Tag: apple

Heating up the smarthome race

Proving that incumbents can strike back, Honeywell takes on Google’s Nest smart thermostat

Last week Apple sent a big message to the smarthome industry with their announcement of the Homekit, this week industrial control giant Honeywell has released its answer to the Google owned Nest smart thermostat with the Lyric.

The Lyric smart thermostat system is quite an impressive package; along with the smart thermostat, it includes a smartphone app and cloud service that lets users control their home heating remotely.

Other features are maintenance alerts, personalised heating settings and geolocation services for turning systems off and on when occupants are approaching or leaving home. To boot, Honeywell claim the Lyric can save households $200 a year.

The big incumbent

It’s a strong push into the smarthome market which Honeywell has been part of since the concept began thirty years ago and it shows incumbents don’t always sit back and wait for disrupters to steal their markets.

The Lyric’s strength is Honeywell’s massive installed base and its army of experienced contractors; the likely way the smarthome market will evolve is that most installations are going to be carried out while homes are being built or refurbished which gives the incumbents even more strength.

Open standards

What’s missing in the media releases and review is whether the Lyric’s cloud services will offer open APIs to other developers and what format household data will be available in. If it’s a relatively open system then it will have a big advantage over Google’s Nest which all indications show is going to be closed to other providers.

No doubt we’ll also be seeing compatible air conditioning units and heaters entering the market soon as well which will drive a standard of some sort to develop in the HVAC field, again the question of how open those protocols will be remains to be seen.

The next move is Google’s, it will be interesting to see how the company will react to the incumbents fighting back and Apple’s strong positioning to dominate the market.

Apple goes for the wearable market

Apple’s gets its message out about wearable technology

“You’re more powerful than you think” is the message of Apple’s current iPhone advertising campaign.

Their latest advert in the campaign features joggers, gymnasts, swimmers and golfers all using iPhone apps to connect with their wearable technologies.

It didn’t take long after Monday’s World Wide Developer Conference announcement of Apple’s Healthkit for the company to get its message out about wearable technology.

Undoubtedly we can look forward to soon seeing the Homekit smarthome campaign showing how Apple’s products make life easy in the smarthome.

What’s absolutely clear is Apple’s determination to be the hub of the domestic internet of things, whether the vendors of those fitness and smarthome devices want to be locked into the world of Apple remains to be seen.

Apple’s grab for the home internet of things

Apple’s iOS8 and OS X Yosemite announcements are part of the company’s attempt to dominate parts of the internet of things.

As usual, Apple’s World Wide Developer Conference in San Francisco yesterday concentrated the attention of the tech world.

This year’s was a little more subdued than usual with the key announcement being around Apple’s new Yosemite OSX operating system, iOS8 and the new developer Software Developer Kit (SDK).

While a little underwhelming after all the speculation about smartwatches and fitness devices, these announcements mark a clear strategy for Apple to lock customers into their products through the cloud, smarthomes and wearable devices.

Open, but closed

Normally discussion about an SDK makes most people’s eyes glaze over, but Apple’s announcement marks a change in the company’s strategy in making over 4,000 APIs – Application Program Interfaces – open for developers to connect their programs into iOS8.

This marks a change for the company in allowing programs to easily hook into Apple’s mobile operating system and while it looks like a move to openness, the ease of making fitness applications, home automation and smart car services actually helps lock users into the Apple ecosystem.

Key to the ecosystem lock-in strategy are the Healthkit and Homekit services offering connections to health and home automation applications which are part of Apple’s Internet of things play, by offering easy access into the iPhone and iPad the company hopes to lock users of third party devices into the iOS world.

Increasing vendor lock-in

Similarly, the cloud services included with Yosemite and iOS8 increase that lock-in making it harder for users to step outside that ecosystem. It’s notable there’s no Android app version of the cloud service which indicates how Google is now Apple’s number one enemy.

Apple’s announcement today shows how the company is positioning itself to lock users into their services as the internet of things rolls into businesses, cars and homes.

It’s an indication the internet of things may well become a world of closed silos and it will be interesting to see how competitors react to Apple’s attempts to be the biggest walled garden.

