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Friday, December 18, 2009

Hardware vendors get elbowed aside

Hardware and software people have different areas of expertise.  Obvious, right?  Not at hardware companies, which as long as I can remember have tended to hire electrical engineers to write their software.  Electrical engineers tend to hire other electrical engineers even when that's not the best fit, and the dismal results are everywhere.

Things are finally changing.  But not because of any reform at the traditional hardware companies.

One of the reasons that Apple has been so successful is that it's good at both hardware and software, one of the relatively few such companies.  By controlling both they can assure a good user experience.  But they no longer build the devices themselves; that's long been done by contract manufacturers who have the facilities and expertise to crank out quality hardware at a low price, built to the specifications of their customers.

Contract manufacturers have gradually become better and better at not just the manufacturing but the design, and many have become original design manufacturers (ODMs) who design and manufacture their own products and merely have them branded and sold by companies with a brand presence.  For instance, the T-Mobile MDA Vario and O2 Xda Mini Pro phones, which were sold by carriers T-Mobile and O2 respectively, were both the same phone, one designed and built by Taiwan's HTC Corporation.  While more recently HTC has also been selling products under its own name, the ODM phenomenon continues.

So now anyone with enough budget can become a hardware company.  Just tell an ODM what the machine needs to do, and they'll design and build it for you to sell under your own brand.

Rumour has it that Google will be selling its own phones and netbooks, getting ODMs to design and build the devices to Google's requirements.

Why would Google feel the need to do this?

Because the existing phone and netbook vendors are not up to the task.  They're hardware companies.  Google is a software and services company.

Hardware companies, even when they have an operating system supplied to them by software people, rarely put out decent products from the user's standpoint.  I won't use a laptop that isn't a ThinkPad or a MacBook (both created by companies that are longstanding hardware and software companies).  And the iPod pushed aside the MP3 players that were already on the market from hardware companies.

Where laptops have less than adequate usability, they have more than adequate power.  Laptops are still being sold on the basis of "more power" that hardly anyone needs.  Netbooks are one response.  The traditional PC vendors, and their high-cost suppliers Intel and Microsoft, have been mocking netbooks to try to stop people from buying them.

Google makes more money when more people are using the Internet, so anything that interferes with Internet use is something it wants to fix.  If Google does sell a phone, it will be because it's not satisfied with the software side of all the Android-based phones currently hitting the market.  And if Google does sell a netbook, it will be because the traditional hardware vendors are unwilling and/or unable to sell computers that are simple and cheap, with "simple" requiring that there be no user-visible operating system via something like Android or Google Chrome OS.

I expect to see more software and services vendors creating their own hardware products.  I want even my television set to come from a software company.

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