MobileCrunch

Posted: 05 Nov 2011 02:25 PM PDT

The backlash was inevitable.

Siri has had a bit of an image problem this past week. Just like all technology propelled by the tailwinds of hype, it hit the inevitable wall of tech punditry. This magically turned the stream of largely positive stories into a river of negative stories under the guise of things like: “the voice of reason” or the “wake up call”. It’s the oldest trick in the book and it never fails to generate massive pageview energy. It happens 100 percent of the time. But it’s important not to lose sight of the bigger picture.

First of all, the downtime issue is a total red herring. Yes, Siri has been wonky on and off for the past few days. God forbid that a service explicitly labeled as “beta” behave like a service still in beta. I understand that this is a bit of a tough concept to understand since companies like Google leave software in beta for the better part of a decade, thus castrating the term. But look no further than how rarely Apple actually labels something as “beta”. They basically never do it. They only do it when they expect a service to be less than spectacular 100 percent of the time.

That’s why stories demanding an explanation for Siri’s downtime are comical. Siri is behaving exactly as Apple has said that it would. Perhaps their only mistake was using the “beta” tag, which again, apparently means nothing anymore. And running a commercial touting the beta feature may not have been the best play right now either.

The more interesting angle of the backlash goes after what Siri is and what Siri is not. A few days ago, Jordan wrote a post entitled “Siri, Why Are You So Underwhelming?” In it, she brings up a few key points that I think are reflective of some frustrations many are having in this post-hype phase. While the broader notion is a bit silly: No, Siri cannot be a full replacement for a human assistant — nor do you have to pay Siri tens of thousands of dollars a year, provide it with health insurance, etc. Some of the smaller points definitely ring true. Siri can’t add contacts. Siri can’t open apps. Siri can’t play TV shows. Etc. But there’s a keyword missing in each of these:

Yet.

Again, see: beta. All of that is coming, I have no doubt.

The key is when Jordan also complains that she can often type faster than Siri can think. That’s undoubtedly true. But the thinking here has to extend beyond the present and your own self. It reminds me a bit of the people who used to say that they needed a physical keyboard on their phone. And that Apple would eventually have to add one to the iPhone. It was a certainty. BlackBerry FTW.

Now all of those people seem to happily be using iPhones (or Android phones) without physical keyboards without problems. BlackBerry? Yeah…

What Siri represents is an extension of computing by utilizing something that (most) everyone has: voice. It’s the same thing with the touchscreens on the iPhone and iPad. They also utilize something that (most) everyone has: fingers. “If you see a stylus, they blew it,” Steve Jobs once famously said. And he was right. Why create something to distance yourself from the machine? In the past, these crutches were needed. We’re getting to the point where they aren’t anymore. Forget the mouse and keyboards, it’s touch and voice.

Everyone is amazed now when they see children interact with the iPad in such a natural way. And they’re even more amazed when they see a child with a physical magazine and it’s extremely foreign to them. The same thing will one day be true with Siri (or any comparable voice technology). What’s easier, teaching a child to type on a keyboard or letting them speak to a computer? There’s a reason why basically every science fiction author in the last century envisioned a future in which we speak to our computers. And there’s a reason why every major technology company has been working on speech technology for the past few decades. It’s a natural thing to do. And it makes sense that eventually it becomes a computing norm. Again, just like touch.

But we’re not there yet. And that’s why we’re seeing some of this backlash. Is Siri perfect? Of course not. It’s probably 1 percent of where it should be if we’re to use it as a regular computing input. But I’m always amazed when people seem to completely discount the fact that the technology will get better over time — and quickly.

But maybe it’s hard to blame them. Again, these are the people who wanted iPhones with physical keyboards. We want what we know. We don’t know voice as a primary method of computing. It’s awkward. It’s foreign. But it won’t be forever. And it especially won’t be for children who grow up learning to speak to computers. Our hesitance to speak to our machines will seem awkward to them.

Does that mean speech replaces text input entirely? Of course not. There are some times where typing is better — when you’re in a noisy room, for example. Or in a place you need to be quiet. Or if you’re saying something private. But there’s also a reason why humans don’t stand with one another and quietly pass notes back and forth.

