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Christopher Dawson

Google's Android overtaking BlackBerry and iPhone

By | August 2, 2010, 11:22pm PDT

Summary: Buh-Bye BlackBerry…Hello Android (and iOS)

I’ll admit it…I was a CrackBerry addict. I used my old Curve until the little letters were all rubbed off and the trackball was a big gummy mess.  I could thumb-type with the best of them. And then I got my Droid Incredible. Buh-Bye BlackBerry. There was, quite frankly, no comparison. It appears that significant numbers of the smartphone users in the US felt the same way, according to new Nielsen research released yesterday.

Before the flames from devoted iPhone users start, though, let me throw out this nugget from the Silicon Valley Mercury News:

“Android and iPhone are eating into both Microsoft and RIM,” [Roger Entner, head of telecom research for Nielsen] said in an interview Monday. “There isn’t really a lot of (consumer) movement going on between Android and Apple. They are both just eating away at the competition.”

While Android phones sold faster than iPhones in the second quarter of 2010, iPhones sales are severely handicapped by single-vendor sales; Android phones are available on all major carriers in the US, making direct comparisons difficult and leaving a whole lot of marketing ahead of Android.  However, what isn’t difficult to see is that once users experience either Android or iOS, it becomes mighty difficult to go back to the BlackBerry.

Of course, many businesses have built expensive communications infrastructure around BlackBerry Enterprise Server, making other phones a tough sell to these companies. Ultimately, though, user demand and compelling features will drive business devision-making. In smaller businesses, where BES is far less likely to be deployed, there aren’t many reasons to stick with RIM’s products when Android and iOS devices do so much more, so much better.

The real takeaway from the Nielsen research is that Google was right. Mobile is the future of the Web, Android will be at the center of mobile (along with iOS), and Google is going to make another fortune. I’ll let others debate whether RIM can compete in this new smartphone landscape. What I do know is that there is probably no better example of the consumerization of IT than the explosion of Android (and iOS…can’t forget iOS) phones in the enterprise and the willingness of diehard BlackBerry users to dump their phones in favor of slick devices with Cupertino and Mountainview seals of approval.

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Topics

Chris Dawson is a freelance writer and consultant with years of experience in educational technology and web-based systems. In 2011, he became the Vice President of Marketing for WizIQ, Inc., a virtual classroom and learning network SaaS provider.

