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CHAPTER I
INTRODUCTION
Modern Smartphones
A Smartphoneis a mobile phone built on a mobile computing platform, with more advanced
computing ability and connectivity than a feature phone. The first smartphones were devices
that mainly combined the functions of apersonal digital assistant (PDA) and a mobile phone
or camera phone. Today's models also serve to combine the functions of portable media
players, low-end compactdigital cameras, pocket video cameras, and GPS navigation units.
Modern smartphones typically also include high-resolution touchscreens,web browsers that
can access and properly display standard web pages rather than just mobile-optimized sites,
Flash compatibility, and high-speed data access viaWi-Fi andmobile broadband.
The most common mobile operating systems (OS) used by modern smartphones include
Apple'siOS, Google's Android, Microsoft's Windows Phone, Nokia's Symbian,
RIM'sBlackBerry OS,andembedded Linux distributions such as Maemo and MeeGo.Such
operating systems can be installed on many different phone models, and typically each device
can receive multiple OS software updates over its lifetime.
The distinction between smartphones and feature phones can be vague and there is no official
definition for what constitutes the difference between them. One of the most significant
differences is that the advanced application programming interfaces (APIs) on smartphones
for running third-party applications can allow those applications to have better integration
with the phone's OS and hardware than is typical with feature phones. In comparison, feature
phones more commonly run on proprietary firmware, with third-party software support
through platforms such as Java ME orBREW.An additional complication in distinguishing
between smartphones and feature phones is that over time the capabilities of new models of
feature phones can increase to exceed those of phones that had been promoted as
smartphones in the past.
Platform, with more advanced computing ability and connectivity than afeature phone.The
first smartphones were devices that mainly combined the functions of a personal digital
assistant (PDA) and a mobile phone orcamera phone.Today's models also serve to combine
http://en.wikipedia.org/wiki/Personal_digital_assistanthttp://en.wikipedia.org/wiki/Camera_phonehttp://en.wikipedia.org/wiki/Portable_media_playerhttp://en.wikipedia.org/wiki/Portable_media_playerhttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/GPShttp://en.wikipedia.org/wiki/Touchscreenhttp://en.wikipedia.org/wiki/Web_browserhttp://en.wikipedia.org/wiki/Adobe_Flash_Playerhttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/Mobile_broadbandhttp://en.wikipedia.org/wiki/Mobile_operating_systemhttp://en.wikipedia.org/wiki/Apple_Inc.http://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/Microsofthttp://en.wikipedia.org/wiki/Windows_Phonehttp://en.wikipedia.org/wiki/Nokiahttp://en.wikipedia.org/wiki/Symbianhttp://en.wikipedia.org/wiki/Research_In_Motionhttp://en.wikipedia.org/wiki/Embedded_Linuxhttp://en.wikipedia.org/wiki/Maemohttp://en.wikipedia.org/wiki/MeeGohttp://en.wikipedia.org/wiki/Application_programming_interfacehttp://en.wikipedia.org/wiki/Firmwarehttp://en.wikipedia.org/wiki/Java_MEhttp://en.wikipedia.org/wiki/Binary_Runtime_Environment_for_Wirelesshttp://en.wikipedia.org/wiki/Feature_phonehttp://en.wikipedia.org/wiki/Personal_digital_assistanthttp://en.wikipedia.org/wiki/Personal_digital_assistanthttp://en.wikipedia.org/wiki/Camera_phonehttp://en.wikipedia.org/wiki/Camera_phonehttp://en.wikipedia.org/wiki/Personal_digital_assistanthttp://en.wikipedia.org/wiki/Personal_digital_assistanthttp://en.wikipedia.org/wiki/Feature_phonehttp://en.wikipedia.org/wiki/Binary_Runtime_Environment_for_Wirelesshttp://en.wikipedia.org/wiki/Java_MEhttp://en.wikipedia.org/wiki/Firmwarehttp://en.wikipedia.org/wiki/Application_programming_interfacehttp://en.wikipedia.org/wiki/MeeGohttp://en.wikipedia.org/wiki/Maemohttp://en.wikipedia.org/wiki/Embedded_Linuxhttp://en.wikipedia.org/wiki/Research_In_Motionhttp://en.wikipedia.org/wiki/Research_In_Motionhttp://en.wikipedia.org/wiki/Symbianhttp://en.wikipedia.org/wiki/Nokiahttp://en.wikipedia.org/wiki/Windows_Phonehttp://en.wikipedia.org/wiki/Microsofthttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Apple_Inc.http://en.wikipedia.org/wiki/Apple_Inc.http://en.wikipedia.org/wiki/Mobile_operating_systemhttp://en.wikipedia.org/wiki/Mobile_broadbandhttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/Adobe_Flash_Playerhttp://en.wikipedia.org/wiki/Web_browserhttp://en.wikipedia.org/wiki/Touchscreenhttp://en.wikipedia.org/wiki/GPShttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Portable_media_playerhttp://en.wikipedia.org/wiki/Portable_media_playerhttp://en.wikipedia.org/wiki/Camera_phonehttp://en.wikipedia.org/wiki/Personal_digital_assistant -
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the functions of portable media players, low-end compactdigital cameras,pocket video
cameras, and GPS navigation units. Modern smartphones typically also include high-
resolution touchscreens, web browsers that can access and properly display standard web
pages rather than just mobile-optimized sites,Flash compatibility, and high-speed data accessviaWi-Fi andmobile broadband.
Mobile phone
The cellular telephone (commonly mobile phone or cell phone or hand phone) is a long
range portable electronic device used for mobile communication. In addition to the standard
voice function of a telephone, current mo bil e p ho ne s c an s up por t ma ny
a d d i t io n a l services such a s sessortext messaging, email, switching for a c c e s s t o
t h e Internet, & MMS for sending and receivingphotos and video. Most current mobile
phones connect to aCellular network ofbase stations,which is in turn interconnected to the
public switched telephone networks phones. Cellular telephone is also defined as a type of
short-waveanalogordigital telecommunication in which a subscriber has a wireless
connection from a mobile telephone to a relatively nearby transmitter. The transmitter's span
of coverage is called a cell.Generally, cellular telephone service is available in urban areas
and along major highways. As the cellular telephone user moves from one cell or area of
coverage to another telephone is effectively passed on to the local cell transmitter. A cellular
telephone is not be confused with a codeless telephones.
