redmotion: September 2012

13 September 2012

iPhone 5 and why Apple makes so much dosh

When you try to improve something that is done very well, you have to be careful not to loose sight of what made it good in the first place. The irony of this is that when you do offer an update to the product, it can appear like you've changed very little, even if everything has changed.

Is design purity a blessing and a curse?

Apple is trying to keep it simple, it's hard to expand on something if your philosophy is simplicity. If they made it more complicated you'd find people complaining that Apple had lost sight of what made the original iPhone so good, and current satified users might switch to another platform. If they keep it as close to the original as they can, they get accused of recycling the idea over and over again.

For me, it's the manufacturing process that stands out as being the most remarkable thing about the new iPhone 5. The back appears to be made from a single, two tone piece of whatever, but it is in fact 3 pieces, so precisely chosen from a selection of over 700 panel variations, with mere microns in difference, it is almost impossible to tell. The design itself, aside from the larger screen is only subtly different from it's predecessors and for all internet "disappointment" about today, it may seem to the creators that all their effort and passion over such tiny details may have been wasted. (Although, perhaps the 2% share price rise may be seen as a positive sign). But there are a lot of people who would not be impressed with the new iPhone, even if it could wash the dishes for you.

Apple's main advantage over the competition is that people spend money on their stuff and are large part of it comes straight to Apple. That is why, even though Android sells more devices, has a larger market share per device, Apple still creams off a much larger percentage of revenue spent on smartphones than everyone else. Granted, hundreds of companies benefit financially from Android-based revenue but they are free to bastardise the original blueprint however they like - usually to it's detriment. When you buy an Android, you can't really be sure what you're getting.


Hardly anyone buys Android apps, even the good ones. Android OS suffers from instability and problems with incompatible apps because there are so many different devices on offer and so many versions of the OS out there that it's no longer economically viable (even for big companies) to buy and test their apps on every available device.

If your Android device can't run the app it is NOT primarily the fault of the developer. It's the way Android is free to be customised on anything and everything. I can't ensure it will work. Sorry. That's why I have a lite version of my apps so you can be sure before you purchase the full version. If it doesn't work I can only apologise, but unless you pay 10x the current selling price and buy ten's of thousands of units, my hands are tied.

Google don't make money on Android, per se, rather they make money from sales of Apps/Books/ Videos on the Appstore. Their current arrangement is vastly inferior to Apples in terms of the company that founded the platform.

So why do people spend so much money on Apple related stuff. Well, it's good quality. It's reliable, there are multiple ways to buy apps and games. What all the other phone makers miss is one detail. A detail that is the sole reason for the Apple Appstore's success:

The iTunes Card  (Apple's seemingly invisible advantage over Android)

This means, anyone with a bit of spare cash can buy apps/games/music. A teen or child with birthday money can walk into a store and buy a card, top it up, go online and go crazy. Every other store, as of today, requires a credit/debit card to pay. The people with the least financial responsibilities, and therefore most likely to buy throwaway things like Apps are currently denied access as a result. This is crazy and a clearly overlooked detail.

Until Google Play sells top-up cards in retail stores like iTunes and Appstore cards, developers on Android will not get nearly as much as they do on iTunes. As a result, quality apps will continue to debut in Apple's store first, some will never make the transition over to Google.

In the same way that the developers battle is to get downloads and retain users of their apps/games, Apples' is to retain it's existing customers while attracting new ones. This is becoming harder because there is now a clear polarised Smartphone market. In the Smart Phone customer base, a cavernous rift appears to be forming between Apple and Android and getting people to migrate from one side to the other will become increasingly harder for all concerned.

EDIT: Ethics

So I asked why Apple makes so much dosh but shamefully forgot to consider the ethical implications of it's manufacture and what things are sacrificed to get such good profit margins:

So, the most important question is how much does it cost to make one iPhone in a factory? Noone knows, this is a closely guarded secret no doubt. Is the poor working conditions in the factory something that could be avoided? Why couldn't Apple sacrifice a little of it's margins to ensure the workers get decent conditions to work in and reasonable pay for the place where they live. Maybe you couldn't make them at all if you had to take this into consideration.

And are Apple Appstore developers party to this inethical treatment of workers? Should consumers or developers worry at all?

One day there will be next to no human involvement in the mass manufacture of these devices. What will people say then? Robots stole our jobs? Or humans no longer need to do degrading low wage manufacturing jobs? Perhaps these people wouldn't have jobs at all if Apple wasn't there.

PS: I own an iPod Touch 4 and Samsung Galaxy SII, a PC and a Mac. I don't favour one or the other, but I do need an iPhone or iPad for development purposes.

Good luck Nintendo, you're going to need it

 Nintendo just announced their new Wii U console release date. December 8th release for Japan: 26,260 yen for basic set, 31,500 yen for premium.

I have fond memories of previous Nintendo hardware, I'd love to see them succeed with this....

However, I believe it will not be a success like the Wii and it could end up being their last TV-only console. They will probably end up converting all their games to work on multiple platforms and focus on Software. Sony will not release a PS4 or another PSP. The nextXbox will be seriously challenged (pricewise) by the Ouya and Steam box, which will make profits from day one and be easier to publish on.

The old masters are loosing out to iPad/iPhone/Android, PC gaming is coming back with the indie revolution (plus the intro of Windows 8 tablets). The risk of building a new game-focused console that only works on TV/in the living/bedroom right now is massive. Nintendo seem to grudgingly know this as they are trying take an intermediate step to handheld/portable delivery with the controller. They should have been much bolder and made a tablet-style console that can stream to the TV but has it's own screen with a wide-open software market straight away.

Personally, I feel that the 2nd TV games console era is actually drawing to a close. I think the global economy will remain stagnant for several more years and people will not buy so much new tech in the west (if they do it will be phones and tablets). China and India might be the saviours of the next gen, but they will soon be making their own kit and their own games.

In a few years - in front of the TV/on the couch - we in the west will be playing on the Ouya and Steam box, Apple's TV / Airplay, Oculus Rift/AR and streamed gaming will be making an impact. Freemium will suck out the dwindling revenue from retail sales which would have fed AAA titles in the past. People will come to expect their gaming fix for free as their money goes back on essential things like food, fuel, clothing, and saving for a rainy day and their tastes shift from demanding every new game look more photo-real than the last to expecting every game be unique to look at.