Horace and Ryan discuss HP’s departure from the PC business, the end of the TouchPad, buying your way into innovation and what it takes to compete and survive in the Post PC era.
via The Critical Path #5: HP’s Innovation Antibodies – 5by5.
This is a good one.
I’m late with posting my estimates for Apple’s current (fourth fiscal) quarter. Normally I post my estimates a few days after the previous quarter’s earnings are announced. This quarter however there was a lot to think about.
As pointed out in my analysis of the previous quarter, the iPhone sold at a far faster rate than I thought. I had expected it would be a “lame duck” in the quarter but the expanding distribution allowed it to continue at a triple-digit growth rate (142% in fact, the highest quarterly growth rate since 2009).
So the question for this quarter is, as always, what’s the iPhone growth? The problem for me is that I have to choose between two assumptions:
The first assumption would put the iPhone growth at 100%+ while the second would place it in the 60% to 80% range. I decided to dial in a figure somewhere in between at 90% but I’m not very confident in this until we see more evidence that a new pattern has emerged.
So here are my “mid” quarter forecasts: Continue reading “Estimates for Apple's fourth fiscal quarter: Entering the post-P/E era”
Two years ago Nokia sold 30% of its smartphones in Western Europe. Today it sells 15% in that market. Its unit shipments went from 5 million to about half that and its market share went from 55% to 11%. Its rank in the market went from first to fifth.
The fall is exceptional and dramatic. The two charts below show smartphone market shares. The top chart shows global share and the second shows Western European smartphone shares (European share data sourced from IDC).
The other perspective is shown the the following chart which shows actual units shipped. Continue reading “Nokia vs. Android”
HP’s sudden departure from a business model that has sustained the company since inception is symptomatic of the passing of an era. Yesterday HP announced that it would exit the PC and tablet computer business, focusing on higher-margin “strategic priorities of cloud, solutions and software with an emphasis on enterprise, commercial and government markets.” In other words, HP is fleeing upmarket, away from a core that it will abandon to device makers.
HP management conceded that the disruptive impact of the iPad forced their hand but that hand was already quite weak from a decade of over-serving the market. The last decade offered plenty of opportunities for incumbent PC companies to adjust to the realities of mobility. However only one computer maker made the transition.
Why is that?
Consider how HP and Apple faced the changes in the PC market almost exactly a decade ago.
The rest, as they say, is history.
The Critical Path #4: Acquisitions – 5by5.
Ryan Irelan speaks with Horace Dediu about Google’s planned acquisition of Motorla Mobility and the potential ramifications for competitors.
My thanks to Eric Hellweg, HBR editor, for offering the opportunity to write in the Harvard Business Review blog and the help in editing and sharpening the message.
You can read the article here:Google’s Strategic Mistakes Drove Motorola Buy – Horace Dediu – Harvard Business Review.
Please use the forum at hbr.org for discussion.
Google’s acquisition of Motorola is clearly designed to be an acquisition of Intellectual Property rather than an entry of Google into the phone business, but the impact on the business will be felt in many ways.
It is surely going to send some Android vendors scrambling. The situation is not without precedent however. The history of governance and ownership of Symbian shows how the licensing of platforms by licensor competitors leads to unintended consequences.
Symbian was formed to be governed in a way very similar to the original Android via the Open Handset Alliance. The company was owned by a consortium of phone vendors.[1] The shares were not equally distributed however with Nokia holding a larger share (though not a majority).
Although nominally involved in decision making, the smaller shareholders never felt entirely comfortable with the arrangement and over time some sold their shares and left the group even though they continued to license the OS.
Eventually Nokia ended up acquiring the company outright and open sourced the code. However, by then the product was obsolete and the only licensee was Nokia itself.
The lesson (and warning) was that a licensor that is also a licensee makes other licensees uncomfortable. The supplier is also a competitor. This is classic channel conflict and never ends well.
Open or not, with or without equity, these arrangements are always unworkable.
So Google’s promise that
“This acquisition will not change our commitment to run Android as an open platform. Motorola will remain a licensee of Android and Android will remain open. We will run Motorola as a separate business. Many hardware partners have contributed to Android’s success and we look forward to continuing to work with all of them to deliver outstanding user experiences.”
seems naive at best.
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Notes:
The charts published here typically show data across two dimensions, (X-axis and Y-axis). Since many times we have to look at data over these dimensions and through time, there are no easy ways to do it without some iteration of the same chart.
As an alternative a “Motion Chart” let you look at data across up to five dimensions (X-axis, Y-axis, Color, Size and Time). This is a dynamic flash-based chart that allows you to explore several industry/vendor indicators over time. You can:
This data and chart are updated and available at higher resolution at the following (permanent) location: https://www.asymco.com/hire-me/vendor-bubbles/
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I took the stacked cascade chart of profit/phone x phones sold into a multi-quarter animation subtitled “The evolution of Shipments, Revenue, Profitability and Cost structure of eight vendors selling mobile phones between second quarter 2007 and second quarter 2011.”
(I recommend selecting 1080p HD view and full screen to sufficiently resolve details.)
httpv://www.youtube.com/watch?v=Vg8idQCc1D8
This is an updated view of the AMP index including Q2 data. As a reminder, the AMP (Asymco Mobile Performance) index is an unweighted average of four “shares”:
You can see the last quarter’s standings here.
The updated index figures and spark lines are shown also on the right-most column on this site.
The biggest mover was Nokia which dropped 6.5 points. The second mover was Apple, with a gain of 3.2. Samsung followed with a gain of 1.38 and LG with a 1.21 and HTC with a gain of 0.95.
RIM lost about 1 point and Motorola and Sony Ericsson remained nearly flat.
The plunge in Nokia’s AMP score is nearly matched by Apple’s gain over the four year time period observed.
The full picture of each component is shown below: Continue reading “Updated AMP Index for Q2”