Disclosure

Christopher Dawson

Christopher Dawson is the Vice President of Marketing for WizIQ, Inc., by day and a freelance writer and educational technology consultant by night. Well, most of his colleagues at WizIQ are based in India, so really he's working with them whenever he can stay awake. He has worked for his local school district as a teacher and technology director, for the Johns Hopkins University School of Public Health, and for Biogen, Inc. (now Biogen-IDEC, Inc.). He has also consulted with STATNet and Cytyc Corporation and retains close ties with X2 Development Corporation (now owned by Follett Software, the supplier of the student information system he administered for several years). Follett is paying him a monthly honorarium to act as a presenter for their "SIS Voices for Student Achievement" community (he produces occasional blog posts and hosts a monthly webinar on the use of student information systems to inform data-driven instruction and school-wide change. He regularly purchases and/or recommends Dell hardware. This is because Dell makes good hardware and has truly committed itself to education in innovative ways, particularly with their "Connected Classroom" initiative. It isn't because he has dealings with the company through his role at WizIQ (which he does) or because they have provided him with long-term loans of a variety of equipment for in-depth testing (which they have). Intel (reference designer for the Classmate PCs he has implemented in his local schools) has provided him with long-term loans of Classmate PCs for testing, as have Dell and Lenovo with their educational offerings. He may report on any of these companies as his experiences with them have direct bearing on educational technology; positive reports are not necessarily an endorsement and he receives no direct financial compensation from these companies or any others. Intel paid all expenses for his attendance at the 2009 Intel Classmate PC Ecosystem Summit which he attended as the sole representative of the technology press. He was invited to attend in 2010 but his wife would have killed him if he spent 3 days in Vegas geeking out and left her home alone with a new baby. Acer provided him with a 50% discount on an Aspire One netbook in early 2009 after he tested it for 30 days through their educational seed program. He liked the netbook at the time but it has since broken and sits unused in his office. Canonical sent him Ubuntu lanyards, t-shirts, and mousepads for his kids. He stole one of the lanyards and proudly hangs his keys from it and occasionally features his 8-year old wearing an oversized Ubuntu t-shirt on his Facebook profile. Gunnar Optiks sent him a pair of computer glasses to evaluate for a holiday gift guide. He is wearing them now as he types this because they never asked for them back and they rock out loud. Seriously - they work brilliantly and make it much easier to spend 20 hours a day staring at an LCD. If they ever asked for them back, he would fork over the $99 and buy a pair. Microsoft gave him 2 free copies of Office 2010 professional, a desktop clock, and a useless book on Office 2010 when he attended the launch of Office/Sharepoint 2010. He occasionally uses the SharePoint lanyard they gave him instead of the Ubuntu lanyard for his keys, but feels dirty afterwards. Adobe provided him with a pre-release version of the CS5 Master Collection for evaluation and ultimately provided a full, licensed copy for ongoing testing of educational applications of this admittedly expensive software. Like the Gunnars, if the license expires or they come out with CS6, he'd actually go out and buy it himself. Which is saying something, because he's actually pretty cheap. Any other companies wishing to send him cool things to evaluate, wear, or otherwise adorn his kids are more than welcome to; he promises to disclose it here if he keeps any of the stuff. Finally, because WizIQ is a virtual classroom and learning network provider, Chris, as VP of Marketing, frequently interacts with, seeks out deals with, and directly or indirectly competes with a whole lot of LMS, SIS, and other Education 2.0 companies. In general, he'll limit his reporting about these companies to news that does not impact his relationship with them or with WizIQ. If he reports on them, it's because what they are doing is newsworthy or worth the attention of his readers and not because he's trying to broker some deal, damage competition, or otherwise advance his position in his day job. LMS and SIS companies, along with other online learning communities, are a pretty important part of Ed Tech. If he stops reporting on them completely, there won't be a whole lot left. He'll be sure to call out any overt conflicts of interest if they are unavoidable. Finally, Follett Software Company pays him a little tiny honorarium every month to present on their SIS Voices webinars and to write the occasional blog or discussion thread for them. Since Follett recently bought X2 (maker of an awesome web-based SIS that Chris just happened to have used, served in advisory groups for, and frequently reported on), this is probably also worth disclosing.

Biography

Christopher Dawson

Christopher Dawson grew up in Seattle, back in the days of pre-antitrust Microsoft, coffeeshops owned by something other than Starbucks, and really loud, inarticulate music. He escaped to the right coast in the early 90's and received a degree in Information Systems from Johns Hopkins University. While there, he began a career in health and educational information systems, with a focus on clinical trials and related statistical programming and database modeling. This focus led him to several positions at Johns Hopkins, a couple-year stint in private industry, teaching high school math and technology, and 2 years as the technology director for his local school district. Most recently, he started his own consulting business and is now the Vice President of Marketing for WizIQ, Inc., a virtual classroom and learning network provider. He lives with his wife, five kids (yes, 5), 2 dogs, and a hateful cat in a small town in north-central Massachusetts. Although he is no longer teaching, his roles with WizIQ and ZDNet allow him to continue helping students and teachers add value to education with technology rather than merely adding to the bottom line.
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RE: Google's Android overtaking BlackBerry and iPhone
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DroidBerry?
iTeaBoy 3rd Aug 2010
I think it was Jason Perlow who suggested some time ago that an Android device integrated into the BlackBerry network would be a pretty formidable mobile offering - and might be the only way for RIM to stay in the game.

Having recently moved from BlackBerry to an Android device myself I have to agree with him. I really liked my BlackBerry and was going to upgrade to the BB handset, but wasn't convinced that BB was going to be able to match Android (or IOS) in terms of OS development (or availability of apps) over the 2 yr term of my new contract.

Android and IOS are the future of mobile device platforms - but nothing matches RIM's network for instant email/msg notification and security.