ABC Nightlife – security, dropping off the grid and 4D printing

Apple Security, the Heartbleed bug and dropping off the grid are the topics of the May 2014 ABC Nightlife spot

Paul Wallbank joins Tony Delroy on ABC Nightlife across Australia from 10pm Australian Eastern time tonight to discuss how technology affects your business and life.

For the May 2014 spot we looked at computer security, specifically Apple ransomware and The Heartbleed bug along with dropping off the grid, 4D printing and the future of design.

To protect from the Oleg Pliss ransomware – or any similar problems – have a strong password, enable the screen passkey and enable two factor authentication.

Join us

We’d love to hear your views so join the conversation with your on-air questions, ideas or comments; phone in on the night on 1300 800 222 within Australia or +61 2 8333 1000 from outside Australia.

Tune in on your local ABC radio station from 10pm Eastern Summer time or listen online at www.abc.net.au/nightlife.

You can SMS Nightlife’s talkback on 19922702, or through twitter to @paulwallbank using the #abcnightlife hashtag or visit the Nightlife Facebook page.

Holy wars and internet empires

Steve Jobs declared Apple would wage Holy War on Google in 2011 in an effort to secure an online empire

A regular topic of this blog has been the rise of the internet empires that want to lock users into their kingdoms.

On the edges of these empires things can get ugly as the competing groups fight for supremacy and to capture users.

In these wars, no-one was capable of getting uglier that Steve Jobs.

Which makes Steve Jobs’ declaration that 2011 would be a year of Holy War with Google unsurprising.

The statement typical Jobsian hyperbole, but we should under estimate just how serious Apple’s staff would take such a statement.

Apple’s intention to wage ‘holy war’ illustrates just how high the stakes as the online empires try to capture users.

Those Holy Wars and the reason they are being fought is something all of us should keep in mind when we’re asked to choose between Apple, Google or Microsoft.

Apple’s long game

Apple are playing the long game with their internet of things strategy so they aren’t panicking into a smart watch

It’s always risky to make predictions about Apple, particularly when they are silly. The company plays a long game and isn’t known for panicked releases of me-too products.

Time is ticking for Apple to announce an iWatch, say analysts is a good example of a silly prediction about Apple’s future products and something that’s quite rightly criticised by Daring Fireball’s John Gruber.

As I’ve pointed out before, the watch market is tiny compared to the smartphone with the entire global wristwatch industry’s sales making up only one-seventh of Apple’s iPhone sales.

Part of the problem with stories like CNBC’s is the tech media’s focus on consumer goods, particularly in the internet of things and wearable technology markets.

Analysts like those quoted in CNBC’s story fall for this fallacy and overlook that the IoT market profits are going to come from the backend, B2B applications of the technologies.

With Apple we’re already seeing this with iBeacon being deployed in sports stadiums and shopping centres – Apple’s recent partnership with United Airlines to provide inflight entertainment is another step towards locking up business deals.

There’s no doubt those business deals will flow into the consumer market and an iWatch may well be part of Apple’s longer plan to lock customers into their products.

However claiming Apple have 60 days to launch an iWatch is plain silly, particularly when you have a company with a track record of not being panicked into launching me-too products and playing the long game.

Avoiding the smartphone commodity trap

Can HTC avoid the looming commodity trap for smartphone manufacturers?

HTC’s announcement that the company going to focus on lower margin, mid market smartphones illustrates the maturing of the phone marketplace.

Smartphones have been a huge, and immensely profitable, business for cellphone manufacturers however the devices are now becoming a commodity as the high end western markets become saturated and cheaper devices start to enter the marketplace.

Having been comprehensively defeated in the high end marketplace by Samsung and Apple, Taiwanese manufacturer HTC hopes to make money in the lower end of the market.

For HTC it’s questionable how profitable these cheaper markets will be; rebates to telcos and distributor markups tend to eat up most the margin while pushing up retail costs.

The biggest factor of all though is the entry of newer Chinese businesses into the market, it’s going to be a tough for the Taiwanese manufacturer to compete with these suppliers.

