
Android - cwan
http://www.avc.com/a_vc/2011/04/android-continued.html
======
arturadib
From the point of view of a developer, one counter-point is that the App Store
still makes far more revenue than the Android Marketplace (about 17x more, to
be precise), so iOS is still a better platform of choice [1].

A counter-point to that counter-point is that Android's Marketplace has far
fewer apps than the App Store (about 4x fewer), and far fewer paid apps (about
2x fewer) [2].

That 8x factor still doesn't explain the 17x difference in revenue. My guess
is that the typical Android app is of lower quality (since the store is not
moderated) and lower priced in comparison to iPhone apps.

At any rate, given this dramatic change in market share, it seems to me that
not deploying for the Android platform at this point is a dangerous
proposition, except perhaps if your primary customer acquisition channel is
the platform's built-in store/marketplace.

[1] [http://techcrunch.com/2011/02/21/861-5-percent-growth-
androi...](http://techcrunch.com/2011/02/21/861-5-percent-growth-android-puny)

[2] <http://reviews.cnet.com/8301-13970_7-20032228-78.html>

~~~
timdorr
Those are paid app revenues only, though. Because of Google's focus on
advertising, that's becoming a very viable alternative method of revenue for
app producers. Look at Angry Birds, who is bringing $1m per month on Android
[1] and doesn't have to sell to as many new customers to maintain those
numbers. Eventually, they're going to hit a wall. $.99 is great up front, but
$0.05 a month from 5x the number of customers is better.

[1] [http://www.intomobile.com/2010/12/03/angry-birds-
android-1-m...](http://www.intomobile.com/2010/12/03/angry-birds-
android-1-million-ad-revenue/)

~~~
tjogin
Angry Birds on Android was launched off of the success on the iPhone though.
Not that invalidates their success on the Android platform or anything, just
that it doesn't speak to the power of the Android platform, since it probably
would never have happened if not for their previous success on the iPhone.
I.e. the Angry Birds story is not a good example of when focusing on Android
rather than iOS would have been a good idea.

Can you think of any Android _exclusive_ app or game that is achieving a
similar success? Then that app is probably a better example.

------
replicatorblog
How do the market share numbers look when you factor in iPads and iPod
touches? The numbers look impressive for Android, but assuming app purchasing
behaviors are the same on both platforms and mobile economics do end up
looking like web economics Apple is still placing WAY more units in the field
and covering a much broader demographic, from 6 year olds with the iPod touch
to grandmoms with the iPad. I wouldn't underestimate iOS and their ability to
make consumers happy.

~~~
webwright
You make a good point. But if you're looking at it as a winner-take-all (or
winner-take-most) market like a lot people do, the phone is where the battle
lies. Once your phone is beefy enough to be your media player, game machine,
phone, and GPS, most people won't have differentiated / specialized devices.

Q4 iPod sales were down 11% year over year. I'd look for that to accelerate as
smartphones become more ubiquitous.

If you want #s of everything, here's what a quick googling yielded:

Android shipped 33.5M devices in Q4 Apple shipped 27.34M iPhones/iPads/iPods
in Q4 (~14M iphones, ~4M iPads, ~9M iPods)

Presumably some meaningful percentage of iPods were NOT iPod touches (i.e. no
App Store), so shave 3-5M off of Apple if you're trying to guess iOS devices.

So conservatively, about a third more Android devices shipped in q4 than all
iOS devices combined. That's BEFORE the 7% market share boost that Fred is
talking about.

(this is quick/sloppy research-- feel free to point to better #s).

~~~
ellyagg
Where did you get these numbers? In my research, I couldn't find good
comparisons at all. I saw some info in various places attributed to Canalys
that showed 33 million iOS vs 32.7 Android unit sales in Q4. I also saw
Schmidt claim 300k daily Android phone activations in Q4 with Apple's Q4
earnings report extrapolating to 375k daily iOS sales. Did Android have 75k
daily sales of non-phone Android devices? Maybe if we include Nooks and
things? Is this even really a useful comparison between two things anymore?
Would a consumer recognize a Nook as being the same thing as a Droid, in the
same way they recognize an iPod Touch is the same thing as an iPhone? This
isn't an idle question since, e.g., millions of the Android activations are
coming from phones in China with totally different user experiences. In my
opinion, Android is not homogeneous enough to compare against iOS in the way
that Windows vs Mac OS used to be.

~~~
webwright
Apple: [http://www.sizzlingbit.com/2010/10/18/apple-
made-20-34-billi...](http://www.sizzlingbit.com/2010/10/18/apple-
made-20-34-billion-revenue-in-q4-2010-highest-revenue-and-earnings-ever/)

Android: <http://www.mobileburn.com/news.jsp?Id=12707>

~~~
ZeroGravitas
Those Apple figures are for calendar Q3, Apple's financial Q4 so you're not
comparing the same time period. Apple generally get a big bump in iPad and
iPod sales in the christmas quarter.