I'm happy with my move to Android, but ideally... I want both!
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What do you mean by instant email?
os2baba 3rd Aug 2010
@iTeaBoy

I have never used a Blackberry, and since you have used both, perhaps you can tell me what you mean by instant email. I get instant email from gmail. I assume I would get the same from my work email although I have never tried it. How does Blackberry defer from this? I know it's secure and encrypted, but how does it defer in the instantaneous delivery?
@os2baba well on an Android phone u don't get your emails instantly unless you are on WiFi or you have your 3g always connected. Which would mean bad battery life overall. Blackberries get your email as soon as it comes in via blackberry servers. And u don't even have to be online to get it.
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BB vs gmail
Pembo Updated - 3rd Aug 2010
@os2baba
On gmail it only seems instant. Actually, your phone has to use battery to establish a connection to the web and gmail servers. It then has to send a request to check the inbox. It does this at regular intervals (5min-2hr) depending on your settings. That can eat a lot of battery throughout the day.
On blackberry, the server pushes a message, like a text message, as soon as the mail arrives. Then the phone checks and downloads the message.
Im on the computer a lot so I just check mine manually every couple of days.

I love my Droid!!
2.2coming this week XD
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business model
banned from zdnet Updated - 3rd Aug 2010
Almost any entity can attain huge market share if they start giving goods away for next to nothing or for free. Huge market share, no profits. Since when has this money-losing business model been so sought after and so highly praised?

not only is google losing money with any android phone that is sold (they must have invested 100 of millions already), but also most of the hardware makers. the mobile divisions of motorola, lg and sony ericccson are all deep in the red. only htc is making money and even they refuse to give unit numbers.

so what kind of ridiculous, non sustainable business model and ecosystem is that where almost all of the players are losing money in the name of os unit market share? and why do tech blogs praise it that much?

only out of utter apple hatred?
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Business Model seems to be working
os2baba 3rd Aug 2010
@banned from zdnet

Motorola turned its loss making mobile division into a profit making one in a year pretty much on a couple of Android phones and they apparently have a hit on their hands with Droid X and Droid 2.

HTC is making millions of dollars in record profits with their army of Android phones

Samsung has got the awesome Galaxy S phones that have got rave reviews and are selling like hot cakes world wide. I wouldn't be surprised to see this as being possibly the hottest selling Android phone this year.

Sony Ericson has a couple of good Android phones. LG is coming out with a bunch of Android smart phones. Acer has a few. Dell has the Streak. Presumably, they all think they can make money as well.

As far as Google is concerned, it's obviously turned out to be a very very wise decision for them. Since they no longer have to depend on Steve Job's mood to decide their future. And in fact are probably contributing rather heavily in him pretty much losing it these days. You don't think that Google is benefiting by not having their long term future decided by an unpredictable megalomaniac?
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agreed
banned from zdnet 3rd Aug 2010
@os2baba
it may be a good strategic idea to loosen their dependency on apple. so that may make sense for google though it is a costly ride.

but most of the hardware makers (besides htc) are losing money with their android strategy. sure, all of them hope that this will change sometime in the future. but hope is not a good strategy.
@os2baba

You are entirely right.

Android's purpose was preventing one phone from dominating the market and locking out rival advertisers like Google (Apple already did that with iAds).

And Google succeeded. Now if Apple or RIM decide they don't want to let Google advertise on their phones, Google won't care - they're dominating the market with their own phones.

And perhaps more importantly, they plan to sell content, like music and books, on Android. If there are a lot more Android users than iPhone users, obviously more people will buy music from Google than from Apple.

With a billion Android users, Google will make tens of billions from the content and the ads that they sell on those phones. Giving the OS away for free was a pretty smart idea.
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motorola
banned from zdnet 3rd Aug 2010
@os2baba
and no, motorola's mobile division (their phone business) is still deep in the red. you may refer to motorola's earnings last quarter. the company as a whole made a profit, their phone division (which will be a separate unit at the beginning of next year) is losing money. their android strategy didn't help here.
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@banned from zdnet While I agree to a certain extent that you can't continue to compete while not making a profit, I suspect there is a lot more there than we know. First Google has made a huge investment in something they are giving away but they will make huge profits in the long run from ad revenue.

@os2baba How exactly was Google's future dependent on Apple/Steve Jobs' mood? I have an iPhone and the default search engine is Google.

@drphysx The purpose of Android (at least after Google purchased it) was to off a mobile OS that they could have deep root in, not to make sure their was more than on dominant OS. Do you really think they would be upset if all competition all of the sudden went away leaving them the only OS in the market?
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Not a money losing business model
cornpie Updated - 3rd Aug 2010
@banned from zdnet The carriers are either giving away or charging very low prices for phones but that doesn't have anything to do with the manufacturer or the carrier making money. The carrier is subsidizing the cost of the phone to you so that they can get you to sign that two year contract. They will then make back the loss on the phone from your monthly bill.

