Why Not All The Rugged Android Devices Will Survive

Why Not All The Rugged Android Devices Will Survive

Why Not All The Rugged Android Devices Will Survive
Rugged Android Devices – Spot the Difference

Looking at the plethora of me too rugged Android devices launched in 2014 reminds me of the early days of the PC industry.

For you younger readers this was a time when a company called IBM invented a device called a personal computer with some help from a chap called Bill Gates.

 

 

In the early days IBM was the only manufacturer but they were soon joined by Compaq Dell and others who created a clone market of product that was literally described as “IBM compatible”

Then came a deluge of “manufacturers” joining the fray. In the UK companies like Apricot Tiny Time Evesham Packard Bell and a very long list of others were all very active. They focused on shifting product in an attempt to grow very quickly whilst stealing market share from the major players.

They discovered that using price as the major differentiator meant that profitable growth was elusive. This was not a great place to be especially when trying to sell to a fickle public through the medium of retail.

Over a period of time these companies consolidated tried to re-invent themselves or disappeared altogether.

Lessons for Enterprise Mobility?

Traditionally our niche handheld market has been dominated by hardware and apps optimised to run on one operating platform – Windows Mobile.

What has surprised many is the speed at which smartphone users have abandoned previously held truths. The demise of Backberry and Nokia has serious lessons for the box shifters in the enterprise space. We have seen huge movement over the last 18 months from users asking for systems to be deployed on Android or iOS.  Motivations include being able to access a different buying economic a much broader range of product and to open the door for BYOD. The killer being once people stop developing on your platform look out.

Many buyers are now used to the norm of a 24 month contract and replacement cycle for mobile devices. So a traditional high initial price with 5 year TCO and multi year repair cycle just does not suit them.

Innovate and Keep up or its Curtains

Tim Cook Apple CEO said earlier this year that he did not see the market for high end smartphones becoming saturated any time soon. That makes sense for him as Apple is the aspirational brand. So like BMW Dyson and John Lewis it does not need to compete just on price.

The same is broadly true in the Enterprise sector where super size major clients having a relationship with a scale vendor makes a lot of sense. But in these cases the manufacturer will only stay competitive by continuing to eliminate channel content and reducing margin to compete with all the alternatives.

So for manufacturers with a history in Enterprise Mobility introducing rugged Android devices is a great idea, right? ….

….sort of, Recent history would lead us to conclude that not all these vendors brands and products will prove innovative enough to survive the onslaught of low cost brands from China. Trying to remain profitable in their current form may lead to another flurry of reorganization and M&A.

Why this is different

Once all the rugged Android clones and new entrants have beaten each other up on price for long enough we are likely to end up with a small number of main players. The others will struggle and find they lack the fire power to survive at the high end whilst carrying costs that are too high to re-cast themselves as a a low cost vendor.

The twist may well be that over a period of 2-4 years the dominant vendors may not be the companies or brands we are used to being on top of the Enterprise Mobility sector. They are likely to include brands we currently think of as “consumer” or do not even know yet.

The advent of Android as the OS of choice and the changing nature of procurement and app design are real game changers which may well leave some our largest well known plaqyers scrambling to adapt.

Why Not All The Rugged Android Devices Will Survive

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