Bring on the competition
The more the merrier, I say.
Two years ago, Huawei was to premium smartphones what Datsun was to family cars in the late 1970s. Cheap and cheerful, and sometimes not all that cheerful. The idea (promoted here) that Huawei would be able to challenge Apple and Samsung was considered ridiculous. “Samsung should be very concerned at what Huawei might be …
I think most of Apple's income sits in an offshore account waiting for a tax break so they can bring in back without it being heavily taxed. All that cash pile and they still need to issus bonds "Apple Set to Raise Up to $4 Billion in Asia-Pacific From Bond Sales"
Loose speculation has alleged that Apple may have started taking submissions to its application stores as 'bitcode' (think p-code or JVM or CLR byte streams at the point of submission, though Apple compiles to architecture-specific code prior to delivery) because it intends to use its established in-house chip designers to transfer their ARM skills to a laptop.
There's no reason to suppose such a thing, were it not just gross speculation, would be iOS rather than OS X, but hopefully it won't go the Windows RT route of being OS X with all the restrictions of iOS.
There's also a lot of firmly solid evidence to suggest it wouldn't be a budget device by objective standards...
Budget isn't Apple vocabulary.
They DO have an ARM ultra air laptop, disguised as a tablet, with detachable keyboard and stylus/pen.
I've said for years that the Mac OS is niche product. Someone here said it's so that workstations at One Infinite Loop have Apple logos and not Dell badges.
Until OSX switched to Intel (and thus Bootcamp was available on Macs), Apple would have used product design software on non-Mac hardware. These days the CAD software Apple use (AutoDesk Alias, Rhinoceros 3D, Unigraphics NX) all have Mac versions, but I don't know how well they compare to their original Windows versions (though of the three, parts of NX were originally Unix-based back in the 90s). Obviously only a tiny percentage of Apple's workforce use CAD, and Jony Ive is more of a physical foam model kind of product designer.
Macs have always had a small market share compared to DOS then Windows, but in some specific sectors - graphic design, audio, music, video production - they have enjoyed a much bigger market share.
Per the quarterlies, Apple sells between 4 and 6 million Macs per quarter, usually bringing in about 10% of their revenue, total company revenue being in the $40–60bn range.
So although they're clearly a niche product, I don't think the vanity label holds water. Compare and contrast with the watch...
For many workflows, Macs are bought because other people are using the same hardware and software combination - this makes troubleshooting easier.
I've never owned a Mac, but have found them pretty civilised to work with - especially when working with audio. Or should I phrase that as I found Windows' audio systems to a pain in the neck. (And no, the software I use precludes me from jumping to Linux)
Macs hold their value well on the resale value.
They are also recognised as having better than average screens, trackpads, quietness, speakers and battery life.
Still, Windows laptop vendors have upped their game in recent years and 3rd party Windows applications are getting better at supporting very high resolution displays, so everybody is a winner.
I don't think you understand Apple's market. They sell things to people who pay a decent price for decent hardware.
I'm a tight arse. My 2006 MacBook is still alive and running (runs the home server now). My mid 2010 MacBook is what I use every day and what I'm typing this on. If you don't look at the purchase price, but at the cost per year, it's _cheap_.
And if you do serious work on a computer, like I do, then there is _nothing_ that beats the quad core MacBook Pro. It's the computer of choice for iOS developers, but also for Android developers. I _never_ pay over the odds for anything. I _never_ buy a computer that's not a Mac.
I buy a HP Elitebook 850 with i7 := $1700
I buy a MacBook pro i7 := $2000
Two years later, I sell the HP Elitebook, price 550 euros
Two years later, I sell the Macbook pro, price 1200+ euros
Don't believe me ? One macbook pro is even listed for 1400 euros, see here:
Who won ? OS X is much better than Windows, hands-down, it knows what "Sleep" means, does not come full of trial software that make the i7 feel like an i3, all drivers are there ... it can do all the CAD/Music/Video shit you dream of doing, when you are on Windows ...
All this to say, Macs are not cheaper than Windows laptops, but they are FAR better value ... note that in the example above, if you really are a point+click expert, you can purchase a windows license to put on your Mac, still better value.
And if you have Windows Server in your data center, your opinion does not count!
Achtung: That Macbook has soldered RAM and SSD, so DON'T BUY IT.
>>I dont think you understand Apples market. They sell things to people who pay well over the odds to buy the feeling they are special.<<
Rubbish. Apple thinks about what the next thing is very deeply - that takes a lot of R&D. Apple think about what people can do with technology and how to best use it. That's why people get excited, because technology no longer belongs to the boffins and nerds.
