At a lunch in Sydney today, Patrick Lo said Apple’s success was centred on closed and proprietary products that would soon be overtaken by open platforms like Google’s Android.
Apple has had unparallelled success by being able to control the entire ecosystem around its products, from the hardware to the software to the acquisition of content and apps through iTunes.
It has used this to effectively dominate the market and shut out competitors. Consumers have also benefited because they get a consistent experience and products that are easier to use.
Lo said Apple’s closed model only worked because, in many product categories like MP3 players, “they own the market”.
However, he said this was only a temporary state of affairs and pointed to the fact that Google’s open-source Android platform for smartphones – which any manufacturer can use for free – recently overtook iPhone in market share in the US.
“Once Steve Jobs goes away, which is probably not far away, then Apple will have to make a strategic decision on whether to open up the platform,” said Lo.
“Ultimately a closed system just can’t go that far … If they continue to close it and let Android continue to creep up then it’s pretty difficult as I see it.”
I love how people say things like this, and then other people print it, and then others read it, all the while thinking that it bears some resemblance to reality. It doesn’t.
The iPod only worked as a closed system for Apple because “they own the market.” And how exactly did Apple end up owning that market? Did that happen before or after the “closed” iPod? I can’t remember.
“Closed systems don’t go that far.” What the hell does that even mean? Anyone who seriously thinks the iPod didn’t go that far is pretty delusional. A decade later, and the iPod is still by far the dominant MP3 player on earth.
“If they continue to close it and let Android continue to creep up then it’s pretty difficult as I see it.” Let Android creep in? Creep in to what? The iPhone is still growing market share. The recent deal with Verizon will prop up market share even further as it stunts Android growth in the US. The iOS ecosystem will continue to gain momentum as Android struggles to attract developers of anything other than ringtones and ad-based-crapware. And in the midst of this, Apple is supposed to “open” up the iPhone? For what reason? What good could possibly come from Apple letting go of its desire to curate the iOS software platform to the benefits of its loyal users? We’d get more ad-ware, carrier-controlled software updates, and all the ringtones we’ve ever dreamed of. Oh, and a task killer. That would be great.
And then, just in case we weren’t sure yet if this guy was a total a-hole or not, he throws in that cheap line about Steve “going away.” Wow. I don’t even know what to say to that.
Most of the losers in the tech industry probably can’t wait for Steve Jobs to go away. Because that’s sure as hell easier than competing with him, isn’t it? Just close your eyes and wish him away.
Tim Cook and company are going to have an easy time staying on top of this industry when Steve decides it’s time to hand over the reigns.