By: Don Reisinger
eWeek.com
2009-10-19
News Analysis: Apple should be concerned that Verizon Wireless has focused its product development and marketing efforts on Google's Android mobile platform. The aptly named Droid smartphone could be the first Android device to score a huge hit with users. With millions of subscribers and huge wireless network, Verizon has a chance to make serious inroads into Apple's smartphone base. The more that happens, the greater the chance that Apple will have to make some hard decisions to maintain its dominance.
Verizon Wireless customers were treated to a slew of ads over the weekend of Oct. 17 showcasing Droid, a new phone from Motorola that runs Google's Android mobile platform.
In the ads, Verizon Wireless highlighted many of the iPhone's shortcomings, including its lack of a virtual keyboard and the inability to run apps simultaneously. It was a direct attack against Apple and, for some, it could have helped clear a few things up about phones that mimic the iPhone's functionality, but don't feature the Apple logo.
Overall, I thought the ads were effective. They did a fine job of detailing what consumers can expect from Droid. But they also highlighted why Apple might want to think twice about Droid and Verizon's partnership with companies offering the Android platform. The way I see it, there's a real chance that Droid is just one of many reasons why Apple should be nervous.
1. Android is a real competitor to the iPhone
Unlike many of the other platforms that offer a touch-screen experience, Android is a real competitor to the iPhone. The software works well. The touch screens are usually responsive. And, unlike the Palm Pre, Android phones have so far not experienced major issues that have limited their appeal to users. Simply put, Android is a fine alternative to the iPhone.
2. Apps
Apple might still reign supreme when it comes to apps (the company offers over 85,000 programs, after all), but Android is second. So far, that platform has well over 10,000 apps. It might not match Apple's offering, but as more phones become available, you can bet more developers will take notice. Expect many more Android applications in a relatively short amount of time.
3. Google "gets" the user
Like Apple, Google understands what the user really wants from a mobile phone. It realizes that they don't want a second-rate touch experience, but a device that does its best to achieve what Apple has with its iPhone. So far, the Android platform is close to doing that. And if Droid lives up to the hype, it might even be able to match it.
4. Verizon Wireless is huge
Say what you will about Apple and its ability to draw customers to AT&T, but Verizon Wireless is a huge company with millions of subscribers. If it decides to make this a battle between Android phones and the iPhone, it could spell some serious trouble for Apple as it tries to find more customers.
5. Finite customers
Following that, it's extremely important for Apple to move out of AT&T's network as soon as possible. There are a finite number of customers that are willing to use the iPhone on AT&T's network.
Apple needs to keep that in mind. Since it's so big, Verizon Wireless might have been the next logical place for Apple to deliver the iPhone. But if Verizon Wireless doesn't want that, Apple could be in trouble.
6. It's a numbers game
It's doubtful that Droid will be able to supplant the iPhone as the most coveted phone in the mobile market, but it is possible that Android itself will enjoy far greater success by relying so heavily on Verizon Wireless. Since Android is an open platform, it can be found on several devices, making it a viable alternative to the iPhone. Combined sales of Android devices could eventually match the iPhone's single-phone sales. It's a real possibility.
7. Features matter
Apple has tied its future to the virtual keyboard. That's not necessarily a bad thing, but it might be an issue as users search for a new phone. We have all been conditioned to use physical keyboards. They tend to be easier to use. And in many cases, it's what we look for in a device. Considering Droid does have a physical keyboard, it's a selling point. And it could cause some who would rather be on Verizon Wireless' network to take notice.
8. Verizon doesn't need the iPhone
Unlike AT&T, Verizon Wireless has proven that it really doesn't need the iPhone. Would it be nice to have it? Sure. But the carrier also realizes that with Android doing a fine job of delivering a rich touch experience, it's no longer a requirement. That gives Apple less leverage in negotiations.
9. Alternative options? Not really
As Apple considers other carriers, it's entirely possible that the company won't be able to bring its iPhone to Verizon Wireless customers. Realizing that, it has two options: T-Mobile or Sprint. In either case, there isn't much to choose from. Those carriers trail AT&T and Verizon Wireless by a wide margin. And when we consider their coverage, it's not even close. I simply don't see Apple having any other option besides bringing the iPhone to Verizon Wireless. But if Verizon isn't open to such a release, Apple might be stuck with AT&T.
10. The future is in doubt
At this point, the future looks bright for the iPhone. But that doesn't mean that it will maintain its dominance. If Verizon Wireless dedicates its bundles of cash to Android phones, it's entirely possible that Google's platform could start making inroads in the mobile space. And in the end, it could put Apple on the run.
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