Post Open Android Asset Check
As you’ve no doubt heard by now Google has been making moves behind the scenes recently to constrain Android development to changes that it approves. This is no doubt in reaction to the threat that competitors such as Amazon and Facebook may come along and effectively hijack the platform out from under Google. From Google’s perspective this decision makes sense. From the perspective of the hardware makers and others who have bought into the “Android is Open” meme this is terrible news.
With that as a background let’s do an asset check on the players in the field:
Apple. They’re laughing. Honestly, probably literally laughing at this news. They own their own hardware stack and they own their own software stack and as Matt Drance pointed out in his brilliant inaugural Apple Outsider piece — Apple loves to control its own destiny.
Google. They’re feeling defensive. They set out to make an open platform and I’d bet they’re feeling the sting of all that rhetoric coming back to bite them in the ass. Of Google executives John Gruber writes, “Andy Rubin, Vic Gundotra, Eric Schmidt: shameless, lying hypocrites, all of them.”. I think that’s too harsh. It implies a premeditation I’m not sure is obvious from the facts. I think they’ve ended up throwing out their (they claim) principled stand on being open once it was apparent it wasn’t going to be totally in their benefit. It certainly calls into question their trustworthiness but I don’t think, in this case, that malice trumps stupidity or self-preservation.
HTC, Samsung, LG, et al. They’re pissed. They own their own hardware stack but do not control their software stacks. This turns them into commodity vendors that will be played against each other in order to gain the favour of their software platform provider. They’ve become the Dell, HP and friends of the smart-phone space. Google now wants to make each of them its bitch. If they’ve got any sense tonight their execs are having a stiff drink and re-watching Oz.
Microsoft. They’re laughing. They’re probably actually quite giddy right now because this means that Windows Phone 7 will be on a more even footing with Android in terms of licensing. If Microsoft can manage their relationships with hardware suppliers better than Google can then they stand to gain some real traction. This plays in Microsoft’s favour — they’ve been managing relationships with hardware vendors for decades, albeit often abusively. Still, experience counts for something.
Nokia. I don’t think anyone at Nokia laughs much anymore. I’d guess they likely feel relieved. They took a lot of heat for electing to go with Windows Phone 7 just a few months ago and now that decision doesn’t appear quite so suspect. Perhaps they are still a commodity hardware vendor for Microsoft but you can bet they’re the preferred commodity hardware vendor. If, say, Facebook cut a deal with Microsoft for Windows Phone 7 customization then Nokia is in a good place to be the hardware partner there.
RIM. Despite being laughed at constantly today, RIM laughs too. They own their own hardware stack and they own their own software stack and as I pointed out previously — they are maintaining control over their own destiny. Which they’re doing like a drunken sailor on three day shore-leave but, still, that “2 CEOs & 4 Eva” tattoo is their choice.
It seems I’ve adopted RIM as the player I’m going to stick up for. Whether that’s because I’m Canadian or because I’m a contrarian I’m unsure but I do feel more positive about them than pretty much anyone else I see commenting on the situation. When I first expressed my thoughts on RIM my argument was essentially the following: they were caught flatfooted by iPhone and they know it; they are talking to remain relevant in the eyes of their major purchasers; they are buying or adopting technologies they believe will give them a better footing in the future; they are doing so without ceding control over their own destiny through adopting a third party software stack. I predicted their end game would be a controlled exit from the smart-phone and tablet space and I suggested that they were looking for ways to gracefully cede that space to Apple while squeezing a few more bucks out of it.
Since I wrote that piece in early January there have been more changes. First, the news came out that it appears that RIM is turning away from the smart-phone market. Also, RIM has said even more dumb things. The latest news is that they’ll be throwing in a Java runtime atop their PlayBook OS in order to support running Android apps. Their waffling, obvious lack of a vision for the PlayBook product and the fact that they’ve got two CEOs and three COOs are all indicative of a company truly in trouble. Yet today we’ve seen these poorly communicated and arbitrary seeming decisions leave them unaffected directly by news that has changed the fortunes of everyone in the industry other than Apple.
Hey, I hear Facebook and Amazon are looking for platforms to customize. I hear that QNX has (I’ll say this as politely as possible)had a few partners. I hear that RIM makes some pretty good hardware and knows their way around the telecom industry. Oh, and Exchange. And I hear Facebook knows Facebook pretty well. Maybe integrating with Exchange and having their own device and doing Facebook chat over BBM would be something Facebook would be interested in? Who knows?
Obviously, that’s speculative but it’s the sort of thing that you get to walk up to the negotiating table with when you control your own destiny. These other clowns that are taken seriously for a month or so at a time, the “hardware partners” that ship a slightly higher resolution screen with an advance copy of an OS that’ll be available everywhere (though won’t install on most hardware) a few weeks later — they’re of little interest. They have no potential to invent anything and after today that’s just even more obviously true.
I hate to keep referencing the same few articles over and over but Matt Drance points out:
Here are some big takeaways for your next slide deck. RIM has:
Very little cash
Weak Q1 guidance
No clear management structure
No clear product strategy
Drance is not wrong that RIM is in very bad shape and it’s not clear where they’re going. I don’t think they’re clear where they’re going. I do think they’re doing what they can to seize upon whatever opportunities come their way. I believe they’re in a better position than most to do so. I don’t think they need to be rescued, I think they’re up a creek without a paddle but they’re splashing their own way to shore and not taking any help from that creepy looking dude with the camera wearing a Google TV t-shirt.