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As Apple showed from 2001-2007, it was doing more than fine with Mac OS X, Macs, Pro software and the iPod. Now, I don't think Apple wants to lose the 50% of its revenue that comes from iOS devices, but I also don't think Apple will be in dire straights if iOS loses a bit of share to others.

Apple can lose market share and still increase revenue. The smartphone market is growing as owners of "dumb phones" are finally upgrading to smart phones now that they are becoming more consumer friendly. Back in the days of RIM/Palm/WinMO dominance, the smartphone was a niche device -- not something you'd see in grandma's hand -- that has changed. When markets are growing everyone can win.

As I said before, the numbers from some recent studies are showing phones "shipped" but not sold to consumers. When carriers get a bunch of stock of phones that they can't sell they start offering 2 for 1 deals to get customers to sign up for a two-year contract. In the tablet market Samsung touted their 2M units of Galaxy tabs sold -- when pressed for how many were actually sold to consumers they would not even give the number only saying it was "quite small". Ultimately, you will see a surge in sales for those GalaxyTabs as Best Buy and others dump them for ridiculously low prices.

Number of units sold is just one statistic -- the other important ones are:
- Average sales price to consumer by phone model
- Average subsidy paid to manufacturer by phone model
- Customer satisfaction ratings by phone model after 3 months of use

The things we will probably never know because the manufacturers won't break the information down for us are:
- Revenue for manufacturer by phone model
- Profit for manufacturer by phone model

Anyway -- I'm not switching to Verizon, but I am very interested to see what Verizon customers do now that they have the choice of iPhone or Droid -- specifically with regards to number of units and average sales price.
 
The retail price has zero to do with the overpricing here though. Apparently Apple is able to produce their phones a lot cheaper than others then (although I have disagree on the same retail price, at least here in Europe a lot of the Android phones are a lot cheaper). But Apple is keeping a larger margin of the retail for profits. That is why in comparision with the rest of the market it is overpriced ..

Good news for Apple stockholders I guess (although they not seeing much dividends either) .. not so much for the customers.

T.
You do not seem to understand the law of supply and demand or how pricing works. If consumers thought that the iPhone was overpriced then they would not buy one and sales would be low. That would force Apple to lower the price in order to compete.

Obviously, consumers (not tech bloggers or geeks) think that the iPhone is still competitive against the competition for the features it offers or they would not continue buying it.

In a nutshell, consumers don't care about how much of a profit margin a product has. All they care about is price and as long as that price is within the range they are willing to pay then they will buy it.

Apple would gain nothing from lower the price since they already sell practically every unit they can make and would only lose out on margin.
 
Before we get too smug over Apple's superiority.. and while Apple's share of the profits still is impressive..

One Massive thing to note is that these manufacturers are NOT exclusively smartphone makers.

So while Apple only has the iPhone range, with which it can evidently skim lots of profits:

Motorola, Samsung, Sony Ericsson, Nokia etc sell a lots of 'dumbphones'

on which the profits are going to be a lot smaller.

This is going to be a larger factor in the discrepancy, which is hinted at in the original article: "Apple focussing on premium end etc. ie Smartphones.

Good comparison would be Droid X vs iPhone 4, and look at profits per unit to really see how good Apple is in managing costs/extracting 'value' out of the consumer.

All this 'race to the bottom' talk is deliberate for certain handsets, however these manufacturers, having more than model (thank god for the consumer like me who likes choice) all have their premium top of the range which sell exactly for as much as iPhone 4, some Android phones even having improved/more modern components eg SGX 540, larger SAMOLED screens etc.

e.g: Nexus S 429GBP unlocked (16GB 1Ghz Hummingbird (A4), SGX 540, 512MB RAM, 4inch SAMOLED 800x 480)

iPhone 4 499GBP unlocked (16 GB, 800mhz A4, SGX535, 512MB RAM, 3.5 Inch IPS LCD 960 x 680)

would be interesting comparison. the higher res lcd plus glass back and front must cost a fair bit so overal they may cost the same to produce, but one retails 70GBP higher. (Software value is seperate/subjective, just looking purely at hardware) Also, Samsung know they are not going to be pushing iP4 numbers (they wouldnt even want to having their Galaxy X 2 coming out in 2 weeks) so economies of scale would be less.

