Technology Journalist and Copywriter

Kate O'Flaherty


Welcome to my blog, featuring industry musings and opinions on the latest products

By kateoflaherty, Apr 24 2013 11:05AM

When Apple revealed its first profit decline in a decade, the firm's share price had already plummeted. Investors are nervous, and it's no surprise.

Apple's closed strategy and lack of recent design innovation were sure to hit the firm eventually. With growing competition from Google and its open Android OS, Apple's bumper profits were always going to be difficult to maintain.

Apple's results beat analysts' expectations, at $9.5bn profit in the second quarter and $43.6bn in revenue. This compared to revenue of $39.2bn and net profit of $11.6bn in the same quarter a year ago.

But share price has halved since last September, when shares hit a high of $700, making Apple the most valuable company in the world. This compares to the period before yesterday's results, when shares plummeted to around $400.

Apple knows it needs to adjust. Yesterday, CEO Tim Cook announced the firm is adding $50bn to its share buyback programme and $8bn to its cash pile, bringing it to $145bn. He promised that despite shareholders' worries, "the most important aspect for Apple will be creating innovative products".

Rumours that Cook is to be replaced will be fuel to those who say the death of Apple's former CEO Steve Jobs was the catalyst for the firm's decline. Perhaps so, as Apple is guilty of a lack of innovation in recent times.

The iPhone 5 failed to replicate the popularity of its predecessors, with only minimal design changes and limited new features. At the same time, competitors such as Samsung have captured the interest of the consumer with alternatives such as the Android-powered Galaxy range.

It will also be interesting to see how things work out for Apple in the retail and operator space. The technology giant has always controlled these relationships - and the networks and retailers had no choice but to cooperate.

The mobile market is a rapidly evolving landscape, and demand for Apple products still remains alongside the late Steve Jobs' legacy. But Apple's walled strategy - led by Jobs - has played a part in its latest decline. Whether the firm now rises or falls will depend on its ability to adapt this strategy in the face of competition from rivals such as Google's Android.

By kateoflaherty, Nov 6 2012 10:45AM

Microsoft's newly-launched Windows Phone 8 might have a chance of gaining more share, but it is acres away from competing with Android just yet.

IDC figures show that in the third quarter of 2012, 3.6 million handsets were shipped running Microsoft's Windows Phone operating system (OS). This is a 140% increase on the same period last year but still way behind Android, which shipped a massive 136 million handsets during the same period.

Even so, IDC predicts Windows Phone could jump to third place in 2013, partly due to Blackberry OS' decline. The prediction only puts the Microsoft OS at 6.6%, compared with Android's current global share of 75%, but it seems Microsoft CEO Steve Ballmer has much bigger ideas.

According to IT Pro, Ballmer said at an event that he expects his newly-launched OS to become a big challenger in the market. This is partly due to the huge amounts of advertising that have been thrown at it and integration with the software giant's Windows 8 operating system.

The launch of Windows 8 last month saw Apple-like queues and to Microsoft's credit, it seems to be selling well. However, if Ballmer expects Windows Phone 8 to be just as successful, he is going to be disappointed.

Last week, Microsoft partner Nokia launched its Windows Phone 8 Lumia smartphones, after reporting an underlying loss for its third quarter in October. To date, phones running Windows Phone have been poor, with no 'killer' device to really raise the OS' profile. Its partnership with Nokia was largely a mistake for most parties, and HTC's Android smartphones hold far more appeal than their Windows Phone counterparts.

The figures speak for themselves. If Windows Phone is to mimic the success of Android it needs to be original, it needs to engage and encourage developers, it needs to be open.

Ballmer can throw marketing spend at the OS but what he really needs to do is inspire people. As Windows is often thought to be the standard for PCs, Android is closer to becoming that for smartphones. If Microsoft doesn't overhaul its attitude soon, its $1bn advertising spend could be a wasted investment.

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