Apple's Share of Worldwide Smartphone Market Slides as Samsung Continues to Surge

[wedouglas]

Not that I'm excusing Apples laziness in pushing the envelope with the iPhone consider this; Apple could (If they wanted) easily flood the market with 50 iPhone variants and scoop up every corner of the market, I mean they have over 100 billion in the bank and easily have the capacity. ?

They probably wouldn't have $100B in the bank if they did that. IMO, the reason for not going at all corners of the market is cannibalizing sales of higher margin, higher priced items.

I really wonder what is going to happen to their margins and profits if they launch the iPad mini. There are a ton of people saying how great the Nexus 7 is, and these are tech people who have had and like iPads.

As the devices become more and more capable, it's harder to justify higher priced devices. If they release an iPhone mini or an iPad mini, there is the chance that people will find themselves completely satisfied with the lesser, cheaper, less profitable device.

 

[2IS]

You make a good argument.... for bringing back the down-voting of comments.

I agree, though I would have upvoted his comment anyway

 

[G51989]

Pedantic comment this is.

Where was the heat whe apple came out with

-iPhone
-iPad
-macBook Air
-retina display macs
-apple tv

People, apple innovates because it is in its DNA. Others copy, follow, and then sue apple when they're cought redhanded copying apple.

And how did they innovate with any of that? They didn't invent the smart phone, the iPhone was actually pretty bad its in 2G form. Didn't sell very well either, until the 3G came out.

iPad, so basically like a worse version of a tablet PC? Good marketing.

A high res display? Apple invented the high res monitor now? Clearly you've never seen a 4K display.

Apple TV, whats so good about this again?

They took products that already existed, made them shiney and pretty, then marketed the hell out of them, Steve Jobs was clueless about how things actually worked, he was just a user who wanted things to be needlessly easy. And most people want that. Which is why Apple does so well.

----------

Nice...cant wait till its small club again to own apple again. Tired of seeing every douchebag have an iphone, mac, and apple sticker on his car. It will once again be nice.

Whys that good? You want to go back to the days when Apple products were almost unsupported garbage? Their computers are still garbage by high end PC standards. Its the iDevices were they do really well and make an awesome product.

----------

lol same silly talk at the same time of the year every year.. the only phone that kills the iPhone is the new iPhone FACT

Yep, but eventually that will end.

Which is why I think buying Apple stock at the moment is a bad idea, once the " i " craze goes away, massive amounts of consumers will go somwhere else, Apple will always do OK, but I don't think they'll stay on top forever.

I think the thing is, is that they dont have a product that people NEED. Where as a company like Microsoft is in a great postion, because lots of people NEED windows.

----------

True, but I don't know if they make the best HDTVs (hard to compare). They certainly look amazing, but I really like Vizio too. Doesn't Samsung make all of those retina displays for Apple?

They make a good number, then Apple glues them into a un repairable disposable laptop and says " hey look! We made a high res display! "

 

[einmusiker]

172% is incredible but I don't know how. The SIII is nice but not as nice as the 4S or Lumia 900.

ummm r u joking? the s3 is worlds nicer than the 4s

 

[G51989]

I highly doubt that

Not in the next year, but Apple isn't nearly as stable as a company like Microsoft in the long run.

Don't get me wrong, Apple makes some awseome really well made stuff, but the fact is, they don't make anything anyone actually depends on. You can do just fine without your iPhone or Mac, but can a large enterprise system, or a large business really do without Windows/Office? Nope.

I think we will see Apple shrink once the ' i ' craze goes away and everyone moves onto the next big thing.

 

[ixodes]

Damn all of Samsungs Mobiles are ugly! How can 50 million consumers not care at all about design?

I happen to prefer performance, & having a highly useful 4.8" display, over style anyway.

Since I use mine for the tasks smartphones were designed for, it's ideal.

The stylish & tiny iPhone is far more valuable as an ego booster for the insecure users that need to validate their self worth by the phone their seen carrying.

See how well that works out? It's Magical, as Jobs would say.