It is a similar model to HP's very successful ink-jet printer strategy where they practically give away their low end printers because they are going to nail you when you buy replacement ink cartridges.

Apple hatred? Get real dude. Apple/AT&T do the same thing - like the iPhone 3gs currently available for $99 (when signing a contract of course).
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no
banned from zdnet 3rd Aug 2010
@cornpie
i am not referring to the subsidization model of the carriers. the carriers pay the full handset price to the hardware makers. they subsidize the cost for the end user and make it back in monthly fees.

i am referring to the latest quarterly reports of motorola, lg, sony ericsson and samsung. all of their mobile divisions (phone divisions) are losing money.
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@banned from zdnet

Is this true? With the momentum of Android, you would think everyone is banking off Google's strategy. What I fear happening is, with so much competition within the Android universe, companies will have to find ways to cut cost/and cut conners on their products just to stay competitive. Like we've seen with Windows PC OEMs, offering cheaply built and unstable hardware with added junkware/bloatware as they race to the bottom. We're already seeing such similarities with the included Blockbuster junkware app on Droid X phones. An App that can't be removed btw.
@banned from zdnet

Not sure where you heard all those companies were losing money? Sony Ericsson is, but I heard that all the others were going strong. Samsung just reported record earnings, and they claimed that part of that was from the mobile division.

The reality is that there is a love/hate relationship between the phone companies and Apple/RIM. Both companies get subsidies and/or revenue sharing, so the phone company make less money (on average) per user, than on a smartphone user running Android or Windows Mobile or Symbian. With those OS', any licensing is between the phone manufacturer and the OS owner. The rest is all gravy to the phone company.
Canalys' numbers are more accurate than Nielsen's, because they are for the last three months and include the iPhone 4.

According to Canalys, 2Q 2010 U.S. market share numbers are:

Android 34%
RIM 32.1%
Apple 21.7%

Worldwide numbers are:

Nokia 38%
RIM 18%
Android 17%
Apple 13%

Source: http://www.canalys.com/pr/2010/r2010081.html

At its current growth rate, which doesn't seem to be slowing, Android might even overtake Symbian (Nokia) within a year and take the number one spot worldwide.

It's "Windows vs. Macintosh" all over again, but this time Google is Apple's competitor. And we all know how the story ends.

Apple will be the highly profitable niche player, making boatloads of money with a very tiny market share.
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iphone 4
banned from zdnet Updated - 3rd Aug 2010
@drphysx
these numbers include only 3 days of iphone 4 availability. this quarter apple will probably sell around 12 million iphones. let's see these market share numbers then.

and your worldwide numbers are bogus. the canalys study doesn't give worldwide numbers for android. you pulled them out of your a**?

by the way. the windows vs. mac analogy doesn't make much sense. microsoft sold their os and made and makes a lot of money with it.

here for the sake of meaningless unit market share numbers most players of the ecosystem (os provider and hardware makers) are losing money. every android phone sold is costing google, lg, motorola and sony ericcsson money. what an accomplishment!
@banned from zdnet

Apple sold 130,000 iPhones per dayfrom the iPhone 4 launch until today.

In the same time period, over 160,000 Android phones were sold per day.

This quarter, about 20 million Android phones will be sold. That's quite a few more than your 12 million iPhones.
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I suspect...
cornpie 3rd Aug 2010
@banned from zdnet ...that many of the iPhone 4's sold will be to people who previously owned an iPhone and are now upgrading...meaning that their purchase does not increase overall Apple market share
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numbers
banned from zdnet 3rd Aug 2010
@bdrphysx
that very well maybe, though i doubt it. let's see then.

and your android worldwide number? where does it come from? a dark place where ... wink
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@banned from zdnet

It's from Adrian's blog post and it makes sense if you do a the maths.

Worldwide Android sales grew 886% from last year, overall smartphone sales grew 64%.