The boffins and nerds still resent Apple for breaking their power over obscure technology.
It's tricky to compare R&D spending btween companies, because Huawei, like Samsung, make many products that Apple don't. One imagines that Samsung throw some money at televisions, just as Huawei do at network infrastructure - their largest sector by revenue.
The 'Huawei spend more than Apple on R&D' statement is a little disingenuous, even if we agree with Mr O's general point that Huawei are to be taken very seriously.
It also gets complicated in other ways. HP's r&d budget on laser printers was artificially reduced because of a very close relationship with Canon. Much of their r&d - all on the engines at least, was hidden in up front payments to Canon and eye wateringly expensive prototype rendering hardware. Not to say it is the same for Apple, but balance sheets at HP did not reflect this. I worked for HP at the time.
>The 'Huawei spend more than Apple on R&D' statement is a little disingenuous
Good point - but there's also the question of value for money. If Chinese industry in general is anything to go by, then a Huawei Dollar buys a lot more work than an Apple Dollar.
Times are changing - My daughter recently murdered her Nexus 7 tablet - to teach her a lesson I bought a 7-inch AllWinner thing direct from the factory shop in China for £35 including shipping - enclosure lacks the quality but overall it's a backfire - twice the speed, 64GB TF etc so she's delighted - Google to her has all the cachet of Persil so there's no stigma either.
Once China start cutting out the EU/US middlemen in earnest it'll wipe out most of our 'manufacturers' - if they start innovating instead of working retro/parallel they'll wipe out all of them. Tech will be as steel in under a decade.
>If Chinese industry in general is anything to go by, then a Huawei Dollar buys a lot more work than an Apple Dollar.
Huawei may or may not get more value for money on their R&D spend, but it's not as clear cut as you suppose. Apple have an R&D centre in Shanghai, for starters. And if Apple thought they could do all their R&D cheaply there, they wouldn't have R&D centres in Cambridge and Tel Aviv (I don't know what they do there, but I associate both Cambridge and Israel with silicon chip design).
Conversely, Huawei have eighteen R&D centres in Europe and employ 1500 in research.
EDIT: As far as I can make out, most of Huawei's European R&D is geared more towards 5G and infrastructure than it is handsets.
Huawei does the rounds of the Engineering programs at Chinese universities and ships them off to Shenzhen. Many of them have a second degree. It pays them close to Western rates (on average 3 times more than Foxconn across the highway - but teens assembling mobile phones would expect to earn less right).They also get a 60% bonus as well as company shares (which no-one knows what they are worth). OK long hours are expected but you can retire at 45. Its rumoured you may get an interest free mortgage as well which given Shenzhen property prices (higher than New York) is huge - this type of golden handcuffs is not unusual.
Huawei also recently took over the relationship that BlackBerry had with Univ.o.Waterloo in Canada and set up a research centre so they likely got some IP in that department. They have numourous others around the world.
An accounting nuance is that R&D at Huawei typically also includes all product development stuff as well which others may term manufacturing.
You might think I've spent some time at the Unicomplex, I couldnt comment. Resistance in futile. I believe Cisco are (rightly) shitting themselves, Apple might wake up as well.
> they wouldn't have R&D centres in Cambridge and Tel Aviv (I don't know what they do there)
There's 20 people at Cambridge including the admin staff. Tel Aviv is larger - the target was 250 employees total but it's not there yet. I'm sure they're doing interesting stuff and I wouldn't mind one of the jobs, but these centres are located (and subsidised) for political posturing and tax negotiation not central to Apple's grand plan. Plenty of UK (and Israeli) staff are doing core product research but they're locked away stateside and are a lot more expensive.
Well, no, it isn't. For one thing a Huawei R&D $ may buy more than an Apple one just because of the high costs of operating in California. And for another, as people are pointing out, Huawei has a much, much bigger product range.
But...I have to say I rather like the look of the P9, just drop that UI guys. Since Huawei are reported as making it difficult to change, they may be too invested in their own L&F. Fix that and perhaps they will grow fast in the West.
Also, there's ASUS who are trespassing on Apple territory these days. They too have just released a range of higher spec phones, and their Zen UI isn't bad. But they also make a lot of quite nice small laptops. I've just bought a Chromebook Flip as a basic portable browser/email device and I am quite shocked at how good it is for the silly price.
The competition at some point in the future may be more between Taiwan and the mainland than between California and Korea. I can imagine Apple repeating its earlier pattern - holding on to the high priced high spec end of the market as it slowly gets eaten out from below. I loved my PowerPC laptops, but they got supplanted when the PIII came out in lower power versions and W2000 came out on laptops.
