Motorola: Apple won’t open the iPhone

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Speaking at the CTIA Wireless I.T. and Entertainment show in San Francisco, David Ulmer, senior director of entertainment products at Motorola, says he’s convinced Apple won’t open up the iPhone anytime soon:

“I guarantee you that you will not see a Napster music service on the iPhone…The iPhone may offer some sort of open web. But music sales? Device sales? Accessory sales? Anything you pay is probably going to come from Apple.”

Utterances of a direct competitor?

A recent ChangeWave survey reviewed at SeekingAlpha shows Motorola losing marketshare, as the manufacturer hurt most by the introduction of the iPhone.

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Once heralded for its market-changing Razr phones, Motorola has been steadily losing market share and has been close to getting knocked off its No.2 position to Samsung. So we can forgive Ulmer for trying to shift attention from his own beleaguered company’s troubles to Apple’s unwillingness to share the wealth.

But what exactly is he complaining about? If we are to assume that the upcoming SDK next February won’t open up the iPhone completely, does that mean that Apple’s customers will be hurt? The iPhone is completely closed right now and its customers are far away the most satisfied in the industry, nearly three times more satisfied than Motorola’s. It’s hard to imagine when the iPhone gets third-party apps next year, customers will be less satisfied.

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This mantra of ‘openness’ is everywhere nowadays. Facebook gets $15 billion valuation after it ‘opens up’ its platform to outside developers. Never mind the fact that Facebook is a one-way data roach motel where users’ metadata remains behind the company’s walled garden.

Those without short memories may remember that a decade ago Macintosh was wide open but a few came to the party. Indeed companies like Adobe, Macromedia, Microsoft and a host of smaller ones either eliminated their Mac offerings, failed to upgrade them or never introduced Mac versions of new products. This was one of the critical reasons that brought Apple to the brink of extinction.

Steve Jobs is determined not to repeat that mistake ever again. Over the last decade, wherever Apple felt a significant Mac market was under-served by third parties, it has introduced its own applications, quickly besting competitors and creating market-leading, signature products: iPhoto, iTunes, GarageBand, Aperture, FinalCut, Motion, Safari, and so on.

We already know that Apple is capable of selling 110 million iPods and breaking historical records in consumer electronics without opening up the device. And it isn’t as if its customers are leaving in droves.

So, indeed, ‘opening up’ a device or a platform is no guarantee of success, otherwise phone manufactures on whose cheap products customers can load a bewildering number of applications wouldn’t be so paranoid of the iPhone. Being ‘closed’ is not a precursor of failure either, as the phenomenal success of iPod shows.

At the end of the day, the success of a product is contingent not upon its ‘openness’ but the degree to which it provides utility and delight to its customers. On that score, as the chart above shows, nobody comes close to Apple’s record.

39 thoughts on “Motorola: Apple won’t open the iPhone

  1. Pingback: “openness” not a gauge of “goodness” | Island in the Net

  2. > Excuse me but when did the browser end on the Mac
    > become under-served?

    The first version of Safari competed with only one other browser: Microsoft Internet Explorer 5 Mac, which was already end-of-life. Microsoft quite famously converted IE from a cross-platform Mac, Unix, Windows browser to a Windows component. The Mac OS X version was very, very slow, never really making it all the way across the divide from Mac OS 9. But if you wanted to use Mac OS X it was your only choice in Web browser.

    With the default browser from the Mac end-of-life, Apple had to install another browser as the default and they chose to make their own. So instead of IE 6 we got Safari 1. There was no other browser to choose from.

    > Not to mention the fact that Camino

    … comes way after Safari in the timeline. Camino went 1.0 in 2006. Safari filled the gap left by IE in 2003 well before Camino shipped. Your timelines are way off.

    > Firefox

    Firefox is also post-Safari. Safari filled the gap left by IE in 2003 well before Firefox shipped. Again, your timelines are way, way off. Firefox 1.0 shipped almost 2 years after Safari 1.0.

    Safari 1.0: January, 2003
    Firefox 1.0: November, 2004

    > and Opera

    Opera is not now and has never been a major browser. It’s strength is mobiles, yet today most mobile Web browser usage is Safari.

