Horace Dediu

I’m assuming we’re supposed to compare this approach to the freer alternatives such as community gardens and city parks. Ignoring for a moment the fact that these gardens are also regulated by serious restrictions on what one can and can’t do, it still puzzles me that the “walled garden” is presented as an obviously undesirable structure.

Aren’t the benefits of a closed, carefully managed garden clearly visible? The experience is controlled, so it tells a story - one which may not emerge from a democratic, anything-goes process or do you think this sort of slow and deliberate story would emerge in a busy American city in the year 2010? Charging for admission means that the place can be maintained, improved, and marketed. There are downsides to this, of course — maybe the management makes boneheaded decisions now and then. Maybe you think that vine maple would look better a little to the left — maybe you’re even right.

via The Walled Garden - Neven Mrgans tumbl.

A walled garden is great as long as the gardener is an enlightened genius.  I can tell you that when operators tried to make walled internets for their handsets, the result was an atrocity.

It's understandable why people recoil at the thought of a walled garden.  But they shouldn't.  If it's no good you can go somewhere else.

As Apple overtook Microsoft in market cap and as Steve Jobs reminisced about some recent history, I thought I'd reflect on some of the decisions that brought Apple to the pinnacle of technology companies.  The criteria I used to select these is how improbable and hence courageous they were when taken and how much impact they have had on the industry. Since the impact of these decisions could not be felt for a long time, the courage required to act early is all the more remarkable.

At the time they were made, none of these decisions did anything to move the stock price or cause great rejoicing. In fact, in many cases the decisions were ridiculed by those who should know better. Yet each one became a massive pillar of the foundation of Apple as it is today.  As you read through, think of the decisions that Apple competitors made or did not make in the same time frame.

Top 10 Apple technology decisions of the 2000 decade in reverse order:

• 10. HTML 5 (canvas). It was initially introduced by Apple for use inside their own Mac OS X WebKit component, powering applications like Dashboard widgets and the Safari browser. Still in its infancy, the canvas element is an Apple technology that promises to finally offer a credible Flash equivalent.  Remember that Flash is now over 10 years old and was incubated at a time when the Web was barely 1.0.  HTML canvas finally brings vector graphics to the modern era.

• 9. H.264. The decision to support a standard video codec at a time when the industry was mostly arguing over whether Blu-ray or HD-DVD would win signaled a foresight that physical media was not long for this world.  The consequences are still being weighed as YouTube and other media sources are shifting their inventory to this format.

• 8. iTunes. iTunes started as a personal music database, grew into a music and media store-front, a payment processing engine, device synchronization and updating center, and finally an application store.  It was forked into both a PC and a mobile version.  Without iTunes the iPod would have been just another MP3 player.

• 7. WiFi. Implemented in Airport before the spec was finished, WiFi gave the laptop wings.  Think back to when you still had to plug a wire into a computer to have it communicate. PC's did not catch up in being wireless for years.  WiFi was even a rare feature on mobile phones when the iPhone shipped in 2007 with some operators (Verizon) banning it from their phones even in 2009.

• 6. FireWire. Along with iTunes brought iPod to life.  Launched at a time when external drives required screwdrivers and a circuit board to install, FireWire made opening your computer case to expand it as common as opening the hood of your car to fix it.

• 5. iLife. Did to user-generated media what word processors did to words and spreadsheets did to numbers. A singularly great reason to get a Mac.

• 4. Portability. OSX migrated across three different CPU architectures in less than 10 years. Apple revealed that they built it from day one to be portable to different CPUs.  That took amazing foresight in the late 90s.

• 3. WebKit. Speed and flexibility.  The biggest reason why we can surf on a phone today.

• 2. Multi-Touch UI. Seven years in development and still sublime.  Starting down this road in 2003 must have seemed science fiction.  But, unlike other companies, Apple took this science experiment and went to market.  Steve Jobs said how he wanted a screen keyboard and how scrolling opened his eyes to making a phone. That took vision.

• 1. OSX/Cocoa. The company's backbone.  Everything above hangs off OSX. Remarkably scaleable, portable, robust and reliable.  With roots going back decades, it's the canonical OS. Somebody should build a monument to it.

Japan's very high demand led the sales outside of the country at five percent, but China and the UK were tied at four percent. Canada despite its proximity was just 3 percent of iPad traffic.

via AdMob: 38% of iPads already outside the US, ad SDK up | Electronista.

Dreamworks CEO Jeffrey Katzenberg sang Jobs praises for several minutes, before declaring: "His greatest accomplishment is going to be this tablet."

"As Steve said last night, there is something indescribable about the connection," Katzenberg said. "Our children are going to get educated on it. They are going to play on it. They are going to consume more media on that than any other (device)."

"The laptop is yesterday's news," he said.

via At D, all hail the iPad | Beyond Binary - CNET News.

Greatest accomplishment...to date.

Best Steve Jobs quote from D8

7:06 p.m. PDT: Is tablet eventually going to replace laptop, Walt asks.

7:07 p.m. PDT: Jobs: "When we were an agrarian nation, all cars were trucks because that's what you needed on the farms." Cars became more popular as cities rose, and things like power steering and automatic transmission became popular.

7:07 p.m. PDT: "PCs are going to be like trucks"

7:07 p.m. PDT: "They are still going to be around...they are going to be one out of x people."

via: CNET

iPad is a product competing along a new basis; that of convenience and simplicity.  The PC vendors are motivated to serve their most demanding customers who expect loads of features and the highest specs. Most people who write about technology for a living will also side with the "truck drivers" because they "know more about transportation than anyone else".

