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Tuesday, August 05, 2008, 06:00 am PT (09:00 am ET)

Inside iPhone 2.0: iPhone OS vs. other mobile platforms


Microsoft's software-centric smartphone model

After initial attempts to sell Windows Mobile updates failed (in part because buying a new phone would be cheaper and make more sense than upgrading year-old hardware), Microsoft found that there is no profitable retail market for selling an OS to phone users. From the beginning, Apple gave its iPhone users free software updates as part of the subscription accounting model it set up for its hardware sales. In other words, Apple invests in new software to lubricate its hardware sales. It's software development efforts are planned specifically to add as much value as possible to end users.

Microsoft targets its operating system updates toward selling additional manufacturer licensees to build new Windows Mobile phones. Windows Mobile Smartphone users upgrade their OS just as the vast majority of Windows PC users do: by buying entirely new hardware. That means Microsoft's development plans typically cater to the needs of hardware makers rather than to end users.

Apple's hardware-centric Macintosh model appeared to fail back in the early 1990s as Windows PCs took off, but returned with a vengeance a decade later in the highly integrated iPod, which destroyed Microsoft's Windows Media plans and resisted duplication by the company's Zune. Similarly, the integrated iPhone humbled the already well entrenched Windows Mobile into third place within just three months of sales, causing Microsoft to scramble out the announcement of plans to copy iPhone features in its next OS version a year or so from now. 

Apple's integrated Mac is similarly eating back into the PC world, with around four times the growth of PCs in general. The problem has grown significant enough for Microsoft to warn its investors about. In its 10-K SEC filings, the company anonymously described Apple's "competing vertically-integrated model, in which a single firm controls both the software and hardware elements of a product" as having "been successful with certain consumer products such as personal computers, mobile phones and digital music players." It also warned that will not be easy to copy Apple, as its own attempts to follow a similar strategy may result in higher "cost of sales" and "reduce operating margins" going forward. 

Other software mobile platforms

Sun's Java ME in general, along with the closed alternative of Qualcomm's BREW (popular with Verizon Wireless), both offer rudimentary mobile software development tools that purport to be widely portable across different phones, but in most cases do not deliver on their 'write once, deploy everywhere' marketing. Both are used primarily to churn out overpriced game applets. 

Adobe's Flash Lite can also be summarily dismissed as another attempt to dump out a "runs everywhere" mobile platform. Flash Lite typically runs on top of another platform, such as Java ME, BREW, or Windows Mobile. Adobe, Sun, and Qualcomm all aspire to be the Microsoft of mobiles, but are currently pulling in licensing revenue from mobile hardware makers without really delivering any interesting functionality for users as one might expect from a software platform.

Google has thrown its own hat into the ring with Android, primarily as an attempt to back open source mobile development and subsequently prevent itself from getting shut out of the potential mobile ads market by Microsoft's Windows Mobile. The premise of Android remains to seen, as the fickle open source community has splintered its efforts among a number of Linux-related efforts as well. Android uses the Linux kernel with, essentially, an original and incompatible implementation of the Java ME platform on top. 

As is the case with Windows Mobile, software mobile platforms such as Java ME, BREW, Flash Lite, and Android all lack any tight integration between hardware and software development, resulting in an experience for mobile users that will be somewhere between Windows, Java, and Linux on the PC desktop. Unsurprisingly, the iPhone offers a more polished experience just like Apple's iPod and Mac. It should come as no surprise why Apple isn't making any efforts to bring Java ME, BREW, or Flash Lite support to the iPhone, because they offer so little on other phones already. 

Mobile software platforms from hardware makers
 
RIM's BlackBerry OS, the Symbian OS, and (at one time) Palm OS were all developed by hardware companies with more similarities to Apple. Palm's own OS has now essentially been mothballed, but during its active development prior to 2004, Palm was able to build an active development platform and assemble an impressive third party ecosystem around it. It has since fallen off into obsolescent irrelevance as Palm shifted toward using Windows Mobile. Somewhat ironically, the only real success Palm has seen recently has been from its simple, Palm OS based Centro phone.

