Android's 'Profitless Prosperity' Criticized

[zakislam]

Venture capitalist "flabbergasted" about profit share despite dominance of market

Android's 'Profitless Prosperity' Criticized : Read more

 

[killerclick]

So, he's criticizing Android because Android devices aren't marked up so high as iOS devices and because Android has so many useful free apps, you hardly ever have to pay for any?

Hmm... seems to me that the customer wins in this case

 

[vaughn2k]

"I am no Apple fanboy, but the notion that Samsung is equivalent to Apple is silly -- Apple's app ecosystem and way everything works together makes it a radically better product...and I think that is an objectively true statement." - McNamee

McNamee is just protecting his investment share in Apple, which is now in decline, and he could'nt sell those share at the moment, the reason he have this story (to delay the downtred further...

 

[drenyx]

...Because they are cheaper?

How about if I don't care for Apple products?

 

[Guest]

Yes because Android isn't being sold by Google per unit, so there can't be any profit there even if Android devices sell in truckloads.

This dude obviously haven't tried an Android device and its host of useful free apps...

 

[cats_Paw]

Is this a troll? Because it sure looks like one. If i am getting this right, he is saying that if you are not greedy like apple you are stupid?
*FacePalm*

 

[Guest]

Shorter version: "Those meanies are dragging my Apple shares down, waaahhhh!!!"

 

[adrhellb]

"...Apple's app ecosystem and way everything works together makes it a radically better product...and I think that is an objectively true statement."

Objectively? Thanks for the laugh.

 

[Someone Somewhere]

And he never notes that google makes it's money from ads/purchases. The more android devices sell, the more people buy stuff or use apps with ads, the more money they make. And there's the nexuses (nexii?), which are sold at cost (roughly), again because they make money from people using them.

 

[wildkitten]

[citation][nom]killerclick[/nom]So, he's criticizing Android because Android devices aren't marked up so high as iOS devices and because Android has so many useful free apps, you hardly ever have to pay for any?Hmm... seems to me that the customer wins in this case[/citation]
No, what he is saying is Google is in a precarious position. They may have more of the market, but 8 billion in revenue is a fraction of Apple's 73 billion. That gives Apple much more capital to innovate with. He also is pointing out that Google could be in danger of Android becoming associated with another brand name like Samsung rather than being with Google.

I think he is also right about people not as loyal to Android as Apple fans are to Apple devices. I know a lot of people that use Android phones, and I use one myself, and none of us feel a need to have our next device be an Android. In fact, the fragmentation is making me seriously consider a Windows Phone next year. But the people I know who use an iPhone are dedicated Apple fans. That may be made fun of here, but brand loyalty is a huge thing for a company.

 

[wildkitten]

[citation][nom]Someone Somewhere[/nom]And he never notes that google makes it's money from ads/purchases. The more android devices sell, the more people buy stuff or use apps with ads, the more money they make. And there's the nexuses (nexii?), which are sold at cost (roughly), again because they make money from people using them.[/citation]

Earlier in the year, Google said it was generating $8 billion in revenue in 2012 with its mobile ads and sales of Google Play mobile content

Certainly looks like he noted that.

 

[IQ11110002]

I didn't choose Android device because it's cheaper, What's he on about.
I chose it because it was the best device at the time of purchase for me and my needs, I am referring to the Note II, Nothing else came close, big screen, big battery(removable),micro sd slot, NFC, removable covers,S pen,micro usb which I can use with my other devices. Do I need to go on?

Seriously, Because it's cheaper? heh That was just a bonus!

 

[dishayu]

Because Google is an advertising company, Einstein. Can they make money from selling android apps or nexus hardware? Yes. But their business model is not that. They make their money from advertising. I believe they are wise enough to understand what is more profitable in the long term. If they can have android on 80% of the devices, they have a much larger base to show adverts to. They can charge advertisers higher and make money that way. Also Google's crowsourcing services keep getting sharper with every new consumer, hence luring more people to their "free" services. In other words, Android is free TV, Apple is Pay-per-view (with the same content). Google makes money from advertisers, Apple makes money from it's consumers.

It comes a huge suprise to me that a venture capitalist can be so short sighted.

 

[Guest]

Apple stock is inflated by market manipulation and has nothing to do with actual market share.

They are playing a game whereby artificially inflating the value of their patents allows them to dramatically increase the total stock value. In fact all the big tech companies are playing this game. They are all selling patents to each other and claiming that they actually have real value. Instead it is just one hand helping the other.

The value of Apple stock is now falling because the market has realised that the products do not provide the value that the stock has been manipulated to represent.

Samsung and Google will be wise not to copy Apple in this vain pursuit to inflate the market value with no foundation.

The Android ecosystem shows the true value of mobile software to the consumer market.

 

[Anaximander]

"I am no Apple fanboy, but"

Then goes on to gush about Apple and their 'superior' way of doing things.

Either he thinks the fellows he's talking to are stupid, or he's stupid in this regard.
Hanlon's Razor ftw.

 

[CrArC]

That was hilarious to read. Especially the paragraph involving his lack of fanboyism.

Apple's products are great, but they're not for everyone. I prefer Android devices to their i-things but conversely I find their laptops are stellar and much nicer to use than 'normal' machines. There's nothing 'objective' about it, it's based on what I need and what I want. For any person to call such an opinion anything else is just a ruination of truth and logic.

