Posts Tagged ‘wwdc’
QCon San Francisco 2008
For most of this year, I’ve been taking notes at conferences using Field Notes notebooks. I love their pocket sized dimensions and they have just enough pages to comfortably hold everything from a conference that I’ll want to remember later. However, for QCon last week I decided to try typing everything into Evernote. The fact that I can access my notes on my iPhone makes the notes just as portable ex post facto, and saved my Field Notes for more worthy pursuits.
Evernote worked out very well, and now I can share my notes online just by putting all of them into their own notebook (folder) and making it public.
So without further ado: my notes from QCon.
Overall, I thought QCon was excellent. While the quality of the speakers was somewhat varied in the sessions I attended, I never felt my time might be better spent checking out a different session, which puts it ahead of most conferences. (I’m a big fan of voting with my feet.) QCon is certainly on my short list of conferences to attend next year. Also on my list are (in no particular order): C4, WWDC, RailsConf, eRubyCon, and 360|Flex.
Understanding Apple’s Revenue Streams
The excellent blog Going Private discusses Apple’s new iPhone revenue model, whereby Apple allowed AT&T to subsidize the price of the iPhone (leading to more iPhones being sold) but gave up the profit-sharing on new iPhone service contracts. The deal is analyzed entirely from the perspective of whether the increased sales volume offsets the lost service contract revenue:
I suspect the figures are pretty offsetting, leaving any future gain in iPhone revenue as a percentage of total revenue really subject to iPhone sales growth v. other sales growth at Apple… and not the new revenue model which is probably pretty neutral.
I didn’t see a way to leave a comment, so I’ll post my comment here. If the only components to this deal were subsidies and contract revenue, then it would be a nearly complete win for AT&T. But this analysis fails to account for the additional revenue that Apple will gain through the App Store selling applications to iPhone (and iPod Touch) owners.
The service contract revenue lost by the new deal is not offset against increased hardware sales—it is offset against App Store revenues. The more people who own iPhones, the more revenue the App Store can be expected to generate. Apple gave up contract revenue primarily in exchange for permission to run its own store selling software over-the-air directly to the iPhone device. In the traditional mobile marketplace, it is the carrier who sells applications and keeps a generous percentage of the application price. Apple negotiated with AT&T (and, apparently, dozens of other carriers internationally) to allow iPhones to purchase and download applications from Apple’s App Store. To secure this, Apple agreed to no longer take a cut of the iPhone service contracts. Additionally, Apple will allow AT&T to subsidize the iPhone, which is now good for both parties. (This new arrangement is apparently much more pleasing to carriers internationally as well, giving Apple more markets in which to sell its product.)
It’s a win for AT&T because they can attract (or retain) many more customers and they no longer split those contract revenues with Apple. Additionally, I suspect that AT&T even gets a small cut of the 30% Apple keeps for applications sold over-the-air through the App Store to AT&T customers.
Apple wins by dramatically increased hardware sales and the right to sell apps over-the-air to iPhones. And the App Store benefits from networking effects. The more people who own iPhones, the more developers will be attracted to build and sell applications in that marketplace. The more applications there are in that marketplace, the more people will want iPhones. The iPhone’s killer app will no longer be it’s revolutionary interface and ease of use, but rather be the applications that run on it. Finally, Apple wins by attracting huge numbers of new developers to its operating system, libraries, and development tools. John Gruber reports that “two engineers from Apple told me that [interest] wasn’t just for the iPhone — that they were seeing plenty of new-to-Cocoa developers in the Mac-specific sessions and labs, too”.
Everyone benefits.
WWDC Prediction Outcomes
WWDC isn’t over yet, but we learned a lot today. Let’s see how I did with my predictions.
| Category | My Prediction | Correct? |
| iPhone | ||
| 3G | Yes | Correct |
| GPS | Yes | Correct |
| Faster Processor | No | Correct |
| Video Conferencing | No | Correct |
| Thicker (face-to-back) | Yes | Correct1 |
| iPhone mini | Yes | Incorrect |
| Higher Pricing | Yes | Incorrect |
| SquirrelFish | Yes | ? |
| iPhone widgets | No | Correct2 |
| Apple Software | ||
| OSX 10.6 Will Be Announced | Yes | Correct |
| OSX 10.6 Named Snow Leopard | Yes | Correct |
| OSX 10.6 Specifically be for Atom Devices | No | Correct |
| OSX 10.6 OSX 10.6 Will Drop PPC Support | Yes | ? |
| OSX 10.6 Will Drop Carbon Support | Yes | ? |
| New / Improved / Revamped .Mac Services | Yes | Correct |
| .Mac Rebranding | Yes | Correct |
| Apple Hardware | ||
| New Apple Device | No | Correct |
| New MBP Designs | Yes | Incorrect |
| New Displays | No | Correct |
| Pie In the Sky Prediction | ||
| OSX 10.6 Adds Resolution Independence | Yes | ? |
Outcome: 13 correct, 3 incorrect, and 4 unknowns. So my prediction accuracy is 65%-85%, depending on how the unknowns turn out. Not bad, given that 10% of my predictions were complete guesses.
1 The original iPhone was 11.6mm thick, according to Apple’s support site and the new iPhone is 12.3mm according to the new iPhone site.
2 No discussion of a DashCode for iPhone or HTML+JavaScript+CSS application development solution was stated during the keynote. If it comes to my attention that widget iPhone development is possible, I will toggle my answer’s correctness.
