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Smartphones: Its the Software, Stupid! March 30, 2009

Posted by pannet in Mobile & Gadgets.
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In less than two years, Apple (AAPL) has gone from no cellphone to having a single phone model that accounts for a 8.2% of the 2008 smartphone market 10.7% in Q4 and 0.9% of the overall 2008 market. The secrets have been its pre-existing industry ties (including its brand, desktop software and iTunes Music Store), its skills as a systems integrator, and their ingenious strategy for creating a new ecosystem.
However, at its core Apple has succeeded because it’s a great software company. They have been a software company since their founding — when Steve Wozniak wrote software to control Apple’s first floppy disk drive. Apple has changed what consumers (and the industry) expects from a smartphone through their software.
Of the major players in the industry, only one or two have the prospect of also being great software companies. The rest should admit that they’re a failure and outsource software to outsiders, shifting from vertically integrated R&D to open innovation. […]

Clearly, Research in Motion (RIMM) (16.6% of smartphones, 1.9% overall) is a great software company. There are aspects of the BlackBerry software that I don’t care for, such as the browser. However, there is no question that they have both created a compelling user client and built a tremendously successful, rapidly growing business around systems integration with their industry-leading backend. […]

http://seekingalpha.com/article/128277-smartphones-it-s-the-software-stupid?source=article_lb_articles

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