    > browsers are much better on the Mac than Safari.

    That’s your personal opinion. However, Apple had to introduce Safari in January 2003 to fill a gaping software need before you could judge Safari against other browsers that came after it and then go on to mistakenly call bullshit on somebody for pointing out there was a lack of browsers on Mac OS X in 2003.

    > Good story otherwise, just this flagrant bull shit
    > at the end makes you toss the whole story as an
    > Apple paid ad.

    Before you say something like flagrant bull shit you should at least check Wikipedia to see if you are out of your fucking mind at the moment.

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  4. Pingback: Yearning for iPhone | iPhone Footprint

  5. John Halbig: “My suspicion was that AT&T was terrified of what a true computing platform writ small”

    If somehow Apple guarantees that AT&T won’t lose revenue (or that amount is otherwise offset through gains elsewhere) do you think AT&T would care at all if the iPhone is open or not?

    I think AT&T might care that Jobs is apparently interested enough to meet with the founder of FON though:

    Video: What’s Steve Jobs like in a meeting?
    http://counternotions.com/2007/10/26/sj-meeting-video/

  6. Bluntly, the “security and stability” argument that Apple used as an excuse to keep the iPhone closed was bull. Period. My suspicion was that AT&T was terrified of what a true computing platform writ small (in the form of mobile OS X on the iPhone) would do to their traditional income streams (think SMS) — it’s no mistake that Steve announced the opening of the platform AFTER it was clear how the iPhone would boost AT&T’s bottom line, *without* having to resort to charging for every text message and byte of data transmitted from the device.

    Now with their subscriber numbers soaring as a direct result of the phone, opening up the platform not only makes the iPhone more desirable, it adds to the viability of the iPod Touch, not to mention any other Ultra-portable computing solutions being concocted by the mad scientists in Cupertino — iTablet, anyone?

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  8. Sandrino,

    Of course, Motorola should concentrate on making non-crappy phones and leave Apple alone. But that’s only the first step.

    The next step for handset makers is to stand up to the service providers to prevent them from selling the phones with most of its features hamstrung. As much as we admire the iPhone, I admire Apple more for breaking the paradigm in its relationship with AT&T.

  9. Translation: Waaa, waa, Apple is beating us at our own game, no fair. Mommeeeeeee!!

    Before my iPhone I had a RAZR, a truly crappy phone better put to use scraping gum off the sidewalk. Instead of whining about Apple and the iPhone, Motorola should try designing a phone that isn’t a piece of crap. If they make a better phone, people will buy it. What is sad is that Apple with it’s very first telephone is beating Motorola soundly. For a company that has been making cell phones for almost as long as cell phones have been around, this is deeply embarrassing. Earth to Motorola, if you can’t stand the heat, take your ball and go crying back to mommy. Motorola should either shut up and compete, or leave the cell phone market to the big kids.

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  11. JC: “Every single free phone has access to better games than the I-Phone”

    The primary issue with games on the iPhone is the UI. Many games won’t easily adapt to a multi-touch interface. Of course, new games may be created to take advantage of multi-touch and motion/proximity/angle detectors. Other games may be modified. But it won’t be an overnight transition.

  12. I’ll tell you what the IPhone needs – and will get – when it opens, is games. Every single free phone has access to better games than the I-Phone, but this won’t happen long with being open. But it will happen FAST once it is.

    The other thing I badly WANT on the I-Phone, is Pandora, but I doubt I’ll get it. But it would be SWEEET, if that happened!

  13. yet another steve: And hardware is where Apple makes its money.

    If in fact Apple is making $400+ per contract in service fees, it seems the company has pulled another rabbit out of its razor/blades hat. Unlike any other manufacturer, it’d be making (more) money from services (and perhaps apps in the future) than the hardware itself — the reverse of the iTunes/iPod paradigm. Neat, uh?

  14. I’m an Apple fanatic, but even to me these don’t sound like a complaint against Apple. Isn’t he merely stating a fact? I don’t read any judgement in his words. Merely, what is true.

    Why is this a story?

  15. “I guarantee you that you will not see a Napster music service on the iPhone…The iPhone may offer some sort of open web. But music sales? Device sales? Accessory sales? Anything you pay is probably going to come from Apple.”