Symbian's hardware partners (including Nokia and Sony Ericsson) have also invested in continually developing the software that runs their phones, although its development tools and potential for future sophistication are limited by lots of early-90s legacy. Nokia has since began investing in other platforms, using Linux in its Internet Tablet and purchasing Linux platform developer TrollTech outright. 

The iPhone spooked Sony Ericsson so badly that its executives jumped on a Windows Mobile backup plan called the XPERIA X1. The company plans to release the new phone in the third quarter, dripping with the advanced hardware features one could expect from a Sony product. However, if its CLIÉ PDAs and Vaio PC line are any indication, users can expect the same poor integration with its third party OS that has plagued every other collaborative Sony product.

The closest competitor to Apple's tight integration model is RIM, which licked up the US market for message-savvy phones and quickly became the darling vendor to corporate IT. RIM's strength comes from its highly regarded push messaging services tied to its BES (BlackBerry Enterprise Server), which requires a significant investment and ongoing fees of around $60 per month per user. Outside of that, RIM's OS platform (which is just a generic Java Mobile Edition implementation) is weak and limited, with little exceptional third party software, limited potential for that to ever change, and poor examples of bundled general purpose smartphone tools. 

Apple's iPhone is weaker in messaging than the more mature BlackBerry platform, but stronger everywhere else, with a desktop class standards-based web browser (providing access to corporate IT web apps), advanced iPod media playback features, and an integrated store featuring everything from games to media to productivity apps. It will be much easier for Apple to match RIM's messaging features (particularly with the backing of Microsoft's far cheaper ActiveSync Exchange Server integration) than for RIM to clean up the rest of its OS, which currently just stinks.
 
Smartphone features the iPhone can't yet do (thanks to AT&T)
 
That having been noted, there are plenty of features that are currently supported by Palm, Symbian, RIM, and Windows Mobile that Apple hasn't yet released, or can't release due to its partnership with AT&T. Among them is support for tethering, or dial up networking, which would enable the iPhone to act as a modem for supplying a laptop with mobile Internet access. A third party app called NetShare has been released in the App Store that does accommodate using the iPhone to create a WiFi link with a computer to share its 3G or EDGE network access. Users may still be constrained from making unlimited use of their mobile network access however, a fact that also applies to other providers who do support tethering, even those that advertise "unlimited" data access. The NetShare app has already been removed from the international Apps Store twice (perhaps for good this time) due to its incompatibility with AT&T's service agreement contract in the US.

Another feature missing from iPhone 2.0 is UMA (unlicensed mobile access), which enables phones to use WiFi networking to place and receive phone calls. Apple has stated that it will allow developers to create VoIP apps that perform calls over WiFI but not AT&T's EDGE network (nor presumably its 3G service). Even so, without core operating system support for UMA, third party apps can't seamlessly transition between mobile and WiFi networking to place calls in the way TMobile has pioneered in the US (in large part to make up for its weak mobile network coverage), nor can they automatically route regular incoming calls to use WiFi VoIP. You'd have to sign up for an independent number and account, which is not nearly as useful.

Apple isn't the only company forced to bow to its mobile partners. Nokia's European N61 phone is revered for its fantastic WiFi and VoIP features, but here in the US it's only sold as the crippled N61i, with support for neither. That highlights the fact that phone makers can only offer so much in certain regions, because their product won't work without the blessing of the service companies that not only give it access to their mobile networks, but in many cases also act as the middleman in selling their product. 

Apple recognized early on that the success of the iPhone would relate greatly to how much it was forced to concede to the mobile companies. Apple was famously rejected by Verizon Wireless as a potential partner because Apple wanted more control over the device than Verizon could agree to; Cingular however was in the midst of growing pains and desperately needed differentiation as it transitioned to using the AT&T name, so it was far more willing to give Apple the increased leeway it demanded. Still, Apple had to pick and choose its battles in negotiating with AT&T, and that required some compromises as well.

On page 3 of 4: Additional common phone features iPhone still needs; Video embarrassed the QuickTime star; and This feature intentionally left blank.