Marketing consultant: ‘Apple’s iAd has no future, and neither does the iPhone or iPad’
Friday, May 21, 2010 - 11:24 AM EDT"Apple's new iAd proposition has been generating a great deal of discussion lately, most of it positive, and most of it remarkably short-sighted. It seems most people, including Steve Jobs, have forgotten the basic lessons of computing and the internet. People who forget history are doomed to repeat it. The iAd has no future, and neither does the iPhone/iPad," Brandt Dainow, an independent web analytics and marketing consultant, writes for iMediaConnection.
MacDailyNews Take: Our iCal is havin' a par-tay!
Dainow continues, "Hardware manufacturers make their money by selling new phones. They have no interest in making phones that last forever, or that can be upgraded via software."
MacDailyNews Take: Mr. Dainow, they do if their customers expect upgradeable devices, as nearly 100 million iPhone OS users do. Android settlers, not so much.
Dainow continues, "Smartphones, like all other computers, sell on the basis of what you can do with them. People buy IT equipment (laptop, PC, or mobile) on the basis of the applications they can run on it. The item purchased needs to be able to do what the customer wants it to. There are so many programs around for PCs today that this is rarely a consideration -- almost every conceivable application you could want is available. As a result we have largely forgotten that capabilities are central to sales. However, there are many instances in which purchasing a Mac is not an option because the required software does not exist, which shows that applications still control purchases."
MacDailyNews Take: Mr. Dainow seems to not know, or has forgotten, that Apple Macs run everything, including Windows and Windows apps natively and/or via fast virtualization. Fact: Apple Macs run the world's largest software library, of which software written for Windows is but a subset.
Dainow continues, "So an operating system's success is dependent on being an attractive platform for developers. In order to be attractive, the operating system must have (or promise) a large installed base."
MacDailyNews Take: Wrong again, Mr. Dainow. In order to be attractive to developers, an operating system, or, more accurately, a platform, must be profitable. Period. Taken to an extreme, imagine Steve Jobs is the world's only Mac user. However, he spends $200 million on software per year. Guess what? Even with one Mac user, there would be Mac developers. Now, in reality,Apple Mac users are better educated and have more disposable income than Windows PC sufferers on average and Mac users buy significantly more software than their PC suffering counterparts. Therefore, Mr. Dainow's argument is flawed from the outset.
Dainow continues, "Apple's desire to control its marketplace has made it a poor choice for developers, even when it offers a large market. Having a large base of customers makes Apple initially attractive, but its poor support for the developer community eventually forces smaller niche players out. The long term result is easy to see -- Macintosh now runs Microsoft Office because no one else was interested in providing a compatible office suite. Apple's restrictive policies over the Mac almost caused the death of the Apple Corporation, and it was only by opening the environment to its arch-enemy Microsoft that Apple was able to survive."
MacDailyNews Take: Not this again. The iPod/iPhone/iPad is not the Mac, so stop comparing them:
iPhone isn't the Mac, so stop comparing them. To draw an analogy between the Mac and iPhone platforms simply highlights the writer's ignorance of the vast differences between the two business situations. Look at the iPod, not the Mac, to see how this will play out.
Google Android offers the same messy, inconsistent Windows PC "experience," but without any cost savings, real or perceived. Windows only thrived back in the mid-90s because PCs (and Macs) were so expensive; the upfront cost advantage roped in a lot of people, who were, frankly, ignorant followers who did what their similarly-ignorant co-workers and friends told them to do. Microsoft still coasts along on that momentum today.
The fact is: Apple's iPhone 3G costs just $99 and the 3GS goes for only $199 in the U.S. with a 2-year plan. I'd call any Android device the "Poor Man's iPhone," but you have to spend just as much, if not more, to partake in an increasingly fragmented and inferior platform. There's no real reason to choose Android, people settle for Android. "I'd have bought an iPhone if Verizon offered them." Just look what's happening in any country where iPhone is offered on multiple carriers. It's a bloodbath.
Apple offers consistency to developers of both software and hardware. Just look at the vibrant thrid-party accessories market for iPhone vs. the Zune-like handful of oddball items for Android. If you make a case or a vehicle mount, does it pay to make 14 different Android devices that number under 1 million each, or to make one or two for what's rapidly approaching 100 million iPhone/iPod touch devices? As Apple's iPhone expands onto more and more carriers, Android's only real selling point ("I'm stuck on Verizon or some other carrier that doesn't offer the iPhone") evaporates. - SteveJack, MacDailyNews, December 23, 2009
And Microsoft introduced Office for Macintosh in 1989. Before any Windows version existed.