    Hmmm…..

    1) I can d/l any MP3 from Amazon or any other service and load it into my iPhone via iTunes.

    2) I’ve got 3rd party Bluetooth headsets, wired headsets, belt pouches, etc.

    Am I missing something or has this guy never really used an iPhone?

    Oh wait, he wouldn’t have. He’s hawking Moto. It’s his job, right?

    As far as opening a new pricing tier for Moto, didn’t Zander choose to focus on the low-to-no margin feature phones because Moto couldn’t compete at the high end with Nokia, et al.?

    Oh, wait, have to don my reality distortion history ignoring glasses….

    Ah, that’s better.

    Yes, I can clearly see his points now……

  16. True. But I expect Apple to open up the iPhone anyway.

    Why would Apple care if Napster ran on it? You’ve still got to buy the hardware from Apple. And hardware is where Apple makes its money.

    I think the real story is that a platform with an SDK and sercurity is a lot more work than a device running on internal software.

    I also expect the iPhone/iPod Touch “platform” to be released in other form factors. With 3rd party support, the multi-touch version of OSX could become the “Windows” of consumer handheld devices. As much money as Apple has made on the iPod, it can now leverage it into an entire class of programmable devices. It is going to be spectacular to watch.

  17. @Loves the iPhone

    Believe it or not, the Mac Browser market was under-served just a few years ago. There was IE or per-release versions of Mozilla/Firebird/Firefox. When Apple introduced Safari, Microsoft had just pulled IE from the platform.

    Safari arrived June 23rd (version 1) and Firefox (version 1) didn’t arrive until November 9th 2004, over a year later.

    When the Safari beta was first released on the Mac in January 2003, it was far and away the best browser for the Mac.

    OmniWeb was the only real alternative and that was paid-for and lacked some standards support (it wasn’t until they switched to WebKit for the page rendering).

    The Mac may have lots of choices for Browsers now, it didn’t then. From 2001-2003 most Mac users went with IE 5**. What does that tell you?

    IE 5 was good for it’s time and had better standards support than the equivalent Windows version, but it suffered from not being updated.

    There is no need for such an aggressive attitude and lanaguage. It looks even more silly when you look at the details you have omitted.

    In your opinion other browsers may be better than Safari, but that was not always the case at all.

  18. “They’re in recovery mode, and understandably so; a handset that sells at full price (even with a plan, whereas most phones are sold at a reduced price with select plans”

    It is estimated that Apple might make as much as $18 PER MONTH on each ATT iPhone contract. I have no info (maybe someone does?), but I betcha MSFT doesn’t fare nearly so well with Windowsn Mobile?

  19. @Joe

    Apple hasn’t opened up the iPhone yet simply because of security and reliability issues (I believe I read about a glitch the 3rd-party apps created that caused the iPhone to believe it didn’t have a valid SIM); Microsoft has very little to do with it. Microsoft can do all the stealing of ideas they want to, but in the end it will have the same effect as the Zune; people will flock to the product that’s already been established by Apple because they feel the original will be more reliable (I’ve yet to have anyone ask me if my MP3 player was a Zune, but I’ve had probably 20 people ask if my ancient Creative was an iPod).
    Apple was taking its time (like it did with Leopard) in releasing the SDK, and I have no doubt it was in the works before Jobs even announced it. Jobs has stated the touchscreen as being a “new interface”, and surely has every reason to push for the ability to develop for the iPhone to help get momentum for an interface that’s much more intuitive; in a year I can see it being a very viable alternative to the UMPCs available now for people who want a nice internet device with the basic functions of a small computer (Apple’s developer base is one of the most creative I’ve seen, and it would surprise me if some awesome stuff didn’t come out of their labors).
    Motorola is simply doing what every other handset maker is doing; reeling at the massive dent the iPhone has made in their business since it’s arrival. They’re in recovery mode, and understandably so; a handset that sells at full price (even with a plan, whereas most phones are sold at a reduced price with select plans) is kicking serious ass in the phone business. :)

  20. Loves the iPhone:“Excuse me but when did the browser end on the Mac become under-served?”

    When Microsoft left Explorer/Mac fallow for years and eventually pulled it.

