“We support two platforms at Apple. Two. The first is HTML5 […] and the second is the AppStore”

–Steve Jobs, WWDC 2010

War of the platforms 1.0

A lot has been written about the “platform wars” between Apple and Microsoft. The quick summary is as follows:

Apple has established the dominant position in mass market personal computing in the 1980s. It has been able to establish this position by integrating its hardware and operating system into a single package – the Macintosh. Popular applications such as VisiCalc, the first spreadsheet software have been created for that platform thus forcing consumers seeking to use those applications to chose the Mac platform over its competitors.

Microsoft chose a different strategy. By licensing its Windows operating system to many hardware manufacturers Microsoft managed to establish a wide hardware footprint, which translated into a larger install base, which in turn made independent software vendors prioritize development of Windows applications over Mac ones. Furthermore, this strategy commoditized the hardware market thus enabling Microsoft to extract tremendous profits from the ecosystem that it nurtured.

In the mid 1990s Apple tried to adopt the Microsoft strategy by licensing its operating system to other hardware manufacturers – the so-called clones. However by that point Microsoft market domination was too large and Apple’s market share continued to slide.

Upon his return to Apple, Steve Jobs quickly killed the clone program and started to gradually rebuild the company by focusing on trendy esthetically appealing computers as well as the Mac OS X, the new operating system. Jobs also took care to make sure that Microsoft will continue developing its Office Suite for Mac.

War of the platforms 2.0

With the introduction of its iPhone, which came with the new operating system iOS, Apple kicked off the post-PC era. Google quickly followed with the Android operating system starting the current platform war for dominance in mobile devices.

Seemingly taking the page out of the Microsoft playbook Google opted to license Android to hardware manufacturers. Google succeeded in getting most major phone and tablet manufacturers to use Android. Today the Android market share exceeds that of iOS. The two companies are competing for developers and independent software vendors. While first-mover advantage allowed Apple to establish a sizable ecosystem, Google is gaining. Majority of popular mobile applications today are available on both iOS and Android.

Adobe Flash

Adobe carved out a niche for its Flash technology. Primarily used for creating rich web-based applications especially those with video, Flash is basically a platform within a platform. An application written in flash will work on Mac, Windows, Solaris and other systems as long as the user has downloaded the Flash player. So by choosing the Flash technology developers don’t have to choose development for Windows versus Mac versus another platform thus diminishing the importance of the operating system as far as flash-based applications are concerned. Adobe in turn is able to sell expensive developer tools, which developers are forced to buy in order to be able to reach the Flash install base.

Apple refused to support Flash on its iOS devices. Adobe accused Apple of stifling cross-platform development, while Apple motivated its lack of support for Flash by purely technological choices (See Steve Jobs’ Thoughts On Flash).

HTML 5 and its long-term impact

HTML 5 is going to allow creation of web-based applications by enabling the browser to run more complex processes such as video rendering, complex data operations and others, in effect making the browser the operating system. Just like with Flash, an application developed for HTML 5 will work on any device that has a browser with HTML 5 support. Unlike Flash however HTML 5 will not be controlled by any one company. It will be a completely open standard meaning that anybody will be able to create an HTML 5 browser and anybody will be able to create an HTML 5 application.

If we assume that majority of software applications will in the future become web-based and if we further assume that HTML 5 will become the dominant platform, that means that the majority of software created in the future will be completely operating-system agnostic. This has two important implications:

1. Because developers won’t be choosing between competing platforms, no company will be able to muscle its way to dominance by aggressively signing on developers.

 2.Because most applications will run on most devices, consumers will not be locked into any specific platform.

This will fundamentally shift competitive dynamics between technology platforms. Instead of competing to establish platform dominance and then protecting that dominance the way Microsoft did in late nineties, competition will increasingly be based on hardware. The role of the hardware operating systems will be to optimize the fundamental hardware characteristics such as battery life and usability. This means that hardware will play a more important role in the competition of technology platforms and will cease to be a commodity.

Steve Jobs’ quote in the beginning of this post as well as the fact that Apple is one of the major contributors to the HTML 5 format, suggests that Apple believes in the above turn of events and prefers competition on hardware to that of competition on third-party software ecosystems.

