Samsung overtakes Apple as world's most profitable mobile phone maker
guardian.co.uk
guardian.co.uk
A few years back when the iPhone was selling more than all Android devices combined, people were quick to say that Android would never be able to compete since it's 'too geeky'.
Awhile later when Android took off a bit and all of the Android devices together sold more than the iPhone, people were quick to say how it's just one supplier (Apple) vs many suppliers producing Android phones.
Bit later, Samsung is doing really well with their Galaxy range, and suddenly Samsung alone is selling more devices than Apple. People then say how Samsung sells tons of different devices while Apple only sells one.
Again, a bit later, a quarter arrives where a single Samsung device (I believe it was the S3?) outsold the iPhone. People were then very quick to point out how profits are important, and Apple makes more profits than anybody making Android.
Well, look at the news now. Samsung now overtakes Apple in profits as well. I'm sure we'll have some new goalposts shortly that we can wait for.
These issues (profitability, marketshare, etc) are not ends to themselves - they are only symptoms or indicators of the real market forces behind them. The real issue is that Google/Android are out competing Apple in features, price and 'freedom'. 'Freedom' in this case being a nebulous concept that translates on-the-ground into something like 'able to load up porn apps on your phone if you want to'.
Googling around, it looks like the S4 still has animation lag in all sorts of places. Amazing.
I mean, hats off to Samsung for getting as far as they have. They've basically exploited Google's engineering resources brilliantly and have been ruthlessly competitive. Their design skills seemed to have gotten slightly better, and bigger screens and every-feature-but-the-kitchen-sink moves phones when they are compared to the iPhone, especially at a lower price point.
But the bottom line is they still don't really have the design chops and the attention to detail. Their "innovations" on the S4 are pretty gimmicky. They haven't built up a large economic moat around their ecosystem. I feel Apple can pretty easily leapfrog them by introducing a device that is a reasonable leap forward from where we are now. The iPhone 4, 4S, and 5 are all in the same design family. I expect the iPhone 6 will be pretty different than any phone we've ever seen before. I think Apple might even surprise us with an iPhone 6 this year. Who knows though.
Oh. My. God.
The difference in user experience is astronomical. I work in the tech industry and I train users on how to use my company's software, and I could not for the life of me wrap my mind around some of the most basic aspects of the phone. Most functions, from scrolling and animations to simple things like changing the focus from a text box on the web page to the URL bar of the browser, had noticeable lag. Sometimes the lag was so atrocious that I could not be sure if my taps worked. Occasionally I would get impatient and tap again, and it would register two taps simultaneously and treat it as a double-tap! You are absolutely right that it felt like using a regular computer - and old and slow one. I couldn't deal with it.
At one point I was checking my work email and had to access a voicemail that arrived as an attachment. I clicked it, and instead of playing the voicemail right away (which the iPhone does), the S4 downloaded it as a file. Okay, fine, I get it, you want to pretend you're a computer. But where the hell did it go? Is there a separate browser area for downloaded items like in Chrome? Is there a desktop, or some kind of folder? And if you're pretending to be a computer, am I going to need special software to be able to open this file? Are you really going to make me open another tab and Google "how to find downloaded files on Android"?!? WHY ARE YOU MAKING ME THINK? WHY ARE SIMPLE THINGS NOT OBVIOUS LIKE THEY ARE ON IOS?
In my experience, people are drawn to Android don't care much about user experience and instead want larger screens and tons of features. Personally, I view my smartphone the way I view my car: I want one that is easy to drive, responsive and won't lag for ~2 seconds every time I do something.
Coming from Android, I have exactly the same response when moving to iOS. 'Why is there no back button? Why is all the functionality shoehorned into one button? Oh, you have to press the button for certain amounts of time for different features? Where's the discoverability?".
You seem to be complaining much more about unfamiliarity with workflow than real issues.
In my experience, people are drawn to Android don't care much about user experience and instead want larger screens and tons of features.
Did you honestly just say that a larger screen doesn't have anything to do with the user experience?
An initial report by Steve Kovach of BusinessInsider proclaimed "Samsung Made $1.43 Billion More In Profit Than Apple Last Quarter, " before the site realized that it was comparing Apple's after tax net income to Samsung Electronics pre-tax operational income.
The site subsequently corrected its story with a new, less racy headline "How Samsung's Profit Compares To Apple's
http://appleinsider.com/articles/13/07/27/samsung-has-not-de...
An earlier version of this said Samsung made more profit last quarter, but it was comparing Samsung's operating profit to Apple's. We apologize for the error.
http://www.businessinsider.com/samsung-made-more-profit-than...
