Great White North Prognostications

In summary Google will win and Blackberry will lose. A quick summary of the three products from a simplified technical point of view.

iPhone is cool and plays music. It surfs the web very well unlike almost any other web capable phone. It will show you the web in miniature as well as your desktop will show you. Except for pages using flash technology. The biggest inherent obstacle for business users is the lack of a keyboard. This means the iPhone user is mostly limited to consuming information. Cool is a major feature here. Everything about this phone is quite cool. It has quite a few applications being developed but Apple seems to want to battle with developers. Microsoft lost a whole generation of developers by doing this “our way or the highway” thing.

The blackberry line is as everyone knows is very good at email. But that is about it. Its web capability is squirlly and nobody that I have ever met uses any of the other applications. Technically it is possible for developers to make things for the blackberry but I don’t see much of this. In my opinion all RIM products are ugly and aimed at 50 year olds who think they are cool but truely truely aren’t. RIM does not seem to have much of an idea that phones are jewelry for some people.

The android is pretty ugly but cooler than anything RIM makes. It has the RIM keyboard and the iPhone web capability. But Google is doing a good job of wooing developers to make apps for the android. This will probably allow the android to be all things to all people. Quite simply it will have all the best features in both the iPhone and the various RIM products. Some coolness, a keyboard for email and stuff, and great web browsing.

The various reviews of the new Android phone compare it mostly to the iPhone and a few compare it to the Blackberry. Most of these reviews either call it a tie or they give the Android a close second place. A very few call it a winner. None of this is relevant until you consider that this is google’s first phone. What will their second phone be like?

The people who I see running around with blackberries are government people, finance people, and real-estate people. The last two groups are taking a huge hit both in jobs and budgets. Thus I foresee a general drop in all smart phone use but mostly blackberries. This will hurt the android somewhat in that it won’t be the raving success that might have come its way with a boom economy but overall this might benefit Google. From a technical point of view it looks like the Android might be cheaper to run than blackberries and iPhones and due to what google is providing to geeks it will soon have applications that will cover any software feature found on the other phones. So if you like some software feature on your favorite phone it will be matched and bettered by the android.

So I see a market that will be looking to cut back hurting blackberry and iPhone but not Android as they have doubtfully built up much dependancy on their tiny market share where as RIM basically has a single product and will be seriously hurt by any drop in revenues. iPhone will be less affected by this but it will give their many competitors such as samsung to catch up with cheaper units. This will hurt things like RIM’s R&D and general moral.

Then I see some companies adopting some Androids to cut cost. This won’t amount to much but it will get people exploring non RIM options. Then when the market rebounds people will not all return to the RIM family. Many will go to Android for both capabilities and cost.

So the timing of this bust will only put nails in RIMs coffin and open a door to Google. I don’t see this as being a huge revenue generator for Google but I do see this as being a massive revenue eraser for RIM.

So in summary Google will do OK; RIM will die a slow death; and Apple will just continue along.

PS My prediction is the RIM will fade in spurts. Basically look at the history of companies like Novell and Sun. They just sort of faded from relevance. Once in a while they would make headlines with a sizable layoff but due to a lack of any crushing debt they just sort of faded from the scene. One customer base that probably won’t switch and will keep RIM plodding along will be governments. Due to the lack of real impact by the economy they won’t cut way back and since they generally are very old school people who are very uncool they will keep on and on with their blackberries. That should fit in well with their various Novell and Sun systems.

I think this comes down to what people use their device for. For typing text primarily for emails the various blackberry RIM devices win hands down.  Most people that I know who have a RIM device only use it for the two features of email and as a very oddly shaped phone; nothing else. I have only met one person who used the web feature which I suspect is the only other feature that a few people use on their blackberrys.

But the iPhone seems to be missing the keyboard which is simply the best way to enter text so that somewhat excludes the email responding crowd. But the key feature of the iPhone other than a repository of cool is its web browser. The screen is as big as is possible on a reasonably sized pocket device. Plus the browser basically works. I create websites that are quite demanding of the web browser and they basically work on the iPhone. No other portable web device that I have experienced can display the web usably. Most phone browsers mutilate most websites and most websites are not designed to work on phones. Technologies like WAP and such are mostly complete failures. But the iPhone truly brings the power of the internet to your hands in a portable way. But this power is limited to the informational part. The social and communications part is lacking. The RIM gets some of the communications part but not the informational and misses some of the social.

So where will this lead these two companies sales? I think that any head to head comparisons are meaningless for the most part at this time. If you are one of those people who is now effectively on call 24/7 because they are so reachable via their blackberry then the iPhone while probably good for your sanity just doesn’t have the email features that you need.  So at this time RIM need not worry about losing those legions of lawyers and MBAs with their crackberry monkeys. But where iPhone will do well is by getting those people who want more out of their phones and want the wonderful data features and the various gizmo features such as GPS, camera, watching movies, and so on. These are the people who bought the razr and thought that they were getting something newer and better. iPhone will cream off some of the top executives from RIM in that they will want something cooler than their worker drones. So with all this in mind it looks like RIM will continue to grow will little loss to iPhone but iPhone will be growing its market from people who either are looking for something new and better or just want to be the coolest kid on the block.

One twist is that the iPhone is both releasing a 3G version and expanding into Europe and Canada. This will make things like market share, units shipped and so on very hard to compare year to year.

Since there is no shortage of lawyers and MBAs being churned out by universities everywhere then RIM need not worry too much about market share. iPhone does need to worry about regular customers willingness to pay for rather expensive data plans.

With all this in mind RIM is safe and AAPL might be in for a wallstreet let down with the next iPhone.