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Unformatted text preview: o convergence (when two o r mo re markets, o nce co nsidered distinctly separate, begin to o f f er similar f eatures and capabilities). Co nsider the market f o r po rtable electro nic devices. Separate pro duct catego ries f o r media players, cameras, gaming devices, pho nes, and glo bal po sitio ning systems (GP S) are all starting to merge. Rather than cede its do minance as a media player, Apple leveraged a strategy kno wn as envelopment , where a f irm seeks to make an existing market a subset o f its pro duct o f f ering. Apple def tly mo rphed the iP o d into the iP ho ne, a device that captures all o f these pro duct catego ries in o ne device. But the f irm went f urther; the iP ho ne is Wi-Fi capable, o f f ers bro wsing, e-mail, and an applicatio n platf o rm based o n a scaleddo wn versio n o f the same OS X o perating system used in Macinto sh co mputers. As a “P o cket Mac,” the appeal o f the device bro adened beyo nd just the pho ne o r music player markets, and within two quarters o f launch, iP ho ne beco me the seco nd-leading smartpho ne in No rth America—o utpacing P alm, Micro so f t, Mo to ro la and every o ther riva...
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