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By John Sutherland, President, Ennova, Inc.
 
While Google’s Nexus is hot, the question is: “will it be a game changing device”?  Will it disrupt the Smart Phone industry by bringing in new capabilities that sweep away the incumbents?

Background – Current Share

Research In Motion (39%) continues to be the smart phone market share leader, down 1-pt since our previous survey in September. At the same time, number two Apple (AAPL; 31%) has edged up 1-pt since September. We note that Apple has experienced continuous market share growth every quarter since the iPhone launch two-and-a-half years ago.  Palm (6%), after holding steady in the previous survey, has slid 1-pt since September. (From Cellular News)

Maybe Yes?

Google has a loyal following who love everything Google.  So there will definitely be a movement towards them.  Cellular News says 21% of those planning to buy a smart phone in the next 90 days say they’d prefer to have the Android OS on their new phone – a monstrous 15-pt jump in just three months. To put this in context, three months ago Android OS was tied for last place in consumer preference among the major mobile operating systems. But since then it has surged into second place ahead of all competitors except the iPhone OS X (28%).

But…

Buying intentions are one thing. Translating intentions into sustainable purchases based on significant differences is a horse of a different color. David Pogue of the New York Times did a good review of the features and capabilities of the Nexus.  When you read  his article you’re left with the impression that, with the exception of “everywhere” voice recognition, Nexus’ features are mostly the same as, or are little better than the competition, with the exception of apps where Apple holds the lead.

Why Not Yet?

To disrupt an existing industry you have to create sustainable buzz, not just marketing buzz. And sustainable buzz is generated when a latent behavior emerges – when the use of a technology affords the user the opportunity to do something they couldn’t do before that is meaningful, reliable, and accessible.

For example, the Blackberry brought us push email.  That allowed us to stay connected everywhere.  New behaviors emerged, not all of them desirable mind you (emailing during a meeting).  This new Blackberry enabled behavior disrupted other phones and organizers (the Palm).

The iPhone utilized the programmable screen with no keys.  That allowed more intuitive interfaces and a whole new array of behaviors to emerge.  Face-Book, Twitter, traffic alerts, conversion calculators, games, games and more games, etc.  Over 100,000 apps have been created in all sorts of areas with a corresponding increase in new behaviors.

Now Nexus has arrived.  Its new capability is voice recognition across all applications.  It means can now employ voice commands and not be limited by their ability to type or interact with a screen .  That’s good in the car for example.  So we can expect new behaviors to emerge in hands-free environments, subject to increasing legal restrictions on phone use in the car.

Is that enough to create the buzz?  Will we a see massive movement from the iPhone and Blackberry over to Nexus?  It doesn’t seem  there is enough new behavioral capability to warrant such a move, especially since voice recognition is not 100% reliable.  Less than perfection is okay when you ask an app to open.  It’s not okay when you dictate a letter to a client and it contains errors.

Then Again

But. . . . and here’s the big BUT.   Google does have presence.  People will buy the Nexus.  It will become a direct player in the Smart phone industry. AND, the operating system is open source.  Blackberry and iPhone are not open source.  With smart-phones only holding about 3% of worldwide market-share (17% North America),  it’s entirely possible (likely?) that with this base their open source developers will develop apps with new disruptive capabilities that Apple and RIM can’t match. So, the battle has begun. Goggle won’t disrupt with its first addition, but don’t count them out.

What can an Entrepreneur learn from this narrative?

1. Not all disruptors have the power to value-disrupt a market.  Nexus’s voice recognition, by itself, is not enough.
2. Sometimes you first need to be playing in a market before you can disrupt it.  So adding a disruptor to your offering let’s you gain fast market share and establish your credentials as a player.
3. You need to have a follow-on strategy for how you will ultimately value-disrupt.  Google’s open source operating system, with its faster speed to market for new disruptors, is the play with the potential to give them the leadership in the market.

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