http://en.wikipedia.org/wiki/Portable_media_playerhttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/GPShttp://en.wikipedia.org/wiki/Touchscreenhttp://en.wikipedia.org/wiki/Web_browserhttp://en.wikipedia.org/wiki/Adobe_Flash_Playerhttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/Mobile_broadbandhttp://en.wikipedia.org/wiki/Telephonehttp://en.wikipedia.org/wiki/Text_messaginghttp://en.wikipedia.org/wiki/Multimedia_Messaging_Servicehttp://en.wikipedia.org/wiki/Photohttp://en.wikipedia.org/wiki/Videohttp://en.wikipedia.org/wiki/Cellular_networkhttp://en.wikipedia.org/wiki/Base_stationhttp://en.wikipedia.org/wiki/Public_switched_telephone_networkhttp://searchsmb.techtarget.com/sDefinition/0,,sid_gci211561,00.htmlhttp://searchsmb.techtarget.com/sDefinition/0,,sid40_gci211948,00.htmlhttp://searchmobilecomputing.techtarget.com/sDefinition/0,,sid44_gci211761,00.htmlhttp://searchmobilecomputing.techtarget.com/sDefinition/0,,sid44_gci211761,00.htmlhttp://searchsmb.techtarget.com/sDefinition/0,,sid40_gci211948,00.htmlhttp://searchsmb.techtarget.com/sDefinition/0,,sid_gci211561,00.htmlhttp://en.wikipedia.org/wiki/Public_switched_telephone_networkhttp://en.wikipedia.org/wiki/Base_stationhttp://en.wikipedia.org/wiki/Cellular_networkhttp://en.wikipedia.org/wiki/Videohttp://en.wikipedia.org/wiki/Photohttp://en.wikipedia.org/wiki/Multimedia_Messaging_Servicehttp://en.wikipedia.org/wiki/Text_messaginghttp://en.wikipedia.org/wiki/Telephonehttp://en.wikipedia.org/wiki/Mobile_broadbandhttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/Adobe_Flash_Playerhttp://en.wikipedia.org/wiki/Web_browserhttp://en.wikipedia.org/wiki/Touchscreenhttp://en.wikipedia.org/wiki/GPShttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/Pocket_video_camerahttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Compact_camerahttp://en.wikipedia.org/wiki/Portable_media_player -
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INTRODUCTION TO IPHONE
Mobile users today want their handsets to be converged devices handling multiple functions,
entertainment being the most important among them. They want their mobile to be fullyloaded with top-end features, but they want all that at affordable costs.
Iphone contains all that features which people demands and iphone meet on the people
expectations.
The Apple iPhone is easily the most publicized new mobile device in recent memory.This
brand is strong among teens, as many say that they hope to buy it. If that does happen, it will
be a kind of "first" in the cell phone market, because Apple isn't likely to discount phones,leaving this to be one expensive status symbol.
We all know that iphone is a big name in the modern mobile world, its applications and
design are the key factors which tempt people towards it.
From this survey we want to know about the peoples attraction towards iphone.
This report will include:
1. Our survey will include the desirability and undesirability of the iphone.
2.
Samples were originated through the observation present and specified in the
questionnaire.
3. The questionnaires included measurement of scale which were:
Ordinal scale
Likert scale
Sampling plan.
4.
The above analysis applied did sketched the preview about the desirable/undesirable
school of thought in the real world.
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APPLE I-PHONE
In 2007,Apple Inc. introduced its first iPhone.It was initially costly, priced at $499 for the
cheaper of two models on top of a two year contract. The first mobile phone to use amulti-
touch interface, the iPhone was notable for its use of a large touchscreen for direct finger
input as its main means of interaction, instead of having astylus,keyboard, and/or keypad,
which were the typical input methods for other smartphones at the time. The iPhone featured
a web browser that Ars Technica then described as "far superior" to anything offered by that
of its competitors. Initially lacking the capability to install native applications beyond the
ones built-in to its OS, at WWDC in June 2007 Apple announced that the iPhone would
supportthird-party "web 2.0 applications" running in its web browser that share the look and
feel of the iPhone interface. As a result of the iPhone's initial inability to install third-party
native applications, some reviewers did not consider the originally released device to
accurately fit the definition of a smartphone "by conventional terms." A process called
jailbreaking emerged quickly to provide unofficial third-party native applications. The
different functions of the iPhone (including a GPS unit, kitchen timer, radio, map book,
calendar, notepad, and many others) allowed consumers to replace all of these items. In July
2008, Apple introduced its second generation iPhone with a lower list price starting at $199
and 3G support. Released with it, Apple also created theApp Store,adding the capability for
any iPhone or iPod Touch to officially execute additional native applications (both free and
paid) installed directly over aWi-Fi or cellular network, without the more typical process at
the time of requiring a PC for installation. Applications could additionally be browsed
through and downloaded directly via theiTunes software client onMacintosh andWindows
PCs, rather than by searching through multiple sites across the Internet. Featuring over 500
applications at launch, Apple's App Store was immediately very popular, quickly growing to
become a huge success. In June 2010, Apple introduced iOS 4, which included APIs to allow
third-party applications to multitask, and the iPhone 4, which included a 960640 pixel
display with a pixel density of 326 pixels per inch (ppi), a 5 megapixel camera withLED
flash capable of recordingHD video in 720p at 30 frames per second, a front-facing VGA
camera for videoconferencing, a 1GHzprocessor, and other improvements. In early 2011 the
iPhone 4 became available through Verizon Wireless, ending AT&T's exclusivity of the
handset in the U.S.,and allowing the handset's 3G connection to be used as a wirelessWi-Fi
hotspot for the first time, to up to 5 other devices.Software updates subsequently added thiscapability to other iPhones running iOS 4. TheiPhone 4S was announced on October 4, 2011,
