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Comment by donflamenco | Hacker News Reader

Here's an idea on how Apple can "win."

The phone market is quickly turning into a mature business like the PC is today. Essentially all of the major innovation on the hardware side is done and the software side will be where people choose their phone/tablet.

IOS has the best apps, period. Apple needs this to always be the case. Just like people buy Windows because of its apps (games, etc.)

Developers make more money on the IOS platform (by far) than any other. Apple needs this to always be the case.

I submit that Apple needs to drop the commission rate for apps sales from 30% to some value approaching zero. This will starve Android/Win8/BB of developer mind share.

Developers will write great apps, make more money and users will pick the IOS platform because it has the apps (games) they want.

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Here's a number of ideas on how Apple could "win" in the way we're apparently talking about:

(1) slash margins and sell the phone cheaper to carriers

(2) subsidize phones at point of sale with spiffs

(3) produce low price phones.

(4) slash their ecosystem commission.

(5) subsidize loss leader app and content promotions.

Yeah they don't seem very interested in doing any of these and "winning" by this definition. Why do people care so much about Apple "winning" like this when they've clearly rejected this model?

The thing is, having a 0% commission would definitely make developers happier and maybe make some more consider iOS as a first platform (although most do already). But that won't keep them from releasing their apps on other platforms after, to make extra revenue. Which in a lot of cases is what happens now, with Apple taking a 30% cut.

You simply can't ignore Android, the biggest mobile OS and its doesn't get starved if iOS developers earn 30% more.

I think about a bold move like buying Verizon or so.

But in my opinion Apple is losing by simple being Apple. They can't keep up with the speed of Google. They spent their money left and right and Apple is sitting on it's cash. Why? They even paid out a dividend, that was the sign that they have no big plan. What was one of the first actions of Tim Cook.

Buying Verizon would be hard to get past the government. See how difficult it was for AT&T to buy Alltel (they had to give a not-insignificant part of it to Verizon to play fair).

Buying T-Mobile, on the other hand...

I think it will not matter as much which company it is, as that it is a cell phone company. Having one corporation in charge of both the device and the service is something that will hurt the consumers in the long run I believe.

Normally I'd agree, but US carriers have done an exceptional job of crippling mobile computing over the last decade, and just about anything would be an improvement. If one or more of Apple, Google, or Microsoft were to buy a carrier and pledge to run it as a dumb pipe, that would be great for everyone. Well, except the incumbents who would be introduced to real competition.

Buy T-Mobile pump 50+ Billion into infrastructure and make the iPhone the only unlimited LTE receiver by simply buying one.

You have the best network so a lot will join with their contracts. Make tons of profit there.

I think Apple has a real problem now, the iPhone is their primary source of revenue. There is not much diversification going on there.

Edit: And btw, this would create an Arms Race for greater good, why not "Who has the best Network" than "Who has the most patents?"

Its a global game not a US one. The amount of money to buy global operators is large. Vodafone is 125bn dollars and as a global operator is just the first on the list. Apple and Google can't just buy global mobile.

True, but you can expand that. It is a long term strategy.

They are sitting on 120B that is just in some hedge funds anyway, why not do something with it that has a competitive advantage. They just have no plan....

Give this money Amazon or Google they would know what to do with it. That's the reason i dislike Apple. They don't have a mayor purpose any more. If there is no company vision, then at least do something that improves everyone's live and gives this company another shot. In the worst case Apple loses the phone wars and is the biggest mobile operator in the world. Not even that of a risky move, mobile operators have a pretty solid business model.

One telecom purchasing another is a completely different beast with a different kind of history than a hardware/operating system company purchasing a telecom.

It was difficult for AT&T to purchase Alltel because after the breakup of Ma Bell, the baby bells have been eating each other and consolidating into the current Big Three (ATT, Tmobile, Verizon). The AT&T purchase of Alltel was seen as a baby bell further consolidating the wireless marketplace.

Android being the "biggest mobile OS" is like QNX being the biggest embedded OS. If you have 80% market share but 90% of your users don't care about being a phonetechnoweeniegeek, then it's irrelevant.

The stat we should be tracking is: out of people who actually use their phones (a horrible name for these things now anyway) as computers, which percentage of those people are using which device? We constantly see stats of "Android has 80% market share! But--now keep this between just you and me--iOS makes up 80% of mobile web traffic."

Actually no, Android now wins in large parts of Europe and Asia by web traffic, iOS still slightly ahead in the US and only massively ahead in some outliers like Switzerland. One thing is sure, you can't ignore Android anymore.

Source: Statscounter

I wonder how portion of Android users care about their platform.

Given the cheapness of some of these phones, would not surprise me if many users had low interest in their devices beyond the phone and basic web/app use.

Looking at the user boards and among my circles, many Android user actually seem to care more about their platform - for better or worse. Apple's continuing "thermo nuclear war* seems to spawn a strong anti reaction. Who'd have thought. I just hope enough Apple exes see this, too.

Is there actual research on this?

I can't see this massive Android flood being based largely on OS loyalty.

>You simply can't ignore Android, the biggest mobile OS and its doesn't get starved if iOS developers earn 30% more.

You really can. It's only "biggest" in sales, but not all those sales are to people buying apps and living the "online" life. In most interviews/surveys developers say that the make little money on Android sales compared to iOS, and that they prefer ad-supported apps so that at least can make a buck with free (which only was for high volume apps).

On the other side, there are tons of iOS only apps and games, that ignore Android altogether, including very successful examples.

>Essentially all of the major innovation on the hardware side is done and the software side will be where people choose their phone/tablet.

>I submit that Apple needs to drop the commission rate for apps sales from 30% to some value approaching zero. This will starve Android/Win8/BB of developer mind share.

Main source of Google's revenue is advertisement, main source of Apple's revenue is hardware sales. If both hardware sales and marketplace commissions will be lowered then it would be improvement rather for Google than Apple.

Have you worked through the entire context of this approach?

There was little reason for an 3rd party developer to spend resources to produce a Mac/Linux port during Windows' heyday. Except as a labor of love.

But Apple doesn't own 90% market share. It's split, and growing toward Android. There is no sensible reason for developers not to develop for BOTH platforms, until it is no longer profitable to do so.

IOS has the best apps, period. Apple needs this to always be the case.

Until they opened up maps for other apps, this wasn't the case. Siri also doesn't look like a world beater yet. 3rd party app quality is still high, but it's disappointing how they let new core apps be so bad on release. I'm not saying software like that is easy. But I think they took a bit of a black eye by releasing software that seemed so half-baked.

You're saying people buy phones/tablet because of better apps/software. Although IOS is best in this respect, aren't people buying more android phones than iphones?

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