Wall St. Journal Looks at iPhone vs. Galaxy

One of the tech battlegrounds we've predicted that will get a lot of media attention this year is the battle between Apple and Samsung.

More recently, I wrote an analysis that looked at the implications for this battle at least for Apple: "What Are the Implications for Apple if Samsung's Latest Smartphone Eclipses the iPhone?"

Interestingly, the next day, the Wall St. Journal reported, "Apple, on Defense, Slams Samsung."

Apple is not used to playing defense so it will be interesting to see how it responds to a serious threat to the iPhone and ultimately to its iPad supremacy.

Stay tuned (as they used to say).

What Are the Implications for Apple if Samsung's Latest Smartphone Eclipses the iPhone?

Earlier this week, the Wall St. Journal published "Samsung Trains Its Eye on the iPhone," an interesting article about Samsung, ahead of its launch of a new smartphone, the Galaxy S IV. 

This blog is not a reviews site so I'm not going to touch on the features of Samsung's new phone.

Instead, what interests me is how the media covers technology.

Two weeks ago, we posted our prediction that "We expect the media to report on several tech battles in 2013," including:

The battle among huge companies. Apple v. Google v. Samsung and Microsoft. Oracle v. Everyone Else. The media have a boxing ring mentality: They love to report on the battle between two competing companies. So we expect continued high level of coverage of Apple, Google, Samsung and Microsoft in their battle for supremacy. Of course, those four hypercompetitive companies are often battling other companies as well. (Yes, we've included this prediction in prior years – we feel that the media continues to be fascinated by this story and see no end in sight.) Interestingly, over the past year, Samsung has leveraged Android to become a major global player in the smartphone and tablet sectors, which is having an impact on both Apple (as an iPhone and iPad competitor) and on Google (since Samsung, as the de facto Android leader, could ask to renegotiate its agreements with Google, cutting Google’s margins).

What's interests me is that the print version of the article included this outtake: "Samsung is taking the battle for mobile to Apple's home turf," which was picked up in the body of the article.

For us, this validates not just the fact that the media would see the smartphone market as a story of two companies but that the media is framing that story as a battle between two companies.

Samsung has to know that much of the Galaxy S IV coverage will include mentions about Apple and the iPhone. 

For Apple, being included in most reviews of the Galaxy S IV is good -- because when reporters are writing about Apple it means less space for Samsung. But that's necessarily good if, as Fox's reported:"Galaxy S IV called Samsung's 'last act in Apple's shadow.'"

If there's a lot of coverage like Fox's, expect Apple to respond either by pushing up its announcement for the next generation of iPhones (the iPhone 5S?) to later in March or June (as had been rumored) or that Apple may keep its October launch date (also rumored) but pack the iPhone 6 with a bunch of new cool features. 

The point of skipping the iPhone 5S name is that it's hard to get fans excited about a phone that's only a half-step up from the prior version when your competitor has made significant advances.

What do you think?

Birnbach Communications' Top Predictions for 2011, Part V

Here's Part V of our predictions, Top trends from 2010 that will continue in 2011.

• Mobile access will become increasingly important in 2011, thanks to the popularity of tablets and the rollout of 4G wireless networks.

• In-flight Internet access did become more widely available in 2010, and we expect it to grow more popular in 2011.

• Online credibility will continue to be important.

• Location-based services and behavioral targeting by advertisers.

• Online privacy will continue to be important.

• Three tech companies received the bulk of media attention in 2010, and they will continue to so in 2011. According to a study for the Pew Research Center’s Project for Excellence in Journalism, those companies were Apple (15.1 percent) and Google (11.4 percent), followed by Microsoft (3 percent). (Tech writer Farhad Manjoo wrote an article that discusses the reasons in an NPR interview, "Does Apple Get Too Much Media Love?") We think that Facebook will join AAPL, GOOG and MSFT in being the most written about tech companies.

• Two main topics were the focus of much of the consumer tech coverage in 2010, and they will continue to do so in 2011, too. The two topics: smartphones and digital cameras (although fewer people feel the need to use the word "digital" to describe cameras anymore). Tablets will become a more important topic in 2011, as noted above.

• Videoconferencing no longer resides just in executive conference rooms. You can now get videoconferencing a growing number of devices and a growing number of carriers thanks to 4G rollouts.

• The continued growth of e-books and e-reader sales, following record e-reader sales and some e-books outselling their deadwood version. There are now best seller charts for e-books, for example. And after a record year in the sales of e-readers, expect another record year in e-book sales, leading to articles in 2011 that talk about the inevitability of the shift to e-books, especially after the expected launch of Google Editions, which is set to offer read-on-any device e-books. The one exception will be children's books, especially popup books (to be known as 3-D books).

