Friday, April 27, 2012

iPad-MacBook Convergence

I've had this feeling for the past several months that Apple was converging on a hybrid device.  A hybrid device would be a combination of an iPad and a laptop, sort of like a MacBook Air, but with a detachable screen, you'd think this would make sense, but after Tuesday's comment by Tim Cook regarding the tradeoffs and how that convergence may not be good to the user, I think we're all having second thoughts.

Pro Convergence

I initially thought that Apple was moving towards convergence when they started making the controls in OSX behave more like those on the iPad, even the scroll control matched the iPad (despite it being opposite of what it should be on screen).  From what I understand about Mountain Lion, it even brings iOS and OSX closer together.  You combine these changes with the very popular MacBook Air and you'd think that the leap from MacBook Air to iPad hybrid wouldn't be big one to take.

While most will admit that the iPad is a very useful device to have around, it's great for scanning emails, websites, apps, etc… It's not that great at taking notes and such, to really take notes well you need to have a keyboard (at least until we have neural transmitters implanted in our brains).  Some people can take notes quickly using the iPad's built in keyboard, but most can't, as a touch typist I have a very difficult time typing on the iPad.  Then once you add a keyboard you'll want to add a mouse (which the iPad doesn't support), if the iPad did nothing else for convergence other than add mouse support, this would solve many issues, I could use a BlueTooth Keyboard/Mouse and then use my iPad as a monitor.  I recently had a friend ask me if he should get an iPad or Laptop for his daughter as she goes to college, I suggested a Laptop and went further to say that the iPad while great, would make a frustrating experience for writing papers and such, yeah there are tools like Pages for the iPad, but let's be honest, Pages isn't Microsoft Word, if you need to email a document to your teacher and you send a Pages file, you'll most likely get an F for the paper.  For a laptop I suggested the MacBook Air, mainly because it's small, light and especially for a woman, it could fit very nicely into a larger purse.

Against Convergence

There are several problems with convergence, until processors/drives get faster, smaller, cheaper, efficient etc… it's going to be difficult to build a device as compact as the iPad, even though the system could be docked with a keyboard, most of the power would still need to be in the tablet itself.  The keyboard could offer more disk space, but in reality you'd want the tablet to be a self contained unit.  Until you can make a device small and light enough and still powerful, making a tablet that is converged with a laptop is going to be tough.  Note that I realize it can be done and has been done with Microsoft and Android devices, I haven't played with the Android device, but a Microsoft device I played with was thick and heavy when compared to the iPad, though it was very cool to play with a full copy of Windows on a tablet.  So the unstated rules of the game are "It needs to be at most as big and heavy as the iPad 2/3".  I think in the next 2-3 years this will be doable.

A smaller possible problem with convergence on Apple's part is that it would put the iPad in direct competition with Microsoft laptops.  Currently Apple dominates the tablet space, but can they really compete with Windows?  I don't think this is an issue about "Which OS is best", this is more of an issue over will users be willing to migrate to a new OS.  I've been running on OSX about 98% of the time for the last 2-3 years, while OSX has it's plusses, it's really just another OS, I think what makes OSX so nice is that Apple combines it with first class hardware.  Anyway for Apple to go head-to-head against Microsoft would be a huge gamble for them.

There's a bigger reason against convergence though, this is a business reason by Apple (though it will be spun as a user concern).  When you use a laptop you get software on it by downloading it from the web or installing it from a physical device (CD-ROM usually).  When you use an iPad you get software on it by downloading it from the AppStore (unless you jailbreak the device, but I'm considering that against the rules for now).  So if Apple builds a hybrid device, they will either need to force the device to use the AppStore, which means that some of your favorite non-app tools would need to move to the AppStore (or not be available) or Apple will need to allow the user to "side load" programs to the device, which means that there's no longer a reason to have the AppStore. 

This last point is where I think the issue really lies, convergence isn't a "user" issue for Apple, though it could be spun that ensuring all software that gets to the device has been approved by Apple, but instead it's a business issue for Apple.  Apple doesn't think it could sell a hybrid device that will not allow you to install your favorite software on it, unless of course that software resides in the AppStore.  I think when push comes to shove, Apple knows they'll make much more money from the AppStore than it will off of building a try hybrid device that requires them to gives up their control of the ecosystem and in the end it's the ecosystem that makes iOS so successful.