Now if Android was at 3% last year... maths tells me it's now at 16.2%. Pretty close to Adrian's 17% so I guess it's correct.
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no
Jimster480 3rd Aug 2010
@banned from zdnet you will see the marketshare of apple go down fanboi. Because HTC alone is selling more phones than apple. With all the other manufacturers out there selling Android phones the only thing that Android can do is gain marketshare.
And these companies are not selling phones at a loss. They have previous debts that they are paying and they haven't grouped their losses from r&d yet it seems. Because with carriers paying companies like Motorola $600 for a droidx with a OS that is free, you tell me how they are losing money.
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@banned from zdnet

Speaking of pulling numbers out of your a**, can you please reference your repeated claim that all phone manufacturers that make Android phones are losing money? I had heard that Sony Ericsson was, and Moto is still in the red from a few bad years, but they are now "making money" riding the wave of Android successes. Everyone else is doing fine, so I'm not sure where your data is coming from.
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@banned from zdnet

Are you saying that LG, Motorola, SE, Samsung, etc would be doing better (making more money, selling more phones) if they were using an OS other than Android? Do you think that Motorola is worse off because they sold massively more phones in the last year due to their Android move? Also, just because the handset makers weren't overall profitable last year (not checking that, just assuming you're correct), that does not mean they lose money on each phone sold...the initial investment in developing a new phone is large, but each phone sold cuts into that initial investment.

As for Google, I believe that they do have a strategy to make money on Android long-term, whether we know what that strategy is or not...and it definitely does not cost them anything for LG to sell a phone running Android.
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@banned from zdnet
Well if it costs them so much they go out of business then hooray for iPhone! But something tells me Google and the phone makers probably have a long term strategy here.

Also, do you really think that iPhone4 sales will change the numbers significantly? Most people buying it are upgrading from an older version of their iphone so any bump will be small. I doubt they care though. History has proven Apple doesn't give a damn about market share.
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@drphysx 160,000 Android phones a day is an impressive number and they are most definitely growing in market share but it's actually kind of pathetic when you consider the iPhone is selling 130,000 a day. One phone on one carrier has 81% of the sales of what 20 phones spread across pretty much all carriers. Android has made incredible growth this year and I don't think it's going to end anytime soon. They are going to get to a point (probably sooner than later) when they experience some serious growing pains and the future of the OS will be determined with how they handle them. Market share is more of a bragging point for the manufactures, fanboys and haters but doesn't really mean much to the average consumer who are the ones that are actually buying all these phones no matter the OS.
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RE: Google's Android overtaking BlackBerry and iPhone
Pete "athynz" Athens 3rd Aug 2010
@drphysx In the study you linked to why is Android considered "others"? IF it was solely Android then why were they not listed as Android? And they say that in the US Android has 34% of the market share yet their chart lists "others" as 31%...
@athynz

You should read that again. "Others" does not include HTC, who make most Android phones and have 14% market share in the US.

The chart you are referring to is for the manufacturers, not the OS numbers.

You can find the OS numbers in the article, it says Android accounted for 34% of last quarter's US smartphone sales, 32.1% were Blackberries and 21.7% were iPhones.
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Actually I don't know how this story ends.
dave95. Updated - 3rd Aug 2010
@drphysx

Will Google get control of the business enterprise segment like Microsoft did with WinPCs by having IT kick out all other competing phones? Will Google offer a key App (i.e MS Office) that's a requirement in all offices around the world and as a result in homes if you wanted to bring your work with you (brilliant)? Will Google drop that "Don't be evil" slogan and threaten to kill partner's licenses if they offer Bing or Yahoo as an option? What about another browser? Will the DOJ in the end drag Google into court and declare them a dangerous monopoly that used aggressive and illegal means (to put it nicely) just to preserve its Android franchise?

Sorry it just does not equate. Unlike Mac and Windows, there will be more than two players competing. Android may indeed overtake iOS because of sheer numbers of phones running the OS (including cheesy Backflip and other cheaply built giveaways). But there won't be anything near a 95% - 3% gap like we've seen with PC's (thanks in large part to aggressive illegal activities). There could very well be two players sharing the top spot (Apple and Google). Unlike PC's, consumers won't have issues going from one phone to the next. The decision will be more of personal preferences, not requirements with one platform holding the important keys (like WinPC's)
@dave95. It won't be Apple and Google it will be Google and RIM.
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Momentum says otherwise
dave95. Updated - 3rd Aug 2010
@Jimster480

BlackBerry is losing its own core base to iPhone and Android platform, with 50% planning to defect. Let's see what they announce today if it will help.

