Apple's iPhone Continues to Outpace Smartphone Industry Growth

[Carniphage]

Enter N900. It's a few months old already and better in about every way to the 3GS.

For someone trying to argue against Nokia, you're very ill informed.

I have already said, ( if you could be bothered doing something other than playing the Espoo Cheerleader ) that Maemo has the possibility to transform Nokia's fortunes at the high end. It is potentially a good product. But it has not sold in any quantities yet.

(And by "high-end" I mean phones that actually sell. Not featurephones with glued-on crystals sold to mentally-challenged celebrities.)

But Maemo has some downsides for Nokia.
The N900 isn't really finished.
And if Nokia declare; "Maemo is the future", they debase the value of the entire Symbian line. They are effectively declaring it yesterday's smartphone OS.

I think they should do this. Symbian is yesterday's smartphone OS.

But a wholesale shift to Maemo is not without risks. And let's be very clear. For consumers and developers, Maemo really isn't a more attractive platform than Android.

C.

 

[Carniphage]

Yes it was poor, but that's only because the competition did phenomenally well. Also, as handset makers move to the different smartphone platforms, the market is going to get very big, very fast. If you look at the numbers in the overall cellphone market, Apple is single digit. Once the entire market has transitionned to smartphones, Apple is going to need a new metric to seperate their offering, or they'll show up as a very thin slice in marketing pies.

There's no doubt that soon every phone that Nokia sell will be declared a "smartphone". Kids will be finding "smartphones" in packets of breakfast cereals. There's be $10 prepaid smartphones in bubble-packaging. Drains will become clogged-up with discarded smartphones.

And in this world, even with 100% growth per annum, the iPhone share of the "smartphone market" will be tiny. And will get smaller. So you are completely 100% right!

But this does not change the fact that Nokia are struggling to sell any phones over $500. Last quarter it was 4M N-series phones. I'd be surprised if they shift $2M this quarter. And their profit figures will reflect this with a year on year decline.

But if you tell yourself this does not matter enough. I am sure you will convince yourself that this is true. This ship isn't sinking... look! the back-end is actually lifting out of the water!

C.

 

[redkamel]

It is an old marketing trick, invented by John Sculley when he was still at PepsiCo (before Apple): Make sure that the numbers that are reported make your competitors believe they are ahead, even when they aren't. In the Cola wars, Sculley found out that his competitor counted the numbers of bottles sold, and not the ounces of drinks sold. Therefore PepsiCo switched to selling larger bottles, making Coca Cola believe that they were ahead (they sold more bottles) when they actually weren't (they sold less drinks).

that story doesn't make any sense. Bottles sold is more important that oz sold (although oz sold is important too). A bottle sale is a single purchase; people don't care about 16 vs 18 oz, they care about pepsi vs coke for most sales. Oz sold only matter if include the party people buying 1L bottles instead of 6 packs

 

[sjo]

But this does not change the fact that Nokia are struggling to sell any phones over $500. Last quarter it was 4M N-series phones. I'd be surprised if they shift $2M this quarter. And their profit figures will reflect this with a year on year decline.

But if you tell yourself this does not matter enough. I am sure you will convince yourself that this is true. This ship isn't sinking... look! the back-end is actually lifting out of the water!

C.

I don't think there's much disagreement that the over $500 phone market is going to die within the next 2-5y (with the exception of the true vanity phones such as vertu).

With the slow upgrades Appe is offering for Iphone, they won't get any new grow either, and their market will be those (every year fewer) loyal who upgrade their model into a new one. Eg, (the current) 30-40m iphone users upgrading every 2-2.5 years = 15m sold units yearly.

2011 Iphone will be squeezed betweeny Nokia-MSFT joint effort of QT(Maemo) + MS Office and Android (Mot/Samsung/LG/HTC/SonyE) with Google cloud services in the high end, and Nokia middle prices smartphones from the low end. And no-one is able to challenge Nokia in the emerging markets with their supercheap Symbian phones there.

How is that sinking?

 

[LagunaSol]

Ok this is just some one looking to come up with an excuse on WHY apple is better and discount number 2 which is winning.

I don't need an excuse to show that other carriers/manufacturers are dumping free phones on the market while Apple's prices (to the consumer) remain static. No sales, no rebates, no dealios. No kidding.

2nd off on AT&T Apple iPhone is getting a $400 subsidity compared to the Blackberry $250. ($150 two year contract + $100 mail in rebate)

I'm not talking about profit, I'm talking about market share. If Apple is getting more subsidy than RIM on each phone then Apple must be doing something right.

So using your logic the only reason Apple is doing so well is it is getting a much larger subsidy than everyone else.

That's not using my logic at all.