So while you have the mytouch slides etc. you have the Droid 2, HTC G2 HTC Desire HDs etc, that all are priced comparably to iPhone (though all available on lower plans in UK compared to iPhone, which still requires cash outlay unless you choose a pretty expensive contract)

You're kidding right? Smugness aside, 4% units sold = 50% of industry profits = The Apple juggernaut doing what it does best. Producing products people love and making money for shareholders.
 
One of Apples most clever acts, was the implementation of Apple Tax. Look at how it's pumped up their revenue. Brilliant indeed.
 
You're kidding right? Smugness aside, 4% units sold = 50% of industry profits = The Apple juggernaut doing what it does best. Producing products people love and making money for shareholders.

you left off screwing over the consumer.
 
you left off screwing over the consumer.

How are they screwing the consumer? I can buy any number of smart phones that are as good or nearly as good or better than an iPhone for about the same price. Because Apple is able to gain greater efficiencies and economies of scale than others and male more is screwing you?
 
How are they screwing the consumer? I can buy any number of smart phones that are as good or nearly as good or better than an iPhone for about the same price. Because Apple is able to gain greater efficiencies and economies of scale than others and male more is screwing you?

since apple choose to pocket their savings instead of passing them on then yes. At some point insane profits need to be called out for what they are.
Steve Jobs is fairly greedy from reports I have read and seems Apple has pick up on it.

Have a relatively small market share yet controlling most of the profits screams greed to me.
Who is winning from that extra greed. Less see Apple but no one else.
 
Verizon's has dropped the price on the HTC Incredible and Samsung Fascinate to $100. Sure Google is ecstatic about this in the short term with their "53% of all smart phones shipped in Q4 2010 ran a Google OS". But Verizon dumping these phones for $100 each is just more evidence that retailers did not sell a whole lot of those phones that were shipped to them in Q4 2010. Next up... two phones for $100.

Google loves it because the more handsets in people's hands that run Android means more marketing demographics to be had and more ad impressions to be made. But the model is not sustainable... the manufacturers who build these phones are by-and-large going to start losing money (Motorola probably already is). Eventually, one of these manufacturers will emerge on top, and when they do they will likely take Android, rebrand it and retool it into whatever they want, and then Google's fingerprints will be removed completely. Who knows - the winning Android handset maker may even create their own app marketplace, install Bing as the search engine (some have), deploy their own mobile ad service, and completely bypass Google altogether. It only takes one or two upgrades to for a leading manufacturer to take their customers back from Google. What Google really needs is at least two of these manufacturers to have sustained profitability so they fight it out with each other and don't turn on Google.

The moral of the story is that Google wins and phone manufacturers lose and the masses of people who could not afford smartphones are now getting them on the cheap, but the devices they are getting will likely be abandoned by their manufacturers with no upgrade path.
 
Marketshare numbers for Q4/2010 for the United States have just been released by NPD:

Android: 53% (+9)
Apple iOS: 19% (-4)
RIM: 19% (-2)
W7: 2% (+2)

http://www.prweb.com/releases/prweb2011/1/prweb8101410.htm

Those numbers are for marketshare for 'sales' of phones by OS for q4...NOT marketshare of 'number' of phones by OS.

In terms of number of phones out there in the US, is about 25% each for Apple, RIM and Android, with Apple a few points higher then the other two. RIM has gone down by the same amount that Android has gone up...with Apple about steady, with a slight increase.
 
since apple choose to pocket their savings instead of passing them on then yes. At some point insane profits need to be called out for what they are.
Steve Jobs is fairly greedy from reports I have read and seems Apple has pick up on it.

Have a relatively small market share yet controlling most of the profits screams greed to me.
Who is winning from that extra greed. Less see Apple but no one else.

