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Old Jan 28, 2014, 10:15 AM   #1
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Apple Continues to Lose Smartphone Share, Gain Mobile Phone Share in 4Q 2013




Even as Apple's share of the smartphone market declined in the fourth quarter of 2013, the rise of smartphones to replace more basic feature phones has allowed the company to continue increasing its share of the overall mobile phone market, according to new numbers from research firm IDC.

According to IDC, yearly smartphone shipments topped one billion for the first time in 2013 and now represent 55 percent of mobile phone shipments, up from under 42 percent in 2012. The fourth quarter alone saw smartphone capture over 58 percent of the overall mobile phone market.

Worldwide smartphone shipments in 4Q13 in millions of units (Source: IDC)
For full-year 2013, Apple's iPhone sales increased by 12.9 percent over 2012, trailing the broader smartphone industry's growth rate of 38.4 percent. Apple was, however, still able to retain firm control of second place in the rankings behind Samsung even as Apple's market share fell from 18.7 percent to 15.3 percent. It was a similar story for the fourth quarter on its own, with Apple's 6.7 percent growth in shipments trailing the broader market and causing the company's share to dip from 20.9 percent to 17.9 percent.
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Apple posted record shipment volume during 4Q13, driven primarily by the addition of multiple countries offering the iPhone 5S and 5C, and sustained demand from its initial markets that saw these models launch at the end of 3Q13. Still, Apple had the lowest year-on-year increase of all the leading vendors. Now that Apple has finally arrived at China Mobile, it remains to be seen how much Apple will close the gap against Samsung in 2014.
But when looking at the overall mobile phone market, Apple performs much better due to its exclusive focus on the rapidly growing smartphone segment. According to IDC's numbers, Apple easily outpaced overall market growth of 4.8 percent for 2013 and 0.9 percent for the fourth quarter alone, boosting Apple to an 8.4 percent share for the full year and 10.4 percent for fourth quarter. Apple continues to sit firmly in third place among all mobile phone manufacturers behind Samsung and a rapidly falling Nokia.

Worldwide mobile phone shipments in 4Q13 in millions of units (Source: IDC)
Just yesterday, Apple released its earnings report for the fourth quarter (first fiscal quarter of 2014), revealing fairly strong overall performance but weaker than expected iPhone numbers that helped drive Apple's stock down nearly 8 percent at the opening of trading today. And with the iPhone accounting for 56 percent of Apple's revenue for the quarter, it's clear the device continues to be the main factor in measuring Apple's success.

Article Link: Apple Continues to Lose Smartphone Share, Gain Mobile Phone Share in 4Q 2013
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Old Jan 28, 2014, 10:17 AM   #2
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ITT: armchair CEOs telling how Apple should be run
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Old Jan 28, 2014, 10:24 AM   #3
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Of course Apple's marketshare will get smaller.. as more and more Android phones are sold. Apple cannot compete with raw sale of units.

What is important is healthy -
* iPhone sales, which we saw yesterday.
* healthy iOS eco system

Marketshare data is one data point, out of many.
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Old Jan 28, 2014, 10:25 AM   #4
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I read an article that looked at the smartphone market and divided it into several tiers. In the "premium" tier, defined as over $400 phones, Apple has something over 60% of the world market share. My point is that we saturate smartphone penetration and "feature" phones are history, we need to change the conversation. Apple will probably never compete in the mid or low end, so diluting their market share with those numbers does not make sense. Apple is increasing sales and market shares in the area they care about -- the premium smartphones (although profit per phone is down slightly).

This is the same for Porche or BMW -- yes they are losing market share to the overall car market, but in the premium sports car market they rule. And that's all they care about.
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Old Jan 28, 2014, 10:25 AM   #5
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This proves the non smartphone market is dragging everyone down. And the only one not affected by this Apple, because Apple didn't enter that market.
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Old Jan 28, 2014, 10:34 AM   #6
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Originally Posted by Cuban Missles View Post
I read an article that looked at the smartphone market and divided it into several tiers. In the "premium" tier, defined as over $400 phones, Apple has something over 60% of the world market share. My point is that we saturate smartphone penetration and "feature" phones are history, we need to change the conversation. Apple will probably never compete in the mid or low end, so diluting their market share with those numbers does not make sense. Apple is increasing sales and market shares in the area they care about -- the premium smartphones (although profit per phone is down slightly).

This is the same for Porche or BMW -- yes they are losing market share to the overall car market, but in the premium sports car market they rule. And that's all they care about.
Another poor car analogy. Predictable

I'm pretty sure Apple cares about marketshare - not just marketshare of the "high end" market. Do they care about that - yes - but as a part of the whole pie.

