Bill Gurleythinks that Android is an unstoppable lading gear that will prevail against all its rivals . For Google , Android is not even a intersection with a business program . It ’s just a weapon at the service of their master domination scheme , a room to destroy any potential threats that may eventually kill their search monster . This is how they are doing it and the possible consequences .
“ hoi polloi get ready , there ’s a power train a comin ' ”
— The Impressions
FromZacks via Yahoo : Mark Vickery , On Thursday March 24 , 2011 , 4:58 Prime Minister EDT “ BlackBerry maker Research In Motion ( NasdaqGS : RIMM – News ) outsmart its fiscal 4Q EPS judge by 2 cents per ploughshare , but miss slightly on quarterly taxation and proffer guidance well below the current consensus . This has sent RIMM shares down about 10 % in after - grocery trading … ”
Yesterday , after the securities industry shut , Research in Motion , the Jehovah of the Blackberry equipment , announced that they would be lowering their current quarter earnings due to scummy average sales prices . In aseparate promulgation , the companionship proffered that their new pad of paper will support Android apps , yet the CEO also made it clear that he believe the earthly concern is too concenter on the criticality of hold a large numbers of applications on your weapons platform . They also hint that the counsel issue is impermanent , and relates mainly to a product hertz not a taxonomical change in the industry .
https://gizmodo.com/the-blackberry-playbook-will-run-android-apps-5785540
Despite all that has been compose about Android , as well as its unquestionable other winner , the reality at orotund still does n’t fully appreciate the raw force of this juggernaut . I have written about this in the past inAndroid or iPhone ? Wrong Question , andGoogle Redefines Disruption : The “ Less Than Free ” Business Model . But even so , the more I see , the more I wonder if I too may have underestimated the unprecedented market disruption that is Android .
One of Warren Buffet ’s most famous quotes is that “ In business , I look for economical castles protect by unbreachable ‘ moats ’ . ” An “ economical castling ” is a peachy business concern , and the “ unbreachable moat ” is the scheme or market dynamic that heightens the barriers - to - entranceway and makes it unmanageable or ideally unimaginable to compete with , or bring in access to , the economic castle . Here is a great postfrom the 37signals web log a few years back that walk through several different representative of potential moat .
Google wants to eliminate any likely threat to their castle .
For Google , the economical castle is clearly the hunt business organization , augment by its amazing AdWords monetisation fabric . Because of its clear web effect , and amazing price optimisation ( though the customer bidding process ) , this machine is a monster . Also , because of its far - reaching usage both on and off of Google , AdWords has a volume vantage as well . Perhaps the most telling map with regards to the location of the castle can be found in Jonathan Rosenberg’s“Meaning of Open”blog post . In this clear manifesto , Jonathan sound off over and over again that undefended systems decidedly lead in the very skillful solutions for destruction customers . That is with one elision . “ In many cases , most notably our search and advertizing products , opening up the code would not put up to these goals and would actually hurt users . ” As Rodney Dangerfield said in Caddyshack , “ It looks good on you , though . ”
AdWords is a highly respectable castle , and Google would intelligibly want to put a “ unbreachable moat ” around it . Warren himself is on record suggesting thatGoogle ’s moat is middling expert already . But where could you pass the moat ? What are the potential threat to Google ’s castling ? Basically , any product that support between the user and Google and has the potential to cark the option of lookup destination is a threat . A great example is Firefox . Like many browsers , Firefox has a search bar built into the upper right recession . This lead to a substantial figure of Google search for whichGoogle give Firefox a bighearted fee . From sentence to time , this fee must be negotiated , and as a termination there are unceasing rumors that Firefox might select another search engine , like Bing . Other illustration include smart - phones and selection made by attack aircraft carrier and/or handset Maker . As an example , a few years back , Verizonset the default hunt boxful on Blackberry ’s to Bing alternatively of Google . Despite Warren ’s organized religion in Google ’s moat , there are ways to move the needle on search share , or at least suffer the economic science by demanding more profit share for distribution .
So here is the kicker . Android , as well as Chrome and Chrome OS for that matter , are not “ Cartesian product ” in the Hellenic business mother wit . They have no plan to become their own “ economic rook . ” Rather they are very expensive and very belligerent “ moats , ” funded by the height and order of magnitude of Google ’s castle . Google ’s object is defensive not offensive . They are not trying to make a profit on Android or Chrome . They require to take any stratum that live between themselves and the consumer and make it free ( or evenless than free ) . Because these layers are essentially software mathematical product with no varying costs , this is a very viable justificative scheme . In essence , they are not just building a fosse ; Google is also scorching the earthly concern for 250 nautical mile around the outside of the castle to assure no one can approach it . And best I can say , they are doing a damn dependable Book of Job of it .
With Android , they are not building a concern , they are build a moat .
Google has organized this justificative play with preciseness . Carriers and handset makers that use Android are yield economic science to do so . The Android version of the “ AppStore ” shares the majority of its economics with the toter and handset manufacturer . Once again , they are not build a business , they are building a fosse ( sorry for the repetitiveness , it ’s intentional ) . Because they are “ giving away ” money to expend their product , this make a rather substantial brain-teaser for someone trying to extract economic rent for a competitive product in the same securities industry .
This is the part that gravel me the most . I do n’t know if a large organized industry has ever look this fierce a physique of contender – someone who is not trying to “ win ” in the definitive sense . They desire food market share , but they do n’t take economics . suppose if Ford were faced with GM paying people to take Chevrolets ? How many would they be able to sell ? What if you received $ 0.10 for every loose Pepsi you consume ? Would you still pay $ 1.50 for a Coke ?
Android may be the end of the software program industry as we know it .
The combined market capitalizations of fellowship that build desktop operating organization , French telephone operating system , mapping software package ( they give this away with Android also ! ) , as well as interior software program that help to specialise mobile gadget is well over $ 100B , and may be several times that . Yet , there is no economic law that need that these industries remain in their current form . When software was first imagined as a byplay , it seemed like a marvelous dream . Because the variable costs were zero , you would make near 100 % profit on each incremental unit that you trade . Perhaps the leave counter - force to this is that if someone can give to make a near equivalent code infrastructure , than they can at their option terms to marginal cost ( $ 0.00 ) , the very definition ofperfect contest .
One might yen to suggest that there is a market unjust here that should be look into by some government entity , but let us not forget that the consumer is not harmed here – in fact far from it . The consumer is getting great software at the cheapest price possible . barren . The consumer might be harm if this activity were prevented . And as we just suggest above , the market is in the end driving towards software pricing that represents “ complete competitor . ”
In Silicon Valley we like to make light source of industriousness that are facing digital disruption such as newsprint , the record industry , and the movie manufacture , suggest that their executive “ just do n’t get it . ” Perhaps now we are witnessing the disruption of not just analog businesses , but also formerly interesting digital job as well .
John Doerr , once said “ The Internet is the greatest effectual creation of wealth in story . ” Android may be the opposite of that , the groovy sound wipeout of wealth in history .
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