The importance of software differentiation in the Android ecosystem

By Sai Srinivas I remember distinctly, when I was a kid, my dad used to take me to this big vegetable market in Secunderabad. It was our weekend ritual and the one thing he was very particular about, was getting the best deal. He pitted each vegetable vendor against each other for their price, until he got the best price. Now, in the above two sentences if you replace my dad with the consumer today and ‘vegetables’ with ‘smartphones’, what you get, is the Android Smartphone Industry. Everyone’s making the same phones and every phone does the same thing. Yes, some phones have a blue interface with 2 GBs of RAM while some have orange ones with 3 GBs of RAM; but no one seems to be going beyond that to innovate something and offer more to their end customers. One of the core mottos of Android is – “Be Together, Not the Same”. It stands for how Android is an open source Operating System, which was free for anyone to innovate upon. It was meant to be an inclusive system where everyone can build and contribute their ideas to make the operating system better. Well, at least that was the agenda when it started. But, if you look at the Android eco-system today, you will notice that every Android smartphone has essentially the same set of features to offer. In the midst of all of the players centering on the same set of offerings, we wonder where did the innovation go. Why can we not build more than just some customizations, that too on an immense scale of target audience for Android devices in the country? Some of the largest companies in the world make smartphones, but what invariably ends up happening, is that they wait every year for Google to add features to Android. This is really surprising because, the one thing that any smartphone user interacts with the most, is the software. That begs me to ask why can’t more companies innovate on Android and create new features that help them create their differentiation. I think this is the need of the hour in the industry at this point in time. Software Differentiation is a valid proposition to target albeit a tricky one, because anyone who is trying to build an idea that does not have any precedence in the industry needs to ensure that they are aiming at an untapped area and also be prepared for that extra bit of criticism that’s going to come their way. The larger picture that one needs to understand is that brands cannot be built by means of a spec-sheet. That might appear true at the onset of making the product but even a spec crazy user sees only the software that interacts with them. This is one area that no phone maker seems to be addressing with more vigor. If you can build one good sticky experience, the user will always want to buy your phone for that experience. Considering the extensive commoditization of Hardware and the reducing margins, the future of the smartphone industry is in Software Differentiation. The smartphone industry is going through a major software revolution phase. The industry has reached a point where consumers should start asking – “What can this phone do?” rather than “What does this phone have?” Because at the end of the day, that’s what matters and that’s what will make a user stick to a brand. The author is the CEO and Co-Founder, CREO