Any attempt to imply otherwise is pure rationalization.

p.s. Apple is doing very well marketshare wise. And there's room to grow (IE - increase) which is important. Even more important - they are very profitable.
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Old Jan 28, 2014, 10:42 AM   #7
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Old Jan 28, 2014, 10:48 AM   #8
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Apple should just not call the iPhone a smartphone but something like
"a phone that people love to use and that gets software updates for at least 3 year"

They would have 100% market share in this category (what my point is, is that most of the android phones out there are just better feature phones and not used for anything smart)
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Old Jan 28, 2014, 10:49 AM   #9
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Originally Posted by Wuiffi View Post
Apple should just not call the iPhone a smartphone but something like
"a phone that people love to use and that gets software updates for at least 3 year"

They would have 100% market share in this category (what my point is, is that most of the android phones out there are just better feature phones and not used for anything smart)
Because that would have meaning?
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Old Jan 28, 2014, 11:21 AM   #10
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What about overall profit from those sales, Apple operates very healthy margins on the iPhone much higher than its competitors. Samsung sold a lot of phones but at huge expense in advertising and low margins. That has shown to be unsustainable as its earnings were way below target. The next couple of years are going to be very interesting in the smart phone market.
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Old Jan 28, 2014, 12:01 PM   #11
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It's so entertaining seeing you guys try to figure out what's going on. Android is not the enemy. Apple is it's own worst enemy. Apple can do everything that Android is doing but do it better. Apple refuses to release a multiple sized iPhone models and they refuse to battle on price and features. People love to bash Android for giving what people want. If Android was so bad why has it dominated for the past few years?
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Old Jan 28, 2014, 12:20 PM   #12
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Originally Posted by samcraig View Post
Another poor car analogy. Predictable

I'm pretty sure Apple cares about marketshare - not just marketshare of the "high end" market. Do they care about that - yes - but as a part of the whole pie.

Any attempt to imply otherwise is pure rationalization.

p.s. Apple is doing very well marketshare wise. And there's room to grow (IE - increase) which is important. Even more important - they are very profitable.
IMHO, Apple cares about making money. And they care about succeeding in endeavors that make them money. If increased market share enables them to make more money, then they will want increased market share.

Greater market share in of itself is not a worthwhile goal. What would be the point in having 100% market share if you lose money on every unit sold and there are no other streams to gain revenue from?

----------

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Originally Posted by cdmoore74 View Post
It's so entertaining seeing you guys try to figure out what's going on. Android is not the enemy. Apple is it's own worst enemy. Apple can do everything that Android is doing but do it better. Apple refuses to release a multiple sized iPhone models and they refuse to battle on price and features. People love to bash Android for giving what people want. If Android was so bad why has it dominated for the past few years?
Apple management should be as smart as you. If only they followed your advice, maybe they would be as profitable at the smarthphone business as LG and HTC.
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Old Jan 28, 2014, 12:37 PM   #13
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Quote:
Originally Posted by samcraig View Post

Another poor car analogy. Predictable

I'm pretty sure Apple cares about marketshare - not just marketshare of the "high end" market. Do they care about that - yes - but as a part of the whole pie.

Any attempt to imply otherwise is pure rationalization.

p.s. Apple is doing very well marketshare wise. And there's room to grow (IE - increase) which is important. Even more important - they are very profitable.
Market share is a look at the entire market to see how each company is ranked.

I'm sure all companies think about their individual market share among everyone else... but it's never a primary focus. It can't be. Companies can only control themselves... not everyone else.

Apple made the conscious decision to only sell expensive smartphones. They're certainly allowed to do that.

Other companies choose to sell across a full range of prices... including cheaper smartphones. And that appeals to a broader base of consumers.

The funny thing is... Apple is still the #2 smartphone vendor by units sales... despite only selling expensive smartphones. And you're right... they are very profitable.

And that's key here. What good is selling a bunch of phones to gain market share if it doesn't make you any money to keep your doors open?

These are businesses after all. You can't pay your bills with market share.
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Old Jan 28, 2014, 02:05 PM   #14
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who is HUAWEIl?

There share increase is crazy.
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Old Jan 28, 2014, 02:12 PM   #15
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who is HUAWEIl?

There share increase is crazy.
Huge Chinese networking company. Another one is ZTE.
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Old Jan 29, 2014, 04:12 PM   #16
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I had some time...

I wanted to try out Numbers on my iPad so I made some pie charts of this market share!

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Old Jan 29, 2014, 08:53 PM   #17
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I wanted to try out Numbers on my iPad so I made some pie charts of this market share!
Thanks for the charts.

For one thing, they point out that we should all be investing in that mysterious company called "Others", because boy oh boy, do they have the majority of sales!

Seriously, what a change from eight years ago. Here's some smartphone percentages from mid 2006:

47% - Nokia
09% - Motorola
07% - RIM
06% - Panasonic
05% - Sharp
25% - Others
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Old Jan 30, 2014, 12:26 PM   #18
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Wink

A couple of things:

Michael Scrip I agree with a lot of what you've said Apple has made to conscious decision but there are lots of good reasons to sell phones to gain market share, even if doesn't make a lot of money.

1) Money could be made elsewhere in the Apple ecosystem. Do you remember the original high end Ipod, and than the introduction of the ipod shuffle considerably cheaper, and resulted in rapid increases in market share, and cause consumers to buy higher quality apple products elsewhere.

2) If they didn't care about marketshare they would never have released the iphone 5C. The whole point is the high end market is saturated where's Emerging markets are not. Apple have realised at least in the Emerging market selling 1 high end phone is not as good as < selling 5 cheaper alternatives.

3) Finally it DOESN'T matter whether the company is profitable or not. The market cares about if things are getting WORSE or BETTER i.e relative profitability not absolute probability. Hence why Blackberry is up 37% since late last year. It's crap company but things have gone from absolute CRAP to somewhat crap haha!
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