OOPS! :)
Most functions, from scrolling and animations to simple things like changing the focus from a text box on the web page to the URL bar of the browser, had noticeable lag.
So I just tried this now and saw no lag. It's not that I don't believe you, but I'm surprised that the Nexus 4 can demonstrate good UI response but the S4 can't (even with all the junk that Samsung puts on top of Android)
I don't see lag as an issue but I agree that there are lots of UI inconsistencies still in Android that make it not as easy to use as an iPhone.
On the other hand - good god is inter-app sharing/integration so useful and efficient. Apple's kinda dropping the ball on that one.
In my experience, people are drawn to Android don't care much about user experience and instead want larger screens and tons of features
Or maybe they, you know, what to actually make their phone do stuff for them beyond what the manufacturer thought they may require.
There's a lot of good stuff on both sides. Dismissing one side condescendingly like that doesn't move the discussion forward.
1. Competition is good! Don't act like there should be only one good option, or you might end up with just that.
2. I really don't like apple as a company, but the iphone seems to be pretty good. It's form factor is a bit better than my S3, and it's noticeably smoother. On the other hand, I drag folders of music onto my S3 and it just fucking plays them. I don't have to sync anything with my computer (and I don't), I get detailed metrics on what my apps are doing (which I find very useful) and I can tear out my default launcher and put something better in (which I have done). Oh and I can change the battery by popping the back off!
3. Actually good, useful smart phones are still a pretty damn new thing. Yeah technically they've been around for a while, but anybody who used a Palm Treo knows what I'm talking about. That means that all these "iphone is so much faster!" or "S4's battery life sucks!" is just related to the fact that we haven't figured it out yet. It takes time to really polish complicated tech.
As happy as I am to see Android thriving I'd prefer to see somebody other than Samsung on top.
Now, for some reason, Apple got the volumes mixed up so that it was IMPOSSIBLE to get any sound (except 6.) without plugging in a 30 pin connector and increasing the volume.
It took me MONTHS to work this out. All of the Apple "experts" I knew swore that this was not possible until I showed them. Even Apple said there was no bug and that it was faulty hardware, which I knew it wasn't.
The problem is that I keep on having similar issues with IOS. It's just "too clever" for its own good. Settings that you need are just not there (eg. accessing WIFI settings with a single click or slide).
There was also the time that iTunes REFUSED to copy music to my iPhone. If I used a 3rd party tool, songs would be copied and could play, but as soon as I used iTunes, it knew the new songs were "corrupted", and put the broken versions of the music on my phone. Thankfully, this bug only lasted a week.
I also find my iPhone 4s laggy. As an example, if I load a web page in the background, and try to scroll the current web page, the phone locks up for about 1000 milliseconds (ie. a VERY long time). It really infuriates me.
As for the Android lag, I am not sure what people are referring to. the Google hardware has not been a problem that I have seen - ever.
I think the best summary I can think of is that IOS is for people that don't want choice (eg. no FLAC, no 1080p MKV, no volume settings, you can't copy music files directly - you need iTunes, etc). Android has more that you need to know about, but at least you CAN find it if you want to.
I have a love/hate with IOS. But, when IOS pisses me off, it REALLY pisses me off. I can't say the same for Android.
You can see that I like choice. I also agree with others that I'd rather see Apple do well than Samsung. Samsung have a highly unethical history. If it weren't for Apple, Samsung would still be churning out rubbish handsets.
It's one of the worst user experiences I come across - very few UI's are so actively unfriendly to discoverability
People have different priorities. This is a tired meme; if you're that bothered by lag you're not using Android, if you're using Android it's not going to be such a huge change in the grand scheme of things. Can we have another argument for Apple superiority please?
Say what you will about Apple, but it's pretty clear they pride themselves on shipping things they are proud to put their name on because they only ship it when they feel the details are right. The App Store review process is in this spirit, they don't want shitty apps screwing up the experience on their phones.
This is why the Maps debacle was a catalyst for their stock plummeting, it showed to many this may have been lost with the loss of Jobs. I think the final build of iOS 7 is going to speak volumes about how Apple's culture has changed or not. If they get the details right, they've still got it. If it's laggy, has minor usability issues everywhere, etc, then that is the type of thing that I think spells Apple's doom.
edit: To summarize, I don't think 'animation lag' is in the same class of tradeoffs as 'open vs closed app stores.' Animation lag is a bug, and makes your work look objectively shitty, full stop. Animation lag 'matters' to everyone, even if they don't overtly notice it, because to everyone, animation lag breaks the illusion of fluid motion and interactivity on a subconscious level. It's sloppiness, plain and simple.