Google’s recent acquisition of Motorola Mobility suggests that Google too believes that that’s where we are headed. Google understands that it needs to create hardware that’s tightly integrated with software and that will be able to stand on its own in competition with Apple and other hardware manufacturers.

Microsoft is late to the race (again). The company recently introduced its touch operating system – Windows Phone. In its marketing materials Microsoft is touting compatibility with popular Microsoft applications such as Office and Xbox Live. Microsoft is also reaching into its developer community to ensure broader software availability as well as partnering with major hardware manufacturers to produce devices that run on Windows Phone. Microsoft is also investing heavily in Silverlight, a proprietary platform that competes with Flash.

What this all means for consumers?

I think that the consumers will benefit from the new competitive dynamics. By not having to worry about whether a particular device will be able to run our favorite applications we will be a lot more free in choosing which devices to buy. I also believe that smaller device manufacturers will proliferate. Who knows, maybe there’s another Apple in the making.

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What’s the future of computer applications? Will it be based on the so called “web-apps” accessed through web browsers that run on terminal-like computers/mobile devices or there is still space for the classic model of applications that are actually “installed” into the devices (maybe in a more transparent way)?

A computer application was, for a long time, synonym of something that (i) either came pre-installed in whatever device you acquired or (ii) you had to buy physically (via the old diskettes/cds) and install it by yourself (or, as most users did, ask someone else to do so). The whole process of buying an application and install it was expensive and too complex for the average user, who ended up sticking to the pre-installed package that came with his or her computer.

With the development of the internet and the increasing number of people with broadband access, some companies started to question and evolve this classic model or buying and using computer applications, but in slightly different ways.

One of the first to challenge this concept was Google, who predicted that in the future all applications would run in a server and users would access only the front-end (or the interface) of these applications  directly through their web browsers. As part of its strategy, Google then engaged into developing web applications that would mimic the functionalities of classic applications, but running entirely on the web (Gmail, Google Docs, etc.). The big advantage was that users wouldn’t need to install those applications anymore, all the data would be in the “cloud” and in the future they might pay for using those as a “service”. Google went even further and also developed a web browser (Google Chrome) that would make those applications to look even more like the classic ones (better layout, capacity to run off-line and some in-device storage). However, it seemed strange that a person would need a full powered computer, with lots of software layers, just to run a web browser (since all other web-based applications would run from inside the browser). The missing part of Google strategy appeared with the launch of the ChromeBook (http://www.google.com/chromebook/). In these computers, the Google Chrome browser would assume the role of Operating System (replacing Windows, for instance), making the system cheaper and faster by eliminating all the unnecessary hardware and software. The concept was beautiful but the ChromeBook project is still far away to be considered a success. Most initial reviews classified it as “expensive for what it does” and “a good complement to your laptop”. The fact is that web applications are still far to be considered as good as their offline counterparts (just compare Google Docs with Microsoft Word), and users would still need a normal computer for their daily activities.

Apple took a different approach. With the launch of the AppStore for its mobile devices, Apple found a new way to take advantage of the broadband development to evolve the classic model of selling and delivering applications to users. In an iPhone, anyone could easily go to the AppStore, buy an application (usually at a cheaper price than classic apps), and install it instantaneously without any pain or external help. It seems like a small difference, but think about how many apps the average user buy for their iPhone vs. the number of apps they buy for their PCs. The difference is huge. In fact, the idea worked so well for Apple that it just incorporated the same concept into its new OS X Lion (for full-size computers) – http://www.apple.com/macosx/whats-new/app-store.html. But did apple forget the concept of cloud computing dreamed by Google by not investing into web applications? Apple’s answer is the iCloud – http://www.apple.com/icloud/ – a platform that would, according with Apple, seamlessly integrate the data used by all your apps, in all your devices. Therefore, Apple users could benefit from higher quality Applications (not confined into a browser) and similar benefits of web-based applications.

Other companies are also going into this direction. Microsoft has just released the beta version of the  new Windows 8 OS (http://www.youtube.com/watch?v=p92QfWOw88I), which looks a lot similar to the  Windows Phone  OS (their Operating System for phones) and we can expect that it will provide an easier way for users to install and use applications in the future. Even Google is exploring the same model through its Android OS for smartphones.

Is Apple on the right direction or will classic apps last only until web-apps become more advanced?