http://en.wikipedia.org/wiki/Apple_Inc.http://en.wikipedia.org/wiki/IPhone_%28original%29http://en.wikipedia.org/wiki/Multi-touchhttp://en.wikipedia.org/wiki/Multi-touchhttp://en.wikipedia.org/wiki/Stylus_%28computing%29http://en.wikipedia.org/wiki/Worldwide_Developers_Conference#WWDC_2007http://en.wikipedia.org/wiki/Third-party_developerhttp://en.wikipedia.org/wiki/IOS_jailbreakinghttp://en.wikipedia.org/wiki/IPhone_3Ghttp://en.wikipedia.org/wiki/App_Store_%28iOS%29http://en.wikipedia.org/wiki/IPhonehttp://en.wikipedia.org/wiki/IPod_Touchhttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/ITuneshttp://en.wikipedia.org/wiki/Macintoshhttp://en.wikipedia.org/wiki/Microsoft_Windowshttp://en.wikipedia.org/wiki/IPhone_4http://en.wikipedia.org/wiki/Pixel_densityhttp://en.wikipedia.org/wiki/Megapixelhttp://en.wikipedia.org/wiki/LED_flashlighthttp://en.wikipedia.org/wiki/High-definition_videohttp://en.wikipedia.org/wiki/720phttp://en.wikipedia.org/wiki/Frame_ratehttp://en.wikipedia.org/wiki/VGAhttp://en.wikipedia.org/wiki/Hertzhttp://en.wikipedia.org/wiki/Verizon_Wirelesshttp://en.wikipedia.org/wiki/AT%26T_Mobilityhttp://en.wikipedia.org/wiki/Tetheringhttp://en.wikipedia.org/wiki/Tetheringhttp://en.wikipedia.org/wiki/IPhone_4Shttp://en.wikipedia.org/wiki/IPhone_4Shttp://en.wikipedia.org/wiki/Tetheringhttp://en.wikipedia.org/wiki/Tetheringhttp://en.wikipedia.org/wiki/AT%26T_Mobilityhttp://en.wikipedia.org/wiki/Verizon_Wirelesshttp://en.wikipedia.org/wiki/Hertzhttp://en.wikipedia.org/wiki/VGAhttp://en.wikipedia.org/wiki/Frame_ratehttp://en.wikipedia.org/wiki/720phttp://en.wikipedia.org/wiki/High-definition_videohttp://en.wikipedia.org/wiki/LED_flashlighthttp://en.wikipedia.org/wiki/Megapixelhttp://en.wikipedia.org/wiki/Pixel_densityhttp://en.wikipedia.org/wiki/IPhone_4http://en.wikipedia.org/wiki/Microsoft_Windowshttp://en.wikipedia.org/wiki/Macintoshhttp://en.wikipedia.org/wiki/ITuneshttp://en.wikipedia.org/wiki/Wi-Fihttp://en.wikipedia.org/wiki/IPod_Touchhttp://en.wikipedia.org/wiki/IPhonehttp://en.wikipedia.org/wiki/App_Store_%28iOS%29http://en.wikipedia.org/wiki/IPhone_3Ghttp://en.wikipedia.org/wiki/IOS_jailbreakinghttp://en.wikipedia.org/wiki/Third-party_developerhttp://en.wikipedia.org/wiki/Worldwide_Developers_Conference#WWDC_2007http://en.wikipedia.org/wiki/Stylus_%28computing%29http://en.wikipedia.org/wiki/Multi-touchhttp://en.wikipedia.org/wiki/Multi-touchhttp://en.wikipedia.org/wiki/IPhone_%28original%29http://en.wikipedia.org/wiki/Apple_Inc. -
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improving upon the iPhone 4 with a dual coreA5processor, an 8 megapixel camera capable
of recording 1080p video at 30 frames per second, World phone capability allowing it to
work on both GSM & CDMA networks, and theSiri automated voice assistant. On October
10, Apple announced that over one million iPhone 4Ss had been pre-ordered within the first24 hours of it being on sale, beating the 600,000 device record set by the iPhone 4, despite
the iPhone 4S failing to impress some critics at the announcement due to their expectations of
an "iPhone 5" with rumored drastic changes compared to the iPhone 4 such as a new case
design and larger screen. Along with the iPhone 4S Apple also released iOS 5 and iCloud,
untethering iOS devices from Macintosh or Windows PCs for device activation, backup, and
synchronization, along with additional new and improved features. There are about 35
percent of Americans that have some sort of smartphone. This shows that the market is
spreading fast and there are also more capabilities for smartphones because of this spread.
Smartphones are also mainly valuable based on the operating system. For example, the
iPhone runs on the iOS and other devices run different operating systems which makes the
functionality of these systems different. This was the most awaited phone in the Indian market.
It is now here, but not before it became famous throughout the rest of the world. Renowned for
its chic design and easy-to-use functions the iPhone has tremendous features such as its wide
and clear screen, iPod, internet capability with classic web browser, GPS mapping, and last but
not lease, a phone. Apple iPhone is being offered in the USA for the price of $900, so the
awaiting buyers in Pakistan expected the same price. Unfortunately, that is not what
happened. To grab hold of this hot item, you will have to shell out Rs.80,000 for the 8GB.
http://en.wikipedia.org/wiki/Apple_A5http://en.wikipedia.org/wiki/1080phttp://en.wikipedia.org/wiki/World_phonehttp://en.wikipedia.org/wiki/Siri_%28software%29http://en.wikipedia.org/wiki/IOS_version_history#iOS_5.x:_Fifth_major_OS_releasehttp://en.wikipedia.org/wiki/ICloudhttp://en.wikipedia.org/wiki/ICloudhttp://en.wikipedia.org/wiki/IOS_version_history#iOS_5.x:_Fifth_major_OS_releasehttp://en.wikipedia.org/wiki/Siri_%28software%29http://en.wikipedia.org/wiki/World_phonehttp://en.wikipedia.org/wiki/1080phttp://en.wikipedia.org/wiki/Apple_A5 -
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Product portfolio:-
Apple has different segment in its product portfolio: - (apple, 2011)
1) Macintosh computers
2) I Phones (I Phone 3g, I Phone 3gs, I Phone 4)
3)
I Pad
4) I Pod
5) Software (I Tunes and other application software)
Political factor:-
In 2010 Emergency Budget the Chancellor announced an increase in the standard rate of
VAT from 17.5 per cent to 20 per cent effective from 4 January 2011. This would affect the
total selling price of i phone 4. (apple store, 2011) GATT laws can interfere selling of i phone
4 in global context. (duke law,2004) As most apple iphone is sold in terms of contract with
other telecommunication companies, sometimes customer finds problem to finish this
contract and thus laws of such contract affect the consumer buying decision.
Economic factor:-
Average Weekly Earnings
Regular pay growth decreases
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As shown in graph average weekly income of people in UK is going slightly
down from February 2011, this may affect the purchasing power of consumer
in future.
Unemployment rate of UK is 7.8% which is quite high and can affect the sells
of company.
Socio-cultural factor:-
Population Estimates
UK population grows to 61.8 million
Population: by gender and age, mid-2009
The estimated resident population of the UK was 61,792,000 in mid-2009, and
Children aged under 16 represented approximately one in five of the total
population and youth population between 20-40 is also high, thus apple has largerscope as it target the customer between this group.
GDP per head in Britain was 23,500 in 2008 which means standard of living in
Britain was high. As apple group is targeting the customer with high income
earning group, can get larger customer group in Britain. (David smith, 2007)
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As per capita income and economy is growing after the great recession most
people want to achieve higher slandered of living by purchasing premium
product. Hence, it widened the market for apple iphone.
As compared to Asian countries the culture of UK is independent that meansindividual are free to take their own decision after 18 years. Which also influenes
the buying decision of consumer.
Technological factor:
Apple iphone 4 is loaded with latest technology going in market. But Innovation
in technology takes place very fast thus companies has to keep updating their
product with new technology. Soon apple is going to launch apple iphone 5,
hence apple iphone 4 would be out of market.
Micro environment:-
Michel Porter identified five forces for analysing the micro environment (Elizabeth, H.
and Terry O, 1996)
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Supplier (Supplier power)
Most of important and tecnical part ofapple iphone4 are manufactured outsideorganisations, supplier have strong power
against apple INC.
The Quality, Quantity, and price termsdeclare by their suppliers have to befollowed by apple INC.
apple doesnt have any power to restrictupon any of the supplier because they all
are expert in their own field.
Buyers (Buyers power)
Buyers such as big organisation such as
o2, vadophone and carphone warehouse
has great power of bargain as apple'smost sales are comprised by this
companies.
For retaling shopping theres no powerwith buyer as it is leading organisation.
