Android Dominates Nearly 80% of Smartphone Market, iOS Drops to 13% Share

[Laird Knox]

As an iOS developer, I'm wondering at what point I should abandon ship and switch to Android development. There still seems to be plenty of cash in iOS dev at the moment but how long will that last with a decreasing market share?

In that context market share is meaningless. Look at the number of units sold - it increased 20%. In other words you have more potential customers than you did a year ago and it is still growing. A growing market is a good thing.

Throwing that out to switch would be silly. It would make much more sense to expand into other markets - Android in this case. Not to mention abandoning one platform for another wouldn't exactly endear you to your current customers and might give pause to those on the new platform.

 

[newdeal]

This is an off-quarter, everyone knows that. Wait to fall.
I trust the actual usage numbers anyway as Samsung is know to lie on numbers.

This report compared year on year and the exact same thing happened last year where iphone 5 was released in the fall so the decline is directly comparable and in fact its even worse for Apple because more people are likley to not buy a 4S knowing the 5 will be a redesign whereas I see very little compelling reason to wait for the 5S if you need a new phone right now

 

[JesusQuintana]

But from the Google/Android point of view, isn't this a great thing? For Samsung, Sony etc. etc. I can see your point, but for Google it's got to be great. Android is spreading throughout the world, and both the rich and poor, developing and developed worlds are becoming familiar with it.

Actually, Android hasn't been very great for Google. Google just does not make very much money from the OS. The numbers are so bad they have to combine them with their revenue from iOS to hide just how low it really is.

Virtually all of the Android growth is in low end phones. Just how much advertising money can they make off of someone who can only afford a $50 phone? And China is the fastest growing market yet Google doesn't have a presence there so all those China sales mean nothing to Google's bottom line.

 

[chrmjenkins]

If your Samsung, yes.

If you're any other major Android smartphone manufacturer, that does not appear to be the case based on recent financial reports.

I was talking about Apple in efforts to make the point that customer satisfaction, profit per device, awards blah blah are all nice, but number of customers still matters.

 

[Cod3rror]

The cycle is complete, time for Apple to invent something new.

 

[lilo777]

Open versus closed system. It's Windows / V.s Mac OS all over again.

That said, Apple has learned how to Be profitable having only a segment of the overall market, and will likely be fine as long as it doesn't start to alienate too many of their current users.

That's not guaranteed. Apple can't keep selling inferior hardware for inflated prices. People are not going to buy iPhones if they have lower specs than, say, Samsung Galaxy phones and higher prices. Wireless carriers will stop giving iPhone higher subsidies than they do to other vendors. Apple profit margins will shrink. It does not mean that they can't survive. But it does look like the iPod phenomena is not in the cards for iPhone.

 

[osofast240sx]

Actually, Android hasn't been very great for Google. Google just does not make very much money from the OS. The numbers are so bad they have to combine them with their revenue from iOS to hide just how low it really is.

Virtually all of the Android growth is in low end phones. Just how much advertising money can they make off of someone who can only afford a $50 phone? And China is the fastest growing market yet Google doesn't have a presence there so all those China sales mean nothing to Google's bottom line.

Samsung and google will be dropping android soon.

 

[ThunderSkunk]

(dm)

 

[xensaenigma]

As an iOS developer, I'm wondering at what point I should abandon ship and switch to Android development. There still seems to be plenty of cash in iOS dev at the moment but how long will that last with a decreasing market share?

Do it, do it now!!!

 

[sirozha]

This is bogus stats. It's immaterial how many handsets have been shipped. What matters is how many handsets have been sold. Apple is thinning their supply channels whereas Android licensees are stuffing theirs. In the long run, what will matter is how long it would take for the Android licensees to sell the units that are in the supply channel now. That's when they will be making profit (if any). My prediction is that most of these Android handsets will be dumped to low-income customers for a nominal price or free with a 2-year contract. By the time the Android channels are drained off the inventory that is sitting in them, Apple will be selling new iPhones coming out in a few months, and those will not be given away for free. So, to calculate the market share, one would have to count the number of units in customers' hands at the end of each time period, and not how many handsets have left the factory.

Someone is trying to create panic to pick up AAPL for cheap before the next run-up in the AAPL stock price this fall.

 

[chumpy34]

I was part of that. I've had an iPhone since the day it first came out, every model. I got so bored with it I sold it an got an HTC One. Once the iPhone 6 comes out I might go back, but we'll see about that . This isn't bashing Apple at all, it was just what I did.

Good comment. I feel the same way to a point, I haven't brought myself to switch to another phone but I am a bit bored and I realize that's a bit crazy as we are just talking about a phone, but with two-year contracts (ATT) and the phones not changing much on the in-between years, i.e. S versions, it does get a bit stale, especially considering how much we use our phones every day.

