Naofumi Kagami

Chromebook = Netbook revisited

Almost a year and a half ago, I stated (in Japanese) that it is plainly obvious that Chromebooks will follow the fate of Netbooks.

I outlined how Microsoft would respond if they ever perceived Chromebooks to be a threat.

したがって今回は、もしMicrosoftが反撃を開始するとすれば、Acerなどの低スペックモデルに割安でWindows 8を供給し、そしてSkyDriveの無料使用分を追加する形で反撃することが十分に予想されます。Google Docsの対抗製品であるWindows 365の無料使用分を付ける可能性もあります。

This time, if Microsoft decides to fight back, they would start providing Windows 8 cheaply to low-spec models like the Acer. They would also add free SkyDrive capacity. It is also likely that they would include free Office 365 to compete with Google Docs.

That seems to be exactly what Microsoft has started to do with Windows Bing. Computer makers will start announcing PCs shortly so we should see how these will be priced. I expect prices to be very similar to Chromebook prices.

So far so good.

We can now sit back and wait for the next chapter:
“Interest in Chromebooks wane.”

Update

It is interesting to note that since Microsoft now has a cloud-based subscription revenue model in Office 365, it will be more willing to reduce the cost of Windows. According to this report, Windows 8.1 usually costs $50 per license but Microsoft is offering it for $15 on low-cost devices.

Office 365 Personal is $6.99 per month or $69.99 per year. Add the fact that all these low cost PCs will come with Bing as their default search engine, hence generating ad revenue for Microsoft, and you can see that this strategy makes sense for Microsoft even without a threat from Chromebooks.

Funny Phablets

Phablets are a very funny product category. Nobody, at least in the west, seems to quite understand what they are.

I don’t either. I’m just observing that the information that we have is difficult to understand, and the common theories aren’t logically consistent.

Here is an example of a bullish prediction for phablets.

“Are Phablets Signaling a Butterfly Effect for Mobile Devices?”

While I have a large issue with how “butterfly effect” is being used in this article, that is beside the point. The point of the article is to illustrate how phablets might lead to significant changes in the mobile space.

In this article, the benefits of a larger screen are given as follows;

“Bigger screens are becoming essential for browsing. They make it a lot more attractive – you can fit more information into a single screen.”
“Email gets easier on a big screen too.”

Now compare this with a report by Opera Mediaworks “Phablets are no passing phad”.

What they find in terms of phablet usage is;

Social networking is by far the top category (53.8% of total impressions served), far outpacing social site usage from phones and tablets.
Phablet users are far less likely to use News & Information sites than phone users and fall well short of tablet users in their interest in Gaming, and Music, Video & Media.

So it seems that phablet users are less prone to browsing the web, and are more inclined to use their device for social networking.

What kind of social networking?

We can’t be sure, but if it is a lot of WhatsApp, then we can be sure that large screens aren’t making too much of a different. The same can be said for Twitter.

This doesn’t match the phablet benefits given above.

My feeling is that nobody really seems to know what the real appeal of Phablets are on purchase and how they are actually being used. Much less whether their success will be confined to Asia or whether they will penetrate other markets.

Design And The Lack Of Intent

I read a great post today by John Moran about Intent within Apple’s designs.

Overarching intent is easy. The hard part is driving that conscious decision-making throughout every little choice in the creative process. Good designers have a clear sense of the overall purpose of their creation; great designers can say, “This is why we made that decision” about a thousand details.

When Jony Ive, Apple’s newly titled SVP of Design, criticizes a material selection or feature decision, “he’s known to use ‘arbitrary’ as a term of abuse.”

John goes to outline the “Three Design Evasions”; what most companies do instead of employing Intent.

Preserving the past.
Copy first without making the Intent your own.
Delegating design decisions to your customers.

The question is, what is holding good design back? Do we lack good designers or are corporations ruining them?

I don’t know the answer. I’m quite sure that a lot of designers are aware of Intent and consciously try hard. The problem is, I tend to find most of the celebrated designers lacking it the most. Instead, I often find good Intent and good design in kitchen utensils and other everyday tools that are not “appearance” driven.

