Jobs gouges Google as Apple profits surge

Barry Collins Read more October 19, 2010

Steve Jobs made a rare appearance on an Apple earnings call to launch a stinging attack on rivals Google and RIM.

Jobs gouges Google as Apple profits surge

The Apple CEO said he “couldn’t help dropping by” for his first earnings call in more than two years, as the company announced record revenue of $20.3 billion for its fiscal fourth quarter and net profits of $4.3 billion.

Yet, the Apple boss had more than healthy financials on his mind, using the conference call to berate his rivals in the smartphone and tablet markets.

Many Android OEMs, including the two largest, HTC and Motorola, install proprietary user interfaces to differentiate themselves from the commodity Android experience. The user’s left to figure it all out

After questioning the sales of Android smartphones, Jobs attacked the ethos and usability of Google’s operating system. “Google loves to characterise Android as ‘open’ and iOS and iPhone as ‘closed’. We find this a bit disingenuous, and clouding the real difference between our two approaches,” Jobs told reporters.

“The first thing that most of think about when we hear the word ‘open’ is Windows, which is available on a variety of devices. Unlike Windows, however, where most PCs have the same user interface and run the same apps, Android is very fragmented.

“Many Android OEMs, including the two largest, HTC and Motorola, install proprietary user interfaces to differentiate themselves from the commodity Android experience. The user’s left to figure it all out. Compare this with iPhone, where every handset works the same.”

Jobs was also scornful of Android’s approach to apps. “In addition to Google’s own app marketplace, Amazon, Verizon, and Vodafone have all announced that they are creating their own app stores for Android,” Jobs pointed out.

“So there will be at least four app stores on Android, which customers must search among and find the app they want, and developers will need to work with to distribute their apps and get paid. This is going to be a mess for both users and developers. Contrast this with Apple’s integrated app store which offers users the easiest-to-use largest app store in the world, preloaded on every Apple iPhone.”

BlackBerry maker RIM was also on the receiving end of Jobs’ tongue-lashing. After claiming that RIM would be unable to catch Apple in the smartphone market, Jobs then went on to berate companies such as RIM who are launching 7in tablets to rival the iPad.

We think that the current crop of 7-inch tablets are going to be DOA: dead on arrival

“One naturally thinks that a 7in screen would offer 70% of the benefits of a 10in screen,” Jobs claimed. “Unfortunately, this is far from the truth. The screen measurements are diagonal, so that a 7in screen is only 45% as large as the iPad’s 10in screen. You heard me right – just 45% as large.”

“We think that the current crop of 7in tablets are going to be DOA: dead on arrival. Their manufacturers’ will learn the painful lesson that their tablets will be too small, and increase the size next year, thereby abandoning both customers and developers who jumped on the 7in bandwagon.”

Storming sales?

Jobs claimed Apple was “blown away” by its fourth quarter results, but analysts were less impressed, with the company failing to meet aggressive predictions and seeing its share price drop as a result.

Apple sold 4.2 million iPads in the quarter, but that fell short of expectations. “A little bit disappointing there,” Gleacher & Co analyst Brian Marshall told Reuters. “[Wall] Street was expecting closer to five million units. The problem is supply, it can’t make enough of them.”

Sales of the iPhone rocketed by 91% year-on-year to 14.1 million units, although iPod sales actually declined by 9%, suggesting that people are increasingly using their smartphone as their MP3 player.

Mac sales were also 27% up on the same quarter in 2009, with the company shipping 3.9 million computers during the quarter. Apple is expected to launch a smaller version of the MacBook Air tomorrow.