Potential entrants (Threat of mobility)
New entrances list, in UK, are many forcalendar year 2011.( 5th generationapple iphon)
new entrants can add many similarcapabilities to their products that match
the iPhone and expand to a wider market
through lower cost and higher-powerproducts..
Entry barriers list are quite high and no
barrier can be seen to exit from market.
Substitute (Threat of substitute)
apple is going to launch in mid 2011 will
outdate the iphone 4..
yet apple iphone3 is cheaper then appleiphone4, thus many customer prefers to
buy iphon 3.
balckburry , HTC and Nokia are maincompetitor of apple iphone can comewith new technology and can dominant
the market.
Industry competitors (Segment Rivalry)
The smartphone market in UK cosist with 4 major companies like
Nokia, blackburry, Apple, Htc.
Result is frequent technology, price wars, battles of advertisement
and campaign and hamperign corporate profit.
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SWOT ANALYSIS:-
Strength: -
InnovativeThe i Phone has an innovative touch screen that is patented and unmatchedby any other mobile product today. It also has many functions of other mobile products
all in one device.
CompatibilityThe phone will work with iTunes and with other Mac/Apple products
like the new Apple TV, allowing for wireless connectivity to the big screen. The i Phone
is also compatible with many Mac OS software tools. Mac OS compatibility means that
the i Phone has limitless potential for upgradeability.
Ease-of-UseThe all-new touch screen interface making operations extremely intuitive.
It is radically different from those of other phones or PDAs that recognizes multi finger
gestures, just as the human hand normally behaves. The Mac OS X application imbedded
into the i Phone assures users will easily recognize what they can do
Brand awarenessApple is well known for cool essential gadgets like the iPods, ipad,
macbook and Smartphone along great technological innovations like the original
Macintosh.
Price At 418, the i Phone would be sold at a reasonable price for its value. It
outperforms any other PDA or smart phone on the market and the convenience of having
multiple features combined into one-device increases its overall value.
QualityThe i Phone has one of the brightest and most scratch resistant screens in the
market. It also has a fine metallic finish that is durable and light. The software suite
included is also unsurpassed with their ease of use and resistance to computer viruses.
Weakness: -
Image The Apple brand is not targeted towards business people, which most smart
phones have targeted. Does not have a reputation as being compatible with the corporate
world.
Price Apple does not yet offer lower priced models for more cost conscious
consumers.
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User InterfaceTouch screen interfaces suffer from the problem of gorilla arm, in
which long-term use of a flat, solid surface for input becomes uncomfortable.
Opportunity: -
Increasing demand and expansion to a new target segmentApple will continue to
target the business productivity market who wants an all in one computing solution. But
as technology advances and smart phones get cheaper companies also have a great
opportunity to target people who want entertainment. Apple will attract these consumers
and get iPod users to upgrade to i Phones.
UpgradeableSince software on the i Phone can be updated, it allows new exciting
features to be brought in which take advantage of the touch screen ability. Future
versions will also be hardware upgradeable.
Partnerships Apple can collaborate with many powerful global mobile phone
companies to flood the market with iPhones, which reduces costs in marketing and
increases revenue through long-term agreement deals.
Threats: -
Increased competition Smart phones are easier to make now more than ever. More
companies may enter the market, given that there are few barriers to entry other than
patents. Competitors or even Apple contractors can maneuver around patents to create
similar devices.
Downward pricing pressureThe i Phone is marketed as a high-end phone, but phone
prices are almost certainly going to fall when other companies undercut the price of i
Phones.
Price:-
As Apple iphone is well known brand in domestic as well international market and
has covered maximum market share in Smartphone industry. Apple iphone 3 and
iphone 3gs were successful in market thus, apple at launching of iphone 4 decided to
set their prices on basis of market skimming pricing rather than premium pricing
strategy.
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Market skimming pricing is setting a high price for a new product to skim
maximum layer from the segment willing to pay the high price; the company
fewer but more profit.(Philip k.and gary.a, 2006,pp.353) Whereas premium pricing is use a high price where there is uniqueness about
the product or service. This approach is used where a substantial competitive
advantage exists.
Apple can use any 1 of the pricing strategy as their brand value and product
were in demand in market. Because of their new technology customer were
willing to pay higher price for the iphone 4. But as product goes old and other
competitors enter the market with same technology apple has to reduce their
price to be in market. Thus, apple used market skimming pricing strategy to
cover maximum market share and revenue in beginning and then to lower their
price according to competition.
Current price of apple iphone 4 is 16GB is 510 and for 32GB 612 .(apple
store 2011)
Place
Channels of distribution are set of interdependent organisations involved in the
process of making a product or service available for use or consumption (Kotler P.,
thr1999. pp. 489-496). There are two types of distribution network 1) direct
distribution channel 2) indirect distribution channel.
Indirect Channel
The indirect channel is used by companies who do not sell their goods directly to
consumers. Suppliers and manufacturers typically use indirect channels because they
exist early in the supply chain. Depending on the industry and product, direct
distribution channels have become more prevalent because of the Internet.(Osmond
Vitez, 2011)
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Direct Channel
A direct distribution channel is where a company sells its products direct to
consumers. While direct channels were not popular many years ago, the Internet has
greatly increased the use of direct channels. Additionally, companies needing to cut
costs may use direct channels to avoid middlemen markups on their products.
.(Osmond Vitez, 2011)
Indirect Channel Methods
Distributors, wholesalers and retailers are the primary indirect channels a company
may use when selling its products in the marketplace. Companies choose the indirect
channel best suited for their product to obtain the best market share; it also allows
them to focus on producing their goods. .(Osmond Vitez, 2011)
Direct Channel Methods
Selling agents and Internet sales are two types of direct distribution channels. Selling
agents work for the company and market their products directly to consumers through
mail order, storefronts or other means. The Internet is an easy distribution channel
because of the global availability to consumers. .(Osmond Vitez, 2011) Apple uses
both types of distribution channel to sell their product in UK. As apple doesnt have
any manufacturing plant in UK they have to import from USA. Apple has their own
online stores thus customer those who want to purchase iphone can order there. Thus
apple uses direct channel for such customer. Apple also has almost 30 retail store in
UK, hence they follow indirect distribution channel to sell their final product to their
customer.(apple store,2011)
As shown in the distribution Chart, Company uses both one level and two level
distribution channels to make available their product to end user.
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Distribution channel of apple INC
Promotion
Promotion is all about companies communicating with customers. A business'
total marketing communications programme is called the "promotional mix" and
consists of a blend of advertising, personal selling, sales promotion and public
relations tools.(tutor2u, 2004)
Advertising
Any paid form of non-personal communication of ideas or products in the "prime media": i.e.
television, newspapers, magazines, billboard posters, radio, cinema etc. Advertising is
intended to persuade and to inform. The two basic aspects of advertising are the message
(what you want your communication to say) and the medium (how you get your message
across) (tutor2u, 2004)
End
user
Added
value
reseller
End user
Retailer
End user
Retailer
Direct sale
force
End user
Retail store
End-users
Online store
Apple
Third party
wholeseller
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Personal Selling
Oral communication with potential buyers of a product with the intention of making a sale.
