It’s Not The Device, It’s The (Expanding) Ecosystem

It's not the device, it's the ecosystem - Apple iOS vs. Android

When you go into a Verizon or AT&T store, you aren’t buying a smartphone. You’re buying an entry ticket into a beautiful garden, an ecosystem full of wondrous delights. Apple and Google are working nonstop to make their gardens into bigger and better places, with the hope that you will stay with them as you buy more devices.

There are new devices coming that will make it even more likely that you will stay in the ecosystem you choose first. When you’re deciding what to buy, it continues to be true: it’s not the device, it’s the ecosystem.

Android has an 85% (and growing) share of the smartphone market. It is widely agreed that Apple is an equal player in that market, despite selling fewer units. Microsoft desperately wants you to think that it has an equally appealing ecosystem built around Office and productivity. Amazon has created its own little collection of phones and tablets built around shopping. For all intents and purposes, though, it is Android and iOS that will seem like the obvious choices when you buy a phone.

Shop carefully. The consequences of your choice might be far-reaching.

The important thing to understand is the lesson that the big companies know very well: once you buy a device in one of the ecosystems, it is far more likely that you will use services and buy more devices in the same ecosystem.

Apple and Google have different motivations and different approaches to keep you in their ecosystems.

Apple makes money by selling premium hardware for hefty profits. Its goal is to encourage you to upgrade regularly to the latest Apple devices and to buy other Apple devices. If you buy an iPad, it’s more likely that you’ll buy an iPhone, and vice-versa. To the extent that Apple provides services – cloud storage, apps – it is all in support of the goal of getting  you to buy more Apple devices. Its primary appeal is the elegance of the devices and the operating system and the perception that Apple is the best premium choice.

Google makes money by showing you advertising. Its goal is to encourage you to use Google services so it can show you ads while you use them. Although it can do that most easily if you buy Android phones and tablets, it is more interested in convincing you to use Gmail and Google Calendar, to store your docs with Google online, and to use Google Chrome and Google Maps, no matter what device you use. That’s why Google services are so readily available on Apple iOS. (Google is keeping its services away from Windows Phone as an anticompetitive measure, hoping to keep Microsoft from ever gaining any momentum in the mobile device market.)

In exchange for your personal data – and make no mistake, Google wants all of your personal data – Google is giving back services that do useful things with your data. Google Now alerts you when you might be late to an appointment by reading your calendar, checking your location with your phone, and looking up traffic. If an ad happens to appear on your alert screen, you’ll forgive it because of the usefulness of the alert.

What you may not be aware of is the next generation of devices that will grow the ecosystems even as they lock you more firmly inside them.

Apple and Google have made their plans very clear. I’m going to talk generally about three categories where both companies are already devoting significant effort.

The first one is a niche: wearable devices that exchange information with your phone and/or track health and fitness data. Android watches will be appearing on the market in the next few weeks in a variety ranging from big and clunky to elegant and clunky. They will display text messages and calendar alerts, and many of them will track health indicators – the number of steps you walk, your heartbeat, your sleep patterns. The information from your wrist will be sent back to the phone for feedback about your exercise goals or various fitness measures. There have been rumors for years that Apple intends to enter that market as well with an “iWatch.”

The key to this upcoming smartwatch market will be that your watch will have to match your phone. An Android smartwatch will talk to an Android phone. An Apple iWatch will talk to an iPhone. Your choice of smartwatch will be driven by your choice of phone.

The second category, “The Internet Of Things,” is the subject of frantic maneuvering by Apple, Google and Microsoft right now. Apple has announced a new “smart home” platform, and Google is acquiring companies and lobbying manufacturers to adopt its standards. The idea is that communication is going to be built into more devices, starting with our homes; each of these companies wants that communication to be under its control and preferably using its devices.

Random examples. Your phone is tracking your location. As you drive home, your phone alerts your home thermostat to adjust the temperature at the house. As you walk up to the front door, it unlocks for you. The lights come on. You receive alerts on your phone when things around the house need to be repaired or replaced.

That’s just the beginning. Low-cost, low-power controllers are being developed that can communicate over the Internet and the possible applications are science-fictional in scope. Wikipedia identifies seven potential categories: environmental monitoring, infrastructure management, industrial applications, energy management, medical and healthcare systems, building and home automation, and transport systems. If you thought technology was already changing fast, get ready for the pace to accelerate to rocket speed.

Apple, Google and Microsoft would all like to control as much of that traffic as possible. One of the obvious ways to do that will be to have devices come to market that work with only one of the ecosystems. Google bought Nest so it could market thermostats and smoke detectors that communicate with Android and iOS devices through Google servers. Microsoft is working on a simplified version of Windows to embed in small business devices. (Remember that 98% of Windows is a rock solid core operating system. Your experience with Windows is mostly affected by the 2% in the user interface but underneath it is a very stable, efficient and secure system.)

If you’re at Home Depot looking at three different thermostats tied to the Google, Apple or Microsoft ecosystems, you’ll likely buy the one that matches your phone. See how it works?

The third category is closer than you would guess. All three companies are negotiating with car manufacturers. The next car that you buy is likely to have a close relationship with one – and only one – of the ecosystems.

If you get a car with Android Auto, it will communicate with your phone and display Google Maps on its screen. It may already have your destination programmed, pulled from your calendar. You’ll be able to issue voice commands to call anyone in your address book, which will be loaded in the car’s memory. Google already has deals in place with more than a dozen manufacturers.

Apple is trying to strike its own deals. There are already cars with iPod docks and connectors. Apple is pushing CarPlay as the system to make iPhones interact with the car for the same kind of services.

It’s typical that Microsoft was way ahead of everyone else and made the mistakes that the others will now build on. Beginning years ago, Microsoft created an automotive system and made deals with manufacturers to include it in their cars – Ford, Kia, Nissan, Fiat and others. I’ve tried it. It’s just terrible. Ford has now backed away from it.

A car is only going to have one communication system for phones. Car manufacturers design cars slowly over a period of years. They’re deciding now on the system to put in cars that will be manufactured over the next few years, and they can read an 85% market share for Android. Mainstream car manufacturers will pick Android as the safe bet for new cars. Apple may be able to convince premium auto makers that their buyers will have premium phones. It’s unclear whether Microsoft will have any place at this table.

In other words, you may – quite literally – be influenced in your choice of your next car by which phone you have in your pocket.

Shop carefully, choose your ecosystem with care, and buckle your seatbelts. Big companies are battling and as usual these days, we may benefit – but we may be crushed as the behemoths duke it out.