Even though Apple has been selling the iPod for more than 10 years, it still owns more than 75 percent of the portable digital music player market. The thought that Apple could “iPod” the tablet market is giving many tablet vendors nightmares.
Even though Apple has not cornered the smartphone market, the company reported record iPhone sales last quarter. Many realize that Apple has just started selling iPhones in China and could be expanding to other BRIC (Brazil, Russia, India, China) countries, too. Many of the smartphone vendors are certain that Apple will roll out a lower cost iPhone at some point and get very aggressive in emerging markets within the next two years. An even more difficult fact for them to stomach is that when Apple rakes in 75 percent of all cell phone profits.
Vendors believe they can compete with Apple in hardware, and perhaps software, but the secret to Apple’s success has always been its ability to build hardware and software into one integrated system. This is where competitors fear they lag.
When Apple engineers begin designing a product, the center of the design is the platform and its services. It’s just the reverse for Apple’s competitors, the device comes first, then the apps and services come into the picture. This is Apple’s major advantage over its competitors.
When Apple was developing the iPad, it already had iTunes in place. All content for the iPad was iOS based, so it was easy enough to build an iOS iPad apps environment on top of what was already there. Then all Apple had to do was create an apps toolkit to take advantage of the iPad’s larger screen size.
Vendors had high hopes for Google’s Android as a similar type of platform to build on, but so far that has not been the case. The multiple versions of Android complicate things for vendors and the community. The fragmentation of Android has been the heart of its failure in tablets so far.