Me? I'll take functional, fast & fun, thank you

 

[matrix07]

Yeah, that must be the Galaxy Ace or Galaxy Y.

However the top-selling smartphone right now is the Galaxy S3 with a 4.8 inch screen. I think that's the first time any smartphone model outsells the most recent iPhone (4S in that case).

That's where I think you're confused. This specific version doesn't outsell iPhone. It might be outsell iPhone 4S at specific time but it doesn't outsell iPhone 4S. People should read the news more carefully.

 

[Michael Scrip]

Have you seen the figures? might win? It already has won... and some time ago.

Yes... Android won.

So now what? What happens to #2 ?

How do car makers deal with that? Ford, Chevy, Chrysler, Honda, Toyota, Nissan... only one of those companies is "winning" at any given time. Somehow the auto industry is still around.

They probably wouldn't have $100B in the bank if they did that. IMO, the reason for not going at all corners of the market is cannibalizing sales of higher margin, higher priced items.

I really wonder what is going to happen to their margins and profits if they launch the iPad mini. There are a ton of people saying how great the Nexus 7 is, and these are tech people who have had and like iPads.

As the devices become more and more capable, it's harder to justify higher priced devices. If they release an iPhone mini or an iPad mini, there is the chance that people will find themselves completely satisfied with the lesser, cheaper, less profitable device.

There won't be an iPhone Mini... the current iPhone is already one of the smallest phone on the market at the moment.

If you're talking about price... Apple already offers a cheaper iPhone... it's the older model. The great thing is... they've already done the work. Apple keeps one factory churning out the older model... and they don't have to spend any more money to make a cheaper phone.

Other companies have to spend money, time and effort to create a new "cheap" phone.

Apple doesn't... and people wonder why Apple is so profitable.

As for tablets... Apple already makes a cheaper iPad... the iPad 2.

The $400 iPad earns about $150 in profit.

The $200 Kindle Fire earns roughly $0 in profit.

But a $300 iPad Mini could earn about $100 in profit... as Apple knows how to squeeze the supply chain.

Isn't the $100 profit on the iPad Mini better than nothing at all? There are tons of people who might want a tablet... but who won't spend $400 or more.

I'm not saying they have to make a cheaper iPad Mini... but it seems like they are leaving money on the table if they don't.

You can get an iPhone from $375 to $849... you can get an iPod from $49 to $399.

It just seems like a similar thing could happen with the iPad.

 

[MuppetGate]

Unfortunately, we don't have anything really concrete by way of sales figures for Samsung, but I'm pretty sure they are selling pretty damn well.

And (like 99% of the people here) I don't have any experience running a multi-billion dollar tech company.

So for the time being, going on past history, I reckon Apple will do pretty much the opposite of what everybody here is screaming for them to do:

Come September, we won't see an iPhone<insert your favourite tiresomely argued version number here> with a 6-inch screen, powered by pixie dust, and priced at $8 (including 2 year contract) just so they can say they sold more phones than Samsung.

The Mac fans in this forum will scream, gnash their teeth, beat themselves with sticks at the Gates of Cupertino, and swear blind that this is it, this is REALLY IT! They are going to buy an Android phone. That is actually okay. All that's happened is that you've moved out of the demographic that Apple wishes to serve.

The Android fans will carry on posting statements that start with 'Since Steve died...'

The new iPhone will sell in bucketloads and Apple will make an eye-watering amount of money.

And everyone will come back next year and scream that unless Apple makes a phone with 50-inch screen and priced at $3 (including a lifetime contract) then they are moving to Android.

That seems to be how it's gone for the past couple of years or so.

I don't think Apple ever really wanted to sell more phones than anyone else. I think they just wanted to make more money selling phones than anyone else. Until they stop doing that then I'm afraid you're not going to get your pixie phone.

 

[BC2009]

I would definitely not trade it in for a Nexus 7, as I prefer Amazon's locked-down app store. No malware worries for me! I am looking forward to the Kindle Fire 2. I'm always going to have a Fire because of Prime content.

