Google Android Captures #1 Position in U.S. Smartphone Market
comscore.com
comscore.com
How people move between platforms would be interesting, and become more important as smartphones reach saturation, but you can't really speculate from this data.
I'm guessing Apple is trying to grab hard onto the market segment that brings in the most profit, while Google is going for the commodity, high volume, low margin option.
The good news is that both models can coexist in the same market. After all, Nintendo's strategy is a bit like Google's, while Microsoft and Sony's are more like Google's. Nintendo has been quite profitable for a very long time even when they didn't own the entire market.
Hardly. Google doesn't make phones.
They also collect licensing fees when phone makers use the Android name, Google trademarks and Google's software in the phones.
I assume their foray into mobile phones is to fragment the market and prevent any other player from gaining a dominant market share.
Is that accurate? Everything I've seen has indicated that if anything money moves the other way - Google sharing revenue on platform ads (and possibly other services) with oems and carriers. I haven't seen anyone claim that oems pay licensing fees to google for google apps and trademarks - I believe they are use granted based on platform spec compliance.
I assume their foray into mobile phones is to fragment the market and prevent any other player from gaining a dominant market share.
While undoubtedly google doesn't want another player to dominate the market, I believe the primary goals for android were to increase global pageviews, drive mobile adoption, and to avoid large upfront costs of paying for placement as the default search engine.
"With a high-quality open platform in hand, we then returned to our goal of making our services available on users’ phones. That’s why we developed Android apps for many of our services like YouTube, Gmail, Google Voice, and so on. These apps are Google’s way of benefiting from Android in the same way that any other developer can, but the apps are not part of the Android platform itself. We make some of these apps available to users of any Android-powered device via Android Market, and others are pre-installed on some phones through business deals."
The phrase "pre-installed on some phones through business deals" is at least suggestive that Google is being paid for the inclusion of their apps on phones.
This is similar to many mobile softwRe arrangements in the pre-iPhone world.
I have no reason to believe otherwise, since some Android-based devices like the original Nook never use the name Android anywhere.
However, I could not find any income statement that details their revenue sources by channel/product line.
The nook if memory serves lacks a camera at least so they didn't qualify.
Compatibility Program overview: http://source.android.com/compatibility/overview.html
Note that this doesn't say you get access to all google apps like navigation - it does appear another agreement is needed for those - I just don't know if that is a pay for access by the oem or some other arrangement.
Now I see history repeating itself, only this time the handset makers have two people trying to squeeze them into commodity providers competing on price: (1) Google and (2) The Carriers.
The original usage was about states competing by offering better terms to corporations. These "better terms" were worse for the people living in the state because they got less tax income and less worker protection. But they are the vendors in that analogy, the customer/corporation was very happy with how things worked out.
Am I really supposed to shed tears over a corporation's business model being a bit more like operating in a free market?
What I will say about Android handset makers racing each other to the bottom is that what is good for you as a consumer is when entire products compete against each other. The trouble with looking at handsets is that they aren't really whole and complete products. They need an OS/Ecosystem/Theme Park and they need a carrier's service to complete them.
What is best for consumers is when there is competition for all the elements of the stack from top to bottom, either in packages (iOS on iPhone on AT&T vs. Android on Nokia on Sprint) or individually. I don't know how things will play out in the Android "space," but from what I've seen so far, the big nut to crack for consumers is the carriers, not the hardware and not the OS.
When text messages are less than a penny each, I will know that the entire stack is competing in a way that is good for consumers.
'fraid not. Here in Canada, the Oligopolistic situation seems worse (if that can be imagined) than in the US. It is possible to buy bundles with effectively unlimited text messaging, but overall the situation for Internet and wireless telephony is anything but an efficient, competitive market.
So, "Yay for Europe!"
I'm sure you've been able to pay extra for a ridiculous numbers of texts for a good while, but now they seem to have dropped to be very roughly in line with their actual cost, which I believe is indistinguishable from zero to the networks.
