4 ms·

I think these companies are looking at this from a long term perspective. This and the smartphones are the only growth markets post-PC. Almost everyone will own

I think these companies are looking at this from a long term perspective. This and the smartphones are the only growth markets post-PC. Almost everyone will own a smartphone and/or tablet sooner than you think, and just a small portion of that market justifies the current slaughtering they will incur to gain entrance to the market and establish a beachhead. At this point it's a battle to the death for the #2 spot. Apple has a massive lead by both defining the market and being almost 100% vertically integrated. Where they weren't vertically integrated, they guessed right on the opportunity factor and cut deals for components while the rest of the market was asleep. Production will eventually level out, and competitive software will get better, and other tablet will eventually be able to turn 90s era PC-like margins on their products. Depending on how smart Apple plays the game (and I am betting on very smart), this may take a few years to over a decade.

billjings 16y ago
Here's what boggles my mind. Motorola was never in the PC business. Why are Motorola and Nokia following Apple in this direction? If you look at it as a question of where historically these companies have been competitive, they are chasing Apple right into their home turf. I mean, let's say that whatever degree of success Apple has in the smartphone market is due to software/hardware design, marketing, and vertical integration. Isn't software even more of an issue with a larger, more powerful form factor? Isn't vertical integration even more of a factor when there's no "subsidized" phone to buff your margins? I don't totally believe what I'm saying here to be honest (Android tablets will probably beat Apple in price at some point, for example), but I still find the process odd - 1. Apple enters the cell phone companies' market, 2. Apple creates the tablet market using its cell phone operating system, 3. the cell phone companies follow Apple to the tablet market. Somebody's being led around.

billjings 16y ago

Here's what boggles my mind. Motorola was never in the PC business. Why are Motorola and Nokia following Apple in this direction? If you look at it as a question of where historically these companies have been competitive, they are chasing Apple right into their home turf. I mean, let's say that whatever degree of success Apple has in the smartphone market is due to software/hardware design, marketing, and vertical integration. Isn't software even more of an issue with a larger, more powerful form factor? Isn't vertical integration even more of a factor when there's no "subsidized" phone to buff your margins? I don't totally believe what I'm saying here to be honest (Android tablets will probably beat Apple in price at some point, for example), but I still find the process odd - 1. Apple enters the cell phone companies' market, 2. Apple creates the tablet market using its cell phone operating system, 3. the cell phone companies follow Apple to the tablet market. Somebody's being led around.