 

[psykhe]

[citation][nom]wildkitten[/nom]They may have more of the market, but 8 billion in revenue is a fraction of Apple's 73 billion. That gives Apple much more capital to innovate with.[/citation]

In theory. In reality both Google and Microsoft spend more money on R&D than Apple.

 

[erickmendes]

@Anaximander
"Either he thinks the fellows he's talking to are stupid, or he's stupid and retard." There fixed it.

 

[Guest]

Apple loyalty is one thing. But selling it at such a high profit is another. Business wise, Apple is doing pretty much everything right.(Or was)

But I would assume that most Apple fanboy would pay whatever price Apple charges them for. That's just wrong. And the fanboys are stupid enough and willing to pay for the overpriced hardware!

Google I'm sure is sitting pretty comfortable and not greedy unlike Apple! And I'm sure they don't feel the need to patent everything they think they've invented first and sue every company out there! Now that just wrecks the innovation part.

 

[99lawrence]

I think he is also right about people not as loyal to Android as Apple fans are to Apple devices. I know a lot of people that use Android phones, and I use one myself, and none of us feel a need to have our next device be an Android. In fact, the fragmentation is making me seriously consider a Windows Phone next year. But the people I know who use an iPhone are dedicated Apple fans. That may be made fun of here, but brand loyalty is a huge thing for a company.

Yes fragmentation is an issue... but it is certainly getting better as the time goes on.

The fact is though, people didn't look at the OS in the first place... my GF doesn't go in thinking "I want iOS or Android or Windows". She goes in thinking "I want the best phone for me at this given point." That so happened to be a white iPhone 4s last time... but don't for a second think that she wouldn't choose a Samsung, HTC, Motorola, Nokia or LG device if it is sleek and attractive. She couldn't care less about whether it is Apple, MS or Google behind it.

I think that is how a lot of consumers think with vague affiliations to brands: Apple, Samsung, "Nexus", HTC and so on... they see that and think that is what they need. A recognised product. Whether it has Android, Windows or iOS is a small factor to consider and probably down to the particular salesman in question that helps them pick out a device.

 

[Guest]

- Apple's app ecosystem and way everything works together makes it a radically better product..


Twat! putting it nicely!

 

[house70]

[citation][nom]wildkitten[/nom]No, what he is saying is Google is in a precarious position. They may have more of the market, but 8 billion in revenue is a fraction of Apple's 73 billion. That gives Apple much more capital to innovate with. He also is pointing out that Google could be in danger of Android becoming associated with another brand name like Samsung rather than being with Google.I think he is also right about people not as loyal to Android as Apple fans are to Apple devices. I know a lot of people that use Android phones, and I use one myself, and none of us feel a need to have our next device be an Android. In fact, the fragmentation is making me seriously consider a Windows Phone next year. But the people I know who use an iPhone are dedicated Apple fans. That may be made fun of here, but brand loyalty is a huge thing for a company.[/citation]
Google gets it's revenue elsewhere, it doesn't need the closed ecosystem model of Apple to make money.
Brand loyalty? Thank god for the lack of it, because that's the fire that drives innovation. If ALL Android customers would be blindly loyal to Samsung, for instance, Samsung would have no reason to continuously push the envelope for innovation. They would rest assured on their laurels, just look at what Apple did (they stop being the innovators because they didn't need to; their customers were snatched for good, enslaved by a closed system where they HAD to buy Apple products, or risk losing all their invested apps).
Last but not least, brand loyalty towards Google is NOT similar to loyalty towards a phone manufacturer. If you have a Gmail account, or if you use Google as your main search engine, then yes, that's loyalty to them, but you can use a Samsung, HTC, Motorola, LG, or any other Android phone and still meaning you're loyal to Google, because all these use Android OS.

 

[billybobser]

I don't have brand loyalty on phones, because I buy them objectively. I chose the better one. If Apple offered me value and a quality product, I would surely buy one. They don't.

As for Google making no money on Android, I'm pretty sure the reason is so Android is pretty difficult to sue if they're giving it away (reason why Apple attacks OEM's and not Google). Googles money is in ads anyway, but if they control the platform they dominate the ads.

 

[house70]

This "analyst" is just tooting his one horn, because he sees his AAPL shares tanking.
No informed person can state all he said and keep a straight face. He's sooo behind, it's not even funny.
Take that "cheaper" argument, for instance: one can enter a store and buy an iPhone for the same amount or cheaper than some top-tier Android handsets anyday, but he doesn't know that?
If he doesn't know it, you don't want to trust your money to an ignorant person; if he knows it but chooses to lie about it, you don't want to trust your money to a liar.
Either way, this guy's credibility is in the crapper. /Q.E.D.

 

[zeratul600]

Only in America android is know for samsung, in the rest of the world, where poverty exist and tech is really expensive most people know that they want an ANDROID PHONE... not a brand but an android, later they will see which phone they can find and afford, but people originally seeks for the android OS because they know that it is really awesome flexible and customizable. Google doesn't need brand loyalty because they have real innovative solutions that people crave for, I never knew anyone who want an IOS phone they want a stupid apple printed behind their phone...