Friday, April 13, 2012

Apple Price Fixing - It's Not a Novel Idea

As some may have already heard, it seems that Apple is in trouble with the Department of Justice for price fixing ebooks on Apple's iBookstore.  What happened is that Apple had discussions with several publishers about publishing on the iBookstore using what's called an agency model, meaning the publisher gets to set the price and the vendor (Apple in this case) gets 30% of the revenue.  This is in contrast to the model that Amazon uses, where Amazon sets the price and if you abide by their pricing you pay Amazon 30% of the profit, if you don't abide by their rules you pay Amazon 65% of the profit.  Apple also had a note in their contract saying that you couldn't sell the book for cheaper elsewhere (a similar note is in the Amazon contract saying that if the book is sold cheaper elsewhere, Amazon has the right to match that price, so in essence Amazon also is saying that you can't sell the book for cheaper elsewhere).  Where Apple got in trouble is that it met with the publishers and the publishers met amongst themselves, what's clear is that the publishers decided together to use Apple's agency model as a leverage to force Amazon to change their policy, what's not clear is Apple's (or specifically Steve Jobs') involvement in this process, outside of agreeing to an Agency model.

Due Diligence

What I would like to understand, and I'm in this position all the time, where I need to become an expert at something that I'm currently an idiot at (many would argue that I'm always an idiot).  When you're trying to ramp up, you try to find experts in the field to help guide you.  These experts can be bloggers on the web, books, or people in the field.  If I were Steve Jobs and I was looking to find a way to take a chunk of the ebook market, I'd go to the publishers and as "What would make you happy", as a developer/consultant I've done this with clients before.  I remember sitting in a law firm in Richmond, VA asking similar questions of the lawyers and librarians about a search tool I was working on.  So while Apple meeting with the publishers, even in a group, and asking them "What would you want" may seem sinister, I see it as due diligence.  If companies can't speak to their prospective clients about projects, then we're all in trouble.

Amazon Model

Amazon's model is very simple.  If your book sells between $2.99 and and $9.99 you get 70% of the profit, anything else and you get only 35% of the profit (and Amazon gets the other 65%).  Amazon is ONLY thinking of novels, they aren't thinking of anything else.  Amazon is using their monopoly of the market to force publishers into their price bracket.  If your ebook isn't a novel, if it requires more than just the thoughts of the author and simple formatting then it's not a fit for the Amazon store.  I've discussed this with an Amazon rep via email and on the phone and I was told that there's no room for negotiation, what they offer is what's on the website, nothing else.

It's Not a Novel Idea

What are ebooks....? Currently when people think of books and ebooks they think of novels.  Let's break down a novel's data structure, it's essentially a collection of paragraphs, maybe some font coding, some block indents and major and minor headings, but that's it.  Novel's are very simple as far as data structure.  Amazon's main ebook reader, the Kindle, is meant for these types of books.  Amazon's pricing policy is meant for these types of books.  Now let's look at the other books that exist out there, the one's that aren't novels, these are:
  • Comic Books
  • Childrens Books
  • Text Books
  • Computer Learning Books
  • How-To Books
  • Legal Manuals
  • Etc...
What do all these have in common? None of them follow the structure of a novel, they are made up of more than just paragraphs and headers.  They contain graphics, tables, charts, forms, etc... They can become interactive with tests, video, audio, and other tools.  Some of these don't have the mass market that novels would, they are meant to be delivered to a specific subsection of users.  Publishers can't make up in volume of sales what they lose at a lower price point.  At Amazon's $9.99 price point, it just doesn't make sense to publish an ebook with them.

What to do?

For my style of publishing, which is legal publishing, we've discussed how to proceed.  We can't sell our content for $9.99, it costs us too much to produce the content and we'd never recoup our cost at the $9.99 price point (which would really give us $7.00 a book).  Also the complexity of our content and the limitations of the Kindle reader aren't great (though if we could set our own price, we'd try to make the content work).  After that we have three options, one is to sell the content as a generic ebook (which I don't like, since I can't control the ecosystem), develop our own ebook reader (which is costly) or use Apple's ebook reader (which is actually quite good).  As a technologist I'm a bit frustrated by Amazon, they've produced a nominal product (even with the Fire) and are trying to enforce premium restrictions on content providers.  They are also treating every ounce of content the same.  I see the same logic with the reporting on the Apple issue, the reporters aren't digging deep enough into the issue to understand the intricacies of ebook publishing, they are making the use of the Agency model and Apple getting a 30% cut of the profit as Apple and Apple forbidding the sale of the book at a lower price as Apple seeming greedy, but Amazon and others have the exact same wording in their agreements, Apple isn't doing anything that Amazon isn't doing, except letting the publisher set their own price.