The whole report is probably inaccurate with respect to profits, because I don't think Apple breaks down its profits that way but I could be wrong. I think the report is using Apple's entire profits on all sales as the profit number here.

But you have to admit, before iPhone, the smart phone manufacturers out there pretty much screwed you on price and gave you no features (e.g.: Palm Treo 680 with no Wifi even though Treo 650 had the option). When iPhone came out, they tried the same price point of some of the premier smart phones, but that did not sit well. So they turned down the greed and lowered the price (finding the sweet spot). Once iPhone took off with the app store the next year, iPhone became the bar by which other smart phones were measured. Ever since then iPhone pricing has represented the maximum price a manufacturer will sell their smart phone for (lest their potential customers consider the iPhone instead). If you recall... Palm's CEO originally said at CES that the Palm Pre would cost more than the iPhone because it was a better phone. However, it did not quite turn out that way on release day. Why? He had no choice but to bring his price down to compete. iPhone will always be more expensive because it is perceived by many as the best -- hence competitors are forced to lower their price -- not out of the goodness of their heart (they are greedy too), but because they have no choice if they want to compete.

If Apple does indeed have some wiggle room (i.e.: if the iPhone-only-profit numbers are huge compared to competitors), then they could lower the price to beat the competition and do the Walmart strategy. But Apple also needs competition in this space. You cannot run a closed ecosystem like Apple does without competition on the market to keep the anti-monopoly folks appeased. If Apple had the room to lower prices dramatically and squash all competition, it would be a really bad move. Its the same logic Bill Gates used when Microsoft purchases non-voting shares in Apple to financially back the company after Steve Jobs' return. Microsoft needed a competitor so they could keep doing business the way they wanted. While Google is strong, many of the smart phone manufacturers have had some desperate years recently, hence their abandoning their own OS development for Android. Regardless, Apple needs the competitors to exist.
 
Marketshare numbers for Q4/2010 for the United States have just been released by NPD:

Android: 53% (+9)
Apple iOS: 19% (-4)
RIM: 19% (-2)
W7: 2% (+2)

http://www.prweb.com/releases/prweb2011/1/prweb8101410.htm

Those numbers are also the number of units shipped to sales channels. Ask Samsung about shipped units versus units sold to actual customers regarding the Galaxy Tab. Verizon is now selling some of those HTC Incredible and Samsung Fascinate units they received for only $100 to try to get them off their hands.
 
And... Top sellers by model...

1. Apple iPhone 4
2. Motorola Droid X
3. HTC EVO 4G
4. Apple iPhone 3GS
5. Motorola Droid 2

Note the iPhone3G is number 4! That is surprising!

Not so surprising if you consider that the iPhone 3GS is only available from AT&T and only purchased by the few folks that don't want the latest iPhone or can't afford it. While the Moto and HTC are bought by people on several networks that can't get good AT&T coverages.

Moto is moving phones but unfortunately can't figure out how to make money doing it. Too bad, I wish them well, but they have some kind of fatal corporate issues.
 
The whole report is probably inaccurate with respect to profits, because I don't think Apple breaks down its profits that way but I could be wrong. I think the report is using Apple's entire profits on all sales as the profit number here.

But you have to admit, before iPhone, the smart phone manufacturers out there pretty much screwed you on price and gave you no features (e.g.: Palm Treo 680 with no Wifi even though Treo 650 had the option). When iPhone came out, they tried the same price point of some of the premier smart phones, but that did not sit well. So they turned down the greed and lowered the price (finding the sweet spot). Once iPhone took off with the app store the next year, iPhone became the bar by which other smart phones were measured. Ever since then iPhone pricing has represented the maximum price a manufacturer will sell their smart phone for (lest their potential customers consider the iPhone instead). If you recall... Palm's CEO originally said at CES that the Palm Pre would cost more than the iPhone because it was a better phone. However, it did not quite turn out that way on release day. Why? He had no choice but to bring his price down to compete. iPhone will always be more expensive because it is perceived by many as the best -- hence competitors are forced to lower their price -- not out of the goodness of their heart (they are greedy too), but because they have no choice if they want to compete.