If you are a prime subscriber, the Fire makes a whole lot of sense. And if you are a student, being a prime subscriber is even cheaper.

 

[MuppetGate]

But a $300 iPad Mini could earn about $100 in profit... as Apple knows how to squeeze the supply chain.

Isn't the $100 profit on the iPad Mini better than nothing at all? There are tons of people who might want a tablet... but who won't spend $400 or more.

I'm not saying they have to make a cheaper iPad Mini... but it seems like they are leaving money on the table if they don't.

That assumes that enough people will buy the cheaper iPad to make up for the cannibalisation of the larger one. Have you any data that proves that Apple is not shifting enough iPads to panic? How are the Kindle profits (not sales, profits) doing in relation to the iPad?

I'm not saying they won't do an iPad mini. I am saying that there is more to being a successful company than shifting boxes out the door for as little money as possible.

 

[BC2009]

You make a good argument for keeping the down-voting of comments off all because someone has a negative opinion about Apple.

Negative comment about Apple is one thing. Trolling is another.

 

[G51989]

Negative comment about Apple is one thing. Trolling is another.

There is some trolling going on for sure.

But I do understand the Negativity towards Apple, even on this site.

Apple, imo. Has gone hill big time. BIG time, they've gone from a company that just wanted to make the best computer they could, I loved so many of my Macs over the years, loved some of my PCs to. I still maintain, that the G5 tower I bought brand new ( second computer I brought brand new right out of college, the other was a decked out Voodoo, sex machine for sure ). I do think it was the best Mac I've ever owned. New Macs? * puts on fireproof suit *. Are ****ing garbage. The RMBP was the only decent thing they've done since the Macbook Air computer wise.

Since then, Apple has turned into a company that puts profits before product design, and they try to squeeze every last dime out of everything.

And, they turned into a junk patent troll, rather than license out junk patents that mean nothing, and make money, they just go lose them in court.

The Apple that I bought my Pismo from, that I bought my G5 from, and that i bought my G4 iMac from, not the same company today, sad to say.

 

[Ping Guo]

I am in HK and over the last couple of months one could see that the popularity of Samsung models are on the rise here. Personally, I bought the Galaxy Note last year because I fancied the big screen (I am a relatively tall person with large hands and fingers) and I thought, the phone won't be very popular among Asians. Boy, I was wrong. Nowadays you can always see a few people around in the bus or subway carrying a Note or the new SGIII watching movies on the go, readings news, writing emails. Samsung phones are immensely popular here.

I dare to say that in big metropolitan areas, where people have to commute on public transports, a phone with a big screen is the weapon of choice. Not many people like to carry two devices (phone and a tablet) in a crowded subway, train or bus.

I'm in Malaysia/Singapore, and I was going to post the same thing. iPhone was ruling the roost a couple years ago but Samsung phones seem to be the device of choice nowadays. Galaxy SIII and Galaxy Note to be precise.

The next iPhone will be a crucial release for Apple, as Samsung and other Android manufacturers are really gaining momentum. Galaxy SIV and Note 2 are not far off either.

 

[Winni]

The Galaxy SIII is WAY WAY WAY better hardware than the 4s. WAY better. The problem with the Galaxy is the OS. IOS is way better than droid. Its pretty much a hardware vs software battle in my opinion.

Yes, the Galaxy features superior hardware. But in my opinion, the Galaxy family also features superior software. iOS is a crippled Walled Garden platform - Android isn't. The OS is the reason why I don't want to use an iPhone and an iPad.

 

[Michael Scrip]

That assumes that enough people will buy the cheaper iPad to make up for the cannibalisation of the larger one. Have you any data that proves that Apple is not shifting enough iPads to panic? How are the Kindle profits (not sales, profits) doing in relation to the iPad?

I'm not saying they won't do an iPad mini. I am saying that there is more to being a successful company than shifting boxes out the door for as little money as possible.

GigaOm has quite a few articles on the matter. His comments echo yours.

Yes... someone who chooses an iPad 2 instead of an iPad 3 means Apple is losing $100 in profit right off the bat. So why did they keep the iPad 2 in the first place?

