Re: WORTH READING Apple's Spat With Google Is Getting Personal

[David Farber <dave () farber net>]

Begin forwarded message:

From: Newmedia () aol com
Date: March 17, 2010 9:52:05 AM EDT
To: dave () farber net
Cc: dpreed () reed com
Subject: Re: [IP] WORTH READING Apple's Spat With Google Is Getting Personal

Dave:
 
That's simple.  In 2012, Intel will be very prominent in smart-phones, when they have a sufficiently well integrated 
processor/memory/baseband package to sell.  Today ARM is the only game in town.  I can assure you that HTC, Nokia and 
others are very committed to offering an Intel-based alternative, in part because of the high-level of licensing fees 
extracted by Qualcomm and the competition coming from Samsung.
 
Android will be a prominent OS on these Intel-based smart-phones.  Google is "helping" Intel by building an alternative 
to iPhone OS (and others) and, crucially, an army of 10's of thousands of developers.  Remember, these companies try to 
be three-dimensional chess players, who are working with 3-5 year time horizons.
 
Today Google helps Intel by offering Cloud Services based on the largest cloud infrastructure on earth -- which seems 
to have roughly 100M x86 cores, almost all of which came from Intel.
 
If you read the NYTimes article that started this thread, you will see that Google needs outside advice to plan its 
longer term strategy.  While Bill Campbell is the focus of that article, you might also consider the role that Intel 
CEO Paul Otellini plays on Google's board.
 
Best,
 
Mark Stahlman
New York City
 
In a message dated 3/17/2010 9:32:54 A.M. Eastern Daylight Time, dave () farber net writes:


Begin forwarded message:

From: "David P. Reed" <dpreed () reed com>
Date: March 17, 2010 9:25:38 AM EDT
To: dave () farber net
Cc: ip <ip () v2 listbox com>
Subject: Re: [IP] WORTH READING Apple's Spat With Google Is Getting Personal

A simple question: All of HTC's phones are ARM based, and Qualcomm makes the processors for all of the Android phones, 
not Intel.  Intel actually feels threatened by ARM (including Qualcomm, TI and Marvell) almost as much as it feels 
threatened by Samsung.

So how is Google "helping" Intel?

On 03/17/2010 08:04 AM, David Farber wrote:
> Begin forwarded message:
>
> From: Newmedia () aol com
> Date: March 17, 2010 6:08:31 AM EDT
> To: dave () farber net
> Subject: Re: [IP] Re: Apple's Spat With Google Is Getting Personal
>
> Folks:
>  
> The issue for Apple is a simple one -- profits.  By virtue of its "closed" business practices, Apple's gross margins 
> are many multiples higher than their competitors.  These profits, in turn, support stock price multiples that are 
> higher than its competitors.  But is this a house of cards which must inevitably fall?
>  
> What is usually missed in the "closed vs. open" debate is the impact of crucial competitive forces.  In this case, 
> the most important actor-to-be is Intel.  When Intel is ready to compete against the ARM architecture with its 
> Atom-based x86 technology -- likely in 2012 and substantially assisted by its partnership with Nokia -- the 
> competitive structure of the smart-phone market will probably be upended.
>  
> Apple has always been an anomaly in business terms.  For years IBM and Motorola subsidized Apple's Macintosh by 
> providing below-cost silicon, in order to keep their Power PC production lines full.  IBM no longer needed Apple in 
> 2003 when they signed up the Microsoft and Sony game consoles and Motorola also abandoned them when it spun out its 
> semiconductor division.  Intel stepped in to rescue Apple's margins with special chip prices and massive engineering 
> help.  Apple said thanks -- but no thanks.
>  
> The real conflict here is between Apple and Intel -- not Apple and Google, which is in many ways acting as Intel's 
> surrogate.  Apple responded to Intel's "help" by buying PA Semiconductor, which has produced the processor in the 
> iPad.  Apple's "closed" margin structure is in Intel's cross-hairs and that is why Apple filed its lawsuit against 
> HTC, a company that is working with Intel on next-gen smart-phones.
>  
> Best,
>  
> Mark Stahlman
> New York City
>
> Archives      

=



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