Honestly the iPhone is getting a larger subsidy than any other phone on AT&T network and safe to assume on the other carriers it is with it is getting a better subsidy price.

Good for Apple. I think that's the entire point of running a business - making more money than the other guy.

I suggest you learn some facts about the iPhone sweet heart deal before you go try to bash blackberries numbers because Apple has force its phone prices artificially lower than everyone else.

I suggest you get your logic processors re-calibrated.

Perhaps we'll see some Buy-One-Get-Two-Free deals from BB soon. Yay market share!

(It is funny that the Apple bashers here are always talking about Apple's inflated prices - unless, of course, when they're talking about Apple's artificially low prices. )

looks like Apple had it own that at least match it if not caused it to better.

English please?

 

[firewood]

Because the iPhone not an open platform... 100% controlled by Apple.

Nowhere near 100%. For $99/annum, developers can run any code they can write (or find source code to) that will fit into a single process, and completely ignore the App store. (I have both App store apps, App store rejects, and white-icon stuff I haven't even bothered to submit, all loaded on my iPhone.) Most of the underlying OS X APIs are fully open, e.g. I could write a multithreaded network server, etc., etc. if I wanted.

And that's not even including people who damage their phone's OS so that hackers can more easily break in and install malware. (If that's not open, what is?)

And seriously, as a consumer, I couldn't give a rats ass about profits. Actually, quite the contrary, if a company is shipping low volumes and making high profits, I'm going to tend to be thinking I'm getting ripped off.

Doesn't matter. If a company is making high profits, than at least some customers think the product provides more value to them than the "rip off" price.

Companies that don't provide enough value to "rip off" enough people can't invest in much R&D, or pull a GM: close all their dealerships and go bankrupt. Have fun getting service nearby.

 

[MorphingDragon]

I have already said, ( if you could be bothered doing something other than playing the Espoo Cheerleader ) that Maemo has the possibility to transform Nokia's fortunes at the high end. It is potentially a good product. But it has not sold in any quantities yet.

(And by "high-end" I mean phones that actually sell. Not featurephones with glued-on crystals sold to mentally-challenged celebrities.)

But Maemo has some downsides for Nokia.
The N900 isn't really finished.
And if Nokia declare; "Maemo is the future", they debase the value of the entire Symbian line. They are effectively declaring it yesterday's smartphone OS.

I think they should do this. Symbian is yesterday's smartphone OS.

But a wholesale shift to Maemo is not without risks. And let's be very clear. For consumers and developers, Maemo really isn't a more attractive platform than Android.

C.

N900 still doesnt fix Linux's shortcomings.

 

[nastebu]

You're forgetting that the 4th quarter of 2009 was the quarter where they sold the most iPhones, ever.

EVER.

And they still didn't manage to retain their market share. And you call that poor performance ? Yes it was poor, but that's only because the competition did phenomenally well. Also, as handset makers move to the different smartphone platforms, the market is going to get very big, very fast. If you look at the numbers in the overall cellphone market, Apple is single digit. Once the entire market has transitionned to smartphones, Apple is going to need a new metric to seperate their offering, or they'll show up as a very thin slice in marketing pies.

I'm not really following you either. Apple had it's best quarter ever in a quarter where they didn't introduce a new phone. Year over year they closed the gap with RIM. And this is bad news?

Anyway, a single quarter's numbers don't show a trend. They show an instance, but a trend is multiple quarters strung together. The four quarters--year total--result is more arguably a trend.

 

[DMann]

Perhaps we'll see some Buy-One-Get-Two-Free deals from BB soon. Yay market share!

This might actually be happening sooner than later:

Businesses trading BlackBerry for iPhone

 

[MorphingDragon]

This might actually be happening sooner than later:

Businesses trading BlackBerry for iPhone

BlackBerries are practically dead in New Zealand and from what I've seen in Sydney, Australia is about the same. The only places I still see Blackberries are old hat firms that are stuck in a technological snapshot.

The most recurring statement I hear is that the keyboard is too small for practical use.

 

[greygray]

I looked at Nokias 20.8M smartphone number.

This corresponds to
4.6 million Nseries
6.1 million Eseries
10.1 million "numbered Nokia Symbian devices"

C.

I would say out of Nokia's creations, the E series has to be the best. The N series is really awful IMO.

 

[KnightWRX]

I'm not really following you either. Apple had it's best quarter ever in a quarter where they didn't introduce a new phone. Year over year they closed the gap with RIM. And this is bad news?

If you've been paying attention, in 2008, Apple was ahead of RIM with the iPhone 3G. They have been steadily losing ground to RIM for the last 12 months. They aren't closing the gap, that's just imaginary trends invented by *LTD*. As it is, for the last 12 months, RIM has been stretching their lead over Apple after having gained back 2nd place.