Unless you're an Apple shareholder why does that matter? As a developer #1 in market share is a very significant milestone.
Unless you're Android, which has significantly less apps than iOS and is getting bad press for its malware problems. Additionally, iOS runs on the iPad, so iPhone developers can universally target the #1 tablet in the world.
Google makes very little off of Android. They've been following Apple's lead design-wise (look at images of what Android was going to look like before the iPhone came out). As a free operating system that carriers can exert full control over, it's no surprise that it's #1 in marketshare compared to a single phone on two carriers, but if that doesn't actually translate into profits for Google, developers for the platform, or innovation for the industry, does it really matter? The iPhone is still directing the smartphone industry and getting the positive press, and the iPad practically has no competitors to this day.
http://www.businessinsider.com/android-revenue-2010-8 Title: Google's Android Is Making Boatloads Of Money, Says Schmidt--Way More Than It Costs To Make
https://lh6.googleusercontent.com/_1IECTAB2-to/TWV9IKxwQOI/A...
And here's the Samsung Galaxy Pro that was just announced:
http://www.eurodroid.com/2011/03/update-product-shot-of-the-...
It's remarkable the influence Apple has had.
Would be cool to see this data over a longer window.
Used browser; 36.2%; 37.0%; 0.8 Used downloaded apps; 33.7%; 35.3%; 1.6
Google does not even really sell a phone. Google sells you, the user.
And god, if I never heard the "Google sells you" line again, it would be too soon. Apple has an ad platform too, you know.
What declining market share?
http://www.comscore.com/Press_Events/Press_Releases/2011/2/c...
Can someone explain, how this got upvoted? 50% of profits with just 4% of market share, the article we ar discussing there sates that Apple's market share grew (6,4 to 7 percent in OEM, 24.6 to 24.7 in total smartphones market. Even more—Apple was the only growing besides Google), and somehow "declining market share" gets upvoted? Add 20x revenues of App Store vs. Android market and 9,5 billions made by iPad in just nine months — all that is somehow "severe danger" to Apple's profits?
Especially if iPhone users start to migrate to Android. While Apple partisans will swear up and down this is simply Not Possible (TM), it in fact is completely possible. Broadly speaking, most Americans will choose to save money and get something "good enough" over something perfect. Even if I stipulate that Android will never be more than "good enough", a statement I would not necessarily agree with but let's go with it, you will still find a lot of not-Apple-partisans getting peeled off proportionally to the price delta between the iPhone and the Android. In which case Apple will either have to drop prices and profits or firmly entrench itself as the high-margin, low-sales player... and drop profits. There really isn't a scenario in which Apple gets to be the high-margin, high-sales player that some people seem almost desperate to believe will be the outcome, but even mighty Apple with its Steve-Jobs-powered RDF can't actually flout economic realities, only harness them.
With iPod, Apple played this almost perfectly, driving down their component prices by always being the single biggest customer of their suppliers, then deciding how long they could charge a premium versus lowering prices to keep the delta with competitors prices from getting too large. They kept the prices close enough that most consumers were willing to pay the premium for the Apple brand.
I actually think they will do the same thing with iPhone. They are getting close to having the previous iPhone version a "free" throw in with new contract, and there are rumors of Apple developing an even lower version for pay-as-you-go contracts.
I think angering content providers is a much bigger risk for Apple right now.
Keep looking in the past.
Compare that with Google.
>that their position is not so unassailable that they can continue looking for new ways to drive away partners and developers without consequences
I think most everyone wants more competition to keep any single company from being abusive, but your response to this is essentially "Apple is still #1!" I don't understand what you are saying here. Is it that you think Apple isn't really under any pressure? That you don't want them to make their developer/partner deals more generous?
Apple now has Verizon support and is available in a lot of international markets.
Next the could diversify to different models, if that would help.
Apple lives from the focus of integrated hardware and software. But the real strength is the attention to the user.
With Android you got Google as the software sponsor, Google as the service provider, Google as the ad platform through which they drive their revenue and you got a multitude of hardware companies using their software.