For example, architecture. Widely acclaimed architecture is more often praised based on its appearance. Of course critics will note Intent and usability benefits. However, as an actual user of these buildings, I have never found myself appreciating the designers’ decisions. In fact, we more often tend to loath the strangely designed rooftops that invariable leak rain, and the unconventional hallway orientations that make you feel lost.

On the other hand, I marvel at the curves of my kitchen cutting knife or scissors which are truly designed to fit your hand. I wonder at the small details on the metal knife embedded in the box of my food wrap which allow me to efficiently cut the film with the minimum of strength and without it tearing in unwanted places.

Even Jony Ive’s designs used to have annoying flaws. I hated the trackpad buttons on the Powerbook G3s which looked nice, but had a very badly designed clicking mechanism. The flimsy hinge on the Titanium Powerbook easily fractured and came off. And it’s really hard to justify the design of the “toilet-seat” iBooks. There was very little Intent in those designs.

In my opinion, it was only after the aluminum Powerbooks which had very minimal ornamentation that Jony’s designs started to blend form and function.

Designing with Intent is probably really really hard. Even for Apple and Jony Ive.

Kamishibai vs. Server-generated Javascript Responses

We’re writing some new capabilities for our Kamishibai.js Javascript library that powers our Ponzu conference system.

I haven’t documented Kamishibai.js, and at this point, it’s not even an independent library. Still, I just wanted to note a few things that crossed my mind recently.

Enough with the JavaScript Already!

A well written slide stack by Nicholas C. Zakas.

After consulting with several companies on performance related issues, it became clear that one of the biggest performance issues facing websites today is the sheer amount of JavaScript needed to power the page. The demand for more interactive and responsive applications has driven JavaScript usage through the roof. It’s quite common for large sites to end up with over 1 MB of JavaScript code on their page even after minification. But do today’s web applications really need that much JavaScript?

The answer in my opinion is no. Not nearly. Kamishibai.js is less than 50KB minified without HTML templates. It is smaller than the jquery.min.js file.

Server-generated JavaScript Responses

Written by David Heinemeir Hansson on the Signal v. Noise blog.

The essence of Server-generated JavaScript Responses (SJR) is as follows;

Form is submitted via a XMLHttpRequest-powered form.

Server creates or updates a model object.

Server generates a JavaScript response that includes the updated HTML template for the model.

Client evaluates the JavaScript returned by the server, which then updates the DOM.

I totally agree to this approach. In Kamishibai.js, we extend it in the following ways;

Instead of returning a Javascript response in 3, we usually send a simple HTML fragment. The Kamishibai.js library looks at our HTML fragment and searches it to see if any of the top level element ids are already present in the DOM. If so, then Kamishbai.js replaces the content of the DOM with the content in the HTML fragment. This allows us to do common DOM-replacements without any Javascript. If you want to add animations, you can do this declaratively through HTML data-attributes in the HTML fragment.

Another extension is the use of JSON. We totally agree that returning HTML is better than JSON if performance or readability of your code is your main issue. However in Kamishibai, we cache responses in localStorage which is very limited in capacity. Since JSON can be made many times more compact than HTML, we use JSON for the responses that we need to store a lot in localStorage.

In Kamishibai.js, we take a progressive approach to Javascript HTML templates. We start by returning HTML fragments. When we think we want to send a view with JSON, we write a Javascript HTML template and a JSON response for that view. Kamishibai.js can automatically determine if the response is an HTML fragment or JSON which should be used with a template. If it is JSON, then it summons the appropriate template and converted the JSON to an HTML fragment. That HTML fragment is further processed to be inserted into the DOM.

Summary

Kamishibai.js uses Javascript to generate pages, but the code is small and simple. We just expand on some concepts by those who eschew complex Javascript libraries, and provide the Javascript to make these approaches easier to follow.

I hope to write more on Kamishibai.js in the future.

Moto G Sales Figures

A quick note as I try to gauge the success of the Moto G.

Total Smartphone Shipments in 2014Q1 were 281.5 million according to IDC and 279.4 million according to Canalys.

Motorola has not disclosed how many Moto Gs they shipped, but they tweeted that they shipped a total of 6.5 million devices in Q1. They didn’t make profits, but neither do most other players.

