Oft-quoted: "Android May Be the Greatest Legal Destruction of Wealth in History"
It's actually a transfer of wealth from the coffers of Apple, RIM and MS to mostly developing-nation consumers who can now afford the same advanced phones as people in developed countries. The trio is doing everything in their power to kill Android, but I do hope it survives.
I've seen more blogs recently use that quote in a negative way, even though it's taken out of context, and the original author of that quote meant it as an overall positive thing (for the world).
Indeed. A lot of people on the Internet have what I call "Joe the Plumber" syndrome; they imagine themselves as though they are better off than they are, and then get upset when something helps the little guy. In this case, people are upset that there is no money in developing your own phone OS, because you can't compete with Free. But in reality, most of these people don't make phone operating systems, but they do buy phones. So Android ends up being great for them: cheaper fun electronic toys.
I'm not sure this debate is likely to go anywhere, but what exactly is wrong with people thinking they are better off than they are, or aspiring to be?
If people don't want help, why force it upon them?
Disclaimer: I love Android and 100% of my slates are running it. I love that it's free. Check my profile, it's all I do all day.
I'm just calling out your "Joe the Plumber" reference.
I'm calling out your calling out of the Joe the Plumber reference :)
Here's how I see Joe: he gets upset that Obama is going to raise taxes on the rich to give benefits to the poor, because he thinks he's rich. But as it turns out, he's poor: he makes $40,000 a year and would greatly benefit from Obama's tax cuts. This confuses me not because of the politics, but because he is acting against his own self-interest because he thinks his self-interest is something that it's not. If he did own his plumbing company, he'd see a little less profit due to Obama's tax increase. But he doesn't own the company and probably will never will; he wasn't even a licensed plumber and he left his job there.
To apply this to phones, people imagine themselves in the position of being a phone software company, when they are really phone developers or users. In this case, Android is good, because it means more users will be using their phone, and that means more apps or more users buying your apps.
This is getting off-topic, but it's possible to oppose taxes to the rich without fancying oneself to be rich. The above Joe the Plumber description paints a picture of a delusional redneck. That's not necessary to debate taxation policy.
EDIT: to bring this closer to topic: is it really "transfer of wealth" if the wealth was never really there? Most new cool gadgets get commoditized. If anything, Android is probably one of the better-designed systems under the hood (at least as far as the app API goes). Either way, the first smartphones were themselves incremental improvements and iterations over prior things like PDAs, etc.
He was, and was actually upset that Obama was going to raise taxes on wealthy people (250k+ incomes), and actually raised a stink about it. Later on, the media dug into his life and realized that he had a very basic plumbing license, did not actually intend to buy a business he had mentioned he was going to do, and only made about 40k per year (and had a judgement lien against his income for failure to pay taxes).
The comparison to Obama's tax plan was not off topic, because "Joe the Plumber" was in fact characterized and quoted by the media as someone who was going to have his life changed for the worse due to Obama's tax plan, when in reality, nothing in his life would have changed, but he still argued against the tax plan.
One doesn't have to be rich to oppose taxes for the rich. Even if those higher taxes would somehow benefit you through a reduction in your taxes. You can disagree with an increase in taxes in principle. For instance, I don't think more taxation is necessary in any income group. How about reducing military or social insurance spending? Problems abound, but the point is, it's not totally outrageous to oppose taxes for the rich even if you only make an average income.
of course not -- but the subject was Joe the Plumber. He certainly framed his question as one of self-interest rather than one of principle, so the question of misunderstanding ones self interest is applicable.
""I'm getting ready to buy a company that makes 250 to 280 thousand dollars a year. Your new tax plan's going to tax me more, isn't it?""
The answer to his question is A.) No, you're not buying that company. And B.) Yes, each dollar you made above 250K would be taxed at a 3% higher rate than normal, if you did. So $3,000 per $100,000.
Misunderstandings abound about economics. It does not mean all opinions flow from misunderstandings, but many are colored by them. Most people (regardless of their opinion on taxes and spending) do not realize that federal revenues as a percent of GDP are at 20 year lows. Which is not surprising, as taxes have been cut systematically over the years.
Yet people generally "feel" like the federal gov't is taking in more than ever as a percentage.
I now see why my post got downvotes. I was unaware that JtP as a specific situation was about mistaken self-interest (originally I thought it was solely about generic blue-collar appeal for McCain/Palin).