Consumer

Where does the consumer come out in all of this? Well if we reward companies that don't innovate win, then we're all in trouble.  So far with Kindle Amazon hasn't innovated.  Their epub format is really derived from a company called MobiPocket, MobiPocket was an innovative company from the 2000's, Amazon hasn't done much to encourage what MobiPocket started.  Amazon now has KF8, which is better, but it's still an awkward ebook format and from my playing with KF8 it seems that the wrapper has both a KF8 formatted book and a Mobi formatted book, plus if you come from epub it'll keep the epub formatted book, so your nice little 3MB epub book grows to 9-10MB in KF8 format (it should be mentioned that Amazon charges per MB for ebook delivery).  Not only is this very sloppy of Amazon, but it's unfavorable to the end-user (or publisher or both) who is paying per MB for ebook downloads, again I don't see why we should reward companies who are rewarded for developing sloppy processes.  Right now I feel the only viable mass market ebook reader out there for non-novel files (and has a price method that pays the publisher for their work) is Apple, Amazon could slip in their if they changed their pricing methods for non-Novel books and fixed their ebook reader to handle content that's more complex than what you'd see in a book.

Friday, April 6, 2012

Android Fragmentation

Android fragmentation is an issue and is getting worse every day, two things happened this week that have made me think that Android could be going down a very bad path unless Google steps in. 

Sprint 4G/LTE

The first is that Sprint announced it's first Android 4G/LTE phone, this phone will be running Android 2.3 (released in early 2011).  The fact that new devices are being released using an old OS is bad news for Android.  This sounds like it shouldn't be an issue, but the problem is that developers now need to develop for the older OS much longer than they normally would (assuming they decide to support it).  The adoption rate of new Android OS is horrible, this isn't caused by Google (directly) or because they users don't want to upgrade, but it's because the phone manufacturers and carriers insist on modifying the Android OS, in essence building their own version of Android.  Some of this is due to different hardware requirements, but some of it's due to the carrier wanting to put their own stamp on the device.

Custom Builds

The other concern is a report that a major Android phone is going to be released, one that isn't a Google phone and one that doesn't use Google Play (Formerly known as Google Market).  This is a concern on two fronts, first is that it's going to further fragment the Android apps, an Android developer must now set up legal and banking agreements with Google, Amazon, Barnes & Noble and RIM if they want to support the current stores, each of these stores have their own methods of approving apps and paying the developer (this is the non-development aspect).  Some of the agreements may also have wording that discourages competition with other stores, so you could easily break the agreement by accident.  Once you have that set up you'll need to submit and manage the delivery to each of the stores through whichever methods they throw at you.  Major custom builds, such as the Kindle Fire, could require extra development efforts to fit in properly with how the hardware behaves.  The Fire definitely doesn't behave like a modern tablet should behave.

This "store" fragmentation is bad for the consumer, they won't be able to switch to a new phone provider/carrier without losing all of their apps, music, movies, books, etc...  This is a similar issue to the any major OS, but few are fragmented like this.

The second front is that companies, such as Amazon, are building products on a platform that they really have no control over.  If Google decides tomorrow that they won't build further versions of Android or that they want to provide functionality in Android that's outside the norm, then the company can do nothing to resolve this outside of taking on the development on their own.

Solution?

Don't get me wrong, I think the Android OS is great and that Google's new phone is possibly the best phone out there.  I feel though that the only way to resolve this is for Google to no longer release open OS, require that any device released with Android use Google Play and that the device can be updated by Google, not by the provider.  While this may sound anti-competitive, it could be the best thing for both Android and the customer.  Right now Android is pushing more users to iOS with their current model, I'm surprised at the number of people moving to iOS because it's a more integrated environment.

Like it or not, having control of your ecosystem is critical, right now Google not only doesn't have control of their ecosystem, they have almost no control over their OS.  If I were the Android lead for a day, I would close future versions of the OS and require manufacturers work with me.