• The continued evolution of communications. People under age 28 don't use their smartphones to place or receive calls – instead, they use them to text, not email, their friends. People above the age of 28 prefer email. The telephone carriers love texting because they make significant margins from texts. Expect more coverage, and more people switching to texting.

Notice, too, what did not make this list:

• MySpace: Obviously not 2010 technology, but clearly not one of Rupert Murdoch's successes. I saw an article in my town's local weekly paper that touched on MySpace by asking, "Does anyone remember its URL?" Ouch.
• Chatroulette: Which blasted onto the scene in early 2010, quickly becoming the source of jokes for late night comedians, hadn't been in months until an article in the Times reminded everyone. The Times thinks that options you might call Son of Chatroulette -- connecting via text, connecting via video using Facebook IDs (to reduce the likelihood of bad behavior) will succeed where Chatroulette's naked men failed the effort. We're not so sure. We can't keep up with our friends and friends of friends even now, much less to make connections to new people the way these Sons of Chatroulette make possible.
  

Check out Part I, Part II, Part III and Part IV.

Let us know if you agree or disagree.

Birnbach Communications' Top Predictions for 2011, The Top 12 Business & Technology Stories, Part IV

Here's Part IV of our predictions, The Top 12 Business & Technology Stories in 2011.

1. The economy, including the deficit, unemployment, taxes, the incoming class of GOP legislators, regulations, and the "new normal."

2. The battle for healthcare reform or the repeal of ObamaCare, depending on your political perspective.\

3. The continuing battle among tech giants: Google vs. Apple vs. Microsoft vs. Cisco vs. EMC vs. HP vs. Oracle vs. SAP. Also expect reporting on the battle between the iPhone carriers: ATT vs. Verizon.

4. Mergers & acquisitions will likely increase in 2011, and some coverage look at the implications and impact of those mergers. There were more than 2,700 acquisitions last year, and this year the tech giants listed immediately above still have lots of cash on hand to acquire companies that will help converge service offerings.

5. Are we ready for 3-D TVs. (Last year the coverage was all about the invasion of 3-D TVs. This year, the backlash to a trend that failed to live up to its hype.) We do expect a lot more attention devoted to interactive TV-like devices, including Internet-ready TV sets in the living room that are also tied to smartphones and tablets.

6. The state of the media, especially print media, online-only business models and online subscriptions. The media – traditional and online can't help but cover itself.

7. The status of Facebook, its policy towards privacy, and the demise of MySpace. (Last year, it was Twitter's business model – which has yet to be fully answered.)

8. The status of OWN, the Oprah Winfrey Network.

9. The advertising recovery.

10. Local search, personalization and the growth of Groupon and similar businesses.

11. Net neutrality, web traffic speeds.

12. The new small business model. It used to be that small businesses were the real job engine in the U.S. economy. That's no longer the case as technology allows for contractors and virtual teams to launch new companies and products. Where you once needed dozens of employees to launch a new software product, these days you need a few employees and an outsourced team in another country.

This is not to exclude the other topics we've included in our 2011 predictions, available here: Part I, Part II and Part III.

Let us know if you agree or disagree. And check back tomorrow for additional predictions. Next up: Top Continuing Trends.

Two Marketing Lessons for App Developers

Clearly there are more lessons to be learned about marketing apps, you have to start somewhere. Call this post App Lessons 1.0.

1. Much like anything else (except Apple technology), people don't like to buy version 1.0 because they know it's likely to have buggy features. Same goes for apps. Apparently, versions 1.0 don't do as well as later versions of the app. According to one app developer I spoke with, "It almost pays to launch as 1.0 and then upgrade even with a minor change to 1.1." In an era when perfect is the enemy of good because you need to get the product or service out the door and into the hands (or smartphones) of customers, that appears to be good advice. You don't want to release a product that still belongs in beta, but you don't want to wait until the app is perfect. Good enough is a good first step.
2. Keep a blog for your users so they can exchange ideas, tips, etc. In the age of social media, this helps build a community of users, which engenders loyalty and results in stronger brand awareness. As an example, check out the blog for Photo Shootout for iPhone. (Disclosure: I've worked with the developer, Paul Michaels, but not on the blog.)
   
   Please share other lessons you may have learned along the way.

WSJ parody: Interview with an Person Experiencing iPhone/iPad Withdrawal

Actually pretty funny.

Turning Distribution Into Revenue

The thing about journalism is this: reports of its death have been greatly exaggerated.

People continue to want news. They just don't necessarily want it in print form.