If Apple does indeed have some wiggle room (i.e.: if the iPhone-only-profit numbers are huge compared to competitors), then they could lower the price to beat the competition and do the Walmart strategy. But Apple also needs competition in this space. You cannot run a closed ecosystem like Apple does without competition on the market to keep the anti-monopoly folks appeased. If Apple had the room to lower prices dramatically and squash all competition, it would be a really bad move. Its the same logic Bill Gates used when Microsoft purchases non-voting shares in Apple to financially back the company after Steve Jobs' return. Microsoft needed a competitor so they could keep doing business the way they wanted. While Google is strong, many of the smart phone manufacturers have had some desperate years recently, hence their abandoning their own OS development for Android. Regardless, Apple needs the competitors to exist.

Thank you for that well-reasoned response to idiots who don't understand economics.
 
In terms of number of phones out there in the US, is about 25% each for Apple, RIM and Android, with Apple a few points higher then the other two. RIM has gone down by the same amount that Android has gone up...with Apple about steady, with a slight increase.

comScore's Nov report last had USA usage at:

34% - RIM
26% - Google
25% - Apple
09% - Microsoft
04% - Palm

Got a more recent source? Thanks!
 
When it comes to competition between Android and iOS, it's as much of a war of words, as a competition between these two devices.

Apple has used it's influence amongst it's followers and fan base to use the word "fragmentation" in a negative way to criticize Android for providing choices of devices. There's also a few versions of the OS, as Android is being very rapidly developed. This too has been bad mouthed. "race to the bottom" is another saying that comes to mind.

In the BlackBerry lineup there's more than one phone. This is also true for every other manufacturer, even feature phones come in variety of styles. And yet none of these manufacturers are accused of fragmentation.

Let's set aside the Android vs iPhone comparison for a moment.

We all know the iPhone is a great phone. Very nicely styled, with a high level of refinement and functionality, the iPhone speaks for itself. Now a few generations away from version one, the iPhone has never been in higher demand, nor has it sold as many units as are being sold now. With the Verizon deal finally sealed we know beyond question the sales volume is really going to climb.

This brings us to the point I find difficult to understand. Just why is it that many iPhone owners go to such great lengths to trash Android? Why such fear & paranoia? Why not have an intelligent exchange of viewpoints, observations and functionality?

From my vantage point it seems to come from within Apple. With such a great phone it's odd that they are so insecure. Then like most words out of the mouth of Apple, the followers buy in and propagate the company position with venom.

Apples on such a successful roll, enjoying massive profits & great momentum, it's a shame they don't seem to be enjoying it as much as they do bragging about it.
 
The whole report is probably inaccurate with respect to profits, because I don't think Apple breaks down its profits that way but I could be wrong. I think the report is using Apple's entire profits on all sales as the profit number here.

But you have to admit, before iPhone, the smart phone manufacturers out there pretty much screwed you on price and gave you no features (e.g.: Palm Treo 680 with no Wifi even though Treo 650 had the option). When iPhone came out, they tried the same price point of some of the premier smart phones, but that did not sit well. So they turned down the greed and lowered the price (finding the sweet spot). Once iPhone took off with the app store the next year, iPhone became the bar by which other smart phones were measured. Ever since then iPhone pricing has represented the maximum price a manufacturer will sell their smart phone for (lest their potential customers consider the iPhone instead). If you recall... Palm's CEO originally said at CES that the Palm Pre would cost more than the iPhone because it was a better phone. However, it did not quite turn out that way on release day. Why? He had no choice but to bring his price down to compete. iPhone will always be more expensive because it is perceived by many as the best -- hence competitors are forced to lower their price -- not out of the goodness of their heart (they are greedy too), but because they have no choice if they want to compete.