Even Apple and Samsung are being affected by the slowing demand for high end smartphones.

HTC’s dilemma would be familiar to most electronic manufacturers; the high end of the market is a narrow niche – the premium smartphone market, like PCs, is dominated by Apple – while the other suppliers fight not to find themselves locked into the commodity end of the market.

For HTC the trap is not to fall into the commodity trap; although it’s hard to see how they’ll do this in a smartphone market that’s increasingly becoming a low margin, high volume game where, like the PC market, there is no middle ground.

Lowered expectations – What is the future for Apple?

Where to next for Apple in an era of lowered expectations?

Last Friday I had a story in Business Spectator on the future of Apple in light of the company’s warning of a 20% fall in revenue next quarter.

The clear message from Apple’s executives was that the company is facing a terminal decline in iPod sales and the iPhone – it’s most profitable and highest selling product – is facing slower sales.

So the search is on to find something that will replicate the iPhone’s success, with the biggest candidate being the iWatch.

The problem with that is the entire wearable technology market is only forecast to be $6bn which is a seventh of Apple’s $42 billion profit last year, so the iWatch can never replace falling iPhone sales.

It may well be for Apple that the period of massive profits and growth is drawing to an end, it doesn’t mean the company is dying – for a start they has nearly $200bn in cash reserves and a healthy $150 billion in sales each year.

Short of Tim Cook unveiling something similar to the iPhone, the future for Apple is probably going to be a bit modest than past few years of huge growth, that’s not a bad thing.

Rather than being the end of Apple, it’s more a revision to the role the company has held for most of it’s existence – a high profit, niche business that sells on quality and brand rather than fighting in the commodity markets.

Milestones of the personal computer industry

Steve Jobs marked most of the milestones of the PC industry’s rise and fall

“There have only been two milestone products in our industry to date,” Steve Jobs told the Boston Computing Club in 1984. “The first was Apple II in 1977 and the second was the IBM PC in 1981.”

Jobs at the time was announcing the third breakthrough – the Apple Mac – which turned 30 last week.

Looking back over the four decades of the PC industry, Jobs’ claim that the Apple Mac was the sector’s third milestone stands up to scrutiny, however the greatest milestone of all for the PC was the launch of Window 3.0 in 1990.

The rise of Windows

Windows 3.0 changed the business model of the industry, it established software vendors – particularly Microsoft – as being dominant over hardware manufacturers, that shift nearly killed Apple and eventually sent most PC builders to the wall.

Microsoft’s advantage over Apple, IBM, Atari and dozens of other systems, was that users weren’t locked into one vendor’s products. It was possible

The Windows 3.0 milestone was even more important in that it forced a shakeout in the software industry as well, many of the incumbent vendors – most notably WordPerfect – though the Windows Graphic User Interface (GUI) was a flash in the pan and that most office workers would prefer to use keyboard instructions rather than mouse clicks.

WordPerfect was horribly, horribly wrong in judging the market and by the time they released the Windows versions of their product Microsoft had captured key market share for Word and the bundled Office suite that dominates the business world today.

Going mobile

So things were good for Microsoft until the next milestone, which again was marked by Steve Jobs, the launch of the iPhone genuinely did change the smartphone industry and was the first inkling of mobile would eventually destabilise the PC sector.

It’s interesting comparing Jobs’ iconic 2007 iPhone which sets the standard for product launches with the somewhat rough at the edges 1984 Boston presentation although both show how Steve Jobs was a master salesperson and a passionate believer in his products.

The PC’s final milestone

Three years later Steve Jobs delivered the milestone product that marked the beginning of the end for the PC industry, the iPad finally delivered a mobile computing device that businesses and consumers wanted.

Apple’s iPad also marked a fundamental shift in the computer industry – no longer did the software companies control the market, power had shifted back to the manufacturers.

From that moment on the PC, and Microsoft’s Windows business, started a terminal decline.

The rise and fall of the personal computer is a great illustration of a transition technology. That Steve Jobs bookmarked the beginning and the end of the PC industry is an interesting note about a technology that changed the home and workplace.

