The internet was abuzz today over star Apple analyst Gene Munster's forecast for the iPhone 6. Munster is known to have a great read on Apple and we thought it worthwhile to point out a few interesting items from his note this morning.
First, his assumptions about foreign market are probably on the money. But it isn't because the device is 'revolutionary' - it's because, finally, it has a large screen! In looking at phone trends over the last 5 years, screen size has done nothing but increase while Apple has stayed true to more or less the original sized screen.
We believe this will be the primary driver of the iPhone 6's success and will account for the sales growth Mr. Munster predicted in his forecast. Apple is tapping into pent up demand for this format, plain and simple.
What we don't believe is in Apple doing anything notably better anywhere else. Siri is still an also-ran to Google's voice search and we view this is the biggest area for innovation as smartphones move forward. Screen real estate will stay approximately the same and even Samsung's Edge line, with curved displays, don't much change this.
People's screen are already filled with their maximum surface area of apps and little will change here.
Google voice search changes this, but removing the need to interface with apps beyond one single app on the home screen. Siri does this to some extent too but Google's product is significantly more powerful than Siri, having an intelligence beyond just 'open app X'.
Google also has an advantage shown most clearly in the latest release of Android (5.0 Lollipop). The Cards concept, first surfacing a couple of years ago in Google Now, will be powerful for phone as they move forward into more general purpose computing devices.
Cards provide an intuitive way to multitask but are also very powerful when paired with Google's big data engine. Google Now surfaces cards to remind you of things based on your location, the route you travel to work and other data driven events.
Apple has no such data backend, limited analytical capacity compared to analytics juggernaut Google and has not seemed to innovate much in this arena.
So while Munster may be correct in his sales forecast the cause is not as huge as he claims. Google's Android system, increasingly fortified with difficult to replicate data and analytics driven services, will continue to maintain share and be a significant player in the mobile space.
Apple will continue to stick to its strengths of design, exclusivity and premium pricing and enjoy their captivity creating eco-system all the way to the bank.
But don't expect anything to materially change here - each side has lots of weapons and a clearly defined strategy.
Who will get pinched? Expect Microsoft and Blackberry to be increasingly marginalized. Anyone not competing on one of these two platforms will be driven out of existence. Also look for the number of large, high end Android phone manufacturers to decrease. The market can't sustain this many hardware companies running the same suite of Google software so expect this number to drop (Sony, LG we're looking at you).