This is excellent analysis and I totally agree with it and something I have long been saying – there is simply too much choice and as early as Aug 2008 I pointed this out at a talk in Amsterdam when I spoke of Long tail devices and let a 1000 devices bloom ..
The key is: from the article above -
“Part of the dilemma for the big and established guys is exactly that,” said CCS Insight analyst John Jackson. “They’re big and established.” It’s hard to shift entrenched market positions because it’s time and resource intensive, he said.
This is not to say that smaller players that are also innovating in smartphones are having an easier time. Dulaney said that OEMs such as Motorola (NASDAQ: MOT) and Sony Ericsson are customizing Android, which can be effective, but also brings risks. “And if you’re not inherently proven as a software developer, odds are you’re not going to do that well,” he said.
The bottom line is that the real threat to major OEMs that are trying to innovate in smartphones comes from companies such as Dell and Acer–firms rushing headlong into smartphone development. “You have a set of market conditions that are ripe for exploitation by companies like Dell who don’t have a legacy business they and their shareholders rely on quarter to quarter,” Jackson said. Such players are well-capitalized and can leverage their manufacturing resources, free of the obligation to ship volumes and attain high margins in order to survive.
So far, the market impact of these small players has been negligible. Nokia is still the worldwide leader in smartphones, thanks to Symbian’s reach.
Apple’s iPhone juggernaut continues to chug along. RIM is still the smartphone king in North America.
Yet with each passing quarter and year, the pressure will mount on established players to increase their pace of innovation. As the leaks of Dell’s Android and Windows Phone plans show, the company means business. These new players are poised to upend the traditional market, or at the least make life difficult for the big OEMs.