The personal selling may focus initially on developing a relationship with the potential buyer,
but will always ultimately end with an attempt to "close the sale".(tutor2u, 2004)
Sales Promotion
Providing incentives to customers or to the distribution channel to stimulate demand for a
product. (tutor2u, 2004)
Publicity
The communication of a product, brand or business by placing information about it in the
media without paying for the time or media space directly. otherwise known as public
relations. (tutor2u, 2004) Apple has its own online store so they advertised their product there
and costumer easily get all information about the product from there. Mostly advertisement of
apple in UK is done by other telecommunication company such as Vodafone, o2, virgin, and
orange. These companies in order to sell their telecommunication services gives i phone with
their services on basis of contract. This is the advertising approach used by apple in UK. Thissaves lots of money for apple and ultimate aim to communicate the message to customer is
done by this telecommunication companies. Apple also have TV ads to promote their
product. Apple also use magazine advertisement to promote their product. Apple also uses
hoardings where image of product is displayed and detailed information is written there. By
putting such hoardings people who are walking roadside can see the information and message
can be conveyed to customer. Apple uses promotional methods using special short-term
techniques to persuade members of a target market to respond or undertake their products.
Apple uses for sales promotions are money back guarantees, lower purchase price and rebates
etc. The Apples stores are very distinct and captivating from many other electronic stores
because they display all of their products for consumers to experience hands-on. Consumers
are allowed to surf the web on any of their computers, listen to the latest ipods, and
experience the iPhone and its features. This lets consumers get comfortable with the products
and familiarize themselves with it. This is a major consumer sales promotion that Apple has
developed.(apple INC, 2009)
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Marketing approaches:-
Segmentation, targeting, and positioning together comprise a three stage process. We first (1)
determine which kinds of customers exist, then (2) select which ones we are best off trying to
serve and, finally, (3) implement our segmentation by optimizing our products/services forthat segment and communicating that we have made the choice to distinguish ourselves that
way.
Segmentation :-
Apple i Phone 4 come under Smartphone segment and classified under unsought goods.
Thus, it requires lots of things to consider while purchasing it though it requires more
attention of Apple INC. Apples target segments consist of professionals, students, corporate
users, entrepreneurs, and health care workers.
Targeting :-
The decision about which market segment(s) a business decides to prioritise for its sales
and marketing efforts.(Dibb and et al, 2001)I Phones marketing strategy is to differentiate
the i Phone from other PDAs on the market. I phones primary customer targets is the
middle-upper income professional that need one portable device to coordinate their busy
schedules and communicate with colleagues, friends and family. I phones secondary
consumer targets are high school, college and graduate students who need one portable
multifunction device. Mainly this market will be replacing their iPod and cell phone with the
iPhone. Apple group uses concentrated marketing strategy for targeting their customer.
Concentrated marketing is a market coverage strategy in which firm goes after a large share
of one or few segment or niches(Philip k. And gary a. b, 2006, pp 231). Apple group uses
Type of segment Variable
Demographic Age, Gender, Occupation, Income
Geographic Region, Population density, climate
Psychographic Social class, Life style, personality
Behavioural Degree of loyalty, Type of User
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this strategy to attract the customer who are interested in store information and communicate
or people who want entertainment on the go. By using such strategy apple targets
Segments consist of professionals, students, corporate users, entrepreneurs, and health care
workers with age group between 16 to 40.
Positioning :-
Positioning is the process of creating an image for a product in the mind of target customer.
Using product differentiation, Apple group positioned the iPhone 4 as the versatile,
convenient, value-added device for personal and professional use. The marketing
strategy will focus on the convenience of having one device for communication, but
also music, pictures, and video, and full Internet access. The iPhone will be promoted
as both professional and hip.
Currently Apple i Phone 4 is in maturity stage generating maximum profit for
company. But soon apple i Phone 4 is going to decline stage because apple group is
going to launch i Phone 5 in July 2011.
Current position of apple i Phone 4 in product life cycle:-
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INTRODUCTION OF SAMNSUNG
Samsung Group is a South Korean multinational conglomerate company headquartered in
Samsung Town,Seoul.It comprises numerous subsidiaries and affiliated businesses, most of
them united under the Samsungbrand, and are the largest South Koreanchaebol.
Notable Samsung industrial subsidiaries include Samsung Electronics (the world's largest
information technology company measured by 2011 revenues), Samsung Heavy Industries
(the world's second-largest shipbuilder measured by 2010 revenues), and Samsung
Engineering andSamsung C&T (respectively the world's 35th- and 72nd-largest construction
companies). Other notable subsidiaries include Samsung Life Insurance (the world's 14th-
largest insurance company),Samsung Everland (the oldest theme park in South Korea) and
Cheil Worldwide (the world's 19th-largest advertising agency measured by 2010 revenues).
Samsung produces around a fifth of South Korea's total exports and its revenues are larger
than many countries' GDP; in 2006, it would have been the world's 35th-largest economy.
The company has a powerful influence on South Korea's economic development, politics,
media and culture, and has been a major driving force behind the "Miracle on the Han River".
Android
Android is a Linux-based operating system for mobile devices such as smartphones and
tablet computers.It is developed by theOpen Handset Alliance led byGoogle.
Google purchased the initial developer of the software, Android Inc., in 2005. The unveiling
of the Android distribution in 2007 was announced with the founding of the Open Handset
Alliance, a consortium of 86hardware,software, and telecommunication companies devoted
to advancing open standards for mobile devices. Google releases the Android code asopen-
source,under theApache License.TheAndroid Open Source Project (AOSP) is tasked with
the maintenance and further development of Android.
Android has a large community of developers writing applications ("apps") that extend the
functionality of the devices. Developers write primarily in a customized version of Java.
