With Apple's launch of the iPhone 5 and myriad new device announcements from Amazon, HTC, Motorola, Nokia, and Samsung, we pointed out that these devices are just one element of a broader ecosystem battle. Apple's product announcements at its San Jose, California, event this morning evince the company's continued ability to exert a superior gravitational pull on its customers and partners than its competitors. Here's why:
Customers get more choice in design and use model. Since Apple's 2010 introduction of the iPad, its competitors' tablet products have only clicked with customers in a separate category: smaller, handheld tablets directly targeted to content consumption — like Amazon's Kindle Fire and Google’s Nexus 7. The new iPad mini’s design suits this use model but is also complementary to the larger iPad line because of its portability — perfectly suited to a range of enterprise applications like field service, where a larger tablet is cumbersome. We expect that many iPad owners, both enterprise and consumer, will add an iPad mini to their portfolio, as will iPhone owners — the new shared data plans from AT&T and Verizon Wireless help simplify the decision to include LTE in their iPad mini.
A new form factor enters the ecosystem without requiring any adaptation. Because the iPad mini display features the same specs as the iPad 2, neither customers nor developers need worry about compatibility or adaptation. All the apps and sites just work. The new device slots into the app and content ecosystem seamlessly — and into the support system that CIOs have put in place for enterprise tablets.
Today Softbank — whose assets include the third largest mobile carrier in Japan — announced its intent to purchase a 70% share of Sprint in a complex financial transaction. It's a gutsy move by a company that has proven success as a market disruptor, first in fixed broadband service and more recently in mobility. Assuming the deal passes regulatory and shareholder muster, Sprint will receive a massive cash infusion that will expedite its implementation of its Network Vision update and its deployment of LTE technology across its national footprint.
But for Sprint to have any realistic chance of wresting market share from the Verizon and AT&T behemoths, it requires additional spectrum to expand its LTE capacity beyond the puny 5x5 MHz of its current plan. And there's a carrier rich in that spectrum resource: Clearwire. Sprint holds a minority interest in Clearwire, some of its customers use Clearwire's network, and it has designed support for the company's spectrum into its Network Vision, but Clearwire needs capital to complete its network and to effect the network's transition from WiMAX to LTE.
If Softbank's president Masayoshi Son is serious about enabling Sprint to disrupt the US mobile market, he needs to add control of Clearwire to his shopping list. CIOs looking to exploit Sprint as a viable alternative to the Verizon-AT&T duopoly need to see this additional step on the roadmap before making a commitment to Sprint for the long-term future.