AAPL Smartphone Shows the Way to Competitors

by: Joel West December 02, 2008 | about stocks: AAPL / HTC / MOT / PALM / RIMM / SSDIF.PK    

Joel West

About this author:
Become a Contributor Submit an Article
  • Font Size:
  • Print

In yesterday morning’s Wall Street Journal, Apple (AAPL) has a full page ad advertising its #1 ranking in US business user customer satisfaction as reported by JD Power and Associates. In a near tie for second were RIM (RIMM) (BlackBerry) and Samsung (SSDIF.PK), with HTC (HTC), Motorola (MOT) and Palm (PALM) (Treo) posting below-average scores. Nokia (NOK) apparently had too few US customers to be measured.

The BlackBerry was tops this year and its score was essentially unchanged. The iPhone passed it, setting a new standard for customer expectations of a smartphone. (This news came out in early November but I didn’t see it at the time).

It’s clear that Apple did well because its competitors failed to deliver. 24% of users reported a software problem. Of those, 44% have to reboot their phone once a week, and 34% have an application error or freeze at least once a week.

Smartphones are small portable computers, with many capabilities and governed by software. It’s not surprising that the best results come from firms that understand software, manage the complexity and focus on delivering a quality user experience. Unfortunately for Apple, by showing the way to its competitors, it will help (some of) those competitors become more capable.C’est la vie (c'est la guerre).

Disclosure: None

Related Articles

This article has 6 comments:

  •  
    Dec 02 08:39 AM
    Apple may be showing the way but no-one has come close in over a year.

    The new Nokia N97 announced today is only slated for production in the second half of 2009!

    What will Apple have done with the iPhone by then?!?
    Reply | Link to Comment
  •  
    Dec 02 09:36 AM
    Good point - It's like that Warren buffet quote regarding investing in a tecnological edge on your competitor only to have adapted by him.
    The question is if it is a tecnological innovation alono we are talking about or a number of complex properies that make the iphone the success it is. I would argue the latter. Sure other smart phone makers like RIM have touch screen + scroll + other iphone design elements + the software looks like it was based on safari which was based on mac os etc. etc. But is that what is really going on behind the iphone's success? It seems to me there's some other level of complexity behind concept + innovation + contextualization. In the final execution, there is a kind of unity in the ipod itunes experience also in the iphone app store experience which will be a very difficult thing to emulate without any real vision or talent behind it all. It's must be like trying to make a Hitchcock film, when you're not Hitchcock.
    Reply | Link to Comment
  •  
    Dec 02 10:53 AM
    iPhone is not just about PHONES. It's about personal computers and media as well. Look at what iPod+iPhone is doing to the computer market, when coupled with Apple's excellent moves of late (moving to Intel processors now that they are best of class) etc...

    And software development? Companies are making more off iPhone apps, at $5 a pop, than they were making selling boxed software for YEARS because so many more people are buying, and there is no marketing or distribution costs whatsoever. And Apple is profiting very handsomely, which, among many other things, is off the wall street radar even now.
    Reply | Link to Comment
  •  
    Dec 02 02:05 PM
    Ya I saw that ad on the back page. The Storm had a good chance until it had software security problems. No matter how cool a phone looks, the bottom line is if it doesn't perform and deliver its useless. Apple mastered both-aesthetics and performance. Hence why people are so bearish on RIMM (predictwallstreet.com/...) and bringing its price down. Apple is forecasted to close up today too (predictwallstreet.com/...) and because sentiment is becoming more bullish for them, I think they will be able to sustain throughout the holidays.
    Reply | Link to Comment
  •  
    Dec 02 03:36 PM
    not to worry about Apple showing other companies the way...by the time other companies have their 'near miss' experiences in trying to catch up, Apple will have some other innovative creation that again outpaces the pack. their budget for R & D goes up along with their profits. when i'm out and about and using my iPhone, people approach me and ask to see it and if it's really as great as the hype (yes!!!)...at first i thought this was a fluke..but it keeps happening. i think holiday sales will break all records for Apple...even in this economy.
    Reply | Link to Comment
  •  
    Dec 03 05:46 PM
    It is a complex issue. Without question Apple has the better product and, as pointed out above, has the depth of engineering and design IP to keep turning out new products for the foreseeable future.

    Yes competitors can try to copy some features but that is like driving by looking in the rear view mirror. Your future products are determined by what Apple brought out last quarter.

    The one fly in the ointment could be the "good enough" effect. That is where people admit you have by far the better product but the cheaper, poorer one is "good enough" for them. As closely as Apple follows their customers I doubt this will catch them by surprise.
    Reply | Link to Comment
More Comments on AAPL ยป
Top Rated Comment Streams:

Numbers are net rating-

See all Top 100 »
More by Joel West

Investment Resources
Money Management
Research
Seeking Alpha provides these ads as a service to its leading contributors
Articles on related themes
Cell Phones
Digital Cameras & Printing
Digital Home
DVDs