If Apple does indeed have some wiggle room (i.e.: if the iPhone-only-profit numbers are huge compared to competitors), then they could lower the price to beat the competition and do the Walmart strategy. But Apple also needs competition in this space. You cannot run a closed ecosystem like Apple does without competition on the market to keep the anti-monopoly folks appeased. If Apple had the room to lower prices dramatically and squash all competition, it would be a really bad move. Its the same logic Bill Gates used when Microsoft purchases non-voting shares in Apple to financially back the company after Steve Jobs' return. Microsoft needed a competitor so they could keep doing business the way they wanted. While Google is strong, many of the smart phone manufacturers have had some desperate years recently, hence their abandoning their own OS development for Android. Regardless, Apple needs the competitors to exist.

You are wrong! Apple does break down it's sales and revenues over it's product sectors. What would be the point of including all of Apple's profits in a report on cell phones?
 
Have a relatively small market share yet controlling most of the profits screams greed to me.
Who is winning from that extra greed. Less see Apple but no one else.

I am, I love the phone and own shares. Producing a profitable and popular product is not greed it is good business.
 
You're kidding right? Smugness aside, 4% units sold = 50% of industry profits = The Apple juggernaut doing what it does best. Producing products people love and making money for shareholders.

you left off screwing over the consumer.

How are they screwing the consumer? I can buy any number of smart phones that are as good or nearly as good or better than an iPhone for about the same price. Because Apple is able to gain greater efficiencies and economies of scale than others and make more is screwing you?

since apple choose to pocket their savings instead of passing them on then yes. At some point insane profits need to be called out for what they are. Steve Jobs is fairly greedy from reports I have read and seems Apple has pick up on it.

I am, I love the phone and own shares. Producing a profitable and popular product is not greed it is good business.
Rodimus, instead of spending so much time and energy trying to convince the world how greedy/evil Apple is... why not simply invest in some AAPL stock, and "share" the wealth. ;)


Have a relatively small market share yet controlling most of the profits screams greed to me. Who is winning from that extra greed. Less see Apple but no one else.
Nope, see here: the company and its shareholders.
 
Rodimus, instead of spending so much time and energy trying to convince the world how greedy/evil Apple is... why not simply invest in some AAPL stock, and "share" the wealth. ;)
QUOTE]

Do what I do and put this screwball on your "ignore" list. He's too young to know what he's going on about.
 
Rodimus, instead of spending so much time and energy trying to convince the world how greedy/evil Apple is... why not simply invest in some AAPL stock, and "share" the wealth. ;)



Nope, see here: the company and its shareholders.

shareholders only really win if Apple gave dividides which they do not.
Most people who buy AALP have zero power. The people who have enough votes to lock things down are in the hands very few people.

It fake view that shareholders really are winning jack. Clearly Apple does not share that insane profits with its share holders.
 
shareholders only really win if Apple gave dividides which they do not.
Most people who buy AALP have zero power. The people who have enough votes to lock things down are in the hands very few people.

It fake view that shareholders really are winning jack. Clearly Apple does not share that insane profits with its share holders.

You must be mad to even suggest something like this for maybe the most profitable of stocks. Within a 10 years period, it had gone from like $10 to close to $350 and still climbing, with target price anything from $400 to $500.
Also when a company pays dividends, this is also reflected negatively in stock price. Mr. Jobs has entered the pantheon of the very few and his company will present the raw model for decades to come in the business world.
 
How is the iPhone overpriced hardware wise? please do explain.

Because it uses the same components as android phones which you can buy for $100.

It's amusing how people here actually think its a good thing that apple is making huge profits. That means people who are buying iphones are getting ripped off.
 
Because it uses the same components as android phones which you can buy for $100.

It's amusing how people here actually think its a good thing that apple is making huge profits. That means people who are buying iphones are getting ripped off.

Microsoft and Google also make huge profits. But I bet you're not bothered by that. :rolleyes:
 
It's amusing how people here actually think its a good thing that apple is making huge profits. That means people who are buying iphones are getting ripped off.

Nobody is getting ripped off. They all, everyone of them, could have purchased a netbook and installed linux if that's what they personally thought was the better deal financially.

I did. I purchased a $120 box and installed linux on. Its cute, but I don't use it that much. I prefer using my MBA 11 a hundred times more.
 
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