A triumph over orthodoxy – Seven years of the iPhone

The Apple iPhone reinvented the smartphone and mobile internet industries. Can it also define the internet of things?

“Once in a while a revolutionary product comes along that changes everything.”

Those were Steve Jobs’ words when he launched the iPhone seven years ago.

It was a strong opening that was reinforced by the event’s tag line, “Today Apple reinvents the phone.”

It wasn’t an idle boast, the iPhone was a leapfrog development – using Jobs’ words – over the existing clunky smartphones and it changed the entire industry and spawned some new ones.

Smart Company’s Yolanda Redrup asked me for a few comments on her story on the iPhone’s birthday and her questions triggered some thoughts on just how the iPhone changed the mobile phone and telco industries.

A triumph over orthodoxy

Apple’s iPhone triumph was born out of the established players’ orthodoxy; companies like Nokia, Blackberry and Palm were wedded to the idea that a tactile QWERTY keyboard was essential for a smartphone.

Those keyboards took away nearly half the real estate on the phone, Jobs called it “the lower forty”, and it made surfing the net a painful task, let alone watching videos or movies.

Full featured keyboards made making calls difficult as well. One of the barriers of adopting smartphones was that using the things as phones was quite difficult.

By having software keyboard and dialling pads that only appeared when needed, Apple solved the problems that faced smartphone users.

Disrupting the telcos

The other orthodoxy in the smartphone industry was that the telcos were essential gatekeepers. Nokia and the other incumbents put the needs of telecommunications companies over users of their phones.

As a consequence email and web browsing capabilities of the existing smartphones were crippled as the telcos tried to lock their customers into their own proprietary networks rather that giving them access to the public internet.

With the iPhone, Apple broke out of that telco dominance and started to dictate terms to the phone companies. This wouldn’t have been possible if the iPhone hadn’t been a far better, and much more popular, product.

Building the app store

Another area where the iPhone disrupted the phone companies’ business was with the App Store. Every smartphone had its own add-on programs but they were expensive with poor functionality and developers had to build versions for every company’s operating system.

Both the telcos and the phone vendors could see that app stores were a potentially lucrative area but systemically failed to execute on the idea with clunky and expensive software.

The App Store showed how smartphones should work and coupled with music, another area where the handset vendors dismally failed, Apple is now earning over a billion dollars a month from iTunes.

Technological change

Some of the iPhone’s success was due to technologies maturing; earlier smartphones were crippled by slow data connections over 2G or CDMA networks and cloud computing, or software-as-a-service as it was then called, was just beginning to mature as a technology.

Cloud services and 3G connectivity meant the iPhone could hand off most apps’ processing needs to the service provider, something that the earlier smartphones couldn’t do because the technology wasn’t there.

That connectivity did come at a cost, the iPhone and its competitors created huge challenges for telcos as they struggled to meet the data demands of their enthusiastic web surfing customers.

Looking at the future

While the iPhone came to dominate the smartphone market, that dominance didn’t last as Google Android devices started to flood the marketplace. Now Samsung is as big a player as Apple and a wave of cheap Chinese products are now flooding the industry.

For Apple and the other smartphone vendors the opportunities now lie in the internet of things (IoT) as connected cars, workplaces and homes require a device to control them. That device is often the smartphone.

In the next few years the market battleground is going to be creating the applications, platforms and ecosystems around these IoT technologies and its no coincidence that Apple has partnered with BMW on providing software for their smartcar.

Jobs finished his iPhone presentation with the Wayne Gretzky quote, “I skate to where the puck is going to be, not where it has been” and committed Apple to always being where the market is going to be.

Where the market is going to be in the next seven years is anyone’s guess, but it would be dangerous to count Apple out.

Steve Jobs’ golden path

Every tech product demonstration is theatre and Steve Jobs showed how it was done with the iPhone launch

“Today Apple reinvents the smartphone.” Steve Jobs announced at the 2007 Macworld Conference when he showed off the new Apple iPhone.

As with most of Jobs’ speeches, the iPhone launch was an impressive display combining the man’s talents, vision and technology to rally Apple’s adoring masses.