Not all of Apple's R&D spending is in California:
EDIT: Apple also have R&D centres in Cambridge and Tel Aviv - though one imagines the cost of living is higher in these places than it is in Shanghai.
I'm not sure it's all that meaningful to compare Huawei and Apple R&D spending.
I'm sure that it's not meaningful, when the comparison isn't all that possible. As Chris and others point out, there's only a few areas where Huawei and Apple compete. If the R&D budgets can be broken out to show the head-to-head spending differences, then there would probably be an important point to make, one way or the other.
Facts require context and, for certain, this click-bait article doesn't have the context required to make the "fact" about R&D spending any meaningful. Even the rush from pointing out such bleedingly obvious journalistic license seems to be losing it's luster around El Reg. I hope that isn't the trend that I fear it is.
Huawei portfolio -
- Solutions: Arpu Up; Broader+Smarter; Costs Down; Go Greener
- Services: Drive Customer Experience; Management; Excel in Operation; Transformation; Network and Services; Quality Improvement
- Products: Fixed Access; Radio Access; Core Network; Transport Network; Data Communication; Application & Software; Storage & Network Security; OSS
- Products: Switches; Routers; Servers; Storage; WLAN; Telepresence and Videoconferencing; Network Energy
- Solutions: Agile Network & SDN; Cloud Data Center; Collaboration
- Industries: Education; Finance; Government; Healthcare; Hospitality; Intelligent Retail; Manufacturing; Media & Entertainment; Oil & Gas; Public Safety; Railway; Smart Grid
- Mobile Phones
- Mobile Broadband
They are spending less money than they are making, that is true (and a sign of a successful business!), but they are still spending shitloads, far more than they were in the run ups to the original iPhone and iPad releases. This suggests that are working on something big, and Apple wouldn't be Apple if they told you what it is (though Elon Musk takes it as a given that Appel are making a car due around 2020).
Apple's ethos is pretty much this:
"September is looming. What are we churning out this time?
- New iPhone; same square design we've used for the last 10 years, same UI as the last iPhone, slightly faster processor, same extortionate price based purely on brand status. Check.
- New iPad; same square design as every other iPad, same UI as the last iPad, slightly faster processor, same extortionate price charged purely on brand status. Check.
- One curveball product we know won't make any money but will make us appear 'innovative'; erm, another watch? Same design, some new expensive wristbands, stick a faster processor in it, same extortionate price, same pointless featues? Call it the Watch 2? Check."
To be honest, it's hard to see where $8bn actually goes. At least Huawei have made significant progress with their product line in recent years.
Apple will be the next Nokia. Sit on their laurels with iOS and product design as Nokia did with S60 and associated handsets.
Can't come soon enough.
Meanwhile Huwaei (Honor) will discover there is a new market for them and double their prices. That's what happened with Hyundai & Kia.
Only about 1% I think.
Most "good" stuff bought in
How much of Apple R&D is cost of their patents and "Design patents" and general R&D overheads in USA?
How many Apple patents and products are real R&D?
How much Apple R&D is Research and how much simply product development of fairly generic industry parts?
Considering Huawei accounting methods, much greater range of products (not just consumer phones/tablets) and their overhead / localities, I expect they are getting better value for money too.
>>Huawei R&D = Research and Development, into technical stuff
Apple R&D = Raid (others ideas) & Design pretty cases<<
You don't understand at all. Companies like Huawei and Samsung are hardware electronics companies. Apple takes that hardware and works out what people are going to do with it and how they are going to use it. That is software design and is nowhere as trivial as hardware thinkers like to make out.
Apple has significantly defined the software and computing world as it is today. The old IT people are still hooked to IBM and then Microsoft who picked up the pieces and still resent what Apple achieved.
That's hardly surprising Apple essentially make four products.
1) Various renditions of the iPhone / iPad / iPod which are all essentially the same iOS device in different sizes with slightly different things omitted / added.
2) MacBooks - a small number of variations and I would argue the iMac now is part of that range too as it shares most of the same components and architecture
3) The Apple Watch.
They do some software : OS X / iOS, various apps.
Huawei on the other hand are actually now competing in fundamental telecommunications technology, so I would expect them to be trying to compete with Ericsson, the new Nokia (which now contains Alcatel-Lucent (which absorbed Bell Labs etc) and Siemens Networks), Genband, Cisco, Qualcomm, etc etc..
The bigger players in that sector have always been huge spenders on R&D and have been the places that have churned out a lot of the core technologies that we take for granted.