 

[Piggie]

Try to imagine what software & devices will be like in 1,000 years. Now 10,000 years. Then from the perspective of someone using that technology, look back at the differences between iOS 4, 5, 6, & 7. Aside from seeming basic and crude as a Model A Ford, the lack of "exciting new features" from one generation to the next seems inexcusably lazy.

And it makes Android, for being so close to iOS, look like an unimaginitive copy, even if it is more feature rich. That two OS's from two different companies should be so similar is embarrassing.

With the iPhone Apple built what they thought the phone of the near future would be. It was a leap forward.

Now they need to do that again.

Indeed, totally agree they HAD a great idea with the 1st iPhone, and they have been milking that one idea ever since and in reality all the iPad is still is just a stretched iPhone.

The screen many many times larger, way way more pixels and the very best Apple could do was basically to stretch the iPhone UI to fit the screen.

Saddest part, we are now looking at the 5th generation of their tablet and they still have not managed to come up with anything better

 

[genovelle]

Queue the shipped vs sold psychos

You mean the psychos who actually have sense enough to question, 1, why all of these manufacturers stopped reporting actual sales like they use to when they were actually winning, 2. Why none of the non-psychos question why Samsung's actually sales number they had to report during the Apple trial only came to a small fraction of what it was widely reported they shipped during the same period. Maybe the psychos just aren't afraid to actually do some research.

 

[Mad Mac Maniac]

But from the Google/Android point of view, isn't this a great thing? For Samsung, Sony etc. etc. I can see your point, but for Google it's got to be great. Android is spreading throughout the world, and both the rich and poor, developing and developed worlds are becoming familiar with it.

Oh yeah sure Google doesn't care. That's just gravy for them. Their goal is get as many people connected to the internet at all times as possible. They still have the b) problem I identified above (not likely to pay for apps, music, movies, etc), but Google doesn't really care about that.

The only real reason Google should be concerned about this is because right now many of their phone makers are losing money overall. That could put them out of business, thus no more android phones. I'm guessing that's partly why Google bought Motorola, to help mitigate that possibility.

I've also read that Google makes more money off an iPhone than off an android phone (on average), but I'm guessing that's just because of the higher-end clientele.

An area which itself is a lower revenue driver. Again, the 'iPad Mini' problem exists for the iPhone as well, except is more severe due to 2 factors driving down sales prices (cheaper model, cheaper variants) - rather than just 1 (cheaper model). The inclination for high-capacity iPads is increasing, opposite to decreasing for the iPhone - and thats increasing margins.

The iPad problem is much MUCH more pronounced. Why? One year ago Apple sold iPhone 3GS, iPhone 4, and iPhone 4s. (they already had the wide spectrum of price). One year ago, they only sold the iPad 2 and 3 ( and the iPad 3 was a brand new model, so it had a much higher relative mix. That always happens immediately following a new release). I remember reading somewhere that the iPad mix was pretty much 1/3, 1/3, 1/3 last quarter ( not taking into account storage). A year ago it was probably (of course I'm estimating here) 2/3 iPad 3 and 1/3 iPad 2. Basically take that 1/3 high end ($500-$830) and knock them down to the low end ($330-wherever), PLUS a reduction in iPad sales. That's by far the largest factor.

And do you have anything to back up that last statement or are you just surmising?

 

[lunaoso]

As an iOS developer, I'm wondering at what point I should abandon ship and switch to Android development. There still seems to be plenty of cash in iOS dev at the moment but how long will that last with a decreasing market share?

I think you should check out this article. The money is still in iOS.
https://www.macrumors.com/2013/04/17/google-play-catching-ios-app-store-in-download-volume-but-ios-still-dominating-revenue/

 

[autrefois]

Apple has nothing to "turn around". Apple's iPhone is continuing to enjoy increased sales and increased profit. Let's have a look at a mobile phone profitshare. It would likely still be around 70% with samsung having the other 30% and everybody else just treading water.

Marketshare is certainly a valuable metric, but hardly the most important metric... Profit is the goal. Apple could easily win marketshare, but at the cost of their profits

As a consumer, I couldn't care less about how much profit Apple makes. Marketshare ensures that developers will continue to produce for the platform you're on (iOS). The more marketshare they lose, the more likely things will come out sooner or exclusively on other platforms. If your platform/device can't do the latest and the greatest, that also affects mindshare.

I want the iPhone to remain the best phone out there. Apple has the knowhow to do this. It seems like their business model is holding them back. Their marketshare continues to drop, but they're making money — that's apparently more important to them than marketshare. We'll see what iOS 7 does to help this, but I agree with others that it doesn't seem like that much of a game-changer. We'll have to see what the iPhone refresh has in store.

