many cafes and restaurants, I see most young adults using the iPhone! Very few use Android phone and these are the same people who have higher disposable income and will be the drivers of e-commerce on mobile devices.

        Regarding use of iPhone as a status symbol in Asia, I can only share from my own experience during yearly trips to those regions. I see young Chinese professionals with iPhones ( common sights in Singapore, Kl, Hong Kong, Shanghai and Beijing and many other major cities. Even my nieces an nephews and friends in Malaysia always request us to buy the latest iPhone, iPad in Australia for them as they want the latest Apple devices as they are only available in Malaysia 4-6 months after Australia.

        When asked why they prefer iPhone, reasons always come to ease of use and quality of the product! Dr Afred Gucci is right in saying that ” Quality remains long after price is forgotten”!

    • Frank Vaughn

      As of November, the split was 70/30 for the older phones. Pretty good article breaks it down in detail: http://www.tmonews.com/2012/11/newest-android-os-breakdown-shows-android-4-0-adoption-closing-in-on-30/

  • Luis Alejandro Masanti

    You can compare the decline of the feature phone with the decline of the rotary phone.
    (I cannot find another analogy in the market.)

    • Nevermark

      Decline of the button land line phone would also be interesting, even though it is still happening and is not likely to disappear any time soon.

      At some point perhaps business will get rid of their land lines and workers will be able to dynamically connect (disconnect) business numbers associated with physical locations to (from) their mobile phones as they show up and leave work.

      • http://twitter.com/frankvaughn Frank Vaughn

        This won’t happen until mobile phone reception/quality achieves equality with land lines.

      • KirkBurgess

        I don’t think it has to be as good, but good enough.

      • http://www.asymco.com Horace Dediu

        In many parts of the world it already has, long ago.

      • http://www.noisetech-software.com/Home.html Steven Noyes

        In my travels, I have never heard that actually. The quality of landlines still exceeds (in a far way) the audio quality of the best cell networks. From voice lag to simultaneous talk/listen, I have found cell phones lacking IMO. Ease of use (the UI is simply great on smartphones), convenience, always there??? That is where the cell phone’s strength really are. Not call quality but for most cases it is more than good enough.

        For 1.5 hour tele-cons, however, I will always pick a landline.

  • Haroon Alvi

    Another parallel ( or analogy) is the decline of the land line phone as new users opt for a cellphone only and no land line [home] phone.

  • http://www.noisetech-software.com/Home.html Steven Noyes

    An interesting thought:
    Android captures 85% of the shelf space, iOS gets 10% and WP gets 5%.

    If we believe Kantar Media:
    Android captured 42% share (December US), iPhone gets 53% and the rest get 5%.

    It would be interesting to see Walmart’s % units sales data based on their floor space allocation. Likewise, is the US Walmart distribution the same as what Mr. Dediu sees?

  • vladiim

    So that means we can finally stop calling them ‘smart phones’ and just call them ‘phones’?

    • Luis Alejandro Masanti

      Just call them ‘cells.’ Phones are also those (disappearing) land-fixed devices.

      • http://www.facebook.com/people/Shameer-Mulji/1685212657 Shameer Mulji

        or better yet: hand-held mobile device.

    • Jeff G

      I call it a little magic box

  • Jmann

    Where is the 2013 Q1 estimates for apple? Can you please do that?

    • Sacto_Joe

      Robert Paul Leitao has a good one on his postsateventide site.

  • Pingback: comScore stats show US smartphone market as two-horse race

  • ajck

    “And as the US goes, the world will follow.”

    Yes…but at a MUCH MUCH slower rate. While in the rich industrialised world, there are 1.6 billion phones (133% of the population figure), 47% of them brands we have designated as ‘smart’ (e.g. Android, iOS), in the developing and emerging economies there are 3.9 billion phones (only 66% of the population figure), and only 12.8% of them smart. How fast is this much larger non-rich world population shifting to smartphones? In 2011, it was a grand total of 1% (one percent). In 2012 the same again, 1 %. (numbers from Tomi Ahonen)

    Multiple forecasts from separate major global analyst houses, show another 4 billion so called ‘featurephones’ will be sold between now and about the 2016 mark alone. In actual fact these days there are no such things as ‘featurephones’ they are all just smartphones with a slightly lower specification. The industry and media just needs to acknowledge the truth which is that we all just call certain brands ‘smart’ and other brands ‘feature’, when in reality there is no real practical difference other than spec and price, they are not different classes of device in any meaningful way.

    Consumers have long realised this, which is why there is still and will continue to be, a far greater number of so called featurephones in use in the world, than so called smartphones.

    Those people we think all have featurephones? They’ve all got smartphones already and they know it…

    • Walt French

      Good analysis except I wonder whether you appreciate how quickly a pivotal capability can upset the status quo.

      Look for instance at Samsung’s announcement of Tizen going wide. Here’s the #1 seller of phones with a marketing budget to match, offering an OS tuned to very modest hardware and upscale aspirations. Tizen is limited today in its ability to run powerful apps, but I can’t imagine Samsung is developing a sub-Android line just as an experiment — they see the same huge numbers you do and would be very pleased to differentiate themselves by offering a more capable device.

      Once — and I won’t say it’s certain — Tizen achieves the critical mass and technological sophistication to offer and support a smartphone ecosystem, the realm of the smarts-deprived phones will shrink dramatically. Technologically, it’s inevitable, since ever-cheaper gizmos can offer high value.

    • http://www.asymco.com Horace Dediu

      The definition of smartphone is straight forward: a phone which runs one of a fixed set of operating systems. That set includes iOS, Linux, Android, Symbian, BlackBerry OS, Windows Phone. By implication, a feature phone is one which does not run any of these operating systems. This is a meaningful description because the OS implies a platform and an ecosystem. A feature phone does not imply any of these.

  • Childermass

    At what point does the job a machine could do become less important than the job it is used to do in actuality? As data shows, and as many commentators here acknowledge, it is clear many smart phones are used as feature phones. Calling them ‘smart’ and ignoring their use means current modes of analysis mean nothing. At best we can conclude we are comparing apples and oranges, shrug and move on. At worst we quibble about what they might be used for and how much they cost and pretend that matters.
    Until a new analytical paradigm is identified – usage for example – we will learn little and be beholden to an entirely arbitrary tech-driven agenda.

  • Pingback: Could 2015 Be the Year of the Last Feature Phone? | Mobi

  • Pingback: Tendências Mobile 2013 em um 'best of' caprichado da Business Insider | AppsRadar