So the only reason you're not following me is because you ignore the facts. 3Q08 Market Share : apple 2nd, RIM 3rd. By 3Q09, RIM 2nd, Apple 3rd. And this gap widened more in 4Q09.

Apple needs to not ignore this fact. They need to do something to turn this around and either again close the gap on RIM or take 2nd place back. Maybe addressing the shortcomings of the iPhone would help some (like changing the wallpaper on the phone, something I've been able to do on most phones since 2002).

(And by "high-end" I mean phones that actually sell. Not featurephones with glued-on crystals sold to mentally-challenged celebrities.)

Spoken like a true fanboy. Ignore the real high-end so that the iPhone can look high-end. Fact : Most phones unsubsidized are 500$ to begin with. A lot of Nokias are, Sony Ericssons, all Blackberries. Apple is not alone in the 500$+ phone market, and guess what ? That's not where they make their sales. The 99$ iPhone 3G is probably the best seller they have. The subsidies count for a lot.

And Vertus are not for celebrities only. A lot of business men carry them if only for the Valet service. My friend prepped one for his boss, which isn't even in a fortune 500. And the Vertu Constellation is made from real 18k gold and diamonds, not glued on crystals and paint. These are the real deal, not some cheap flea market crap. The Ascent Ferrari is made out of titanium with leather covers. Fit and finish is flawless on these phones, the iPhone doesn't even start to hold a candle to them.

The fact is the iPhone isn't something special. Get that out of your heads. It's just another phone, sold at the same competitive subsidised price as other phones, offering less or more features than other phones depending on your needs. It's an option in a sea of options. That's why Apple is not dominating this space (and they really aren't even close to doing so).

Plain and simple.

But Maemo has some downsides for Nokia.
The N900 isn't really finished.
And if Nokia declare; "Maemo is the future", they debase the value of the entire Symbian line. They are effectively declaring it yesterday's smartphone OS.

The N900 isn't really finished only if the iPhone 3GS isn't really finished either. What the heck is that supposed to mean ? The N900 ships with Maemo 5, which is a shipping release. It's as finished as it comes as far as products go. I guess since iPhone OS 4.0 is coming, all iPhones right now are unfinished products too ? Ludicrous argument.

And Nokia doesn't have to declare anything about either. They can happily ship both platforms with varying feature sets to cover more bases in the market. Kind of like what Apple is doing with the iPods with a very simple unnamed OS, the iPod Touch/iPone devices, the iPad and finally the Mac line-up. Different devices, different OSes, different needs.

"There can only be 1", effectively Highlander Marketing, is a very bad business mentality. It only works if you have 1 consumer buying your products.

 

[ChazUK]

Are people really saying that a BOGOF deal on a single brand (blackberry) in a single country has a real impact on "worldwide" marketshare? (I can't find the offer available anywhere else, please educate me if you can. )

It's not as if Blackberry went to Verizion and Sprint with a truckload of Blackberry phones and said "We don't care what you do with them, give them away if you can, just keep that iPhone 3rd in worldwide marketshare!!!!1!1one"

 

[Stella]

Nowhere near 100%. For $99/annum, developers can run any code they can write (or find source code to) that will fit into a single process, and completely ignore the App store. (I have both App store apps, App store rejects, and white-icon stuff I haven't even bothered to submit, all loaded on my iPhone.) Most of the underlying OS X APIs are fully open, e.g. I could write a multithreaded network server, etc., etc. if I wanted.

The term 'open platform' has to be defined more clearer, from my definition of 'Open Platform', iPhone would be closed, while Symbian would be 'Open' ( as always has been ) - the level of control the OS vendor imposes. OSX would very much be "Open" .


Yes, you have to pay $99 even to deploy your own applications ( that aren't destined for the AppStore ) to your own iPhone / Touch device, without jail breaking. I won't go further because from there on in, iPhone becomes very closed - app vetting etc which other platforms don't do, in most part. Apple imposes strict ( and inconsistent ) rules about what applications can and cannot be published to AppStore ( the reasons for this aren't important for now ). Now, even mentioning the word Google Android is deemed offensive ( http://www.theregister.co.uk/2010/02/05/apple_slaps_iphone_app_for_mentioning_google_android/ ), but again the reasons for this is unimportant for this posting.

I think most developers / users who are familiar with iPhone would agree that iPhone is not an open platform - is it a closed ecosystem that Apple very tightly controls. If Apple want 3rd party developers then they must publish the API.

I think they should do this. Symbian is yesterday's smartphone OS.

Symbian will be a mid range platform for Nokia, it isn't being phased out. The future of Symbian looks exciting, a lot of things are happening - for example, a total revision of the UI - which most people would agree, Symbian needs desperately.

 

[Carniphage]

That's why Apple is not dominating this space (and they really aren't even close to doing so).