I'm fairly confident that Android is far enough ahead in smartphones sales
(i.e. more than double globally, more than triple in the U.S.) that you can
include iPods and they're still ahead and the gap is growing. I'll wait till I
see a few quarters of numbers for the Android tablets before I'd be happy
assessing how they're doing against iPad sales.

edit: Here's what Apple call their Q1 results, covering Q4 2010:

<http://www.apple.com/pr/library/2011/01/18results.html>

iPod sales declined 7% year-on-year, the 33 million iOS (pod+pad+phone) number
mentioned above which would roughly equal Android smartphone sales last
quarter works out if you assume half of all iPods are iPod Touches (I have no
idea if that is true, either historically or currently).

------
davidedicillo
I feel these kind of stats will always be flawed for the following reason:

\- It doesn't include other devices running iOS (as a developer I look at
those too, especially if my app doesn't require Internet).

\- It doesn't consider that a big % of Android phones run apps horribly if not
at all. Also most of this phone we'll never be easily upgradable to a newer OS
version (I don't care if you can do it, I'm talking about for "normal"
people), because the carriers and manufactures prefer pushing the new phones
that come out every other week.

~~~
trotsky
I can't tell if you're trying to convince us, or convince yourself.

~~~
davidedicillo
Not trying to convince anyone. I was just stating that as a developer, I could
be interested in more than 50% of the iOS market, and I could be interested in
having my application being able to run on as many devices as possible of such
market.

That doesn't mean that I wouldn't love to tackle the Android market as well,
and we'll definitely do that. But we have limited resources so we chose the
one that at the moment generates the most revenues.

~~~
trotsky
No issue with counting iP*d's, that only makes sense. What I was trying to
figure out was the big percentage of Android phones that [... or] don't run
applications at all". Have a list of those?

~~~
davidedicillo
I meant, given an application, there's a good chance that it won't run on run
on all the Android phones.

~~~
ZeroGravitas
I could say the same about Apple's iOS (e.g. you can use hardware not present
in _all_ devices, or target APIs that not _all_ devices have (or are even
capable of being) upgraded to), and it wouldn't be be an accurate reflection
of the real situation there either.

Unless you put numbers on it, then it's an empty statement.

------
credo
In his post, Fred dismisses critics by saying _"I got a lot of heat from Apple
fanboys for that post"_

However, you don't have to be a "fanboy" to recognize that Fred is a huge
proponent of "free". It makes sense for VCs to promote a zero-revenue, high-
growth, "free" approach.imo that explains a lot of Fred's bias towards
Android.

I'd say that vc-funded companies should develop on both iPhone and Android (as
Color did).

However, most developers will be better off with iOS, if they can only invest
in one platform - unless their business model is strongly predicated on a
"free" app monetization model.

------
dr_
Fred is a big proponent of "open", which is great, but it's still not clear
that "open" is going to win this game.

The battle between Windows and Apple wasn't just about "open" versus closed.
It was about availability of third party software. It was about ability to
distribute effectively. It was about mindshare. There are other reasons that
Apple was not successful through the late 80's to 90's (even when they allowed
third party computer manufacturers like Franklin to license their OS). But
Apple is an entirely different beast now. And Android appears to be on it's
way to such a wide variety of configurations that it may not even be
recognizable as Android at some point - what if Amazon's app store becomes
real popular? At that point, are you developing for Android or are you
developing for Amazon?

I wonder how many major corporations out there right now that are thinking of
how tablets could fit into their work environments are playing around with the
Android OS? My guess is not many.

------
petercooper
Android is going to "dominate" in the same way that Microsoft still
"dominates" the desktop. That is, it might end up with a larger share of the
market because it ends up getting distributed on 101 phones, but the actually
valuable and choosy end of the market will still be on the iPhone. I'm sure
Apple's quaking in its boots that it'll get to maintain its crazy profit
margins while people are making pennies on the Android.

