March 1, 2011 § Leave a comment
I have always wanted to launch a speculative post series that poses tantalizing questions that are not entirely out of the realm of possibility. The first of them is a recently speculated possibility  of Apple dropping the price of the iPad to $399 at its event on March 2. The reason why this makes sense are as follows:
- Considering Apple’s margins with the iPad, $399 seems entirely possible and still profitable.
- Apple’s supply chain heroics are legendary including the purchase of bulk volume parts recently. They could use that to their favor here.
- A year since the launch of the original iPad, the Bill of Materials might be more in Apple’s favor.
- While Apple’s competitors  are trying to match the $499 cost and struggling to do so, Apple could lower the bar of entry on the iPad further, thereby decimating its competition.
- The upcoming app store changes for publishing apps and the 30% cut for Apple could more than make for the loss in margins on the iPad.
A move to $399 would really kill the competition in the short term until they can figure out a way to compete in price with the iPad. I had questioned Motorola’s pricing strategy in an earlier post and stick to the hypothesis that a true iPad killer or even rival would have to compete on specs, ease of use and price. While it is easy to match the former two, the issue of price is much harder to alleviate. Sanjay Jha, the CEO of Motorola Mobility went on record defending the pricing of Xoom and saying that it made perfect sense for a world class tablet that in some sense was better than the iPad. While he could be right in his defense of the quality of the product (the Xoom has released to relatively good reviews), by not price competing with the vastly popular iPad, he was settling for a second place in a fledgling battle. This definitely was/ is a disappointment to Android enthusiasts. At $399, the new iPad would further strengthen this argument and make the Xoom a not so compelling buy.
It boils down to this: Will Apple want to hold onto its juicy margins with the iPad and be content with its current position or want to kill off the fledgling competition, once and for all?
The March 2 event will hopefully reveal the truth.
Update: Unfortunately, the speculation stayed unfounded. Apple just launched iPad 2 for the same price of $499. Remains the most compelling tablet in the market for the price.
January 13, 2011 § Leave a comment
Happy New Year to everyone. I took a short break from blogging for a vacation followed by the holidays. The New Year is upon us and is shaping to be extremely interesting one for the mobile technology folks. As a user and a technology follower, there has never been a better time and we are less than a fortnight into 2011.
I hope to post more regularly and hopefully learn more in the process!
October 7, 2010 § Leave a comment
In May, Google announced Google TV with much fanfare. It was announced as the second coming of television and the true marriage of the web and television. After many leaks and official sprinkling of information, the product is ready to go with a select set of partners (Sony, Logitech, Intel, DishTV,…). With official products now unveiled, I am not sure if I see the value in adding more hardware to my living room. Google TV may still thrill me by being a complete experience, but early videos and press has me skeptical about its real impact.
Take for example one of the early Google TV experience products, the Logitech Revue. It promises the complete web in your couch plus access to web enabled TV content. Cool stuff. But is it worth spending $299 on? I could see a $49 app or maybe a $99 hardware unit that almost disappears from view in the living room as enabling this cool stuff. But do I really need the $299 product (with extra for the camera and mini controller and many other useless accessories?). Maybe in the future, the add-on hardware will become a minimal unit that is essentially a commodity. Cool gear has a way of becoming a commodity fairly quickly.
Second example to illustrate my point is the Sony Bravia line of Google TV enabled HDTV’s. These already expensive TV’s might not be worth spending any extra money on unless its a small price point over its non-Google TV enabled counterpart. Sony could do this if the product takes off well and an integrated experience without extra hardware and significant markup would be appealing.
By lowering the cost of its hobby TV product, Apple has set the price benchmark that Google and its partners need to reach to make it appealing against the competition. Given the ubiquity of the iOS fans and the success of iTunes, Apple TV will have a strong headstart in this nascent business and Google will have a challenging task ahead to one up the iOS product.
The most critical element to all of this is the programming. Google (and to a degree, Apple) is having problems convincing networks to participate and offer Google TV enabled programming. Until this happens, the connected tv/entertainment box industry will be segmented and thus minimally successful. Even Apple with its huge popularity hasn’t had much success selling Apple TV to the networks and thus to the consumer. If Google can change this status quo, it will be a huge difference maker. Early tidings aren’t very good but hopefully things will change for Google’s sake.
For now, Google and Apple just opened up yet another battleground and it will be an interesting one in the coming months to see how it goes. As always, the great folks at Ars Technica, have a nice writeup on the launch of Google TV.
July 6, 2010 § Leave a comment
A couple of issues ago, Fast Company had a big article on on Smart Cities and how IBM, HP and Cisco are betting huge on them. There have been more from them on the same topic that can be found here . So what does a smart city mean and how does it impact you and me?
Most of you must have noticed IBM bombarding all business and tech magazines with its smarter planet pitch while Cisco does something similar with its “Smart+Connected Community“. Billions of dollars are being poured into courting everybody from local planning officials to heads of state. In addition, ads campaigns are all over the place and more is expected in the coming months.
The business folks at IBM and Cisco have reams of material on the matter here [IBM][Cisco] describing energy and financial savings for communities that become “smarter”. They are also touting better educational opportunities and improved government functioning as major benefits of moving to a smarter community. From what I have read and assimilated on this topic, it boils down to the following real world factors.