Dainow plods on, "Apple never joined in the universal move to PC compatibility. Based on the Motorola chip, Apple chose to cater to niche market players with hobby computers such as the Apple II. Apple's day came later when it copied the GUI operating system being developed by Xerox and created the first Mac. The GUI posed a threat to Microsoft's survival and the dominance of the PC, until Microsoft got its own GUI right with Windows 3.0. Microsoft's strategy was always to open its platform to the widest possible developer community, while Apple's was always to restrict and control. In many ways, Steve Jobs continued to think in terms of the world he grew up in, a pre-PC world -- each computer manufacturer producing its own operating system and strongly controlling developer access."
MacDailyNews Take: Mr. Dainow, Apple did not "copy" the GUI from Xerox. To state so only highlights your ignorance. You might just as well have written, "I do not know what I'm talking about, so here's five pages of my disjointed, illogical theories." For anyone who cares, the real story, as told by the people who lived it, is right here.
Dainow continues, "Right now the iPhone has a dominating position in the U.S. smartphone marketplace. However, we must recognize this is a global village. Apple cannot sustain the iPhone as a purely U.S. phenomena."
MacDailyNews Take: Mr. Dainow, please explain this: Apple dominates Japan’s smartphone market with 72% market share; sales tripled in latest quarter - May 19, 2010. Hello, Mr. Dainow? Paging Mr. Dainow...
Dainow continues, "If the smartphone goes the way of previous computers, and the way of the internet, Apple's strategy will eventually lead to the iPhone occupying a similar niche to the Mac -- a miniscule market share sustained only by the fanatical loyalty of dedicated followers."
MacDailyNews Take: Mr. Dainow, the operative word in your statement is "if." And it won't, for the reasons we've explained above; not to mention that, four pages in, you haven't yet been right about anything.
Dainow continues, "Steve Jobs says he hates Adobe Flash and will not support it on iPhone. The reason is clear -- Flash provides a cross-platform development system. Build an app in Flash and it runs on every operating system that supports Flash."
MacDailyNews Take: For the umpteenth time: We do not want ported software on our iPhones, iPads, and iPod touches. The type of "write once, deploy everywhere" software that lazy Adobe wants to "help" developers to excrete results in lowest common denominator apps that fail to take advantage of individual platforms' strengths. Rather than see developers create great experiences by playing to the strengths of individual platforms, lazy Adobe, and Mr. Dainow it seems, instead want mediocrity everywhere. Adobe just wants to control the tools developers use to poop out cookie-cutter apps that fail to inspire users because they fail to take advantage of each platform's unique hardware and operating system features.
Dainow continues, "Locking Flash out is unsustainable if you want to retain market share."
MacDailyNews Take: Is this guy serious?
Dainow continues, "When I look at the lessons of history, Apple's own past, and how things work out, it seems to me inevitable that within 5-10 years the iPhone will hold around 5 percent of the smartphone market at best."
MacDailyNews Take: Seriously, our iCal might have just audibly sighed. Not sure if it was satisfaction, consternation, or something else.
Dainow continues, "iAd is just a second-rate widget. Calling iAd creations 'advertisements' is misleading. iAd advertisements are, in reality, widgets... The iAd is a symptom of Apple's inability to come to terms with the way computing has been for the last 30 years. While designing innovative products, as a business Apple still strategizes like it's the 1970s -- trying to create isolated ecosystems when everyone else knows the world wants one big open inter-connected system."
MacDailyNews Take: Mr. Dainow offers no proof of that statement either. At least he's consistent. We have about 100 million reasons and rapidly growing that proves that Dainow's wrongly-described "isolated ecosystem" hasn't dissuaded "the world" from accepting the iPhone platform. Really, how can you call a platform "isolated" when it's connected to the Web, has over 200,000 apps made and supported by tens of thousands of developers and supports a flourishing ecosystem of third-party accessories, including mass market vehicle and electronics makers? Mr. Dainow's arguments are illogical and incoherent.
Dainow continues, "Apple seems wedded to the idea that it can own all aspects of its customer experience, even though its own corporate history shows this is unsustainable. The smartphone environment is a mirror of the early days of personal computing, yet Apple shows no sign of having learned from this experience."
MacDailyNews Take: Mr. Dainow, you're wrong and your attempt to compare two dissimilar things in order to try to predict the future is just plain silly.
Full article — click away, as we've linked to Dainow's "print article" page that not only has his five rambling pages combined into one, but (whoopsie Mr. Marketing Consultant!) also has no ads 
— here.