Last week the New York Times magazine had an excellent feature on the story behind the landmark launch of the iPhone. It’s worthwhile reading to understand the theatre that goes behind a major tech company’s launch event.

In the case of the iPhone, a myriad of tricks had to be performed to make sure the still being developed device didn’t fail in Steve Jobs’ hands during the launch – one can be sure the Apple founder wouldn’t have been as relaxed as Bill Gates when a Windows 98 system crashed onstage a decade earlier.

A key part of Jobs’ presentation was the ‘Golden Path’, a script that would showcase the iPhone’s features while avoiding known problems.

Hours of trial and error had helped the iPhone team develop what engineers called “the golden path,” a specific set of tasks, performed in a specific way and order, that made the phone look as if it worked.

Much to the relief of Jobs’ staff, the demonstration worked flawlessly and Jobs’ polished presentation showed why he was one of the most admired, if flawed, business leaders of his generation.

While most tech CEOs could never dream of emulating Steve Jobs, almost every one has a ‘golden path’ to show off their product in a new light.

Something we should remember when watching these demonstrations and the press coverage that follows is that most of them are carefully staged theatre and we should hang onto our wallets until well after these devices are on the shop shelves.

As it turned out, the iPhone was a spectacular success and did re-invent the smartphone industry. Along with being able to deliver a killer presentation, Steve Jobs was also good at driving teams to deliver his vision.

Steve Jobs image courtesy of Wikimedia.

Building a business culture

Culture matters in an organisation. While a positive culture doesn’t guarantee success, it does make it more likely a company will survive its founders.

“How can you create a great organisation of people and be that mean a person?” Asks funds manager Julian Robertson about Apple founder Steve Jobs.

Robertson, who based the decision to sell his Apple shares on the details in Walter Isaacson’s biography of Steve Jobs, was largely ridiculed for his decision but the veteran investor has a very good point.

A company’s culture develops from the top – if the senior management are paranoid, rogues or thieves then those attributes will eventually percolate through the company.

The Tyco Lesson

During the 1990s I had the unfortunate experience of working for Tyco International at the time it was led by Dennis Kozlowski, a man listed by Time Magazine as one of the ten most crooked CEOs of all time, senior management’s attitude of treating the company’s funds as their own piggy bank was copied throughout the organisation.

Tyco suffered badly during that period and subsequent management has had to work hard to undo the influence of Kozlowski and his cronies’ poor leadership.

One organisation I’ve watched closely over the last few years has been Australia’s NBNCo, the state owned company set up to build the nation’s National Broadband Network.

In under four years of operation the company has developed a dysfunctional management culture that saw the project miss its targets by over 70%.

For the NBN, a hands off attitude by senior management allowed bureaucratic silos to develop in a relatively small and young organisation. Those silos then started perpetuating bad habits as managers hired their friends and ignored good management processes. A lack of process and management accountability have been the main reasons the company has failed to meet its targets.

Apple’s challenge

In Apple’s case, Jobs created a culture of fear and secrecy with the company going as far as creating its own secret police designed to intimidate staff. The entire company was beholden to, and evolved around, one man’s vision, ego and quirks.

While Jobs was ahead of the game, all was good for Apple shareholders but the risk was always that Jobs would make a major mistake or leave the company. It turned out to be the latter when Jobs passed away.

As with any company built in the image of its founder, Apple now struggles to adapting to life without Steve Jobs and his successors have to reinvent the company’s culture around a more collegiate management structure than an often not-so-benign dictatorship.

Microsoft are facing a similar transition as Steve Ballmer leaves the company. Like Apple, Microsoft is an immensely profitable facing a changing market at the very time they are transitioning to a new generation of leaders.

Leaders such as Steve Cook at Apple and Ballmer’s successors at Microsoft have a massive task in changing their company’s culture as they try to undo a generation of management habits and this is why Robertson’s reasoning about selling his stake makes sense.

Culture matters in an organisation. While a positive culture doesn’t guarantee success, it does make it more likely a company will survive its founders.