Luckily... according to Om's reports... only 18% of iPads sold today are the cheaper iPad 2. So it doesn't look like it's cannibalizing the more profitable iPad 3 very much at all.

It's only $100 more to get a much better screen and faster processor... and it looks like people are going for it. That's wonderful news.

But this only applies to a customer who has at least $400 to spend on a tablet. Not everybody does.

Maybe the iPad will be the iPod and iPhone where there are many different products (and price points)

The iPod line is interesting... with so many different form factors. The Shuffle for a cheap, no-nonsense music player... the iPod Nano for more storage and capability... the iPod Classic for supreme storage... and the iPod Touch for iOS, apps and games. They all serve different purposes.

The iPod Touch represents 50% of all iPod sales... but I wonder how sales of the Touch would be if the Nano and Shuffle didn't exist. The iPod Touch is a fantastic device... but it's a little overkill if you just wanna listen to some music. Clearly Apple sees the need for different types of iPods... everybody won't want to strap a $200 computer on their arm at the gym.

Apple is also great at upselling. They get you in the door with a low price... but they can easily convince you to upgrade.

Look at the iPod Touch. $199 to start... but it's only $100 more for 4 times the storage. Sounds good.

I'm thinking the 7.85" iPad Mini would do the same thing. $299 gets you thinking "hey I can afford that..."

But for $100 more you can get the 9.7" iPad 2. That makes sense.

The iPad Mini is there for people who only have $300... and it gets them into the iTunes ecosystem. And they can always get a better iPad next time.

But people who have $400 or more to spend... they can jump right into the bigger iPad 2 or 3.

It's a delicate issue, though. If everyone started buying the $300 iPad Mini... and it turned out to be good enough... then nobody would buy the regular iPad anymore.

So I can definitely see that side of it too.

 

[Savor]

The popularity of Samsung is even more evident here in the Philippines that was once ruled by Nokia. iPhones have also become popular here but iPads and iPod touches are just as popular. But for brand in phones, Samsung is becoming the #1. I have a cousin who works for Samsung. He used to sell HDTV's in malls but works in the office now. He told me how Nokia is dead and how Samsung is taking over. Ironic considering he uses an iPhone 3Gs and BlackBerry as a secondary line. But he does own alot of Sammy's stuff. There is one mall here where you can enter a Nokia, HTC, LG, and Sony Xperia Store but the most crowded is the Samsung handset store next to an unofficial Apple retailer. Filipinos are all over the Note or GS3. Then there is the lowest ends like the Corby II (seems crappy) and Galaxy Y that appeals to the budget conscious. I see Sammy phones everywhere.

Philippines have had an infatuation with Korean culture as of late. Many Koreans TV novellas and K-pop has taken over the young crowds. Many also immigrate to start businesses and learn English which is cheaper. Understand that Nokia used to dominate this country. Since 2004-2005, Samsung got the ball rolling as my cousin told me. But the last two yrs they have taken things to another level. Check the SMART Window, TV, and cameras. Check the bendable OLED screens. Check how fast their Exynos chip is compared once released. Even if the iPhone succeeds, that is good for Samsung since Apple is their #1 buyer. You cant make money if your customer has no money.

 

[wordsworth]

A friend decided to get a new phone a couple of weeks ago. His existing phone was, in technology terms, antiquated. He tried a couple of phone stores, where the sales people gave him their various pitches. He was unimpressed by them. The next store he went into, the salesperson went straight to what seemed like the best deal for him.

My friend ended up leaving the store with a Samsung phone and a monthly contract that allowed him a hugely impressive amount of free calls and texts. All for £7 (a little over 11 dollars) per month. He was also offered an upgrade to his landline/broadband contract. Because my friend already had that upgrade in place, the salesperson then, unsolicited, offered to reduce his existing monthly landline/broadband contract fee by £10 per month.

My friend subsequently left the store with a shiny new phone that looks very like an iPhone and which behaves in a similar fashion, and he was better off by £3 per month than when he walked into the store.