The problem isn't that he's supporting cuts for someone in a different bracket, it's that his own reasoning has him in the bracket which he's not in. He's opposing tax laws that don't directly affect him based on the misunderstanding that they do directly affect him.
$40k a year and he is poor? umm... Sure he would benefit from tax cuts but $40k/year is not poor. According to wikipedia poverty line sits around $22k in the states.
It's wrong for people to think they are better off than they are because such thinking leads to decisions that will hurt Joes in the end. It's exactly Joes who shoot themselves in the foot by thinking that it's an each man for himself world.
"Socialism never took root in America because the poor see themselves not as an exploited proletariat, but as temporarily embarrassed millionaires." --Steinbeck
I'm not sure I'll be able to change your mind if it's not evident to you why that is a bad self-image, but here goes:
First, you have to define "bad". It's not bad for the planet, or bad for society as a whole. It's bad for the person who has that belief, because it leads him to act against his self-interest (as a poor person) and making him act for the interest of richer people.
Shouting "Why should the rich pay higher taxes so the poor can get better healthcare?" when you're yourself poor isn't "good" for you, is it?
First, you have to define "bad". It's not bad for the planet, or bad for society as a whole. It's bad for the person who has that belief, because it leads him to act against his self-interest (as a poor person) and making him act for the interest of richer people.
It depends on how important your principles are to you. One expression of altruism that the left in the US doesn't seem to respect at all is the idea that someone who's poor or unemployed might still believe that it's not healthy for society to grant him all sorts of entitlements.
Put another way, apparently "voting for your own self interest" is a good thing only when the lower and middle classes do it. I find this hypocritical in the extreme.
Shouting "Why should the rich pay higher taxes so the poor can get better healthcare?" when you're yourself poor isn't "good" for you, is it?
I'd like to think that my bank balance doesn't determine my political thinking, with regard to what I believe is the best way to run a society for the long term benefit of all of its members.
I wholeheartedly reject the notion of 'class' when applied to productive adults in the United States. So the rhetoric of rich versus poor means nothing to me, beyond referring to an unreasonable concern that some people seem to have with numbers stored in a bank's database under keys associated with other account holders.
Trivializing money by referring to it as "just numbers in a bank" is surreal. Those numbers in a bank are the #1 determinant of whether you will do things like: eat, have a roof over your head, or pass on your genes.
It's pretty much impossible to overemphasize the importance of those numbers.
You're pretending that class doesn't exist while you pretend that money doesn't matter. Class is real. And class is important specifically because money does matter. A lot.
When you're truly rich, they're just numbers in a bank. They're a scorecard by which you determine whether you're winning. Poor people want a reliable car and a roof that doesn't leak; rich people want a higher score, but rich people are more effective at getting what they want.
As for Joe the Plumber syndrome, there's a relevant quote from Vladimir Nesov. Something along the lines of "revealed preference is not a very charitable way to interpret people's actions."
>One expression of altruism that the left in the US doesn't seem to respect at all is the idea that someone who's poor or unemployed might still believe that it's not healthy for society to grant him all sorts of entitlements.
So if you're poor and left-wing nobody should take you seriously? What if you're rich and left-wing?
And I don't think a lot of people have a problem with the rich voting in their self-interest. It's when they control the airwaves and purchase the government that people get upset.
(Needless to say, I'm not referring to people in the 250k-500k band here, but rather that 1% that controls half the wealth of the nation.)
Probably because there is a rather obvious negative interpretation: People think they have a real chance to become a millionaire, while in reality, they will probably always be comparatively poor. So they always make decisions based on this imaginary future as a rich person, even if it is much more likely that they will not be better off in the future.
The implicit assumption is that the plumber is farther along in his life and has a lot more (family, home, social benefits, health, etc.) to lose than a 19 yr old in YC...
The first step to fixing a problem is acknowledging you have a problem ....
If the Joe the Plumber wants to support tax cuts for the rich and he's fully aware of his situation, then there is no issue having that opinion. But if his self-image is distorted (as was implied by the media reports), then it is bad to posses that as it means you will be making wrong decisions based on incorrect understandings.
The issue isn't his desire to aspire to greater wealth, it's his unrealistic understanding of what his actual financial status is.
Steinbeck clearly didn't mean it as a compliment, though, so I have to assume the same of anyone who just drops the quote in a thread with no elaboration.
That's ludicrous. Perhaps people make decisions based on values instead?
For example: I don't make 250k/year, but I'm opposed to increasing the taxes of that income bracket. Perhaps a true value driven person sees taxes not as a way to get more of what they didn't earn, but as something that isn't morally right.