Your use of the word "shitty" here is highly subjective though. The evidence seems to be that most (or at very least a non-trivial subset of) consumers don't know, don't care or even actively prefer the "shitty" experience. Thus one could even argue that Samsung, far from being unaware or lazy is actively choosing this as the most rational and logical path to profits. It may just be that the people such as yourself are in the 10% of the population who are a) particularly sensitive to this sort of thing and b) extremely used to the iPhone level of experience.
Now I myself also find the stock Samsung experience incredibly ugly and laggy. The interesting thing is that you can remedy it in about 30 seconds by dragging a few widgets off the screen, disabling a few useless services and/or putting an alternative launcher on. Thus most of the lagginess is only "skin deep" and not a fundamental property of their phones. I think internally Samsung actually does very good engineering and optimization of their phones. At some point the marketing department gets a hold of the phone and completely ruins it, but thankfully it is too far down the chain for them to do any fundamental damage to it.
There is still such a thing as craftsmanship. When building a dresser, a craftsman ensures the back of the dresser looks as clean and elegant as the front, despite the fact that people will generally never see the back. A corporation churning out dressers as cheap as it can will just line the back with particle board. In furniture, where things generally don't change, this is a sound strategy, but in technology, building a company churning out garbage (relatively speaking) I think tends to catch up to you since you won't attract craftsmen to help create the next big thing.
If it wasn't obvious already, I'm an Apple shareholder, and I am not worried about Samsung. Samsung has made it very clear over and over that there is very little element of craftsmanship in their corporate culture, from the output of their work (like laggy animations and stock installs reminiscent of Windows 98 crapware) and the Onion-seque internal slide decks where they robotically ripped off every element of the iPhone they legally could, likely without asking themselves why those things were designed the way they were. I'm far more worried about Google, who have shown that they both can and want to get better at design, and have a unparalleled capability to build services to power well-designed products. And Microsoft has shown they have the will to change, and are swinging the bat, even though they haven't hit the ball yet.
Comparatively speaking Samsung is kind of a joke and when a new paradigm comes along (wearables, a dramatic shift in smartphones, etc) unless they can xerox their way to keeping up they will be left behind. They caught this particular wave perfectly, and are leveraging a very unique situation (Google being a free remote engineering department) to their advantage. I'm pretty sure the cat is out of the bag and Google is going to ensure Samsung is not riding their coattails to profits when the next wave hits.
I don't think you can really say this. They throw a lot of stuff against the wall that is original, and some of it does stick. The Galaxy Note was ridiculed by everybody but turned out to be a hit. The large size and stylus turn out to be a big selling features to people you wouldn't expect (eg: small women seem to love galaxy notes - because they were never able to fit a phone in their pocket in the first place, and many are used to carrying around a paper diary that is almost the same size anyway). They certainly copy a lot of stuff from Apple (and others) where they think that's the right path, but it's unfair to say they add nothing new.
> I'm an Apple shareholder, and I am not worried about Samsung
I'd go so far as to say that your kind of viewpoint might well be dominant inside Apple itself, and the "blind spot" it creates might be a major reason why Apple has struggled to compete against Samsung.
Bingo. Samsung doesn't have the same kind of refined, surgical design discipline that Apple does but that doesn't mean that they're incapable of coming up with interesting new features. They just arrive at them in a different way.
Honestly after using iOS 7 for a while I'm worried that Apple has seriously lost its way. There are so many instances of simplistic design ideology trumping usability in iOS 7 I'm not even sure where to start listing them. iOS < 7 was visually cheesy in some respects but it was extremely polished and usable.
If you call the s4 garbage relative to the iphone,then I'm sorry to say it's either you don't know the meaning of garbage or relative or you must be one desperate shareholder. I hope you didn't buy them at $700 apiece.
Samsung is already investing and developing its own wearable devices and other stuff anyway but I guess it doesn't matter to you. If I were you, I wouldn't buy stocks in both companies since they are all making money anyway.
ps: I neither use Apple or Samsung phone and I enjoy my phone very much
Did you buy at $700, at $400, or at $30?
This is false. Apple has banned applications for dubious grounds, such as competing with Apple. Extremely useful apps like Swype and its alternatives have been banned.
The app store is not just about protecting users from shitty apps, it is also about total control over the iOS platform, often to the detriment of users.