Of the 6.5 million devices, we know that Moto X isn’t a significant portion. Maybe 0.5-1.0 million.Moto X Sales

Kantar has reported that Moto G sold well in the UK. Moto G 6% in UK Kantar Moto G report

Nokia hasn’t reported on how many they shipped in 2014Q1, but it seems like somewhere between 5.6-8.1 million. Nokia Lumia sales

For some perspective on how other manufacturers are doing, IDC has a report. Samsung sold 85.0 million and Apple sold 43.7 million. Even LG sold 12.3 million.

I would say that for an Android phone that had very strong reviews, the Moto G sold in Nexus-like numbers. That means that it didn’t sell well relative to the big players, but would be significant to a player like LG which makes the Nexus 4 and Nexus 5 smartphones. In many ways, the Moto G is a Nexus device.

It is possible that Motorola could continue to grow upon the success of the Moto G. That is not however what happened for the Nexus devices. At this point, I expect Motorola to remain in their current position at best. As the association with Google disappears, it is more likely that it will actually go downhill.

Testing jQuery Evaluation Times

In our Ponzu conference system, we don’t use jQuery but instead our vanilla Javascript library. The main reason was that jQuery was slow on some mobile devices.

There hasn’t been too much discussion on the web about this, but I found this article rather interesting. I’m including the test code in the following links.

jQuery 2.0.0 evaluation from CDN.
jQuery 1.11.0 evaluation from CDN.

Some things to note;

The times in this test (not the original one on the post) may include network access. I found that in Safari 7, pushing the reload button or using the shortcut (command + r) forced a request to the CDN. On the other hand, if we placed the text cursor in the location toolbar and then pressed enter, it would use the cached Javascript code and would not send a request to the CDN. When comparing browsers, we have to make sure that network requests to the CDN are not firing.

Jobs-to-be-done in India

Just happened to read an article on The New York Times with a very interesting quote;

“Micromax is giving India what it wants: more bang for the buck,” Rahul Sharma, its co-founder and chief executive, said in a phone interview. “Most Indians don’t walk into a store asking for a smartphone; they go, “Bhaiyya, isme chat chalega?” (“Brother, will the chat apps work on this phone?”)

I suspect that this is not only relevant to the Indian market, but also key to getting “late-majority” and “laggards” to switch from feature phones to smartphones, even in countries like Japan with its ferocious appetite for high-end iPhones.

This is the ultimate jobs-to-be-done for smartphones. The specs or OS or ecosystems of smartphones don’t really matter.

Thoughts on Premium

A lot of people use the work “Premium” to explain Apples iPhone strategy, and/or their strategy in general. Apple’s products tend to be priced at the high-end of the market. On the other hand, Apple tends not to sell products priced at the lowest-end of the market. This tendency is strongest for the iPhone lineup, which constitutes only of phones in the high-end; Apple does not introduce new models targeted at the lower-end, although they do sell previous-year’s models at lower prices.

Some people have suggested that Apple has a broader product range for their iPods and their Macs, and hence they are not idealistically opposed to selling products at a range of price points, going from maybe the mid-range to the high-range. My opinion is that this is not the case. My understanding is that Apple produces the absolute best product they can for a specific customer, and only provides some minor configuration options (like RAM, HDD).

Take the iMac and the PowerMac for example. It is tempting to say that the PowerMac is the high-end model whereas the iMac is the mid-range model. However, this is not the case. For the vast majority of people who buy iMacs, the PowerMac is not only an overkill. It is actually less suited for the required jobs-to-be-done. The PowerMac is designed for creative professionals who require the very best in computing power, and who will also add extra hardware to the core PowerMac. The iMac is for normal people who do not need so much power, but instead value convenience of setup and ease-of-use. The iMac and the PowerMac are not high-end and mid-range models; they are two different products targeted towards two different markets with very different needs. Hence this is not an example of Apple selling a premium product.

The same goes for the MacBook product line up. The current retina display MacBook Pro is great for creative professionals but sacrifices portability. For people who want to carry their laptops with them, the MacBook Pro is actually a worse fit than a MacBook Air. Hence the MacBook Air is not a lower-end model of the MacBook Pro, but a different product for a different segment of the market.

