The mobile platform war is a two-horse race right now. According to Gartner, Android and iOS accounted for 75 per cent of the global smartphone share at the end of last year.However, this de facto duopoly has started to raise concerns. There is a debate within the industry about whether a third platform will emerge to challenge the incumbents. According to our analysis, there is room for a third player, as we explained in our note on how the mobile platform network effect works.
We recently chatted with Peter Farago, VP of Marketing at Flurry, to discuss the mobile platform wars and the possibility of a third viable platform. Flurry is a mobile analytics company and so has a pretty good vantage point on trends and developments among consumers and developers.
Farago told us, “Flurry and the ecosystem want a healthy third player, it’s good for everyone.” This echoes the sentiments of Verizon CFO Fran Shammo, who said on Verizon’s last earnings call, “I do think, though, it is important that there is a third ecosystem that is brought into the mix here, and we are fully supportive of that with Microsoft.”
Microsoft is the natural choice for a third platform, the only candidate with enough clout behind it to make a meaningful dent. However, Farago was ambivalent about its chances for success. He told us that it still has a small user base and total developer support; it is “not invisible, but not meaningful.”There are some bright spots though. Farago said that Microsoft has “been very aggressive in [developer] outreach.” He said the platform has been well-received by developers and is “more responsive than Android.” He also noted that the company “has a legacy of building great operating systems and developer communities,” so you don’t want to count them out just yet
Nonetheless, while Farago is hopeful they’ll get the user base, that haven’t been pushing their case very hard. He told us, “I’ve been waiting to see more out of them; I haven’t seen enough evidence.” It took 14 months for the Microkia partnership to bring a phone to market, they need more aggressive consumer outreach to get the necessary installed base to get the ball rolling.
However, Farago said that Amazon may be even better positioned. Microsoft and Nokia each have their own set of goals for their partnership: Nokia wants to sell phones, but Microsoft wants to sell phones using its platform and also attract developers and advertising dollars. Their goals overlap, but it can also muddle the end product. Amazon, on the other hand, views their Kindle Fire tablet exclusively as a “shopping and media client.”Between developers and consumers, mobile often becomes a “‘chicken or egg problem,” and you can easily end up in a position where you get neither. Amazon breaks the paradigm, creating a product that furthers their end goals of commerce and content delivery, shooting for a low price, and letting the rest follow. Farago told us, “They make the device good, but not great, then get the installed base, which attracts the developers because they have an attractive audience.”
Of course, Amazon does not have a smartphone yet, but there has been speculation around such a move for some time now. Jumping directly into the smartphone would seem to be the logical next step, unless it decides dealing with the carriers is too much of a hassle.
Finally, Farago said that Samsung may be the dark horse in the platform wars. Samsung is reportedly upset with Google and, like Amazon, could choose to fork Android and create their own platform. Given its strength in hardware sales, Samsung already has the chicken, but will the egg follow?
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