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Sunday, June 30, 2013

Maturing iOS 7 chatter

As the dust settles from the initial design reactions to iOS 7, more productive assessments are being brought to light from the influential-class bloggers:

(There is also anecdotal evidence from twitter chatter that already like using iOS 7, although being a beta, it still crashes frequently.)

The general consensus is a very distinguishable OS that requires a premium handset.

This pushes against the thesis of commoditization.  Causing price differentiation, and a pathway to maintain margins. 

The threat of commoditization is very evident when looking at the current Chinese market. The below charts, via Fortune article by Philip Elmer-Dwitt, China's handset market, via the low-end, are pushing Android growth. (Which Google benefits nothing from. They are completely shut out of the china handset market phones, even with Android. Google is basically subsidizing the very heavy lifting in OS development, for nothing in return.)

 Click to enlarge.
The standout of this niche market in Android is Xiaomi, best known for mimicking Apple's strategy.  This new growth is primarily being driven by a new emerging consumer class in china.

The iOS 7 creates differentiation that requires premium components.

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