1. Building a well designed network to serve all aspects of the community from the ground up. Simple as it may seem, it hasn’t happened in much of the west since development and infrastructure growth has been staggered. When wiring a community from scratch, smart network engineers can do an optimized and well connected system that will account for potential bottle necks and build better load balancing techniques into the system. While this is in no way revolutionary, it will perform much better than most evolutionary infrastructures we are used to.
2. Using vast amounts of collected data to feed back into the system and optimize it from all aspects. This is something that is becoming bigger and bigger as we speak. Data Mining has so many applications that are yet to be “mined” (pun intended) it is mind boggling. IBM’s expertise in data mining will come into play here. Predictor systems will be in vogue and for a good reason.
3. Provide a backbone that can handle future traffic requirements. This is big. Much of the current infrastructure is not scalable enough to handle the explosion in Internet traffic. A smart city built from the ground up will be designed taking this very important element into consideration. If there is one thing all planners and designers agree- network traffic is headed one way, up.
4. Enable rich applications that were impossible until recently. This will be an offshoot of the previous point. The better the infrastructure and available bandwidth, more innovative the applications that can use them. This ties into some of the ad-speak of the smarter city ideas namely improvements in basic education and remote teaching.
5. Empower newer kinds of economies that lie untapped. This is an unknown entity which will remain so until each and every smart city identifies its niche and uses all the new found power to exercise it to its benefit.
But for all the cool things that it promises, there is a huge cost to pay. Each of these cities are billion plus dollar investments which will take a lot more to manage and maintain. Herein lies the bounty Cisco, HP, IBM and many more are after. The promise of newer revenue streams that could take care of the bottom line for years to come.
I am just waiting to see the first smart city built from the ground up that manages to not just be a showcase of cool technologies, but one that actually executes on a vision to put all of it to use for its citizens.
May 20, 2010 § 1 Comment
Somewhere in San Jose, there are big changes happening. One that is not being shouted out from rooftops but a major one, nevertheless. As the title of the post would have revealed, I am refering to the transformation of and at Cisco. For most of us, the perception of Cisco is a staid old router company that makes gazillions selling routers and switches to the world. While that is still very true, Cisco has made a very conscious and admirable approach to expanding its portfolio in very adventurous ways.
Looking at their acquisitions over the last few years, one can get an idea of how they are trying to spread their wings without fundamentally changing themselves. The first oddball acquisition really happened in 2003 when they picked up home networking gear pioneer LinkSys. At that time, people were surprised by Cisco’s move to the SME and home office business but it definitely made sense. Things were then relatively silent from their image makeover standpoint until 2005 when they acquired Scientific Atlanta, a profitable maker of set-top boxes. Until then, Cisco had primarily been a backend communication equipment vendor with the lone exception of LinkSys. With this, they were starting to expand further into consumer electronic devices. The rest of their 2005 acquisitions, minor yet important are listed here. In 2006, they acquired a bunch of complementary tools to start putting together an ec0-system for enterprise customers at the front end. They are listed here. Their next big acquisition came in 2007 when they picked up WebEx, a pioneer in web conferencing systems and business collaboration tools. This was a major move by Cisco, one that would be bolstered further by their Tandberg acquisition in 2009.
With WebEx and later with Tandberg, Cisco was placing itself more and more in the end point devices and services space- for enterprises big and small. This was a smart move to build a complete enterprise offering for its customers- many of whom had large Cisco accounts and affiliations. The icing on the cake happened in 2009 when Cisco is an extremely surprise move, acquired Pure Digital Technologies, the maker of the very popular Flip video systems. This was a straight consumer play that was extremely unlikely for a very large networking vendor. But by 2009, Cisco was no longer that Cisco 0f 1999. They were a “network” ecosystem player- one that made anything any everything that had an IP address and the ability to communicate via a wired or a wireless interface.
The launch of the Valet line of Linksys devices targeting the novice home network user and the acquisition of the Moto Development Group, a consumer electronics design firm confirms Cisco’s full on assault on home electronic and networking devices. The company is now intriguingly poised to be a force to reckon with across the full spectrum of networking gear- ranging from GigaBit core routers to consumer video capture devices, from corporate wireless systems to enterprise video conferencing software and hardware. This is not your dot-com Cisco. This is a very different beast and one that had a lofty vision.
Welcome to the Human Network!
April 22, 2010 § Leave a comment
Last year when Dell announced a couple of handsets for the Latin Americas and China, the bloggers heaved a collective “meh!” . The phones looked pedestrian and did nothing to make a case for Dell in the new business. When news came out that Dell was going to be on ATT, there were critics questioning the value of the move for ATT. How much things have changed since then…
Yesterday, Engadget unveiled a bunch of Dell prototypes destined for the North American market over the next few quarters. While their actual performance remains to be seen, the specs are worth dying for. 4.1 inch AMOLED screens, HD displays, hulu apps, Android 2.1 or Windows Phone 7 and more.
Dell has not been a purveyor of great design but they have managed to be a solid performer in the PC industry. How they make an impact on the smartphone market where the iPhone towers over all is going to be interesting to watch.