~~~
jarek
I'm sure Google is terrified of becoming like Microsoft's Windows and Office
divisions too.

~~~
bostonvaulter2
Well the MS Office division is pretty profitable...

------
mikeryan
The disparaging use of the term fanboy is disappointing from someone who I
respect like Fred.

Can't we just prefer one good product to another equally good product without
being reduced to "fanboys"?

------
ratsbane
I'm not sure it's important to predict now whether iOS or Android is going to
be bigger or more profitable to developers. They're both going to be enormous
and they're both going to be around for a long time, just like the Window-Mac
horse race from the 1980s to now. There's a lot of money to be made on either
- or both. Going back to the Windows-Mac comparison, though, think of all the
horses that aren't still in the race from the 1980s: CP/M, Amiga, OS/2, etc.
That's the question for the mobile marketplace. What is going to be the mobile
equivalent of those? WebOS? Symbian? Windows 7?

------
dannyr
In terms of market, Android is like China while iOS is USA/Japan.

The Chinese market is huge but they do not have the spending power of the
Americans or Japanese yet.

Companies will probably not make a lot of money in China right now but it is
wise for them to try to penetrate the Chinese market sooner than later so
they'll be in good position when things pick up.

This is similar to Android's position. Not a lot of money to be made yet but
it would be a foolish move not position yourself in the market.

------
CoffeeDregs
The most fascinating part of the smartphone battle is that Google/Android has
basically stopped and reversed a giant vertical integration play by Apple.
Markets swing back and forth between integrated and disintegrated and Google
grabbed the pendulum and pushed it back toward 'disintegrated'.

~~~
GHFigs
The table indicates that Google's share growth (+7.0%) has come at the expense
of RIM (-4.6%) Microsoft (-1.3%) and Palm (-1.1%). Apple's share continued to
grow (+0.2%). The breakdown is similar for all of comScore's figures for the
last six months.

~~~
moultano
Does it even make sense to talk about share growth coming at anyone's expense
when the market is growing this quickly? Is the absolute number of RIM phones
falling? At this point I doubt any appreciable percentage is accounted for by
people switching from one platform to another.

~~~
ZeroGravitas
RIMs sales are still rising and Apple's market share growth, which has been
flat for about a year, translates into somewhere between 50 and 100% sales
growth. Meanwhile Android sales are up 800-1200% so yes, it's mostly about
who's getting the new entrants to the smartphone market.

------
cletus
I'm a little disappointed that Fred has fallen into the seductive trap of
comparing Android and iOS to Windows and Mac. It's superficially attractive
but doesn't stand up to any serious scrutiny.

What's winning here isn't _openness_ (which has many, many definitions), it's
_commoditization_. Android is successfully commoditizing the smartphone
market, which is good for Google, good for consumers and bad for the carriers
and handset makers (who are willing accessories in their race to the bottom).

A better analogy (IMHO) is, in gaming terms, PCs (Android) vs consoles (iOS).

PCs are more powerful than consoles (except for a short window when the
console is released). This of course depends on what (if any) graphics card
the PC has. PCs (despite Windows) are essentially "open". You can install what
applications, devices, drivers, etc you want. Technically you can replace
Windows with something like Linux too (but that won't do your gaming any
favours).

Consoles are essentially a closed system. The device is protected from
modification (to some degree). Publishing games requires meeting hefty
requirements laid out by the console maker (and license fees).

The benefit of the console model is clear: consumer don't need to mess around
with them. They just turn them on and they work. Gaming publishers can develop
to a much wider audience with a fixed hardware platform.

We've now reached a point where 3D graphics have basically gotten as good as
they need to for the vast majority of consumers. It's a bit like the move from
video to DVD was huge (in terms of quality). DVD to Blu-ray? The majority of
consumers still don't care (and probably never will).

Better graphics engine in games basically translates into higher art/content
costs and that is a case of diminishing returns.

So consoles are basically killing off PC gaming (except for a few niche
genres)--and here's the key point--because _the hardware is as good as it
needs to be_.

None of this was true in the Windows vs Mac era. The rapid development of
Windows-based PCs, both in terms of raw power and price-performance, is really
what killed the Mac.

That power is now of far diminished importance. In the mobile market, in some
ways, more power is less desirable because it comes at a cost in battery life,
size and weight (none of which were ever relevant to the Windows vs Mac
debate, other than for laptops). Now shrinking transistors does lead to
increases in power but that is fairly predictable and uniform across all
platforms.

Consumers, give enough power, start valuing other things like the UI, the
design of the device, the ecosystem, the brand and so on (basically this is a
"need" to "want" transition).

