Ben Evans wrote the article I’ve been wanting to write about why the phone market is fundamentally different than the PC market. I’m glad he did; his version is even better that what I had outlined. A quick taste:
In the 1990s, the PC market was mostly a corporate market (roughly 75% of volume). Corporate buyers wanted a commodity…Meanwhile with no internet, home buyers were mainly interested in a PC that ran the same software they used at work (and all of the games were for PC).
Hence, in this market all of Microsoft’s advantages were in play, and none of Apple’s. Apple, in Steve Blank’s phrase, did not have product/market fit. The Open model deployed by Microsoft and Intel produced a generic commodity product that was exactly what the market wanted: Apple’s model did not. Fundamentally, Apple’s selling points were irrelevant, invisible or both.
It’s a must-read; I agree with every word.
There is one more point worth adding, in the interest of putting this myth that phones = PC’s fully to bed. Specifically:
Apple didn’t lose the PC market to Microsoft; they never owned it in the first place.
You’ve heard the phrase, “No one ever got fired for buying IBM.” That axiom in fact predates Microsoft or Apple, having originated during IBM’s System/360 heyday. But it had a powerful effect on the PC market.
In the late 1970s and very early 1980s, a new breed of personal computers were appearing on the scene, including the Commodore, MITS Altair, Apple II, and more. Some employees were bringing them into the workplace, which major corporations found unacceptable1, so IT departments asked IBM for something similar. After all, “No one ever got fired…”
IBM spun up a separate team in Florida to put together something they could sell IT departments. Pressed for time, the Florida team put together a minicomputer using mostly off-the shelf components; IBM’s RISC processors and the OS they had under development were technically superior, but Intel had a CISC processor for sale immediately, and a new company called Microsoft said their OS – DOS – could be ready in six months.2 For the sake of expediency, IBM decided to go with Intel and Microsoft.
The rest, as they say, is history. The demand from corporations for IBM PCs was overwhelming, and DOS – and applications written for it – became entrenched. By the time the Mac appeared in 1984, the die had long since been cast. Ultimately, it would take Microsoft a decade to approach the Mac’s ease-of-use, but Windows’ DOS underpinnings and associated application library meant the Microsoft position was secure regardless.
Evans is correct: the market today for mobile phones is completely different than the old market for PCs. And, so is Apple’s starting position; iOS was the first modern smartphone platform, and has always had the app advantage. Neither was the case in PCs.
The Mac didn’t lose to Windows; it failed to challenge an already-entrenched DOS. The lessons that can be drawn are minimal.