We have seen similar models in the past, where the hardware companies had to pay the software provider their share for the software license. The Google model is indirect.
Apple has shown in recent years that they have no problem competing against these business models, even with a tiny market share. Apple does not sell by features or price.
My main problem with Apple is not about how their deals with developers or partners work, but that they don't allow me as a user to take full (or 'more') control of the device software. That for me as the user, I have no other choice as to get software from their store is limiting me.
But what if they lose Netflix, Kindle and others by demanding too much, but those applications are still available on Android? At that point, how much better does iPhone hardware and software have to be for consumers to buy an iPhone over an Android phone?
With iPod, Apple had high profit margins, the most and best content, and dominant market share. They should want to repeat that model with iPhone, not the 1990s Mac model.
That link basically says that Jan-Jun 2010 Apple sold just under 3% of all smart phones in the world, but they took in 39% of all profit made in that sector in the same time period. It's really astounding what they've been able to do this relatively established market in just 3 or 4 years. No wonder everyone else was so blindsided.
Apple isn't after market share or any metric in particular, they never have been. They're after making great products they want to use.
ex.: http://macdailynews.files.wordpress.com/2011/03/110303_andro...
I can get a "Free" iPhone 4 32GB on any carrier I like in Australia.
// This doesn't mean that Android isn't undercutting apple on price -- but that $0 / $50 / $200 upfront are not meaningful in any way
Ads here have to display the minimum cost over the terms of the contract, which makes it slightly easier to compare them.
Of course, this means that telcos do stuff like making plans that include "$300 of value for $30/month", which is an absurd claim when they set the calling costs too, and vary them depending on the plan.
"Google Android Captures #1 Position in U.S. Smartphone Market"
I have always been puzzled by this attitude which seems to be rampant with Americans. Don’t you notice something’s up when somebody offers you something for “free”?
Yes, they are -- the only benefit will be contract/no-contract. Pay full price and come back two years later and tell me it's not free.
> The subsidized price is never a meaningful metric for comparison
It's not subsidized when you pay the same monthly rate regardless (T-Mobile being the exception)
> I have always been puzzled by this attitude which seems to be rampant with Americans
It's not an attitude; it's an acceptance of reality. I'd like a discount with Verizon if I bring my own phone but I'm not counting on it anytime soon. Not sure what's puzzling about that.
The phones are obviously still subsidized, you just don’t get a phone for free. It’s just that they presumably also overcharge you if you bring your own phone. Wow! That wouldn’t fly in Europe.
I think it stems from incompatible networks (GSM vs CMDA).
Since you can't take an out-of-contract phone anywhere else (with some exceptions), signing a new contract for a free or reduced-priced phone is your best option. Other companies can't use reduced rates as an incentive to bring in newly-out-of-contract customers with a perfectly working phone.
It's created a consumer mentality where getting your phone from the carrier is just the way it's done and signing a contract is the best value.
> It’s just that they presumably also overcharge you if you bring your own phone.
Sure, you can look at it that way but the average consumer here has accepted that you get your phone from the carrier so the idea of being overcharged doesn't even cross their mind. They look at it as getting something in return for signing a contract and making a commitment.
That goes to the heart of this discussion. In the US, the iPhone is marketed as a premium product apparently because it isn't available "FREE". In fact, the total-cost-of-contact is pretty close between say an iPhone and an Android phone with similar specs.
Obviously price (and price perceptions) affect market share.
Again, another BULLSHIT post. The dominant Android phones are overwhelmingly the high-end phones that retail in the $600-$700 range. They all come with thousand-dollar plus contracts. There may come a time where such a blurring occurs, but it won't be until the cost of data contracts significantly drops. And you can bet that Apple will be fighting for that market as well.
Again, Android's dominance has been on the backs of Motorola Droids and Galaxy S' and HTC Evo 3Gs, and the like. All high-end phones.
But you keep trying to make yourself feel better as you clutch, desperately, only your iPhone.