http://www.crn.com/mobile/225800171;jsessionid=ZJ2Z1C0SQ5003QE1GHRSKHWATMY32JVN

http://www.crn.com/mobile/225800171;jsessionid=ZJ2Z1C0SQ5003QE1GHRSKHWATMY32JVN
@drphysx
I definitely agree. Though I like iPhone and Android, Android will continue to eat everyone's lunch (in growth) with the launch of Froyo (Android 2.2). and with the Antenna issues with iPhone 4 sales are not going to be quite as good for an Iphone as they would have. I program on both and prefer Android myself, though I have some issues with it as well as far as opening the platform more (more access to hardware especially in multimedia)
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Since in the UK ( I can't speak for other regions) Apps bought through itunes are strictly NOT for comercial use - the iPhone can't really be described as a business phone, as any app used for business purposes would put the user in material breach of their iTunes user agreement. So RIM = secure grown up business machine - iphone = toy - and that is how most business people view them, according to the BBC business report this morning. Given the iTunes useage policy the iPhone can't really be anything else!
@psychobdelic: you are misinformed, a business can deploy iPhone apps on his own devices.
The weak link in this business model is Google Android customer administration. Google cannot deliver reliable app sales administration and I for one do not have the time or desire to deal with it. I will stay with ATT/Apple
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I Think It's Great!!!
cyberslammer 3rd Aug 2010
Blackberry, Android, IPhone...those three are all great phones, all have their drawbacks and advantages...

I just love not seeing Microsoft on the list. Hope it stays that way.
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@cyberslammer
Most likely, it's coming, and they may make quick progress. Their marketing is usually (not Kin) pretty good. Microsoft will be in a lot of commericals this fall between the phones and the "game" controller.
@Schoolboy Bob Sorry to disagree. Microsoft's business model from the beginning has been to totally dominate a market using monopolistic methods of intimidation and vaporware to kill off competition. They are currently in the unfortunate position of actually competing in the mobile marketplace where there is real competition from very good companies (Apple, Google, RIM, and the plethora of hardware folks using Android as an OS). I've not seen any hint of real competitiveness from Microsoft. Including Mr. Ballmer's recent comment about "...Apple's sold more iPads than we would like..." as if he controlled the marketplace and the iPad was an interloper who slipped through the slats in the fence.
Microsoft's foray into commercials over the past couple of years have been so laughable as to be nearly tragic. Jerry Seinfeld? Gimme a break. "I'm a PC."? Mimicking your competition seldom works. "I designed Windows 7."? Again, why would I want some moron designing my OS?
They are a day late and more than a dollar short in the mobile marketplace and unlike when Apple has been in that position (iPod, iPad, iPhone) Microsoft hasn't the tiniest percentage of vision that Apple has demonstrated time and again.
Unless Mr. Ballmer is replaced by someone with hunger and vision, and soon, Microsoft will creak along on it's OS and Office monopoly till it slowly becomes irrelevant. As the venerated Walt Kelly said in "Pogo" once, "We have met the enemy and he is us." Could be Microsoft's new company motto.
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You've Got It Wrong
Scott Michael 3rd Aug 2010
Google may be right, but the "real takeaway from the Nielsen research" is that the web is the future of mobile, not the other way around. It's great to have rich mobile applications that use data from the web, and to have on-the-go access to websites, but handheld web use (small screens, limited and expensive bandwidth) will hardly overtake "non-mobile" platforms for accessing the Internet.
Ok, banned from zdnet is obviosly an Apple Pie, so there is no way of reasoning with that person.

Android as a platform might become dominant and banned from zdnet will still argue.

But I will tell you one thing: Even with all of those "12 millions of Iphones", the trend of Android rising will continue.
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BlackBerry, with its secure network is a strong candidate for serious business. (i.e. the kind of business that spends lots of money)

Android, For those that want choice.

iPhone, for the fashionistas that don't care about choice, as long as it's chick, they'll get it. Even if they have to be dictated what network to subscribe or what apps they can run.

All of them are valid markets, Although I can see people that would like them to overlap (i.e. secure iPhone).

At least the cool factor is getting to the Android phones, (Albeit not with the same clout as the iPhone).
In smaller businesses, where BES is far less likely to be deployed, there aren?t many reasons to stick with RIM?s products when Android and iOS devices do so much more, so much better.

Dead on with that point
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