The Smartphone Wars Aren’t Over, In Fact, They’ve Only Just Begun

Since Apple debuted the iPhone in 2007, smartphones have been the gadget du jour. Or the gadget du whatever-the french-sounding-word-for-“several-years”-is. Android came on the scene a little over a year later and the rivalry began that’s been driving the smartphone market forward. Currently, that rivalry has reached an all-time high and it almost seems like the positions are starting to settle. Android continues to activate millions of devices every week, and Apple continues to make huge profits on high-quality, if very few products. It’s a mechanism that’s worked fine in the desktop and laptop industry for years now. It’s easy to settle in and think this is how it’s going to be. Android will be the Windows of the smartphone world, with a lot of crappy devices and a few really fantastic ones that dominate the market, while Apple stays one of the biggest, most powerful individual manufacturers with a platform all their own that ends up as a very influential, very large niche.

Trouble is, this story isn’t over, folks.

For starters, let’s be clear. In the obviously parallel world of desktops, everything is possible. There is virtually no limit to what can be done with the software on either a Windows machine or Mac. This is not the case in the smartphone world. Not only are some things not possible, there’s many things that aren’t even good. And, as it turns out, each platform currently has their niche, their specialty that they do well. And so far, none of them have all of their bases covered.

For the purpose of this analysis, I’m going to focus on three platforms: iOS, Android, and WP7. First, though, I want to explain why the rest of them don’t matter. For starters, most of them don’t exist anymore. WinMo is dead, disowned by its creator. Same with Symbian over in Nokia’s camp. These two platforms still have their devotees, but when their masters abandon them, there is no hope for a future with them. They’re out. Palm, as a platform, generally garners a lot of attention, but their strategy, even after being bought by HP, is not a winning one. HP simply does not have the brand power or the marketing to push a whole platform powered by only a couple of devices by itself. To say nothing of Palm’s lack of feature parity or developer interest to match iOS or Android. Or HP’s generally confusing strategy of attempting to put WebOS in printers and desktops. Desktops! Where it will compete against Windows? No. Bad idea. And as for Blackberry, well, I’ve gone over how they need to get their act together already. The three players with the most promise for the future, then, are Android, iOS, and WP7.

And so far, none of them are finished.

To be clear, they’re all good platforms. WP7 is the most immature, but it’s off to a fantastic start. iOS and Android have their obviously huge userbases and fantastic feature sets. But none of them are complete. Consider the following list of basic functionality that we expect from our smartphones:

• Email, texting, and social correspondence
• Notifications
• Maps and navigation
• Productivity and organization
• Music
• Streaming video
• Gaming
• Cloud data sync and backup

These are all very basic categories of functionality. And, to be clear, the three major platforms all do them to a degree. None of them, however, do them all as well as they could. And none of them perform all of these tasks natively. Apple’s notification system lags horribly behind not just the smartphone market (Palm, Android and even WP7 do it better), but even half the desktop solutions. Apple also doesn’t exactly have a strength in cloud data sync, still relying on a desktop with iTunes to backup your contacts and messages. Android has games, though only recently are their games reaching iOS levels of quality, and the music and movies situation is pretty bleak outside of third-party software. Android is missing Netflix and Hulu, and a native music store is still nowhere to be seen. Meanwhile WP7 doesn’t do all that great on their mapping software, or at least not quite as great as Android does. Gaming is coming along nicely, but they’ve still got a ways to go before their app library is up to snuff. Every platform can do these things decently well. But none of them have the total package in a unified, first-party, powerful way. Yet.

iOS

Apple’s major weaknesses are in cloud data, productivity, and maps. Much of this is rumored to be solved by the advent of a free MobileMe service. This would allow Apple to offer a first-party solution for contact syncing over the air, as well as a cloud-based email/calendar/storage system. And, as our own Steven Callas has pointed out, Apple has at least bought a couple mapping companies. Rumors on what Apple plans to do with that have been quiet lately, and whatever they do would certainly be complicated (they’d have to out Google Maps to put their own map service in and that could prove messy when Apple still depends on Google a bit for YouTube and search). Apple has a lock on the multimedia aspects, with movies and music bundled nicely into iTunes, so freeing up MobileMe and getting some native mapping services would flesh out Apple’s current offerings to cover all the bases, leaving the App Store to fill in the niche gaps.

Android

Apple’s weaknesses are a little more subtle than Android’s. The iPhone is capable of doing a lot of the things it’s missing, even if the services aren’t the best and not from Apple. Android, on the other hand, has a bit more obvious omissions. For starters, outside of YouTube, streaming video is a bit of a wasteland. Flash video support is nice. I, for one, have occasionally watch The Daily Show on my phone/tablet. Unfortunately, the two biggest sources of streaming video outside of YouTube (which has a native app) are Netflix and Hulu. The former uses Silverlight, not Flash, and the latter actively blocks anything but a desktop or laptop from viewing their videos. Then there’s music. Not only does Google not have a music service at all (Apple has iTunes, Microsoft has Zune), but the offerings we do have are fairly scattershot. The most comprehensive third-party solution is doubleTwist, which integrates the Amazon MP3 store into their desktop syncing client, however this is less than ideal. Amazon MP3 is available for most Android devices and even includes the Cloud Drive, but these features are not currently rolled into doubleTwist on the phone. Then there’s Rdio, Thumbplay, Pandora, last.fm, and oh yeah, Android’s native music player which only works with music manually dragged and dropped to your phone’s storage. It can get messy.