When you hear someone say that the iPad is just a toy or that it's only for consumption and not creation, think about that professional truck driver's bitterness at seeing cheap consumer vehicles cluttering up the roads, doing nothing but serving the unproductive whims of an uneducated population.

Steve Jobs On iAds:

[It's to] make developers more money.... People are using apps way more than they are using search. So if you want to make developers more money, you’ve got to get the ads into apps. But the mobile ads we’ve got today rip you out of the app..." Apple has figured out a better way.

This is pretty much the same as his statement on the iPhone 4.0 launch: asymco | On a mobile device Search hasn't happened.

Apple, with its $50 a share in cash, could earn as much as $17 to $20 a share in 2011, which means the stock is trading at a cheap 12.5 times next year’s earnings. Cramer said even if Apple hits his $300 target, the stock will still be cheap trading at just 15 times earnings.

“That’s less than almost every single growth stock I follow,” Cramer said, “and even less than the S&P 500’s multiple.”

via Jim Cramer Predicts Apple Inc. (NASDAQ:AAPL) will hit $300 a Share | Madd Money.

S&P forecasts the S&P 500 average P/E for 6/30/2010 at 22.57.

Readers of this blog may recall that I noticed Apple's discounted valuation several times.

A spokesman for Nokia, the world's top cellphone maker, declined to comment on the sales number, saying the company was pleased with sales, but an executive was more bullish.

"Sales have substantially exceeded expectations," Alberto Torres, head of Nokia's solutions business, told the Open Mobile Summit trade conference in London this week.

via Nokia top model N900 sales below 100,000: Gartner | Reuters.

If Alberto Torres' expectation for a flagship product is substantially less than 100k for a launch quarter, I wonder what disappoints him.

After 12 million units sold in 28 60 days, it’s time to review the analysts’ predictions:

First year iPad unit forecasts (sourced from TMO Finance Board)

• Brian Marshall, Broadpoint AmTech 7.0
• David Bailey, Goldman Sachs 6.2
• Kathryn Huberty, Morgan Stanley 6.0
• Shaw Wu, Kauffman Bros. 5.0
• Mike Abramsky, RBC Capital Markets 5.0
• Gene Munster, Piper Jaffray 3.5
• Ben Reitzes, Barclays Capital 2.9
• Keith Bachman, BMO Capital 2.5
• Jeff Fidacaro, Susquehanna 2.1
• Chris Whitmore, Deutsche Bank 2.0
• Scott Craig, Merrill Lynch 1.2
• Peter Misek, Canaccord Adams 1.2
• Doug Reid, Thomas Weisel 1.1
• Yair Reiner, Oppenheimer 1.1

Looks like at least half two thirds of these guys have already blown it.

For the record, in January I forecast 6 million units for calendar 2010 (and 10 million in first year).  It looks like I'll be facing the iPad dunce corner as well.

See: Analysts predict iPad sales

A few eyebrows were raised when Microsoft presented a slide at a French event where they made the claim that 30 Million Windows Phone devices would be sold by the end of 2011.  Given that the first Windows Phone won't ship until October 2010 at the earliest, or, according to Mr. Ballmer, "by Christmas," count me among the skeptics.

However, the claim was later retracted by Microsoft stating that they mis-quoted IDC, the original source for the forecast.  The correction was perhaps meant to put an end to the credibility crisis.

However, the actual forecast from IDC was even more preposterous. Apparently IDC makes the forecast that 32 million "Windows Mobile" devices will sell during all of 2011--a combination of both Windows Mobile and Windows Phone devices.

Instead, the research company forecast 2011 sales of 32 million devices running all Windows Mobile operating systems. This includes expected sales of devices with Windows Mobile 6.5, which is already on the market. IDC has not given any sales estimate for Windows Phone 7, which Microsoft has said will be available in the fourth quarter.

Their report showed about 16 million Windows Mobile devices shipped in 2009, with a forecast of 22 million this year and 32 million next year.

Windows Mobile shipped a total of 3.7 million phones in 1Q10, so in order to reach 22 million this year they need to ship 18.3 million for the rest of the year or, on average, 6.1 million phones a quarter.  That's a higher number than what Android shipped in Q1 with BOGO promotions (5.2m units). That's almost as high as the launch quarter for the iPhone 3G.  And all this (mostly) with WinMo 6.5!

Alternatively perhaps IDC foresees a huge launch for Windows Phone. Assuming an erosion of the WM6.5 to 2.7 m this quarter, 2 million in Q3 and 2 million in Q4, then Windows Phone would somehow need to ship 12 million units during the last quarter.  This number is higher than what iPhone sold in its highest ever quarter.

This sounds sillier than 30 million Windows Phones in 2011.  By claiming that Microsoft's combination of deprecated Windows Mobile (6.5) and unreleased Windows Phone 7 will continue to sell at a growth of 38% this year, they are actually suggesting an acceleration in sales going into the second half at a rate higher than what the market is likely to grow at.

In other words, they are suggesting that Microsoft will gain share during the rest of this year. Share gains for a platform that has declined in share in Q1 from 10.2% to 6.8% with 3.7 million units sold on the back of further share losses the quarter prior. Share gains against Android that competes with a free license. Share gains with a new platform that has no clear differentiation vs. the iPhone.

Asymco is now in its third home and fourth design.  After starting in February 2010 with iWeb hosted at me.com, moving a month later to Wordpress.com, I've finally moved the blog to a proper hosting site (dreamhost) and merged the blog with asymco.com.

One reason I had to leave Wordpress.com was that they required payment for the removal of ads from my pages.  Although I understand their business model, I felt that it's more important that what users see is my content and only my content.

At the time of moving, the blog had 306 posts, 272 comments, 64 tags, 9 categories and nearly 40k hits.

Hopefully the transition will be painless to those who came to the old site.