31 May 2010

Apple! Time To Pay The Piper

A milestone in our society and culture occurred earlier this month. Apple became worth more than Microsoft. So now Redmond which used to be castigated as the Evil Empire is now 3rd behind Google and Apple.

Apple has largely arrived in its much vaulted position by avoiding such issues as security and integration into the corporate world. Here is a great article from Infoworld. (How I miss the print edition!)

Well - now it has to step up to that challenge and it better start do it pretty fast. So since I have your attention this far let me have my say on the subject of the iPhone.

I think it is an amazing piece of technology. But I have a very hard time with its model. Unlike the traditional players in the mobile space - they blazed a new model and have been very successful at it. All at the expense of the consumer.

Normally the network operator guys keep their revenues and the handset guys get paid a fee or sell direct. Mostly the former. Thus the network operator has been in control of the market. This was not good enough for Apple. The asked for AND managed to get it - a share of the network revenues from the first customer AT&T. In exchange AT&T got exclusivity. But the price was high. But Apple wasn't content with that - they wanted additional revenue. So they simply applied the iTunes model and created the App Store thereby creating an additional revenue stream.

And just to make sure that they MADE enough money - they ensured that the design of the network usage required additional data access for even basic services such as email and texting. Thus when you are online with your mobile device - the amount of network traffic can be high. Pity the poor people on the Pay as You go model billing schemes. But it is FAR worse if you roam into a different network. Then you pay $$$$ for network traffic. I have seen some staggering bills from people who roamed for just a short time in a foreign country.

Sloppy design by Apple makes this the default state rather than an option. So those Apps might be free to download or low cost but they can COST YOU BIG TIME. King Gillette is probably laughing his head off in the great pantheon of business ideas.

If you hear me speak at conferences - I call the iPhone the devil incarnate for this reason. (In fairness to Apple - Google's Android does much the same thing). I don't just stick with my crackberry because the device is better - no - its because I can manage the cost of the device AND the network.

So Apply - time to start playing nice and being a good corporate citizen. No more cavalier behavior.

Do you think they will listen to me? Naaaaa..........


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