Apple and Google are the two strong leaders in the smartphone wars. Microsoft recently kicked off its comeback bid, and RIM follows next month. Which one has the best shot of being the third horse in this race?

Eric Zeman, Contributor

December 18, 2012

4 Min Read

Microsoft and Research In Motion both face an uphill battle to win back market share from Apple and Google. More important than taking back share from the leaders, however, Microsoft and RIM need to focus on beating each another first if they hope to take on Apple and Google later.

The smartphone platform wars have evolved markedly in the last 10 years. In 2002, BlackBerry OS, Palm OS, Symbian OS, and Pocket PC 2002 were the reigning smartphone platforms (if one can say that less than 5% of the entire cellphone market counted as reigning anything). Five years later, in 2007, these platforms were still at the top, though Pocket PC 2002 had morphed into Windows Mobile 5 and Palm was already beginning to decline. Now, 10 years later, these four are all but dead.

Google's Android platform and Apple's iOS platform have taken their place. Together, these two now hold 90% of the entire smartphone market, leaving little more than scraps for the rest. A market that was briefly a five-horse race eventually dwindled to a four-, then three-, and now a two-horse race.

There's one important ingredient a challenger needs, one that supersedes good hardware and a solid operating system. That ingredient is an ecosystem. Ecosystems lead to customer stickiness.

[ Would RIM be able to win back market share without Google apps? See What If Google Ignores BlackBerry 10? ]

My friend Kevin Tofel, who writes for GigaOm, offered a very good argument with respect to ecosystems. "The longer a handset owner sticks with one platform, the more they invest in content and apps that only work with that platform. This lock-in cost is a potential barrier to switching. And for those who invested early in a platform, as much as four or five years, it's highly unlikely a switch will occur. Who wants to re-buy premium apps, books, videos and other content?"

Apple and Google have been building their ecosystems for years. The ecosystem includes not just the device and the operating system, but the tie-in with desktop systems, content stores, the cloud, accessories, and so on. Apple's iTunes Store is the world's largest seller of music. Google is attempting to catch up and has greatly expanded its own Google Play Store in recent months.

Consider alone the number of movies you may have purchased via iTunes, for example. If you've bought 10 movies, that's $100 to $200. Movies purchased from iTunes play only on Apple devices; you can't port them to an Android, BlackBerry, or Windows Phone device. If you give up on iOS, you lose mobile access to that content. The same example can be applied to Android or Windows Phone. That's a powerful motivator to keep people where they are.

Now consider Microsoft and RIM. Which has the better ecosystem? Clearly, Microsoft does -- at least as far as consumers are concerned.

Windows Phone 8 ties in to Microsoft's Xbox gaming and content services, in addition to Windows PCs. Microsoft's access to music and video content is far greater than RIM's, for the moment. (RIM plans to add video and audio content to the BlackBerry World store with the launch of BlackBerry 10.) Further, Microsoft has a great story right now with the launch of Windows 8, Windows RT, and Windows Phone 8, which share their kernel and have a similar user interface.

But RIM has a solid enterprise ecosystem. It has good developer relations, incredible messaging services, strong ties to the government and big business, and a dedicated user base that has historically kept BlackBerrys ahead of Microsoft's mobile efforts for ten years.

In the end, the battle between Microsoft and RIM may come down to which group exercises is purchasing power more freely: consumers or enterprises.

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About the Author(s)

Eric Zeman

Contributor

Eric is a freelance writer for InformationWeek specializing in mobile technologies.

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