Honestly, I agree with about 99% of the 'pro-apple' arguments here, because it is frustrating that companies aren't stepping up their UX game, but that's just peanuts compared to this type of nonsense: https://news.ycombinator.com/item?id=6092875
Luckily, my Nexus 4 has given me a smoother experience than even my old ipad 2 so far (can't say the same of my nexus 7 unfortunately), so it isn't that bad either way.
Swype however is kind of an obvious example of something they likely are not allowing not because of fear of competition but because Swype, if successful, would effectively fragment the text input mechanism on iOS. I can respect the argument that on iOS Apple wants to maintain control of the experience of entering text. Regardless if you feel this is an ethical thing to do, I think you have to acknowledge that in that case it is less about anti-competitive behavior and more about maintaining consistency, which is a core tenet of good design. I think overall the App Store process is largely about maintaining things like quality, consistency, and performance, and if you don't believe me you can look to examples like the Facebook platform where the element of human-screening was ignored and the place filled up with garbage.
They simply don't care about the segment and would rather support a good-enough solution than a best-of-breed.
It's a pity too because the primitive stock keyboard is easily my #1 frustration as an iOS device user. Once you've gotten used to something like SwiftKey or Swype on Android it's hard not to get angry at Apple when you're forced to go back to their 2007 keyboard. How is this putting the user first?
I think a bug is more forgivable than a deliberate decision to make things broken (closed app store).
Apple has had a string of shitty products. It's just that people are too busy talking about their good ones and block out the bad ones, for some reason giving Apple a free pass that they don't give other vendors.
I once got a video ipod. The marketing was "You can watch movies on it!". Yes, if those movies are shorter than 45 minutes in length. It was actually a substandard bit of kit - the video screen was mostly useless, and the windows version of iTunes that I had to load it with was unmitigated shit - and famously so.
I mean what about comparing an animation lag - an annoyance - to the 'death grip' phone that didn't work as a phone?
Apple make nice kit, but the idea that they only do good work needs to die. They are superior designers and astounding marketers, but they're certainly not perfect.
It's likely that in time we'll see a native of manually memory-managed runtime in Android, at a huge development cost; I can hardly see Apple providing an open ecosystem, ever.
That aside, Samsung is the most successful company with the worst design aesthetic I can think of. I don't know why people buy their devices, even if one is an Android fanatic there are devices that lag less and look much better at better prices. I'm shocked they are doing as well as they are.
That's legit.
>I'm going by YouTube videos of the s4.
That is not.
Scrolling web pages was noticeably nicer and less laggy than in my Nexus, but still imperfect.
My iPhone OG was quite responsive until about iOS3, when it got kind of slow.
I've never had problems scrolling in non-web-based apps.
Of course, the equivalent operation on a similar-year Android or Blackberry makes you wonder why anyone bought those phones.
I am still yet to see these on my Nexus 4. Maybe some devices have the problem, but it was blown out of proportion? I don't know..
Samsung does make the Nexus 10 though, but even on 4.3 it stutters pretty regularly. Of course my iPad 3 stutters a bit too, I assume the extreme resolution plays a big role there.
The remaining goal posts by the way are where apps get built first and general app quality. The time that developers move to Android after first making their app on iOS is probably shrinking. The disparity of where apps get made first is also probably shrinking.
Another point about why is Android doing so well: Apple seriously needs to get better at services. They are amazing at hardware, they are great at software that runs on devices, but they have bombed again and again on software that runs as a service in the cloud. This severely limits them. Maps, mobile me, icloud syncing, they have trouble keeping their developer portal up, etc. I believe this is a problem with Apple's culture and what they value. Server software isn't pretty, and it's iterative. That is you bring up something that works, then make it better. Apple's culture is to wow with the first try, but they've been disappointing when it comes to software as a service.
I think that's one of the reasons Scott Forstall was forced out. It seems he was backing a lot of Apple's Data / AI / Cloud products, and may have wanted to keep Google out of iOS, in order to give his products an advantage. But Apple doesn't make money on Maps, it makes money selling the phone (and OS, and App store), and it's silly to hamstring your platform simply to give a few second-rate Apps an unfair advantage. (And they were second-rate - anyone who competes with Google's killer apps is taking a crazy risk).
Now, as i already said here, the problem isn't that they need to get better at service, the problem is that they need not to be absolute crap, and get some culture. If Apple Maps was only just as good as bing map, they could have made it. If iCloud was only just as good as dropbox, they could have made it. If "Ping" was only as good as... just any social network you could think of, then it could have leverage the other great apple system.
The problem is that their server side is so bad, it can't even leverage other Apple strengths.
They may care now that they own an Android phonemaker (Motorola.)