The exact same goes for the iPod lineup. There was never two products in the iPod line-up that targeted the same use-case with one being the premium product and the other being an entry level one. The only “premium”-ness of a product in the lineup were products with maxed-out storage.

Now let’s apply this to the iPhone. Smartphones tend to have the same jobs-to-be-done for almost every person (except those who use smartphones as a feature phone replacement). Smartphones are used for communication, taking photos, playing some games, viewing maps and sometimes watching movies or listening to music. There is no segment like the creative professionals using PCs, who use their smartphones for very different purposes that require much higher processing power and/or expandability. On the other hand, there are no smartphone users who would be content with a device without a display, like the iPod shuffle. It’s even very difficult to make the argument that the variation between the MacBook Pro and MacBook Air is necessary for smartphones, because everybody highly values portability and because retina displays are necessity even for mid-range phones.

Regarding the iPhone, the only segmentation that would make any sense is a small variation in screen size. This would be similar to the 11-inch and 13-inch MacBook Airs. The current 11-inch an 13-inch model only have $100 price difference and choosing either is more about personal preference than premium/mid-range targeting.

Looking at what Apple actually sells and the markets that it’s targeting, selling a mid-range iPhone and a premium iPhone in parallel appears to be very uncharacteristic of Apple, and I doubt that it will ever happen. I sense that Apple doesn’t ever segment markets by “low-end”, “mid-range” or “premium”. More likely, they simply segment by “junk” and “best”. Any product variation in their lineup is a result of simply targeting different jobs-to-be-done.

If you believe that this is how Apple thinks, then the evolution of the iPhone lineup is pretty obvious. They may introduce a slightly larger (or maybe slightly smaller) iPhone in the same way that they have 11-inch and 13-inch MacBook Air models. That is, specs other than the screen size will remain mostly the same. The price difference would be small and choosing either would be totally a matter of personal preference.

For the lower-end, selling previous-year’s models at discounted prices seems to be a working in developing countries.

In fact, it’s a shame that there are very few companies that take the same approach as Apple. That is, market segmentation by “junk” and “best”.

Chromebook Disruption Revisited

Although some people consider Chromebooks to be a low-end disruption to traditional laptop PCs, I have been skeptical of this for quite a while (“Why the Chromebook is not a Low-End Disruption”). In January 2013, I even outlined why Chromebooks will ultimately follow the fate of Netbooks.

The flattening of iPad sales (1, 2, 3) strengthens my conviction.

Simply said, low-end disruption is much harder than many people believe. iPads have failed to replace laptop PCs in the low-end disruption fashion; Apple is now focussing on new-market disruption as is clearly demonstrated in the new “Your Verse” marketing theme.

Even with low-end disruption, there has to be a significant new-market disruption element. Low-end disruption is more than a few hundred dollars saved or a small bit of convenience. There has to be a clear and hugely significant improvement that broadens the use-cases, thereby allowing computing to happen in situations where it was not previously feasible. The “Your Verse” campaign is trying to tell us that the iPad does exactly this.

It follows that if iPads failed to disrupt laptop PCs, the chances of Chromebooks doing the same is close to zero.

What Next?

The dust on the iPad sales decline news has mostly settled, and at least the sensible analysts have converged on the view that the cause was the rise of the smartphone; that the smartphone became good enough for many of the computing needs that tablets were previously purchased for.

So now that we have a rather adequate idea of what happened, let’s try to go forward. Let’s try to see what will happen in the future.

Tablet sales vs. PC

Up till now, the rhetoric was that tablets will overtake the PC in sales quite soon. This assumed that tablet market will continue to grow while PCs will gradually decline.

First, it is possible that the overall tablet market (not only iPads) might also slow down. Hence tablets might not overtake PCs so soon.

Second, comparing tablet sales to PC sales may not be meaningful. Whereas many analysts previously thought that tablets were replacing PCs, that does not seem to be the case. In fact, it seems to be the smartphone that is replacing tablets and also PCs.