Plain and simple.

So just one question:

How come Apple, selling just one, rather dull featureless phone, which has a minuscule market share... manages to make more profit from its handset sales than the entirity of Nokia.

http://www.businessinsider.com/apple-iphone-operating-profit-nokia-2009-11

Apple won't ever dominate the cellphone space in terms of unit-sales. But you have to admit that is a little bit dominate-ish

C.

 

[KnightWRX]

So just one question:

How come Apple, selling just one, rather dull featureless phone, which has a minuscule market share... manages to make more profit from its handset sales than the entirity of Nokia.

http://www.businessinsider.com/apple-iphone-operating-profit-nokia-2009-11

Apple won't ever dominate the cellphone space in terms of unit-sales. But you have to admit that is a little bit dominate-ish

C.

Nokia doesn't rip off people and try to market cheap chinese products as a premium product worth a premium price ?

This argument, like I said many times before, is complete bunk. As a consumer, this only serves to turn me off from the iPhone.

And this doesn't indicate that the iPhone is dominating anything at all. Market power is not defined with profits, but with unit sales, presence, and influence. The cellphone market is clearly a very competitive field with many offerings. None of which are truly dominating the others.

 

[Goona]

Add in the ipod touch and Apple has sold around 75 million iphone OS devices. This is a platform devices will flock to no matter what the Android fanboys in this thread want you to believe. Add in the new iPad and the numbers of iphone OS devices grows even more. Apple is promoting a platform, it's not just the iphone that sells the iphone OS, you have the ipod touch and the new iPad. Not to talk less of Apple eating the other companies lunch in profits.

 

[Goona]

Nokia doesn't rip off people and try to market cheap chinese products as a premium product worth a premium price ?

This argument, like I said many times before, is complete bunk. As a consumer, this only serves to turn me off from the iPhone.

Cheap Chinese products, why the **** is it cheap, because it's made in China. Where does Nokia makes its phones? So because its made in China its cheap eh, I guess if Apple made it's phones in America it wouldn't be cheap. What sort of myopic thinking is that?

Yeah Nokia doesn't care about profits, I mean they don't want more profits. They are in this in the name of the consumer. If you believe this I have a bridge in India to sell you.

 

[KnightWRX]

Cheap Chinese products, why the **** is it cheap, because it's made in China. Where does Nokia makes its phones?

Depends. The 7th and 8th position of the serial number will indicate this for you. It can be in Finland, Germany, the Emirates or Azerbaijan. The European made models are generally higher quality.

And yes, it's cheap because it's made in China. There is no other reasons to move manufacturing there besides price. Manufacturing the same product in the US would cost more du in no small part to labor expenses.

Does this come as a surprise to you ? Why else did you think all manufacturing is moving to China ?

So essentially, Apple is saving tons of money and not passing on the savings to consumers, hence the higher profit margins.

 

[Goona]

Depends. The 7th and 8th position of the serial number will indicate this for you. It can be in Finland, Germany, the Emirates or Azerbaijan. The European made models are generally higher quality.

And yes, it's cheap because it's made in China. There is no other reasons to move manufacturing there besides price. Manufacturing the same product in the US would cost more du in no small part to labor expenses.

Does this come as a surprise to you ? Why else did you think all manufacturing is moving to China ?

So essentially, Apple is saving tons of money and not passing on the savings to consumers, hence the higher profit margins.

You know most things in this world are now made in China, I guess they are also cheap eh? You don't buy things made in China. Nokia also makes phones in China. I guess you don't buy those phones. What makes a phone made in Azerbijan better than one in China? Almost every electronic device in this world is now made in China. I guess you don't buy electronic now right? Take your myopic thinking out of here.

 

[Goona]

Most Nokia phones are now made in China:


http://migs.wordpress.com/2008/06/09/most-nokia-phones-are-now-made-in-china/

I guess we should stop buying their cheap Chinese phones.

 

[ChazUK]

Post deleted by Chaz.

 

[Goona]

LOL @ Goona defending Chinese labour whilst spewing this racist bile in the Engadget comments system:





http://www.engadget.com/profile/3647678/

And who the **** are you? Fckkk outta here mate, is that how they say it in the UK?

 

[ChazUK]

Who am I? I'm someone who hates double standards Goona.

You seem to be the most rabid iPhone fan I've ever seen online willing to insult people and whole nations to defend the thing, it's sickening and evil.

This will be the last you hear from me so don't worry!

 

[Goona]

Who am I? I'm someone who hates double standards Goona.

You seem to be the most rabid iPhone fan I've ever seen online willing to insult people and whole nations to defend the thing, it's sickening and evil.

This will be the last you hear from me so don't worry!

Yeah I sure will insult your nation if you insult mine, good day!