Imagine the number of Samsung phones sold using this method across the UK. And I wonder how these sales are conducted, worldwide? Regardless, I assume that this example of attractive hard-sell enjoyed by my friend is one of those ways that Samsung's sales figures are surging.

Yes, we know it isn't an iPhone, but the price is very right! I was tempted myself. (I too have an 'antique' phone because I'm not away from my home/office enough to worry about full-on connectivity.)

 

[Mr Hill]

Don't you just love how analysts always show figures like this but don't show everything behind them?

1. Yes, Samsung's numbers are surging but no one really ever points out that they have bunch of variations of their handsets on every carrier. Apple has the iPhone and that's it.
   
2. I would also say that 95% of that surge is because every carrier either gives the all of those handsets away for free or a buy on get one free deal (maybe a handful of the newer phones aren't but you get my point). And, like some of you have pointed out most consumers go for the cheapest option.
   
3. And lastly, OF COURSE Apples numbers have slowed this quarter. The new iPhone is about to released in a couple of months and the numbers are going to spike again. As always. Then what are the analysts going to say? "Look what we did, we showed Apples slumping numbers and they responded"?

Get over it people. It's the same crap year after year since the iPhone's debut. Analysts are desperately searching for that thing that topples Apple so they can say they were right after all the times of being wrong.

You're right about the Samsung phones. I work at a retailer selling phones and service and constantly run promotions offering Samsung phones buy 1 get 1 free or free altogether. In fact we have a buy 1 get 1 free right now on all Samsung Galaxy branded smartphones until September.

Add in the fact that Samsung offers cheap phones on virtually every carrier. Prepaid or whatever. Many consumers often times say "I just want a smartphone" and Samsung is there with a low priced handset running Android 2.1. and they're satisfied. Some people see "oh Samsung is leading smartphone marketshare" and assume that it's because everyone is buying their top end devices with the largest screens and latest specs when in fact those are not even the strongest selling Samsung phones. That's why despite 150 million phones sold, the GS2, GS3, or Galaxy Note are not even close to the 4S numbers.

People scream "well the iPhone is now on Cricket and Virgin too" but forget that it requires a $650 upfront payment whereas there are some Samsung phones that are free or cost less than $100 when you sign up. The 3GS is "free" but the problem is that it is ONLY on AT&T and monthly plans are around $90 per month minimum. Even though there are tons of people who want an iPhone, at the end of the day it comes down to their wallet. They get what they can afford and still have a smartphone.

Apple also has yet to release an iPhone on T-Mobile, which could add several more million sales this fall.

Apple still doesn't have any need to worry at this point. They still have by far the best selling smartphone and easily the biggest profiting smartphone. Samsung's strategy is to flood the market with tons of devices with lower margins while Apple's is to sell a single device with maximum margins. The iPhone still has that "it just works" right out of the box function going on and Samsung has yet to figure that one out.

As far as actual handset sales go, there is also a reason why Samsung won't release numbers. They're likely embarrassing in comparison to Apple's numbers. If they had any handset approaching iPhone 4S sales numbers, I'm sure they would be happy to release the data.

 

[wedouglas]

Also on a personal note .... Damn all of Samsungs Mobiles are ugly! How can 50 million consumers not care at all about design?

I know, right? It's almost as if only iPhone owners have taste...

Who gives a **** about the design if 90% of people wrap them in rubber cases.?Everyone I know has put a random colored/designed rubber case on it because everyone knows someone who dropped it and cracked it. My GF's 4S fell off the table 2 days after she got it while we we eating lunch outside -- chipped the back corner.

 

[Otaviano]

Yes... Android won.

So people just don't get it.

There is a great Steve Jobs quote from when he first returned to Apple where he sad for Apple to succeed Windows did not have to lose. Not many people talk about that quote.

It's a shame because he were are and it's the same old misguided dynamic.

iPhone Vs. Android
Mac Vs. Windows

Apple makes a cellphone, that they choose to supply the software is irrelevant. Android is a software platform distributed to companies that make cell phone hardware.