Apps can be downloaded from third-party sites or through online stores such asGoogle Play
(formerly Android Market), the app store run by Google. As of February 2012 there were
http://en.wikipedia.org/wiki/South_Koreanhttp://en.wikipedia.org/wiki/Multinational_corporationhttp://en.wikipedia.org/wiki/Conglomerate_%28company%29http://en.wikipedia.org/wiki/Samsung_Townhttp://en.wikipedia.org/wiki/Seoulhttp://en.wikipedia.org/wiki/Chaebolhttp://en.wikipedia.org/wiki/Chaebolhttp://en.wikipedia.org/wiki/Chaebolhttp://en.wikipedia.org/wiki/Samsung_Electronicshttp://en.wikipedia.org/wiki/List_of_the_largest_technology_companieshttp://en.wikipedia.org/wiki/List_of_the_largest_technology_companieshttp://en.wikipedia.org/wiki/Samsung_Heavy_Industrieshttp://en.wikipedia.org/wiki/Shipbuilderhttp://en.wikipedia.org/wiki/Samsung_Engineeringhttp://en.wikipedia.org/wiki/Samsung_Engineeringhttp://en.wikipedia.org/wiki/Samsung_C%26Thttp://en.wikipedia.org/wiki/Samsung_Life_Insurancehttp://en.wikipedia.org/wiki/Samsung_Everlandhttp://en.wikipedia.org/wiki/Theme_parkhttp://en.wikipedia.org/wiki/Cheil_Worldwidehttp://en.wikipedia.org/wiki/GDPhttp://en.wikipedia.org/wiki/Miracle_on_the_Han_Riverhttp://en.wikipedia.org/wiki/Linuxhttp://en.wikipedia.org/wiki/Mobile_operating_systemhttp://en.wikipedia.org/wiki/Smartphonehttp://en.wikipedia.org/wiki/Tablet_computerhttp://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Computer_hardwarehttp://en.wikipedia.org/wiki/Telecommunicationhttp://en.wikipedia.org/wiki/Open_standardhttp://en.wikipedia.org/wiki/Open-sourcehttp://en.wikipedia.org/wiki/Open-sourcehttp://en.wikipedia.org/wiki/Apache_Licensehttp://en.wikipedia.org/wiki/Android_Open_Source_Projecthttp://en.wikipedia.org/wiki/Mobile_appshttp://en.wikipedia.org/wiki/Java_%28programming_language%29http://en.wikipedia.org/wiki/Google_Playhttp://en.wikipedia.org/wiki/Google_Playhttp://en.wikipedia.org/wiki/Java_%28programming_language%29http://en.wikipedia.org/wiki/Mobile_appshttp://en.wikipedia.org/wiki/Android_Open_Source_Projecthttp://en.wikipedia.org/wiki/Apache_Licensehttp://en.wikipedia.org/wiki/Open-sourcehttp://en.wikipedia.org/wiki/Open-sourcehttp://en.wikipedia.org/wiki/Open_standardhttp://en.wikipedia.org/wiki/Telecommunicationhttp://en.wikipedia.org/wiki/Computer_hardwarehttp://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Tablet_computerhttp://en.wikipedia.org/wiki/Smartphonehttp://en.wikipedia.org/wiki/Mobile_operating_systemhttp://en.wikipedia.org/wiki/Linuxhttp://en.wikipedia.org/wiki/Miracle_on_the_Han_Riverhttp://en.wikipedia.org/wiki/GDPhttp://en.wikipedia.org/wiki/Cheil_Worldwidehttp://en.wikipedia.org/wiki/Theme_parkhttp://en.wikipedia.org/wiki/Samsung_Everlandhttp://en.wikipedia.org/wiki/Samsung_Life_Insurancehttp://en.wikipedia.org/wiki/Samsung_C%26Thttp://en.wikipedia.org/wiki/Samsung_Engineeringhttp://en.wikipedia.org/wiki/Samsung_Engineeringhttp://en.wikipedia.org/wiki/Shipbuilderhttp://en.wikipedia.org/wiki/Samsung_Heavy_Industrieshttp://en.wikipedia.org/wiki/List_of_the_largest_technology_companieshttp://en.wikipedia.org/wiki/List_of_the_largest_technology_companieshttp://en.wikipedia.org/wiki/Samsung_Electronicshttp://en.wikipedia.org/wiki/Chaebolhttp://en.wikipedia.org/wiki/Seoulhttp://en.wikipedia.org/wiki/Samsung_Townhttp://en.wikipedia.org/wiki/Conglomerate_%28company%29http://en.wikipedia.org/wiki/Multinational_corporationhttp://en.wikipedia.org/wiki/South_Korean -
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more than 450,000 apps available for Android, and the estimated number of applications
downloaded from the Android Market as of December 2011 exceeded 10 billion.
Android was listed as the best-selling smartphone platform worldwide in Q4 2010 by Canalys
with over 300 million Android devices in use by February 2012. According to Google'sAndy
Rubin,as of February 2012 there are over 850,000 Android devices activated every day.
Galaxy Nexus,the latest "Google phone"
The Android operating system for smartphones was released in 2008. Android is an open-
sourceplatform backed byGoogle,along with major hardware and software developers (such
as Intel,HTC,ARM,Motorola and Samsung, to name a few), that form theOpen Handset
Alliance.The first phone to useAndroid was theHTC Dream,branded for distribution byT-
Mobile as the G1. The software suite included on the phone consists of integration with
Google's proprietary applications, such as Maps, Calendar, and Gmail, and a full HTML web
browser. Android supports the execution of native applications and a preemptive multitasking
capability (in the form of services). Third-party apps are available viaGoogle Play (released
October 2008), including both free and paid apps.
In January 2010, Google launched the Nexus One smartphone using its Android OS.
Although Android has multi-touch abilities, Google initially removed that feature from the
Nexus One, but it was added through a firmware update on February 2, 2010.
Concerning theXperia Play smartphone, an analyst at CCS Insight said in March 2011 that
"Console wars are moving to the mobile platform". In the same month, the HTC EVO 3D
was announced byHTC Corporation,which can produce 3D effects with no need for special
glasses (autostereoscopy). The HTC EVO 3D was officially released on June 24, 2011.
http://en.wikipedia.org/wiki/Andy_Rubinhttp://en.wikipedia.org/wiki/Andy_Rubinhttp://en.wikipedia.org/wiki/Galaxy_Nexushttp://en.wikipedia.org/wiki/Google_Nexushttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Intelhttp://en.wikipedia.org/wiki/HTC_Corporationhttp://en.wikipedia.org/wiki/ARM_Holdingshttp://en.wikipedia.org/wiki/Motorolahttp://en.wikipedia.org/wiki/Samsunghttp://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/HTC_Dreamhttp://en.wikipedia.org/wiki/T-Mobilehttp://en.wikipedia.org/wiki/T-Mobilehttp://en.wikipedia.org/wiki/Google_Playhttp://en.wikipedia.org/wiki/Nexus_Onehttp://en.wikipedia.org/wiki/Xperia_Playhttp://en.wikipedia.org/wiki/HTC_EVO_3Dhttp://en.wikipedia.org/wiki/HTC_Corporationhttp://en.wikipedia.org/wiki/Autostereoscopyhttp://en.wikipedia.org/wiki/Autostereoscopyhttp://en.wikipedia.org/wiki/HTC_Corporationhttp://en.wikipedia.org/wiki/HTC_EVO_3Dhttp://en.wikipedia.org/wiki/Xperia_Playhttp://en.wikipedia.org/wiki/Nexus_Onehttp://en.wikipedia.org/wiki/Google_Playhttp://en.wikipedia.org/wiki/T-Mobilehttp://en.wikipedia.org/wiki/T-Mobilehttp://en.wikipedia.org/wiki/HTC_Dreamhttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Open_Handset_Alliancehttp://en.wikipedia.org/wiki/Samsunghttp://en.wikipedia.org/wiki/Motorolahttp://en.wikipedia.org/wiki/ARM_Holdingshttp://en.wikipedia.org/wiki/HTC_Corporationhttp://en.wikipedia.org/wiki/Intelhttp://en.wikipedia.org/wiki/Googlehttp://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Open_sourcehttp://en.wikipedia.org/wiki/Android_%28operating_system%29http://en.wikipedia.org/wiki/Google_Nexushttp://en.wikipedia.org/wiki/Galaxy_Nexushttp://en.wikipedia.org/wiki/Andy_Rubinhttp://en.wikipedia.org/wiki/Andy_Rubin -
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Bada
TheBada operating system for smartphones was announced by Samsung on 10 November2009. The first Bada-based phone was theSamsung Wave S8500,released on June 1, 2010,
which sold one million handsets in its first 4 weeks on the market. Samsung shipped 3.5
million phones running Bada in Q1 of 2011. This rose to 4.5 million phones in Q2 of 2011
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COMPANY PROFILE
Type Business unit
Industry Telecommunication
Founded Seoul, South Korea 1977
Headquarters Suwon, Shout Korea
Area served Worldwide
Key people Geesung choi, President
Products Mobile phones,Smart Phone
Telecommunication system
MP3 Player, Laptop computers
Revenue US$ 21.1 billion (2007)
Net income US$ 2.3 billion (2007)
Employees 344,000 (2010)
Website Samsung consumers
HISTORY
Unlike other electronic companies Samsung origins were not involving electronics but other
products.In 1938 the Samsung's founder Byung-Chull Lee set up a trade export company in
Korea, selling fish, vegetables, and fruit to China. Within a decade Samsung had flour mills
and confectionary machines and became a co-operation in 1951. Humble beginnings.
