Tag Archives: platform

Why Fred Wilson is wrong about Apple

apple_android

UPDATE: When this article was written in May 2014, Apple’s stock price was $84.65. Today it sits at a comfortable $130.26.

If you’ve followed the tech news recently, you may have heard Fred Wilson’s comments about Apple. In essence he believes Apple is too reliant and rooted in hardware, and that hardware isn’t viable in the long term. Mobile hardware, is becoming a commodity.

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To be sure Androids have come a long way, and they may yet improve a lot by 2020 as Fred says. But the aftermarket value of iPhones really does speak volumes. See below.

1. iPhone has never had the best hardware

If you’ve ever watched a Samsung ad, or talked to someone with the phone you probably know this already. Bigger screens, faster processors, first phones with fingerprint readers, or untethered syncing. The list goes on and on.
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Yes Apple is rooted in the hardware business, but not in a way that a commodity can disrupt it. They’re rooted in the hardware business only in as much as it helps them deliver polish. If it helps them deliver a seemless experience, and a device that Jean Luc Picard would appreciate, then they are in that business. . Just “make it so!”.

2. Users are seduced by simplicity

So how is it possible that an inferior piece of hardware could sell more?

Easy. Those users don’t think that way. They aren’t buying hardware. What do I mean?

I would argue many iPhone users buy for the experience, the simplicity, the ease of use. Designers call this User Experience or User Interface, but end users don’t know these terms. What they know is they don’t have a headache. They’re not frustrated trying to move an image from one app to another, or copy/pasting etc.

User interface is that invisible force that just makes everything on the device better. Call it polish, but it’s much more than a pretty face.

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3. Most users don’t care about “open”

Another benefit touted on the Android side is it being “open”. The OS is open-source, and then extended by manufacturers. While this surely brings down costs to them, it may be all be irrelevant to end users and consumers.

Yes open standards are great for competition, great for markets, and ultimately great for users. But Microsoft is a great case study in why consumers often still choose a closed solution.

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4. Apple is Sexy

That may sound fanboyish, but seriously. Look at the accessories market for blinging your phones.

If that’s not enough, look at the aftermarket value. iPhones retain their value, Samsung’s don’t.

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5. Android is still broken

From where I’m standing, and a lot of experts agree, the Android ecosystem is broken.

For one the AppStore, being historically unregulated, is chock full of malware and dangerous downloads. Most users aren’t computer experts, not good at evaluating security risks, and pay the price.

What’s more many Android phones come stocked with bloatware, slowing down the device, and reducing reliability from day one.

Read: Why the Android ecosystem is broken

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5 Things I learned about bitcoin from Chris Dixon, Balaji Srinivasan & a16z

I’ve avoided the bitcoin hype for long enough. I’ve watched a bit on the periphery, but recently been doing a bit more research. Then I bumped into the new Andreessen Horowitz podcast, and got a crash course on it!

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http://blog.pmarca.com/2014/01/22/why-bitcoin-matters/

1. Goldman Sacks has taken notice

Want proof that Bitcoin isn’t just for geeks? Goldman has released a report and they have real interest.

Specifically Goldman identified the potential for 210 billion dollars in savings in payments that Bitcoin could bring. That’s billion with a “B” and serious opportunity for disruption!

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2. Solves online trust problem

There are many who feel Bitcoin doesn’t have potential as a currency. But even those folks feel it’s underlying technology could solve a big problem with online payments, the general ledger problem.

When you want to send digital things, whether a signature, contract, keys or currency, you need a way to establish trust between people. Bitcoin solves this with it’s technical sounding “block chain” which serves as a sort of internet notary public. Anyone can check on this common general ledger the status of a transaction, without fear of compromise, double entries or theft.

For more in-depth discussion, check out Bitcoin & the Byzantine Generals problem. It explains the general ledger aka the block chain in a lot more detail.

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3. Better digital wallets

Although currently bitcoin wallets are banned on the iphone AppStore, the potential there is huge. Currently there still isn’t a good digital wallet solution, and bitcoin sits nicely in that space.

Bitcoin is more a platform, and a set of protocols, a new digital infrastructure that solves a lot of big problems online. As new apps are built on top of it, they abstract away the technical complexity, providing day-to-day

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4. Store of value for Greek & Cyprus

Citizens of distressed countries can face the fear of their savings eroding away. That can happen rather quickly as we’ve seen in Greece & Cyprus. Savings in Bitcoin presents an alternate currency within which one could place some of their savings. Since it’s not controlled by any government or power, it provides a hedge against such fears.

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5. Say goodbye to inflation

Fiat currency, as it’s known, is the currency we live with today. It’s the post gold standard currency, where the federal reserve controls the money supply. Quantitative easing, aka printing money, is the lever the fed uses to keep a small steady inflation on the money supply.

With the gold standard before it, and potentially through something like Bitcoin, you eliminate the government meddling, and inflation along with it. Some argue this would reduce or even eliminate the so-called moral hazard in the present system. With the gold standard, large & systemic firms cannot be bailed out, so they have a huge insensitive to behave prudently, or fail.

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