My point is simply that you should take the Siri backlash with a grain of salt. We’ve seen such backlashes before, we’ll see it again. Everything is “stupid” and “useless” until it’s everywhere.

[image: CBS]

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With 4S Now Tops Among Big 3, Apple Grabs 52% Of Industry Profits; Doles Out Huge Bonuses

Posted: 05 Nov 2011 06:14 AM PDT

As you’ve likely heard, there’s been a lot of upside that’s been reported of late when it comes to Android’s mobile OS. Thanks to Nielsen, we know that, yet again, Android is leader among mobile OSes, now accounting for 43 percent of U.S. smartphone marketshare, up from 39 percent in July; while Apple’s iOS remained at 28 percent over the same period, placing it in distant second.

Of course, Apple has a little bit of vertical integration going on, and in spite of their lagging well behind Google in mobile software market share, iPhones are used by a full 28 percent of smartphone customers, making them top manufacturer for yet another quarter. Hardware leans significantly in Apple’s favor.

So, while the iPhone made up a relatively small 4.2 percent of the mobile handsets shipped in Q3 2011, it seems that Apple is now accounting for over half of the industry’s profits. Yep. According to Canaccord Genuity analyst Mike Walkley, of the top eight cell phone vendors across the globe, Apple owns over 52 percent of the total operating income. And while that may seem impressive, that number is down from 57 percent in the second quarter.

In comparison, Samsung owns 29 percent of profits among the top vendors, up from 18 percent last quarter, while HTC accounts for 9 percent, RIM comes in at 7 percent, with Nokia at 4 percent. Though Apple’s 52 percent share of the operating profits of the top eight vendors is impressive in spite of the relatively small percentage of iPhones shipped, Samsung’s meteoric rise is certainly worthy of note.

According to Walkley, Samsung gained 11 points of value share thanks largely in part to the Android Galaxy S II, while RIM and Nokia continued to slip. Of course, while most groan over RIM’s future, at least Nokia is making a play at Windows Phone, hoping that its play into the U.S. market can turn a sinking ship around.

That being said, the analyst (and firm) found that Apple’s new iPhone 4S was the top selling phone for AT&T, Sprint, and Verizon (the three largest carriers in the U.S.), with the iPhone 4 — in spite of its next-in-line now being sold — remaining a top selling model for each of those carriers. As 9to5Mac says, the phones get older, the margins seem to get better. And with the popularity of these phones increasing, Walkley projects that Apple may ship as many as 29 million iPhone handsets in Q4 2011.

And that’s not all, as this succession of SEC filings shows, Apple’s executives are now reaping the rewards of a strong fiscal year (in which the company passed the $100 billion mark in revenue). The company awarded 1 million shares of stock to seven top execs, which will see bloated wallets for those of that remain with the company through 2016. The recently promoted SVP of Internet Software and Services Eddy Cue received 100,000 shares of stock in the form of a restricted stock units. 25 percent of Cue’s shares turn into freely tradable stock in September 2014, with the remainder vesting in September 2016.

Each of the remaining six executives received 150,000 shares of restricted stock, with 50 percent vesting in June of 2013 and the remainder vesting in March of 2016. Based on the current price of Apple stock, that works out to a payday of approximately $60 million each for the execs who received the 150,000 shares. (Which includes: Scott Forstall, Senior Vice President, iOS Software, Bob Mansfield, Senior Vice President, Hardware Engineering, Peter Oppenheimer, Senior Vice President and CFO, Phil Schiller, Senior Vice President, Worldwide Product Marketing, Bruce Sewell, Senior Vice President and General Counsel, and Jeff Williams, Senior Vice President, Operations.)

While Apple’s new CEO Tim Cook wasn’t mentioned in these new filings, he was awarded 1 million shares of stock upon his appointment as CEO, with 50 percent vesting in August 2016 and the remainder vesting in August 2021 (should Cook remain an employee of Apple).

So, while Google continues to rise in mobile software, it seems that thanks to Apple’s hardware and its dominance around the world thanks to the iPhone 4 (and now the 4S), both Apple and its executives are cashing in.

Thanks to Alistair Israel for the image