I do. My wife works at a telco with a couple million handsets on its network. The 'negotiations' they had with Apple are well known among the company's managers. But thank you for playing.
Again, Android's dominance has been on the backs of Motorola Droids and Galaxy S' and HTC Evo 3Gs, and the like. All high-end phones.
And again, I'm telling you that that's not what's happening now in 2011. When the Droid/Milestone was king of the hill in the Android world, Android's marketshare was a fraction of what it is now. What's changed is that Android has set the low-end of the market on fire. There's no reason to buy a feature phone anymore. This is also the reason the software attachment rate on Android is so low - cheap people don't buy software.
But you keep trying to make yourself feel better as you clutch, desperately, only your iPhone.
Wow. Troll much?
Microsoft might have a chance, if they started to give away their OS, but probably not.
Android uses Linux, you don't have to write an OS from completely from scratch.
Apple is doing well, and Android is doing amazingly well.
I'd suggest the much more plausible line of logic, along with being logically sound, is that as Android is now outselling the iPhone, the Android is a serious competitor to the iPhone. Pretty much by definition of "serious competitor". Will you still be dismissing it as "not a serious competitor" when Android outsells the iPhone by a factor of two? Because I rather expect it to only be a matter of time.
Android is not a serious competitor for Apple because it's not making Google money. It has a negligible app presence and a fragmentation problem. iOS is still what guides the industry, it's what people talk about, it's what Android is copying (Android was going to look totally different before the iPhone came out in 2007), and it's where the developers are.
It took an operating system with no price tag and the promise of total control for the carriers to outsell a single phone. That's a big deal. Even then, not one single Android handset outsells the iPhone on its own, and the iPad still has no legitimate competitors.
More importantly, Apple make huge profits on iOS devices. It has the developers, and it gets the press attention. Android makes no money for Google, barely has developers, and is known as the geeky platform for cross-armed OSS evangelists who hate Apple. It's also experiencing a non-trivial rise in malware--two negative articles came out today in major news outlets. Sorry, but Android is not a serious competitor for Apple.
Seriously, how incredibly boring.
Several single phones are already outselling iPhone 3GS in the U.S., and single company smartphone lines by Samsung and HTC are roughly on par with the total sales of Apple phones and look set to overtake them soon. Whether the Samsung Galaxy family will overtake the iPhone family mostly comes down to whether you feel that a Verizon iPhone, or an AT&T 3GS, or Tim Cook's rumoured cheap/small iPhone nano is still an "iPhone" and how far you'll extend the same logic for the various Galaxy S phones. (Though more directly, in some European countries a single Galaxy S model outsold the iPhone 4)
http://www.idc.com/about/viewpressrelease.jsp?containerId=pr...
Android Explodes in Western Europe, Drives Market Growth and Becomes the Biggest Smartphone Operating System in 4Q10, says IDC
Android growth was 1,580% year-on-year vs. Apple's 66%
The story was news at some point, at least. It's a major milestone in the mobile OS wars.
I'm not sure whether Motorola is there mostly on the strengths of smartphone sales alone or combined with dumbphones.
I've already connected it via Wifi and downloaded apps. Looks like can play with quite a lot of features without even activating.
Edit: also, I saw on Slickdeals.net that Target is/was selling them for $129 and you get a $20 gift card.
EDIT: Link to the thread (thanks georgie) about it being $129 w/ $20 gift card at target. Damn good deal, note the one I played with worked fine over wifi before it was activated with VM. Sale started yesterday: http://slickdeals.net/forums/showthread.php?sduid=0&t=27...
On the other hand, it's a nearly-pure Froyo experience, the battery life and performance is great, the plans are dead cheap, it has awesome hardware buttons not crappy haptic capacitive ones, a Market install of "Quick Settings" opens up the Wifi Hotspot feature. Seriously, $25/mo?!
Anyway, I bought one, and coming off an old iPhone (and AT&T), I think it's great so far. Might have to reevaluate after I spend some time out of the metro area and away from Interstates.