From 1958 onwards Samsung began to expand into other industries such as financial, media,
chemicals and ship building throughout the 1970's. In 1969, Samsung Electronics was
established producing what Samsung is most famous for, Televisions, Mobile Phones
(throughout 90's), Radio's, Computer components and other electronics devices.
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1987 founder and chairman, Byung-Chull Lee passed away and Kun-Hee Lee took over as
chairman. In the 1990's Samsung began to expand globally building factories in the US,
Britain, Germany, Thailand, Mexico, Spain and China until 1997.
In 1997 nearly all Korean businesses shrunk in size and Samsung was no exception. They
sold businesses to relieve debt and cut employees down lowering personnel by 50,000. But
thanks to the electronic industry they managed to curb this and continue to grow.
The history of Samsung and mobile phones stretches back to over 10 years. In 1993 Samsung
developed the 'lightest' mobile phone of its era. The SCH-800 and it was available on CDMA
networks.
Samsung has made steady growth in the mobile industry and are currently second but
competitor Nokia is ahead with more than 100% increase in shares.
Samsung Telecommunications
Samsung Telecommunications is one of five business units within Samsung Electronics,
belonging to the Samsung Group, and consists of the Mobile Communications Division,
Telecommunication Systems Division, Computer Division, MP3 Business Team, MobileSolution Centre and Telecommunication R&D Centre. Telecommunication Business
produces a full spectrum of products from mobiles and other mobile devices such as MP3
players and laptop computers to telecommunication network infrastructure. Headquarters is
located inSuwon,South Korea.
In 2007 Samsung Telecommunication Business reported over 40% growth and became the
second largest mobile device manufacturer in the world. Its market share was 14% in Q4
2007, growing up form 11.3% in Q4 2006. At the end of November 2011, Samsung sold
more than 300 million mobile devices and set still in second after Nokia with 300.6 million
mobile devices sold in the first three quarter of 2011.
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Objective
Our project work focuses on the study of the Android ecosystem and how it differs
from other mobile ecosystems such as those surrounding the iPhone. This project includes
the study of the Android Market, (online mobile application store for Android users)
application developers, and which factors developers consider for selecting a platform for
application development. To understand application development trends across Android and
iPhone platforms, we compared the Android market with the iPhone App Store, the leading
application store in current mobile market, and how different kinds of developers are
working for the Android, the iPhone, or for both the platforms.
Apple launched an online application marketplace called the iPhone App Store before
launching iPhone 3G. Currently, this store has more than 195,000 applications. To match or
surpass the success of iPhone App Store, Apple rivals such as Google and Blackberry
introduced their own application downloading stores called Android Market and
Blackberry App World respectively. The Android Market is similar to the iPhone App
Store or to any other application store; it boasts a catalog of applications, services and tools
available for the user to purchase download and use. Today, the Android Market also has
around 49,000 applications. Thus, the comparison between iPhone and Android application
stores will help explain the new challenges faced by these two application stores, and also
the demand for these stores in the near future. This study will help understand why third-
party developers choose the Android over the iPhone, what determines their success, which
large companies are directly involved in developing applications for Android, and which
factors they consider for developing an application.
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LITERATURE REVIEW
In order to achieve success in project implementation, the first step is to research and
find information already available. During research, we found many articles related to our
topic. This paper is based on the content from these articles. We have divided the this sectionin four main areas: (a) Overview of the Mobile Ecosystem (b) Overview of Platform
Leadership (c) Fundamentals behind the Open Source Platform (d) Introduction to the
Smartphone
Overview of the Mobile Ecosystem
As we know, mobile phone usage has been increasing dramatically over the last several
years. Globally, if a usage comparison can be carried out between PCs and mobile devices;
mobile devices have approximately 3.5 times more usage then PCs. These mobile deviceshave become a platform to support wide variety of data applications such as capturing and
sharing photos, downloading, recording, and sharing audios and videos, and gathering
information from the Internet, to list but a few. At the same time the way people use their
mobile phones has also been changing noticeably, from voice calling and text messaging to
data applications. This trend arises from falling handset price, larger phone screen size, better
and faster mobile processors, affordable price of storage, etc. Thus, the mobile phone has
become a complex system requiring integration of a wide range of component suppliers and
an equally complex distribution system. By reviewing a paper written by Dr. Joel West and
David Wood, (2008) this section is divided further
Mobile/Wireless - Business Ecosystem
Any firms performance depends on success of their own business ecosystems, which can be
larger than the firm itself. A mobile/wireless ecosystem typically contains network of
suppliers, distributors, product or service makers, and technology providers which have an
effect on, or are affected by the creation and delivery of a companys own benefits.
Moreover, a mobile/wireless ecosystem is highly interdependent among member firms (and
other bodies) and some of these ecosystem members, being well-located, play a crucial role
in connecting ecosystem members and catalyzing links between other members. (Joel and
David, 2008) Also to optimize performance, a complex product ecosystem requires alignment
of interest among various members and partition of the technical and business responsibilities
among these members. The following figure gives an idea of how the mobile business
ecosystem life cycle works
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Categories in the Mobile/Wireless Business Ecosystem
The major categories include:
Original Equipment Manufacturers (OEMs).
They create new devices or handsets for end users by combining externally sourced or
internally developed hardware and software.
Semiconductor Manufacturers.
They provide compatible hardware anddrivers for their respective hardware components.
