The Android OS is evolving much faster than the ecosystem can handle. Chris Sauve displays this point beautifully in his analysis of Android fragmentation and the impact to developers. Android’s release cycle is annual. Ice Cream Sandwich, released in Q3 11 still has less than 1% adoption nearly six months post launch. Jelly Bean, the next iteration is scheduled for six months from now.
Carriers and operators control the release schedule for these system updates. They take time to test the new OS’s impact on the network and also to make modifications to the OS for customer differentiation. There is no question about Android’s success – Asymco forecasts 1B Android devices will be deployed in about 18 months. But how much do new OS versions matter for customers/end users?
These data indicate new OS versions don’t matter much. Even Gingerbread devices have enough price/power/utility to compete with iPhone or Windows Mobile or other alternatives. The same is true of Mac OS releases. Mountain Lion will have some benefits to Snow Leopard, but I think the OS needs of most users are satisfied.
Other differentiators are content – apps, movies, and music – and price. But on the whole, these are roughly comparable between Android and iOS. We already know how the market share will shake out. Android will win the bottom 60% of the market. And iPhone will always be a premium product. This was the strategy all along for Google and Apple.
What do you think will be the differentiator for mobile phones and operating systems in the next 3 years?

4 thoughts on “Mobile phone OS – A battle worth fighting?

  1. The differentiator for mobile phones over the next three years won’t be the phones or the OS – it’ll be the carriers. After a few years where I’ve seen little significant change in the major operator offerings (if anything, the offerings have converged on the same prices and features!), I believe we are on the cusp of some disruption to that portion of the industry.

    Republic Wireless, with its $19/month unlimited plan, delivered via an Android phone that defaults to transporting calls over WiFi, not the cellular network, is the best example of this trend. MetroPCS offers a $40/month plan enabled by their lower-cost PCS network technology, with a choice of Android phones – admittedly not the latest and greatest phones, but as you point out, latest and greatest is mostly not required anymore!

    I’m curious how Apple will play this trend – the cost premium for having an iPhone is growing increasingly large as the monthly price differential between ATT/Verizon and Republic/MetroPCS yawns ever wider. Over a two-year contract period, an iPhone on ATT could easily cost $1,500 than an Android phone on Republic. At what point to consumers say “that is too much” – or does Apple say “hello Republic”?

  2. All great points. What do you think will happen to carriers? Does ComCast/NBC acquire a carrier and media companies provide quint-play offerings? Or do we see consolidation among carriers?

    How do carriers differentiate aside from cost and using IP networks instead of voice?

    Verizon is pushing all of its voice traffic to IP traffic with the next version of LTE. (http://www.slashgear.com/verizon-voice-over-lte-in-two-city-trials-full-2013-us-launch-tipped-20210156/)

  3. Good questions – I’m not sure how the carriers can differentiate going forward – if the main thing they deliver is voice and IP connectivity, then most consumers will gravitate to the carriers that provide the best cost/reliability mix.

    It’d make a lot of sense for the carriers to consolidate up until the government blocks the deals (which happens already).

  4. I hope they branch out into other subscription services they can bundle into existing subscription packages. Could be crazy things like home security, elder care monitoring, diabetes monitoring or content subscriptions.

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