It's too slow. It's about what happened yesterday, after all.

It's not convenient. You can have it delivered to your home or office or pick it up from a newsstand -- but the printed newspaper isn't available on your smart phone, your iPod, etc.

It's too expensive.

What's interesting is that technology has transformed the first two complaints: you can now get real-time news updates and you can access it on your smart phone, on e-readers like Kindle, etc.

Technology has improved distribution of the news. But while it has brought some costs down significantly, technology still hasn't generated revenue streams to pay for the news.

Even providing an iPhone App hasn't solved the revenue question, as reported in the New York Times, "There’s an App for That. But a Revenue Stream?" Check out "For Murdoch, It’s Try, Try Again" by the Times' David Carr, which looks at ways Murdoch, the Times, Boston Globe and others are thinking about getting consumers to pay for news content.

As Murdoch told the Times, "Quality journalism is not cheap, and an industry that gives away its content is simply cannibalizing its ability to produce good reporting. The digital revolution has opened many new and inexpensive distribution channels but it has not made content free. We intend to charge for all our news Web sites.”

By doing so, Murdoch and others will establish a wall that will prevent search engines from finding the content, and reduce the number of people able to access that content. Then it will become more important for PR functions to use social media to raise awareness of the coverage about their client or organization.

Still, the first challenge is to get people to pay for general news. Check out a New York Times article from today about the Financial Times, "Financial Times Feels Vindicated by Web Strategy," which looks at how the FT's strategy of putting its content behind a pay wall has been paying off. Up next for the FT is a system of micropayments.

Do we have a case study deficit?

We've must be in the midst of a case study deficit. Or how else to explain two iPod mentions in one issue of Entrepreneur -- and I'm only half-way through the issue.

Don't get me wrong. I like my iPod, but is it really the only positive case study people cite? There's got to be something else.

And don't say the iPhone.

Today's iPhone Release May Be Big News -- But the Continued Drop in Ad Sales Has Bigger Implications

According to major media, along with the social media world like Twitter, today's big news is the release of the latest iPhone 3G.

The iPhone has certainly had a significant impact on the cellphone handset business. But the latest version is an iteration, not a revolution. It will be replaced next year with more of the same -- no doubt cool stuff, but more of the same.

Bigger news, I think, was reported on page 5 of today's New York Times' business section: "In Deepening Ad Decline, Sales Fall 8% at Magazines: The decline is led by automotive and technology ads" by Richard Perez-Pena.

The current business model of magazines and newspapers in the U.S. is based on advertising. Without advertising, a U.S. magazine won't survive -- even if it maintains a high circulation base. In the past year, magazines with circulations of several hundred thousand have folded merely because advertisers had dried up.

That doesn't mean that readers had given up on the magazine. Just advertisers. In contrast, European magazines typically charge higher subscription fees, which are used to underwrite a greater proportion of a print outlet's costs. Presumably, in Europe, a magazine with a high circ. could survive an advertising downturn.

Not so in the U.S., where news and some business mags were hit by the continuing slump. BusinessWeek's ad pages dropped 14.8% and Forbes dropped 12.6 for the first half of 2008, according to the Publishers Information Bureau, which tracks this information.

Even some of the biggest circ. magazines were hit, including Reader's Digest, Cosmo, Ladies' Home Journal and Family Circle.

Things are so bad here that Thomas J. Wallace, editorial director at Conde Nast, told Perez-Pena, "The joke here is, 'Flat is the new up.'" (Translation: that just having flat advertising sales is great in this environment.)

The implications to the news is that there will be more layoffs at magazines and newspapers, which are having an even more difficult time. Many of those layoffs will come from editorial for two reasons:

1. You can't cut the advertising dept., because you people to sell space to advertisers.
2. The decline in ad pages by 14.8% brings with it a drop of at least 14.8% in editorial pages. That means magazines don't need as much content, which means they can cut reporters without much impact.
   

Over the past year, BusinessWeek and Fortune updated their formats. Expect more to follow suit. When they do, a letter from the editor or publisher will say that the new format is designed to better help readers, but don't be fooled. The new formats are designed to convey that the magazine continues to be relevant.

But after cutting reporters and editors and bringing more charts and graphics, that's probably not the case. Skimpier content is not more relevant. Meanwhile, in announcing format changes, a number of newspaper chains have said they will be adding more charts and graphs, as the Boston Globe's business section has done.

Unfortunately, these changes have not stemmed the exodus of readers or advertisers.

The iPhone is great. I would consider getting one if the carrier had better coverage in my area. But the news about the ad declines is unlikely to be cyclical, and means bad news for traditional media.
to attract advertisers .