Operating System Vendors. (OSVs)
They provide platform, SDK, and features to OEMs. They also promote and support
application developer communities.(William, 2009)
User Interface (UI) Suppliers.
They determine mobile phone companiesuser interface development groups, and they work at
the application level dealing directly with users. Most UI code is distributed through platformoperating system vendors (OSVs) (e.g., ACCESS, Google), original equipment
manufacturers (OEMs) (Apple, Motorola) or via open source projects (e.g., GNOME,
Enlightenment), or even handset OEMs (e.g., Motorola and MOTOBLUR)
Wireless Network Operators.
They provide distribution channels forphones in different countries, and also determine what
software components should be preloaded on phones. Operators also have their developer
program that includes Software Development kit (SDK) and app stores. e.g., Sprint Developer
Program, AT&T Developer Program.
Enterprise Software Developers.
They develop company compatible software for its own employees that use companys
phones.
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Other Software developers.
They can also be referred to as independentsoftware vendors. (ISVs) There are large ISVs, (e.g.,
Google, eBay, Amazon) small ISVs and individual developers who make user applications and
also middleware components such as database.
Consultancies and training centers.
They include firms that are licensedby specific mobile phone companies to provide training
courses based on firms software development kit. It plays minor role in the ecosystem. In
many cases, however, it happens that members of a mobile phone ecosystem, for e.g.,
Symbian ecosystem, are also members of competing mobile phone ecosystems such as
Windows Mobile, Googles Open Handset Alliance, etc.
Study of Mobile/Wireless Ecosystem Tradeoffs
The firm that sponsor a business ecosystem, also inherit issues such as how to collect the
ecosystem requirements for a new product, how to balance between interested participants
and ecosystem leader, and how to prioritize the conflicting needs of various ecosystem
participants (Joel & David, 2008). To overcome these above mentioned difficulties, firms
have to face a series of tradeoffs in managing ecosystem relationships. These tradeoffs could
be made under conditions of limited sources, time, and knowledge of the future which
include:
Breadth vs. Depth.
A sponsor, who participates in the mobile/wireless ecosystem, can deeply engage with a
limited number of key partners to maximize their chance of success without increasing
amount of time and money. Or a sponsor can engage with a large group of partners to make
sure that all possible important partners are addressed.
Scale.
The sponsor can provide personal attention, but it has a limited reach. A large
mobile/wireless ecosystem will provide less personal attention compared to a small
mobile/wireless ecosystem, but it can reach a large audience. So the firm has to consider
economy of scale during implementation of their own business ecosystem.
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Customization vs. Standardization.
The customized business programs,made to fulfill individual needs, could be more effective
but less efficient. But by doing standardization of these programs, a sponsor could support all
its members in more efficient way except their elite partners
Prioritization and Tiering.
A random distribution of partner importancecan result in unbalanced attention by giving an
importance of two-to-four levels. To tier this business program, the sponsor needs a number
of decisions such as how many partners should be in each category, how much resources
need in each category, what is the potential revenue, what is the size of channel, etc. If an
important partner is neglected by sponsor, it could turn out as a missing an unfamiliar one.
The biggest challenge for a real business ecosystem is how to capture loyalty and attention of
its partners who could be members of multiple competing ecosystems. In mobile phone
ecosystem, these partners include software developers, handset manufacturers, operators, etc.
Thus, a mobile/wireless business ecosystem is the interdependence of technical and
economical relationships, and it has a significant degree of variation between firms.
Overview of Platform Leadership
As mentioned above, a mobile phone ecosystem is very complex; it requires the involvement
of many participants with different expertise. There are two fundamental forces behind the
creation of a complex productinterdependency and innovation. These high-tech companies
are able to produce what they want, by getting the required components from suppliers.
Sometimes, these suppliers deliver some other complementary products so called
complements along with main components. So the main product made by firm has
interdependency with these complements. Platform leaders have to work very closely with
other firms to built innovative and new generation of complement products in their
competitive market. In order to achieve platform leadership, firms can use a framework
called the Four Levers to design a platform leadership strategy, more effectively (Gawer,
A. & Cusumano, M (2002).
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Area of Study
Samsung Electronics Co., Ltd. (KRX: 005930) accused Apple Inc. (Nasdaq: AAPL) of using
litigation to limit consumer choice after the iPhone maker said it was seeking to halt U.S.
sales of Galaxy S3 smart phones.
"Apple continues to resort to litigation over market competition in an effort to limit consumer
choice," Samsung said in a statement. "We will continue to take the necessary legal measures
to ensure the availability of our innovative products in the United States."
Seeking to capitalize on a recent major legal victory over its rival Samsung, the Cupertino,
Calif.-based electronics giant, in a separate case, asked a federal district court in San Jose,
Calif., on Friday to add four more products to a list of Samsung products that Apple says
infringe its patents.
In February, Apple alleged that at least 17 Samsung products infringe its patents. In the
amended lawsuit, Apple added Samsung's flagship smartphone Galaxy S3, Verizon Galaxy
S3, Galaxy Note and Galaxy Note 10.1.
In documents filed Friday, Apple said those 21 Samsung smartphones, media players and
tablets released after August 2011 were "copycat products."
"Rather than innovate and develop its own technology and a unique Samsung style for its
smartphone and tablet computer products, Samsung has chosen to copy Apple's technology,
user interface and innovative style," Apple said in one document.
Samsung's Galaxy S3 hit the 10 million global sales mark in July, less than three months after
its release. The rampant sales drove Samsung's quarterly profit to a record high of nearly 8
trillion won ($7 billion) for the June quarter.
At the time, analysts were forecasting that Samsung, which controls more than a third of the
global smartphone market, would sell 15 million to 20 million of its Galaxy S3 in the
September quarter.
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If the court finds those devices are infringing Apple's patents, it could temporarily halt sales
in the U.S. market even before the trial begins -- an outcome Samsung is anxious to prevent.
Apple last week won $1 billion in damages in a separate case after a U.S. jury found that the
South Korean company had copied critical features of the popular iPhone and iPad. Samsung
has vowed to appeal the verdict, all the way to the U.S. Supreme Court, if necessary.
On Aug. 27, Apple gave U.S. District Judge Lucy Koh a list of eight Samsung products it
wants pulled from shelves and banned from the U.S. market, including popular Galaxy model
smartphones.
A new study reveals that Apple's iPhone has already crushed the eight Samsung smartphones
that it wants to have banned in the U.S. markets, Wired.com reports.
Advertising analytics firm Chitika measured a week's worth of U.S. mobile web traffic
generated by the iPhone versus the eight contested Samsung phones.
The study showed that iPhones drove eight times the mobile web usage of all eight Samsung
models combined.
In other words, iPhones accounted for 88 percent of all web traffic analyzed, versus 11
percent generated in total by all the Samsung phones.
Shares of Apple Inc. (Nasdaq: AAPL) closed up 0.21 percent on Friday. So far this year, the
stock has gained 64.26 percent.
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