In all of these areas Apple has a _huge_ lead.

But Apple only produces one handset at the very top of the market. Android
wins total market share in smartphones for two primary reasons:

1\. Most people just use their phones as phones (diminishing the value of the
ecosystem); and

2\. Android competes in a lot of markets the iPhone doesn't.

So I concede that Android seems likely to dominate the phone market at this
point. _I just don't think it's terribly relevant to the future of mobile
computing._

The future (IMHO) is about tablets, a market where Apple has an enormous lead
and huge advantages, one where the halo effect is likely to benefit everything
else they produce.

~~~
bad_user
I'm a little disappointed that (a) people have short memories or (b) everybody
else is 10 years younger than me, at least

    
    
        Fred has fallen into the seductive trap of comparing 
        Android and iOS to Windows and Mac ... What's
        winning here isn't openness (which has many, many
        definitions), it's commoditization
    

Windows "commoditized" PC hardware -- the differences between smartphones and
what happened in the nineties are few and far between, even though you're
struggling to look for reasons why it's not ;-)

    
    
        The rapid development of Windows-based PCs, 
        both in terms of raw power and price-performance, 
        is really what killed the Mac.
    

That's inaccurate -- standardization between multiple PC makers and the
availability of PCs is really what killed the Mac ... I don't live in the US;
my first computer was built by a local company (it was cheap too). Apple
couldn't and still can't compete with that.

    
    
        Consumers, give enough power, start valuing 
        other things like the UI, the design of the device,
        the ecosystem, the brand and so on
    

Before OS X, Mac OS was a piece of shit -- again, you're wish-believing; as if
"price" and having a standard between multiple smartphone makers is suddenly
less important.

    
    
        Android competes in a lot of markets the 
        iPhone doesn't
    

Markets also converge -- in the early nineties IBM's OS/2 was promoted as this
next-generation OS (and it was kick-ass), while Windows was the cheap solution
for 286 PCs. SOFTWARE is so liquid that markets don't have clearly defined
lines; and if you're telling me the iPhone is this superior alternative for
people who want superior stuff, then the iPhone already lost the battle.

    
    
        The future (IMHO) is about tablets
    

The future, from my perspective, is convergence of every house/office
appliance we have to being a personal general-computing device, including your
fridge and your toaster.

And you can call a PC by any other name, but it's still a PC.

Saying that the future is about tables is really shortsighted; here I was
hoping for something as big as the Internet.

~~~
parasubvert
1\. Local PC clone companies used to reign but these days seems the big boys
like HP, Dell, Sony, Acer have recaptured the share. The market for tech has
gotten large enough that it seems to be more brand-driven than spec-driven.

That's the main difference between mobile devices today and the PC wars of the
80s. The market (thus far) is no longer interested in low cost custom builds,
they're looking for an all-in-one experience. Though perhaps there is room for
both approaches in the market, and there won't be quite a winner-take-all
scenario here.

2\. Mac OS was NOT a piece of shit, though I guess it depends on your
priorities. For those that loved it, it was brilliantly designed and useable.
They (mostly) forgave its Windows 95-esque brittleness.

3\. Saying that every appliance includes a PC doesn't say much about what the
computing experience will be _like_. I personally don't think my fridge and
toaster will have much more power than they do today, because I can't see the
utility in that (adjusting my fridge temperature from work? eh?).

But I do believe that smart phones & tablets will be the predominant mode of
"mainstream computing", given how quickly the iPad is growing.

------
bostonscott
IMHO -

Apple's advantage is design. Google's advantage is search.

As the boundaries of mobile search are pushed (better local, better social,
voice search, better x), I believe Google will dominate mobile. Good mobile
design will become ubiquitous, but search is a different story.

Google has the best search technology (along with the best infrastructure and
data to support it). They also have the best ad network to monetize its
benefits.

~~~
marcc
It's not very insightful to realize that Apple has design while Google has
search. This is obvious.

Design won't become ubiquitous. Where else has this happened in the world?
Design is hard. Great design is incredibly difficult to achieve. What Apple's
managed to do is create a great design and then make it a priority all the way
through the company. They won't ship a product if the design isn't exactly
what they want.

Building a search infrastructure is expensive, but relatively trivial.

I disagree completely in your assertion that design will become ubiquitous.

~~~
bostonscott
You're right, great design is incredibly difficult to achieve - the first
time. But then it gets copied by numerous competitors. That's happening right
now with the iPad.