One way to increase marketshare (especially with a brand as established as the iPhone) is to lower prices. Apple already has an obscene amount of money just sitting there. If they care about marketshare, they will lower prices of their iDevices, or at least offer entry-level ones at lower prices. They're no longer the only serious contender in town, and most people will buy other products if they're comparable but cheaper.

Yes, they will go from getting a ridiculous amount of profit to just a very high profit margin. But having enough money is not even close to a problem Apple has right now. I think that marketshare, by making sure they match or surpass features of the competitors and/or making prices lower, will accomplish want consumers want. Hopefully someone at Apple will remember that money isn't the only thing that's important to success.

 

[nikicampos]

Of course sales and shipments tend to slow down once iOS 7 was announced in June, it comes hand to hand with a new iPhone, everyone knows that.

Also, iPhone price is $649 while nexus is $300... big difference, and even cheaper Android phones.

 

[nrose101]

This is honestly all I care about:

 

[BaldiMac]

Open versus closed system. It's Windows / V.s Mac OS all over again.

I'd say it has very little to do with open v closed. Android's market share is mainly the result of cheaper and wider distribution

As an iOS developer, I'm wondering at what point I should abandon ship and switch to Android development. There still seems to be plenty of cash in iOS dev at the moment but how long will that last with a decreasing market share?

With current trends, there should be plenty of cash [carry the one... and...]... forever.

Someone is trying to create panic to pick up AAPL for cheap before the next run-up in the AAPL stock price this fall.

Or... IDC is releasing the same report they release every quarter for several years.

Good comment. I feel the same way to a point, I haven't brought myself to switch to another phone but I am a bit bored and I realize that's a bit crazy as we are just talking about a phone, but with two-year contracts (ATT) and the phones not changing much on the in-between years, i.e. S versions, it does get a bit stale, especially considering how much we use our phones every day.

It's almost like Apple is aware that a lot of people are on two year contracts, so they target the improvements to the iPhone around the idea that most people will upgrade their phone every two years. Crazy.

 

[Mad Mac Maniac]

You mean the psychos who actually have sense enough to question, 1, why all of these manufacturers stopped reporting actual sales like they use to when they were actually winning, 2. Why none of the non-psychos question why Samsung's actually sales number they had to report during the Apple trial only came to a small fraction of what it was widely reported they shipped during the same period. Maybe the psychos just aren't afraid to actually do some research.

1) The fact taht company stop reporting their sales have nothing to do with these shipped metrics. These are still accurate. Plus Apple reports these same Ship-through metrics when they report their sales. I'm not sure how they handle it with Apple store... but they report shipped to BB/AT&T/etc as a "sale" even though it's only actually "shipped". So it's still a mostly apples to apples comparison

2) Well, I can't speak knowledgably on this. You may be right, but I thought I would have heard about this if it were the case.

 

[JohnGrey]

As for the article, I'm not surprised and I've believed for a few years that Apple will drop very low in the smartphone share which will then start to impact on their other product sales. I'm someone, like many apparently, who has dropped iOS for Android and hasn't looked back.

That is Apple's contribution to commercial history. Create new product categories with blue ocean products of incredible design, myopically focus on that to the exclusion of most everything else so that it functionally becomes the cornerstone of your company's profit, then watch as the proliferation of low-cost alternatives of variable quality whittle your market share to virtually nothing. It happened with the IBM PC, happened with Windows, and now it's happening with Android. The problem is that, a few brief recessionary periods aside, Apple had the luxury of operating in the largest nominal increase of wealth in the history of the planet, an economic cycle that is now coming to a crashing end. What remains to be see is if the discretionary income of those in good financial shape with find its way to Apple in sufficient amounts to maintain their profit margins. Myself, I find it unlikely. Not saying that Apple will fail outright, I just believe that it will be a very different company three years from now.

 

[genovelle]

Puzzling

I guess I am one of the few who think it's very odd that they ship 80% of the Smart Phones but some how Apple's tiny 13% accounts for over half of the usage. If they are really so popular why do most people I know have iPhones and trust me if people are paying for a data plan which they have to with a smart phone, they are using the internet on their phones.

 

[lazard]

Again.... we're talking shipments here... not sales... don't know how many of those new shipments are sitting dead on shelves???

We know how many shipments of iPhones are sitting dead on Verizon's shelves.

 

[donutbagel]

Casually looking around, I'd have guessed it's the other way around.

Probably all those sales in places like India and China. A cheap Android phone instead of another super-expensive iPhone is rare in California, and I see very few people using expensive Android phones here.

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Others are now 0%. What others? Also, why isn't Android considered Linux?

 

[Jaro65]

No real surprise here. Google is sorta in the position with mobile devices that Microsoft was with PCs. It looks like Apple will then occupy the same position that they did with PCs. As long as they can maintain the profit margin, they do pretty well as a niche player.

Not exactly what SJ wanted though.