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Why smartphones are like cornflakes boxes

columns Updated: Aug 04, 2014 00:13 IST
N Madhavan
N Madhavan
Hindustan Times

Two seemingly unrelated events last month showed that a time may come soon, when smartphones and tablets maybe sold by the kilo. Well, almost. In business management jargon, when something becomes cheaper and cheaper and easily available in abundance, they call it “commoditisation.”

So, when you buy cornflakes, you can buy it loose and cheap at a local grocer, or go for some value-added stuff in a fancy box, the way Kellogg’s sells it.

When IBM and Apple teamed up last month to announce a partnership, on the face of it, it was about the two companies working together to create a new class of software applications for iPads and iPhones with an accompanying plan to sell these devices bundled with specialised software to large corporations.

Think of it as a technological equivalent of selling cornflakes fortified with vitamins.

On the other hand, in the same month, John Sculley, former CEO of Apple, famous for his long career as a marketing wizard at Pepsi, landed in India to promote his new venture, Inflexionpoint, which launched its cheap Obi mobiles for the Indian market as part of its Asian focus.

Sculley was famous for marking the home computer a consumer product as snazzily marketed as cola — which, like cornflakes — is just a commodity.

Obi wants to sell phones at the lower end, while Apple needs partners at the upper end, because increasingly, the handheld devices are just like a vehicle to bundle software and services. Increasingly, they will become more like a carton in which content and apps will be packed in, like cornflakes.