  21. “Over the last decade, wherever Apple felt a significant Mac market was under-served by third parties, it has introduced its own applications, quickly besting competitors and creating market-leading, signature products: iPhoto, iTunes, GarageBand, Aperture, FinalCut, Motion, Safari, and so on.”

    Excuse me but when did the browser end on the Mac become under-served?
    Not to mention the fact that Camino, Firefox and Opera (and probably many more) browsers are much better on the Mac than Safari.

    Good story otherwise, just this flagrant bull shit at the end makes you toss the whole story as an Apple paid ad.

  22. Yes – give me an open phone with no WiFi nstead. What I really want is a system where I can buy tracks and get them onto my phone, and be unable to get them back out again.

    I wager that in 12 months time, Apple’s third-party app business is going to be larger than anyone else’s, simply because they have an easy way for people to buy, install and manage third party apps. Even if it is ‘closed’.

  23. Pingback: Tech News » Blog Archive » Motorola Exec Claims Apple Won’t Open the iPhone

  24. If i was Apple i wouldn’t open it either, why make it easier for Bill Gates since M$ has already stolen all their other ideas.

  25. “Tom, as you know, this is the Microsoft approach. You create an ‘open’ platform, you get ‘partners’ and then laugh all the way to the bank”

    Exactly. The term “open” shifts whether you are talking to a LINUX guy; or an Apple guy (regarding the Darwin Kernel or the H.264 video standard); or Microsoft (we’re “open” because we let more than one company sell hardware– as long as you’re not talking about the Zune or the Xbox!).

    I don’t care about “open” or “closed”. I just want “superb”. Life is short; I don’t tolerate bad coffee, either.

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  27. Tom, as you know, this is the Microsoft approach. You create an ‘open’ platform, you get ‘partners’ and then laugh all the way to the bank. Remember, Microsoft accused Apple for being ‘closed’ when iTunes/iPod gained marketplace prominence. But then they turned around shut down PlaysForSure, screwed their partners and started to compete with them directly with the mighty Zune.

    If you are Motorola with absolutely zero software advantage vs. Apple, what else can you say?

  28. the thing I’m wondering is, if the iPhone SDK really is nice and open, what’ll happen when some developer wants to port an Amazon MP3 purchasing app to the iPhone, or maybe a Zune Marketplace portal for the iPhone? My guess is, the SDK and/or the approval process at Apple will be just hunkey-dorey. It’s actually more likely that Amazon and Microsoft most likely won’t publish an open API for the developers to even get started.

    But as far as making online purchases from software and hardware vendors, hell, I can do that right now from my iPhone. Can’t download directly to my phone, but that’s got nothing to do with allowing purchases from competitors (unless you’re talking about the ringtone industry, but I personally will never lend any legitimacy to such a preposterous industry).

  29. “Yes, I’m so worried about not having Napster on my iPhone!”

    I was also amazed by that comment. Do these guys actually talk to anybody besides their chauffer’s?

  30. Pingback: Motorola Exec Claims Apple Won’t Open the iPhone

  31. Good points. Yes, I’m so worried about not having Napster on my iPhone! I wonder if I’ll be able to get a Zune software player to replace the iPod, or perhaps install Internet Explorer, or the Java applet version of Google Maps to replace the slick Maps client it comes with.

    Being “open” along with the Google gPhone myth are the last desperate stand for iPhone critics.

  32. Pingback: Cult of Mac » Blog Archive » Motorola Exec Claims Apple Won’t Open the iPhone

  33. OMG. How can Motorola have to gall to anything to say something negative about any other handset manufacturer? That company is the crappiest company to ever come down the pike. Underpowered G4s, ROKRs, giving Freescale away, low-orbit satellites, being taken to the cleaners by a family of Euro-crooks. They just pissed investors money down the toilet and lied to them at the same time that everything was peachy-dandy.

    Closed or not, the iPhone beat the gd pants off all Motorola handsets. I really wish Motorola would STFU and get their own house in order. Kick Zander into a retirement home and break up the company or sell itself to Nokia or something. When I think about Motorola’s head start in the handset industry and what it is today I feel like puking. Michael Dell should have made his infamous statement to Motorola instead of Apple.

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