Surely Android is a disruptor of wealth rather than a destroyer of it?
There are things Android does for free (or very cheaply) which ask serious questions of competing products but what about the efficiencies that are created because more people have access to functionality which enhances their lives and businesses and the new markets it creates?
Free turn by turn navigation software may destroy wealth for, say, Tom Tom and Garmin, but what about all the people who now have it but didn't before and who are now wasting less time as a result? Some (not necessarily all, but some) of that time will translate into additional wealth for them and those they deal with. Similar cases can be made for getting better information on the go (via e-mail and the web) and so on.
Not to mention the app developers who can now make money where no market previously existed, the handset manufacturers who are selling more expensive handsets, the networks who are selling data plans, the smartphone accessory manufacturers.
It would be hard to quantify what has been created against what has been destroyed, but I'd wager that it's far more accurate to describe what has happened as a disruption or a move than destruction.
Explain to me again, slowly. Apple is spending $1B in R&D to design the iPhone. Google is spending the same amount to design Android. Where is this money coming from and is it a sustainable investment from Google?
You understandably suffer from the mistaken impression that Android is 'free.' when the reality is that the kernel is 'free' but the 'Apps' which most phones have (mail, dialer, appstore, browser, maps, etc etc) are actually licensed for actual cash. It's not entirely clear how much that costs (and it benefits Google for that not to be clear).
In terms of business advantage, Android seems to me to be fairly unique. Google created a lower barrier to entry into the 'smartphone' market than either Apple, Microsoft, or RIM. Folks who took advantage of that were people early on were people who had the most to gain (low end carriers like T-mobile, Chinese ODMs who wanted to move up the value chain like HTC). They captured a large (if somewhat chaotic) developer market by making much of the source code for the system available for download, and they did create the ability for an individual to create a nearly complete phone 'stack' for certain types of hardware.
The established players greatly underestimated the impact of capturing the 'hobbiest' phone market. (Much like the established data processing players missed completely the impact of the hobbiest computer market).
Google generates anywhere from two to three billion dollars a quarter in free cash flow, which accounts for any and all R&D investment in Android, so its a classic example of being able to take huge profits from your cash-cow market (Search advertising) and disrupt a different market (smartphones) which is the fastest growing channel for advertising (Mobile ads).
Not to mention that Google probably has a better network than any phone carrier today, and they have a voice calling product (Google Voice), its entirely possible at some point for them to create a 'phone' system based entirely on WiFi (like, maybe something with this new whitespace bandwidth that is available or a bunch of hotspots) which gives you a device which can replace AT&T or Vodaphone or whomever.
Ultimately Google understands that nobody bought a smart phone because they 'wanted to be a customer of AT&T', rather they bought it because as a tool it made them more productive. If Google can back into owning that whole stack then their company becomes just that much more valuable.
Worth throwing a bit of pocket change at is it not?
Android pays for itself, in lots of different ways, among them and by far most importantly: Being the default search provider on 550k additional phones/day. That's worth a billion $ to Google any day.
I don't think it's just about search. I think sometimes Google does things Because They Can and then try to figure out how to make money later. Android's most realistic reason for existence, IMHO, is to ensure that Google users can take their data with them. If there was no Google phone, then the world would stick with Exchange, and GMail is not Exchange.
I always thought that Android's raison d'etre was to prevent any other company from dominating the smartphone business (Apple having apparently the best shot at this, but would still apply if Microsoft or RIM seemed likely to) because they would then have a huge opportunity to cut Google out of the loop - they could use Bing for their default search engine, have a built-in mail app that's not Gmail, etc.
There's money back and forth between these companies all the time. It's just behind closed doors for 90% of it. Patent suits are the equivalent of tabloid coverage of a public argument. It could very well be resolved behind closed doors like many other suits.
If Google controls the platform, then Google's other products will never go out of style ; do some reading on micro-economics / complementary products.
The problem I have with this quote is that Android adds wealth to the world. Its a new open device platform where before there wasn't.
What it does destroy (or more likely, just moves around) is money. There's a great big whopping difference between the two. What was certainly destroyed is power, ripped from the hands of a few and dissipated among many. This makes some people very angry.
All you've done there is say "I have a different definition of wealth".
From the perspective of most people discussing this wealth and money are interchangeable and it's not helpful to start substituting in new definitions (even if those definitions are justified).