Apple makes computers, that they choose to supply the software is again irrelevant. Windows is a software platform distributed to companies that make computers.

Do you see where I am going with this? How is comparing a company that makes one cell model to an entire software platform a fair comparison?

The reality is Apple sells more cellphones that nearly the entire cellular industry. The generate the majority of profits in the cellular industry. Doing this while maintaing excellent customer satisfaction levels and a high level of loyalty from their customers.

What exactly are they losing here? And what exactly is Google winning? You have companies like Amazon skinning Android, removing all Google services from it and using it in their products. Where is the win for Google or Android in that?

You want to look at general numbers, sure Android is winning. If you look deeper than that I think the fight is much much more even. I wouldn't even consider Samsungs current success to be a win for Google and Android. You don't think Samsung would like to pull a Kindle Fire on their Android products.

 

[iZac]

I know, right? It's almost as if only iPhone owners have taste...

Image

Who gives a **** about the design if 90% of people wrap them in rubber cases.?Everyone I know has put a random colored/designed rubber case on it because everyone knows someone who dropped it and cracked it. My GF's 4S fell off the table 2 days after she got it while we we eating lunch outside -- chipped the back corner.

Haha, you got me there, it's by biggest bugbear. I'm in the silent minority that refuse to use a case because they all look foul.

 

[numlock]

So people just don't get it.

There is a great Steve Jobs quote from when he first returned to Apple where he sad for Apple to succeed Windows did not have to lose. Not many people talk about that quote.

It's a shame because he were are and it's the same old misguided dynamic.

iPhone Vs. Android
Mac Vs. Windows

Apple makes a cellphone, that they choose to supply the software is irrelevant. Android is a software platform distributed to companies that make cell phone hardware.

Apple makes computers, that they choose to supply the software is again irrelevant. Windows is a software platform distributed to companies that make computers.

Do you see where I am going with this? How is comparing a company that makes one cell model to an entire software platform a fair comparison?

The reality is Apple sells more cellphones that nearly the entire cellular industry. The generate the majority of profits in the cellular industry. Doing this while maintaing excellent customer satisfaction levels and a high level of loyalty from their customers.

What exactly are they losing here? And what exactly is Google winning? You have companies like Amazon skinning Android, removing all Google services from it and using it in their products. Where is the win for Google or Android in that?

You want to look at general numbers, sure Android is winning. If you look deeper than that I think the fight is much much more even. I wouldn't even consider Samsungs current success to be a win for Google and Android. You don't think Samsung would like to pull a Kindle Fire on their Android products.

its apple´s own prerogative that they only release one model (though in many flavors while still offering older versions). there are plus points and minus points to that but they have to live with it. to use it as an excuse and a crutch is pathetic imo. same with their stagnant update cycle while most of the world moves on.

if this trend continues then apple is not going to be having the majority of the profits forever because they will be losing sales

btw where does amazon and their products even come into smartphone market figures?

and that steve jobs quote has been used quite a lot on this board in most of the lawsuits threads.

 

[Rogifan]

The S3 is a better phone than iPhone. And it's pretty darn sexy.

Also, have you used Android lately?? In the past, it was pretty crappy. These days, it's surpassed iOS.

The S3 is sexy? I think you need to get your eyes checked.

 

[kdarling]

As far as actual handset sales go, there is also a reason why Samsung won't release numbers. They're likely embarrassing in comparison to Apple's numbers. If they had any handset approaching iPhone 4S sales numbers, I'm sure they would be happy to release the data.

Samsung only released sales figures for a few years out of all the time they sold phones. However, they still announce major milestones:

Samsung just announced 10 million GS3's sold in two months, and had previous spoke of over 5 million Note sales. That works out to be around 20 million high end devices (GS3s and Notes) per quarter.

Apple sold 26 million iPhones in their last quarter, of which exit surveys showed 19 million were iPhone 4S, 6 million were iPhone 4, and 1+ million were the 3GS. To be fair, many buyers, especially in China, are waiting for a redesign.