A cheap Android phone is now a good phone. Your move, Apple...

I bought a Nexus 4 out of intellectual curiosity. After three years of using iPhones, it's now my main phone. That's great for me, but a problem for Apple et al...
Written by Matt Baxter-Reynolds, Contributor
Thumbnail - Nexus 4 Love
Bit too early for Valentine's day, but I simply can't wait any longer... I love you, Nexus 4!

One of the problems I have as someone who writes about technology is that there are certain types of technology -- particularly post-PC technology -- that you can only really understand by living it. The problem is that if you're like me and feel a level of affection for your smartphone that it borders on indecency, trying to live with a phone that's not your normal one is in reality pretty difficult.

But, when asking myself searching questions about the BlackBerry Z10 I felt I needed to know more about Android. The phone I've been using for the past year has been an iPhone 4S. I'd used Android kit for work, but that's not the same as living with it. So I bought a Nexus 4 when they came back into stock in the UK, the idea being to spend the least amount of money possible as I presupposed it would disappoint as much as first- and second-generation Android devices had.

What I received was a fantastically good phone, and one that within an hour had relegated my iPhone to the "list of phones I used to use". Whereas a year or two ago Android versus iPhone was about as fair a fight as a stone-age tribe against going up against a squadron of time-travelling F-15s, today a cheap Android phone is a very good phone. And that's a real problem for Apple, and also for Microsoft and BlackBerry.


My affection for the Nexus 4 seems to stem from the fact that it is so cheap, although it's cheapness is a little bit of a cheat. Through the expedient of direct distribution through Google, the end customer doesn't pay the various fees to the middlemen in the chain -- specifically the carrier, the wholesaler, and the retailer. Google does take a small hit -- LG who make the device has to remain happy and not lose out compared to traditional distribution. All this means in the UK a 16GB Nexus 4 can be had for £279 including tax (about $450). In the US the 16GB model goes for $349 excluding tax. (If you take tax and duty out of that, it's about the same price in the US and UK, which itself is unusual.)

You can add to this cheapness the fact that the phone is fast (which it is), and good (which it also is). As technologists, we know that a product that scores highly on being cheap, fast, and good should be impossible. The Nexus 4 is the impossible -- it feels great to hold, the screen is big and bright (4.7"), it's fast and fluid (sorry, Microsoft). 

The fact I've been able to adopt the Nexus 4 into my day-to-day life can all be explained by "utility". The Nexus 4 is simply offering to me, personally, a level of utility which is close to that of my iPhone 4S, yet at about half the cost of a new iPhone 5.

I've started to use "utility" as a way of thinking about ecosystems. We tend to talk about a platform ecosystem, but in reality more nuanced than that. Each device platform has a number of ecosystems -- an app ecosystem (i.e. the catalogue of available apps), a content ecosystem (e.g. iTunes or Google Play), and a storage ecosystem. (This last one I use to think about how were I to write a document Office 2013 I might save it in SkyDrive and then have it available on all of my devices. You might also call this a "workflow ecosystem".) The utility of any one of these will vary depending on personal usage, and may be additionally split depending on usage modes. For example, I only use iTunes to buy movies for the kids, so the inability to watch an iTunes movie on an Android phone doesn't affect me at all. I use a small set of apps on a smartphone, but I do tend to use them day-to-day, so a poor app catalogue presents very low utility to me. Each individual will obviously need to satisfy different requirements from the ecosystems that they are willing to stump up cash for.

It's clunky and obvious, but you can notionally score a platform's utility by adding up the plusses and minuses from each of the ecosystem areas within the context of a particular mode of usage. For me, the score that the iPhone came up with wasn't too far from the score that the Nexus 4 came up with. I'm not sure I'm in a position that's particularly unique. (I hope to write more about this idea this month.)


That's a problem for Apple. Whereas in the period before if any non-technologist had asked me what phone they should buy I always would have said "iPhone". ("It just works.") Now that I own a Nexus 4, I can no longer do that. Moreover, I personally can't see why I'd ever buy an iPhone again because I'm now aware that I'm just spending an additional chunk of cash on a smaller screen, a nicer build quality, and notionally the chance of getting good apps first. (Developers are still tending to targeting iOS first and then porting to Android.) I guess I also get Siri.

Mind you, whilst that's disturbing for Apple, it must be terrifying for Microsoft and BlackBerry as they fight it out for the so-called "third platform" slot. (For the uninitiated, this is the idea that the market will support a platform other than the dominent iOS nor Android. Microsoft and BlackBerry are currently fighting for this piece of market.) Whereas before I thought this was an interesting intellectual exercise, I'm now wondering whether it's simply a straightforwardly mythical beast and that the best any contender for this slot can do is keep a toe-hold in the market and wait for a more decisive-slash-destructive realignment of the market where they can realise some sort of "first mover" advantage into whatever emerges from that destruction.

A key part of the "third platform" problem is that the remaining market that these two can move into is already small. In the US in the last quarter of 2012, Android and iOS together had 95 percent of the market. Therefore, both Microsoft and BlackBerry have to fight to get a wedge into that slot and then make it bigger. This means taking proportional market share from either Android or iOS. It's easy to attack Apple on price, but attacking Android on utility could be very difficult. The answer to both the Android problem and the upstarts weedling in to create a third-platform problem from Apple's perspective could be to deliver a cheaper iPhone. That's a scenario so explosive you could describe it as nuclear. But it's now one that I'm considering as being "likely". The iPhone needs a reboot -- cheaper, a more modern look (iPhone is having a fashion problem), and with a bigger screen.

And this isn't just about smartphones. I didn't like, and therefore didn't continue using, the Nexus 7 because the screen was the wrong size and the wrong shape. Widescreen displays on tablets make landscape content too stubby and portrait content too wide. iPad's 4:3 display, modelled on US Letter-sized paper works much, much better, even if you shrink it down to a mini 8" screen. I fear it's only that utility of that more appropriate aspect ratio that's keeping me on the iPad -- I suspect a Nexus 7 would offer good enough utility on the other factors.


Everyone has something to lose here. Apple has lost its key differentiator -- the iPhone is no longer obviously better than a strong, fourth-generation Android device. Microsoft and BlackBerry might be about to witness a nuclear war between two competitors that already outgun them in every possible way, leaving just scorched and irradiated ground for them to try and thrive in. And if Google does win this battle, it hasn't won the war. The big problem I see for Google is that Samsung is now so powerful within the Android market, it's starting to become unclear whether Android is actually Samsung's product or Google's. But that's a story for another day...

In the meantime, I have a really good phone that's really cheap. Happy customer is happy.

What do you think? Post a comment, or talk to me on Twitter: @mbrit.

Image credit: Google, Wikimedia

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