As I say, I'm not saying that the definition is wrong, I'm saying that it's not the common usage and it's not what people repeating the quote mean, therefore if you disagree with the quote on that basis you're not disagree with what was actually said.
When you say "it destroys [...] money" that's what they mean, you're just picking on their choice of words.
As it goes I agree with you about it creating wealth (see my post elsewhere in this thread), I just don't think the right way to express it.
Yes, you're right. All of this is going to the third world. What? Don't start believing that Android is CHARITABLE. It's a different business model. And this patent case is just a bunch of huge companies suing each-other. None of these companies is any more charitable than the other really. Has Google not done enough gray things for you to realize this yet?
Android, as an operating system created by Android, Inc. and incubated and promoted by Google, is not "charitable" per se, but that's not the point that martythemaniak is making. As a free, open-source piece of software, it effectively acts as a lubricant in the consumer electronics market. By eliminating the manufacturer's cost of building a device's operating system, Google have made it more affordable for both device manufacturers and consumers to effect smart mobile device transactions. So while it may not be strictly financially "charitable" for Google to do this, if we account for the non-financial value of these transactions, I think it's fair to say that an enormous amount of wealth has been created above and beyond what would otherwise have happened in a market that was only dominated by devices running non-free software, especially in countries that have populations that are generally too poor to afford the iPhone.
The manufactures that put Android on their devices are not mom and pop electronics firms. So the implication that this is somehow shifting money to poorer people is kind of ridiculous. Unless you mean the top 1% richest people in those countries. Because I don't think the manufacturers will go to their labourers and pay them any more money just because some hardware was designed in house (hardware design doesn't employ many people either).
It's not Tom's shoes. In fact I find it hard to believe that even Tom's shoes are Tom's shoes.
> The manufactures that put Android on their devices are not mom and pop electronics firms
And this has no effect on treeface's reasoning
> the implication that this is somehow shifting money to poorer people is kind of ridiculous.
Again, there is no implication money is shifting hands.
What treeface said is that a massive amount of value is being generated by lowering the cost of building smartphones, thus reducing prices and allowing more people to use them and (he/she didn't say that) by offering a convenient standard software writers can write against, creating a market larger and less fragmented than any other player had managed to create.
Are consumers in third world countries really saving tons of money on android? Anyone with subsistence living won't buy a smart phone. You're inevitably implying that you're saving the money of someone middle class somewhere. Hardly as noble as you might have thought originally.
These companies are much more ethically inert than you think. It's just a new sort of marketing that uses the lifestyles of the CEO's or the employees as a selling point. The change in economics, or straight out charitable donations as a selling point.
Android is shifting things for certain, but it's not one laptop per child.
Here in India, I was able to get an Android smart phone for half the price of an iPhone. I can also build Android apps on my Debian Linux machine without incurring any additional costs.
The fact that the devices cost lesser(even before the phone company subsidizes it) and yet have GPS and an accelerometer enables me to at least attempt certain kinds of applications that target the mass market here in India.
Also, the ability to read the source code allows me to learn about a smartphone operating system in the same way I got know about a PC operating system by reading Linux's source code.
I would never want Android to be like OLPC. Android is more like a free market. OLPC was charity.
Apple has every right to protect its intellectual property. I think it is equally important for Americans to debate about, and review, the American patent system (where required).
Overall, if HTC can pay royalties to MS, then I guess they can do the same with Apple.
There is a lot of middle-class people in the third world. Also, don't forget every market benefits from cheaper smarter phones and a software stack everyone can contribute to and benefit from is a huge gain in efficiency.
Motivation and effect are different things. Whenever (simplification, all else being equal, yadda yadda) someone undercuts market incumbents with a cheaper equivalent product, it has the effect of leaving consumers with more wealth, whether or not that's the producer's motivation.
It's nice that more people can afford a shiny thing now. But the iPhone has been pretty much market price for a long time now. I just don't see the touting that "poorer" people can afford a smart phone as anything other than marketing.
Henry Ford brought the price of a car down to a price that people can afford. The design to do so was to sell more cars. That's what creating a market for commoditized and mass marketed products does.
But the quote implies that there is some kind of huge shift of either money or power from a large company to the consumer (really poor consumers too!). It's not, it's a shift of a market from one paradigm (and a few companies) towards Google's paradigm where they make money off the back end.
It's actually a transfer of wealth from the coffers of Apple, RIM and MS to mostly developing-nation consumers who can now afford the same advanced phones as people in developed countries. The trio is doing everything in their power to kill Android, but I do hope it survives.