But! Google’s working on it! Honeycomb now comes with “pluggable DRM” which may or may not be what Netflix needs to create their platform-wide Android app (lack of DRM is a huge problem for the content studios that supply content to Netflix), and Hulu’s Android app is on its way. Granted, it’s been promised “in the coming months” since January, but at least they’re working on it. Meanwhile, rumors fly about Google’s music service. You have to take all rumors with a grain of salt, and especially when dealing with the music industry, it can be difficult to nail anything down, but when a story starts popping up more often, you tend to take notice. For what it’s worth, Google has set aside market.android.com/music and market.android.com/movies for a specific purpose, much the same way they did for books. It’s perhaps the most vague of the not-yet-there-but-coming-soon features on any of these platforms, but Google is moving in that direction.

WP7

Curiously, it’s actually the latecomer to the game that has the most reliable promise for getting all the bases covered first. Microsoft already competes with Google in search and maps with Bing. They compete with Apple in music with the Zune. They’ve got Netflix on board with their platform already. In terms of gaming, which is actually one of the most difficult aspects to get started on, they’re coming along nicely. Oh and did I mention Xbox Live integration? Yeah. They’ve got that, too. Oh, and productivity. Microsoft invented this little thing called Office. Maybe you’ve heard of it? In all honesty, WP7 is shaping up to be a better integration of all of Microsoft’s myriad services and products than even Windows is. You know what integration of Microsof products looks like on a Windows desktop? A giant list of folders that either start with the word “Microsoft”, “Windows”, or “Live”. The machine I’m currently working on, pre-installed with Windows 7, came with two folders next to each other in my Start menu: “Microsoft Office” and “Microsoft Works”. Why. No, there’s not a good answer to that. Meanwhile, on WP7, all of Microsoft’s products seem to just fit. Maybe it’s the naming scheme of the more popular services. “Bing.” “Zune.” “Xbox.” A nice little array of four letter, nonsensical words that all have a solid brand going for them. And, it’s worth noting, none are the dominant force in their field. Not Bing, not Zune. Xbox is big, but not a bloated giant of industry like Windows. There’s tons of valuable brands and integration between them here to stand out.

That just leaves their UI which looks amazing. Not perfect, mind you. Microsoft took a lot of risks with their new UI and some things, well, we’re still not sure if they’ll work. And it needs a few things, like universal search, or a better way to navigate huge lists of apps. Microsoft: I’m less than convinced tapping to see your huge app list, tapping a button to see the alphabet, then tapping the first letter of the app you want to see is the best way to do this, but kudos to you for putting something in there at least. The OS as a whole still needs to do some growing, but we’ll see.

So, given all that, what’s WP7 missing? Well, to put it simply, the phones. Apple and Google are moving in the direction of each others’ services, rounding out all the features that their respective platforms are missing natively. They’re also both huge. WP7? It’s a tiny little platform with itty bitty market share. There’s only a few WP7 devices right now and, frankly, they’re mostly the same. And they’re also mostly waiting on a series of updates that are going to round out their functionality. They’ve got all the ingredients, they just need to bake the damn thing.

They also need a way to make up marketshare. Enter Nokia. Microsoft has just recently signed a deal that will take Microsoft’s platform that’s full of potential into the hands of Nokia’s hardware designers that were, in times past, responsible for creating the world’s most dominant smartphone platform. And as an added bonus, they’re even bringing along some of Nokia’s mapping services, which could seriously help Bing out. Perhaps it’s my Android bias, but a smartphone doesn’t feel complete to me without a GPS, turn-by-turn app built-in. It’s honestly pretty likely that WP7 will have that in a couple years. Microsoft has a lot of hurdles to clear before they can make up the market share they need in terms of actual users. They’ve also got the relationships in the industry, the partners, the influence, and not to mention the money and the drive to get it done.

Where do we go from here

Let’s be honest, no smartphone platform is perfect. Furthermore, look how much the landscape can change in a short time. 18 months ago, it was Apple vs. RIM and Symbian for smartphone dominance, with WinMo on the downturn and Android barking at the tree Apple was sitting on top of. Now? Symbian’s dead. WinMo’s dead. RIM is confused and lost. Make no mistake, the big three smartphone platforms we’re going to see duking it out from here on are Android, iOS, and WP7.

And really, that kinda feels like how it should be, isn’t it? We’ve got Apple, the first company to build a GUI computer and make the machines usable by humans. We’ve got Microsoft who proliferated the idea that software could be a business and put a computer in the hands of just about every person on earth. And then there’s Google who, once everyone had those computers, came to the internet that naturally evolved from this system and made sense of it. These are the titans that made the technology industry what it is today. They’re the ones whose stories will get made into movies. Don’t get me wrong, all the other companies out there have played their part, but these three are the ones who are going to fuel the fanboy fires, that are going to drive the smartphone market farther than any of us imagined it could go. Given where it already is, that idea is pretty exciting.

The stage is set. The platforms have been defined, and the race is about to begin. There’s still plenty of room out there for smartphone growth. Only about one in three cell phone users in the U.S. even have a smartphone. Worldwide, there’s even more room for growth. And, like camera phones before them, eventually smartphones will simply become the norm. There won’t be dumbphones featured in store displays. They’ll exist, sure, but as a niche market for grandparents or emergency devices. We’re not there yet. It’ll take several years to get there. And the race to see who’s going to control that market when we get there begins now.

Let’s do this thing.