Jan 2, 2019, 12:26 AM ETInterview, Fireside Chat, Webinar

a16z Podcast | Enough with the Old Stuff -- Time for New Questions in Mobile

Platform Monoculture Ends: Questions regarding the survival of legacy platforms (BlackBerry, Windows Phone, Nokia) are obsolete; the market has settled into a duopoly.
Apple's Disproportionate Value: Apple sells roughly 10% of global phone volume but controls a dominant share of high-value user activity, including 80% of US Black Friday e-commerce revenue and approximately 50% of global web browsing.
Android's Volume Share: Android holds approximately 50% of global phone sales volume and is growing slightly faster than Apple's share.
Stability of Winners: Both Apple and Google have achieved their strategic objectives; user bases and developer ecosystems for both are currently stable.

Samsung's Volatility: Samsung, previously holding 50% of the Android market by volume and nearly all profits, is experiencing sagging revenue, particularly in the high-end segment.
The "Shenzhen Ecosystem" Disruption: Lower-tier Chinese manufacturers are challenging the "scale" requirement for success by leveraging the entire Shenzhen supply chain, reducing the need for Samsung-level vertical integration for volumes of 5–10 million units per quarter.
Chinese Vendor Strategy: New entrants (e.g., Xiaomi) are differentiating through design and interface skinning rather than hardware exclusivity, similar to past strategies by HTC or Nokia.
Global Expansion Limits: Chinese vendors are currently targeting middle-income markets (India, Brazil) rather than developed markets like the US, where distribution barriers remain high.
Commoditization Risk: The Android hardware business is inherently difficult unless operated as a pure commodity device manufacturer.

Xiaomi's Software Differentiation: Xiaomi has successfully built a differentiated, integrated software experience in China (combining Google-like services and Apple-like UI) in the absence of Google Mobile Services (GMS).
Open Android Viability: A major uncertainty is whether manufacturers (HTC, LG, etc.) will attempt to fork Android outside of China to escape Google's constraints, potentially by replacing the App Store with Amazon's or creating custom discovery layers.
Google's Legal Leverage: Google contracts currently forbid vendors from selling incompatible, forked versions of Android alongside Google services; vendors must choose between a closed Android build or a "forked" build with zero Google services.
Critical Services Gap: Google Maps and the App Store are identified as the only two services currently essential enough to make a closed ecosystem difficult to displace; other services are considered less critical for survival.
Future of Android's Core: Google faces an existential tension between wanting to move Android toward a web-centric model (Chrome apps, indexable content) and maintaining control via proprietary handset APIs.

Unbundling and Rebundling: The industry is cycling through a complex pattern where websites unbundle into apps, apps unbundle into messaging services, and notifications become actionable mini-apps (Zawinski's Law applied to mobile).
Notification Fragmentation: The current notification panel is described as a "broken experience" due to the sheer volume of alerts, driving a shift toward actionable payloads that allow tasks to be completed without opening the full app.
The Web vs. App Dichotomy: Google prefers a web-centric model for data indexing and linkage, while simultaneously relying on a native API layer to maintain control over hardware and user behavior on Android devices.
Aggregation Layers: Discovery and service access are shifting from the browser to fragmented "super-apps" (e.g., WeChat in China, Facebook, Amazon), creating new barriers to entry for traditional search.

Apple Watch Utility: The Apple Watch is validated as the premier form factor for a color wrist-screen, but its broader market adoption depends on whether users have a compelling use case beyond notification display.
Reinforcing the App Model: Wearables currently reinforce the native app ecosystem rather than serving as a disruption to the Apple/Android hegemony.
Historical Parallels: The current uncertainty regarding interaction models mirrors the mid-90s "Gopher vs. PointCast" era, but with higher sophistication in the OS and less certainty about the eventual winner.

Market Size Projection: The industry is moving toward 4 billion smartphones globally, with the growth driven by affordability and data plan availability rather than just device ownership.
Value of Connectivity: Mobile connectivity provides outsized economic value to low-income populations (e.g., doubling income for bricklayers in India or fishermen via job/market info).
Local vs. Global Ecosystems: The mobile market is fracturing into distinct local ecosystems (e.g., 500 million Android users in China) where global market share statistics are less relevant than local penetration and user value.
Strategic Irrelevance of Global Share: Enterprises now target specific geographies (e.g., "users in Spain" or "middle class in Jakarta") rather than optimizing for global unit splits, as local dynamics dictate viability.

Android's Future Identity: It remains undecided whether Android will evolve into a Chrome-based web runtime, remain a proprietary Google walled garden, or fracture into multiple open implementations.
iOS Stability vs. Android Fluidity: Apple's future is viewed as largely contingent on product execution (extensions, pricing) rather than structural shifts, whereas Android's fundamental architecture and control are subject to major transition.
Next Major Platform: New hardware operating systems (Firefox OS, Jolla) are unlikely to succeed; the next major shift is expected to come from either a fundamental interaction technology change or a redefinition of the OS's role.
Disruption Sources: Potential disruptors include the maturation of wearables, the expansion of messaging apps as primary aggregation layers, or a shift from app-based to web-based operating system dynamics.