Why I think Android will take over the world in 3-5 years
Now before I start my discussion and analysis, I would like to issue a disclaimer. I am not some die-hard Android fanboy, in fact I am (deep breath everyone)....... a BlackBerry addict. You know those phones that were really popular back in 2007-2009 with those small screens and keyboard? Now we tried to come back with an interesting OS called BB10 which I am sure about 0.5% of the world is aware about. Don't get me wrong, you would have to pry my BlackBerry out of my dead hands because for some reason I just love it. However fanboyism aside, I am aware that I make up a very small group of individuals.
I am also very interested in technology and in particular the mobile phone market. I like to invest into tech stocks so I need to make judgements on where the market is headed. My purely unbiased view is that in 3-5 years time Android will be the only major consumer os, with the likes of ios, BBOS and Windows phone making up a niche market of loyal followers. My reasoning behind this theory is quite simple. Reason number 1 is hardware is becoming irrelevant, reason number 2 is cloud computing.
Reason 1 Hardware is becoming irrelevant
If you look at the hardware king right now, Apple, there is no doubting they make a quality product. It is refined and feels great in the hand, and the fit and finish is arguably the best in the business. However if you look at Apples recent quarterly income statements, more than 50% of their revenue is coming from the iPhone alone. The main way they make money off of the iPhone is selling memory. The price differences between the 16gb-32gb-64gb is $100 for every "jump up" in the model you take. However as many of you are aware from buying microSD cards, the cost of memory is very cheap. Apple's COGS(cost of goods sold) between the 16gb to 64gb model only varies by roughly $30 USD, however it will cost the consumer $200 for the extra memory, leaving Apple with a healthy $170 profit. This has proven to be a wildly successful business model for Apple to follow. Make quality hardware and charge a large premium for it.
Android, and Google Nexus hardware in particular is changing the game. If you compare the iPhone 5s to the recent Nexus 5, you would for sure notice differences in quality. However whether or not the differences warrant the price difference of $419 (Nexus 5 $399 for 32gb, iPhone 5s $819 32gb) is extremely debatable. This debate becomes even more crazy if you compare it to something such as the Moto G.
And this is where the basis of my first argument lies. I think Apple will become a niche company (and other hardware makers like BlackBerry) because only a certain niche of people will warrant paying double or even triple for a phone, when there are others that can do something very similar to it. I also notice a trend in many of those around me, that used to have an iPhone but due to certain circumstances (lost it, broke the screen etc) replace it with an Android because they no longer see the value in paying such a large premium for Apple hardware.
Reason 2 Cloud Computing
Google's vision is that sometime in the near future, every man, woman and child will have access to broadband internet. That no matter where in the world you will go, you will always be connected. This is why we are seeing things such as the chromebook that always need to be connected to the internet to work. Nowadays what differentiates a phone is not really the hardware, but its what it can do software wise. Android phones have access to a plethora of Google services that make our lives better. Things like maps, youtube, and especially drive differentiate it. Yes I know they can be accessed on other phones, but they are not as tightly integrated as they are on an Android. I believe that once consumers buy into Google Services, they will have no choice but to use an Android phone. I believe what Google will do is to start limiting its services slowly on other platforms in order to coerce people onto Android. We already saw this with the delay in releasing Google Maps to ios6, and not releasing Google Maps at all onto BlackBerry10. No other platform delivers better connectivity from phone, tablet, desktop to laptop than Android does currently.
With the two reasons stated above, I think that in 3-5 years Android will fully take over the consumer phone space. They are giving consumers a reason today to skip out on paying large amounts for hardware, and is making it easier to connect all of the electronics in our lives. People like me that use a BlackBerry will continue using it until it eventually disappears into a niche (I hope it doesn't) and Apple will follow a similar path.
So what does everyone think of this theory?