Without those boring infrastructure and fundamental tech makers, there would be no iPhone.
At the end of the day, Apple's basically an IT based consumer products company, and a very successful one. However, that's all it is and that's where all it's R&D seems to focus.
That's not at all to be critical of Apple, but they're not Huawei and they're not Ericsson any more than they're Ford or Toyota.
They make network equipment that compete with Cisco all the way up to their highest end, they make storage arrays that compete with EMC, Netapp and IBM, they make servers, and on and on. They don't have the broad range of Samsung making everything from chips to ships, but they have more in common with Samsung than they do with Apple.
Obviously only a small portion of Apple's $8 billion in R&D goes towards phones, because unless there's some major new revolution coming that changes 2016 -> 2020 expectations of phones as much as the iPhone changed 2006 -> 2010 expectations, there just isn't that much to do. A lot of it may be going towards making a car.
Comparing companies by their R&D spending only works if they are in the same markets and of the same approximate size. You might reasonably compare Oracle and IBM's R&D, or Microsoft and Google's. Comparing Apple with Huawei or Samsung is silly, you might as well compare Facebook's R&D with Exxon's...
Apple also considers acquisitions part of their R&D. They make eight or nine digit acquisitions here and there a dozen times a year, many of which don't make the press because they can't write an article about it referencing an iPhone rumor. If you see promising technology you can use someone has already started the R&D effort on, you can buy that company and continue their work.
>“Samsung should be very concerned at what Huawei might be demonstrating in two to three years' time. So should everyone else,” I wrote at MWC 2014 – to general derision.
Eh? I actually remember posting a comment under that article, along the lines of 'nano injecting molding sounds bloody cool!', and I didn't recall any derision. And hey, if you're due any derision, you'd expect at least some from the good commentards who loiter around the Reg!
But no! Reviewing the comments that were made under the 2014 article, there is no scoffing at AO's claim. The comments roughly broke down into four types:
- How do you pronounce Huawei?
- nano-injection molding and ion beam cutting sound cool - how do they work? and
- I've got a Huawei and I'm impressed with it for the price.
- Huawei have been gaining momentum through their non-handset businesses.
And since when did quantity equate to quality anyway? Loads of companies spend more than Apple on R&D – however their accountants are defining it for this financial year.
The hard question is what they're spending that R&D money on, not merely how much dosh they're splashing about to reduce their tax exposure.
Finally: what's with this insistence that all corporations are all somehow directly comparable? Huawei are almost exclusively focused on the communications sector of the IT industry. Apple have fingers in rather more pies, including music streaming services and boutique laptops, while Samsung build everything from silicon chips to cargo ships. You might as well have written an article on how Google have spent more money on bananas than Fincantieri.
Microsoft have been milking Windows and Office for well over twenty years now; why should Apple be in any more hurry to invent yet more markets they'll only be sued over by trolls in East Texas? It's not as if they're short of a few bob.
>>Sure, true R&D is more expensive than simply re-packaging other deasigners technology.<<
Companies like Huawei and Samsung are hardware electronics companies. Apple takes that hardware and works out what people are going to do with it and how they are going to use it. That is software design and is nowhere as trivial as hardware thinkers like to make out.
Some people like the commenter above think that is trivial, but Apple establishing what they did in a very hostile marketplace is anything but trivial repackaging of others' ideas.
Apple has significantly defined the software and computing world as it is today. The old IT people are still hooked to IBM and then Microsoft who picked up the pieces and still resent what Apple achieved.
The difference between Apple and Samsung and other companies - Samsung is just an electronics company assembling components together, whereas Apple is a systems company working out new uses and ways to use the products, bringing technology to the rest of us. The effort that goes into that does not come for free, but others would like to pretend that it does, so they can rip off Apple's ideas.
There are lots of ways to design user interfaces, so why don't the others go and design their own patterns of use and user interfaces? Because that is a huge R&D cost and takes time and they want to own the marketplace now.
Apple has done a lot to define the software and computing world as it is today. The old IT people are still hooked to IBM and then Microsoft who picked up the pieces and still resent what Apple achieved. You can always see this old anti-Apple attitude coming out in the many posts that are made in response to articles like this.
"Some of the biggest funders of corporate R&D, including Nokia (R&D equals 14.4 per cent of sales), Microsoft (13.9 per cent) and Research in Motion (6.8 per cent), have virtually nothing to show for it. Nothing that is, except declining market share, compared to their more parsimonious peer: Apple (2.7 per cent). No wonder The Wall Street Journal declares, "[T]here's little apparent connection between R&D expenditures and successful product launches.”"
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