Bert Danner has an interesting article at Seeking Alpha on the mobile platform war between Apple's iOS versus Google's Android. Danner argues that Apple will win over Google because its software and business model are better structured for harnessing the "network effects" of software platforms. I think Danner over-reaches in his conclusion but the network effects analysis offers valuable insight on the scale of challenge that other contenders, including Microsoft, Amazon, and RIM, will have as they try to break Apple and Google's duopoly-like dominance over mobile software platforms.
In this context, a network effect is a positive feedback loop whereby platforms with stronger ecosystem of developers, content and service providers attract more customers. More customers then attract more developers, content and service providers, and so on. Given that developers, providers and customers are finite, the network effect of stronger platforms will eventually starve weaker ones of these critical ingredients for success. Thus, Danner reasons, Apple's "virtuous cycle of ever-increasing platform value" will cause it to "inexorably strengthen while the competition starts to actively weaken," leaving Apple's iOS dominant.
Where Bert Danner falters in his analysis is in assuming that the mobile platform battle will play out like desktop computing, where network effects yielded near monopoly-level dominance to Microsoft. A better analogy might be Coke versus Pepsi, where two competing ecosystems profitably hold sway with near duopoly-level dominance.
Like Danner, I am impressed with the power of Apple's mobile strategy. iOS is well-suited to Apple's software/hardware business model. More importantly, the ecosystem that Apple has built around iOS allows Apple to maintain a disproportionately large share of smartphone and tablet device profitsin spite of what I've argued as lackluster device innovation.
Google's iOS apps seen as 'potential risk' for Apple (Silicon Valley Business Journal)
Moving from iOS to Android: your guide (Android Authority)
Ubuntu for smartphone Vs Google Android Jelly Bean Vs Apple iOS 6 (Northern Voices Online)
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