As a result, we don’t know right now what is going to happen to tablet vs. PC sales. We are also starting to think that this question is rather meaningless.

Absolute tablet sales

We know that the tablet market is rather complex. On the high-end, there is the iPad which is used for all kinds of tasks, including web-browsing, reading books, composing emails, drawing art, playing games, watching video and a lot more. On the low-end, there are media players which are not used for web-browsing but are used a lot for watching videos.

The price points are very different, as is the ecosystem, product quality etc. With this huge difference, it is questionable whether we can discuss these two segments together; it looks like there are two completely different markets.

For the iPad segment, it is reasonable to assume that the current trend will continue. Assuming that the flattening of iPad sales is a result of smartphones becoming more capable, we don’t see an immediate end to this trend. Investment continues to intensify in mobile applications and services. On the other hand, there are few compelling applications targeting the mass-market that require a tablet to enjoy. The exception here might be Microsoft Office. The ubiquity and importance of Microsoft Office could enable the iPad version to single-handedly reverse the downward trend of iPad sales.

For the other tablets, there is reason to believe that they will continue to expand. Prices are getting extremely affordable to the point that tablet hardware is now being bundled with subscription services, such as education. That is to say that these tablets are not longer a product in themselves, but an accessory to a service. They are single-purpose devices, much like the jug that comes with your coffee maker. They do not compete with other jugs. Since customers are not making an explicit purchasing decision when acquiring these tablets, competition with smartphones is irrelevant.

Unless a new consumer killer application emerges, the upside potential of the iPad segment lies mostly in businesses and education. As I mentioned, Microsoft Office may be a big boost to the corporate adoption of iPads. The problem is that corporate and education IT are slow-moving. We do not know when adoption will kick-in at the level that we need to see a visible reversal in iPad sales trends. It make take some more years, in which case we would see a continuation of the current downward trend for a while.

Long term

There is no question that the iPad is a magical device.

Whether laptop users will embrace it for their work as a PC replacement is actually kind of irrelevant. Replacing PCs doesn’t expand the possibilities of computing if the same people are using it for the same tasks. Instead, what is really important is how iPads allow children, old people and people with disabilities to use computers. Equally important is how it allows computing in situations where it was previously difficult, like when you are standing and do not have access to a desk.

Too many people thought of the tablet as a PC replacement (and found that tablets were actually being replaced by smartphones). That was the wrong approach. Tablets will never thrive if they can only find their niche in between two strong and ever-evolving products. Tablets will thrive if they can carve out their own niche and that niche grows.

That niche is a new market segment. It is a market that did not previously exist. The majority of potential customers are not yet aware of the possibilities, or there may be roadblocks which have not yet been sorted out. Sufficient budget may not yet have been allocated to these projects. It will take time.

In the long term, I am confident that the iPad will thrive. The current levels of iPad purchases and awareness are extremely high, and it is totally unlikely that many people will or have found exciting new niches. Unfortunately none of these have yet become truly mainstream, but it is inevitable that many of them eventually will.

iBooks Author

In this context, it is easy to see that iBooks Author, the software that you can use to create beautiful multimedia books for the iPad, is a long-term play. It is an attempt to improve the quality and quantity of e-books specifically for the iPad. It has to potential to grow the iPad education niche, but it will take time.

Mid term

In the mid-term, I expect iPad sales to continue to struggle. They may even significantly decline. Keep in mind that current iPad sales are extremely high, much higher than PC shipments from either Lenovo, HP or Dell so even a significant decline does not mean that iPads will lose relevance.

I have no idea how long this will continue, or if business/education sales will be large enough to ever sustain 20 million iPad units per quarter for example.

What we do know is that the iPad still does not have a direct competitor and that looks like this will continue to be so mid-term.

Risks

The risk that I do see to the iPad business is tablet bundling with services. It is possible that we will continue to see a proliferation of single-use tablets being offered for free or extremely cheaply with education services, business solutions, entertainment subscriptions etc. These markets rarely care about providing the best possible user experience and they could prevent the iPad from finding traction in these markets.

Apple’s solution to this problem is easily predictable. They will work on the ecosystem and developer tools so that better services and solutions are uniquely possible on the iPad. The race is on.