------
blrgeek
In design and usability, (iOS & Android) >>>> Feature phone.

So for most people in the world moving from feature phones to Android is going
to be a huge leap forward. The difference between iOS & Android is a rounding
error in this comparison.

A HTC Wildfire @ USD 250 is equivalent to an iPhone4 @ USD 600 for someone
upgrading from a Nokia 1100!!

Android is allowing different manufacturers to offer phones at wildly
different form factors & functionalities and most importantly price!

Apple is focused on the niche high end market where they can make maximum
margin.

------
bballant
Mr. Wilson's numbers leave out some key realities about Android as it stands
as a smartphone platform.

First of all, Android is much harder to develop for than the iPhone. This is
because the Android ecosystem is so dispersed. There are many more phones,
many more os versions, and many more carriers to support. For a resource-
strapped application team, iOS is a simpler choice and a quicker win.

Also, there is, what I would say, less of an app culture amongst Android users
than iPhone users. I think this because I develop and work on a team that
develops native apps for both platforms as well as a cross platform mobile web
app. Our iPhone app does about 50 times better (in each category -- downloads,
usage, and revenue) than our Android app without exaggeration. Part of this,
to be honest, is our iPhone app is better, and that is partly because of my
first point. Even in our mobile web app, though, we see about twice as many
iPhone users.

Now, I'm glossing over a whole slew of details here, but the net takeaway for
me is, if I were a start-up looking to make a dent in the smartphone market,
I'd start with iPhone.

~~~
orangecat
_First of all, Android is much harder to develop for than the iPhone._

As someone who's published apps on both platforms, I'll disagree with that.
For me the occasional extra effort it takes to support multiple resolutions
and OS versions is more than made up for by being able to use a semi-modern
language. (Preemptive response: Yes, I know Objective-C well, and non-
enterprisey Java beats it hands down).

~~~
rimantas
Do you also know Cocoa Touch well? Even if I prefer Obj-C compared to Java,
it's Apple APIs where the real beauty is.

------
spenvo
The Microsoft-Nokia deal has yet to have an effect on the marketplace. Nokia
will take WP7 international, and that will be bigger than the Verizon iPhone.

~~~
rbarooah
What effect do you predict?

------
guptaneil
I'm not quite sure how the numbers Fred shows prove his point. Android has a
larger market share, but it's only been one month since the Verizon iPhone
launched. It's entirely probable that had it not launched, Android would have
a significantly larger market share. Likewise, it's possible that given
another three months, Android's share will reduce even farther. The only thing
the numbers prove is that the Verizon iPhone was not a magic bullet that
killed Android immediately on launch, but nobody expected that. (I don't
actually expect Android's market share to decrease in the coming months
either, but my point is that the numbers aren't very useful right now.)

------
fleitz
I could give a crap how much market share of people who don't buy anything
google captures. If you are making free ad supported apps I'm sure android
will be better if you're expecting people to buy your app just avoid it all
together.

------
radicaldreamer
I'd be interested to know what percent of those Android phones have the
Android Market installed and how many have multiple or a competing application
store.

~~~
metageek
Hardly any Android phones don't come with the Market--in fact, the only ones
I've heard of that don't are China Telecom's oPhone ecosystem. Plenty of
Android _tablets_ don't have the Market.

~~~
VB6_Foreverr
I just got a cheap android smartphone for the equivalent of $100. I was afraid
it might be crappy but I'm delighted with it. It has resistive rather than
capacitative touch which aparently is not as good but you then don't miss what
you never had. Imo the market works great though I've only downloaded freebie
apps so far, chess, sudoku, google sky map. Glad I didn't fork out 5 times as
much on an iphone. Google have done me a big favour

~~~
metageek
I _love_ Google Sky Map. I particularly enjoy pointing it at the ground and
seeing stars from the Southern Hemisphere.

~~~
VB6_Foreverr
I must try that!

------
martythemaniak
A lot of us had a good laugh when people said the global android phenomenon
would could to a halt because of the Verizon iPhone.

My opinion on why the iPad will suffer the same fate:
[http://martin.drashkov.com/2011/03/why-android-tablets-
will-...](http://martin.drashkov.com/2011/03/why-android-tablets-will-
dominate.html)

------
shalinmangar
Do people really believe that Apple wants to dominate the mobile market? It
seems wasteful to critique sales comparisons of iOS vs Android when Apple has
never shown any signs of making iOS devices a monopoly.