There are people who have tattooed the Apple logo on their body. There aren't that many people who have tattooed Samsung's logo if I had to guess.
Apple cultivated and created their brand (rebuilt it really, as it did go through a rough patch in the past were only true believers were left following it). But now it is the brand people worship.
That is very important to consider when these articles are written. Most likely the writer is a tech savvy enough to personally either be in the Apple cult or not. And people will most often than not defend their own camp against the other camp. Those from the Apple camp who invested thousands of dollars in products will consciously and unconsciously defend it regardless of whatever the market is doing (as we've seen they've managed to twist and reinterpret the news in every possible to still make Apple come on top).
Another point to consider is this. Apple is a luxury product affordable by many. It is luxury because there is not other luxury phone besides it. The riches and most opulent person out there, will probably still have an iPhone or iPad. They'd buy a diamond studded golden case dipped in platinum for it but it will still be an iPhone. And this is the same device that someone who is middle class or below can still obtain. Think about it. What other luxury products are the same. Cars? Nope. Watches? Nope. Clothes? Not really. So that serves to reinforce the cult following. Look I can have the same phone as <myfavoriteactor> or other <famousperson>. That is pretty powerful.
Windows has a 'picture' logo and occupies the same rung as samsung in the 'quality vs Apple' pie fight, but there are folks out there with winlogo tattoos. I've seen photos of a few different ones, but my guess would be that there's fewer than there would be for Apple.
One thing that annoys me more than Apple fanboys are Android fanboys.
Merely pointing out the functional differences between iOS and Android does not automatically make somebody an "Android fanboy".
Merely pointing out the philosophical differences between iOS and Android does not automatically make somebody an "Android fanboy".
To generalize this, merely pointing out things that can be perceived as negative about one product/company/person does not mean that the person expressing such ideas automatically supports some competing product/company/person.
To make my point more clear, why on earth would you or anyone care about how much money the manufacturer of a product you use (or has similar OS to the product you use) make or by how much money its beating its main competitor in this quarter?
I can think of three possibilities:
- You are a market analyst.
- You are an investor.
- You are fanboy.
I am going to go with fanboy.
- You are a developer that has to make some bets about where to focus resources and learning time.
I would also probably categorize this in to "investor", in the sense that your business is investing on that platform, so profit margin of that platform in a relevant information for you.
I am a user concerned with long-term investments into ecosystem: apps, purchases of DRM-d content (as bad as it is), compatibility with peripheral devices (external batteries, fitness and medical etc). I've been burnt before (Palm devices anyone?) so now I pay a great attention to market share, third-party ecosystem, opinions of developers about the platform etc.
- You are randomly interested in the world.
- You are bikeshedding, following Sayre's law
Merely pointing out the functional differences between iOS and Android does not automatically make somebody an "Apple fanboy".
Merely pointing out the philosophical differences between iOS and Android does not automatically make somebody an "Apple fanboy".
To generalize this, merely pointing out things that can be perceived as negative about one product/company/person does not mean that the person expressing such ideas automatically supports some competing product/company/person.
Goes both ways.
The only thing that sucks is it doesn't have a decent ssh client but that is remedied by the fact it works as a tether and I can use my laptop with it. I don't like running root on a touch screen device either due to the massive danger mistyping as root and shooting something.
By the way, how do the privacy policies of Windows Phone and Microsoft Live services compare to those of matching products from Apple and Google? I have tried and failed to find a systematic comparison (i.e., a table) of how much data about the user the three mobile OSes and their vendors' apps collect and what they say about redistribution the data to third parties. I'd rather not try to perform this analysis myself (IANAL).
Perhaps there's a market opportunity here.
That problem with outlook.com is not related to the phone itself nor the mobile platform so that is moot. I don't use outlook.com - I have an IMAP Server and work exchange server and they bot work perfectly on the device.
WP8 does play well with Linux i.e. it doesn't require Zune any more to access the device. It doesn't however mount any disks on the device if you plug it in though, so I tend to yank out the SD card and poke it in my laptop. Apart from that it is an entirely self-supporting device that doesn't need machine connectivity at all so it's good enough for me.
As I said, I don't use Windows Live services at all. We have a Microsoft Exchange 2010 system at my company. It talks to that perfectly fine.
I did use it for a bit a while ago but SkyDrive has numerous problems where they delete your files so I can't rely on it.
I would disagree that the problem with Outlook.com is not related to the phone itself or the mobile platform, though. It certainly does seem to me that Windows Phone is intended to be used with Windows Live by its average user. For example, using Outlook.com is the officially recommended way of getting Outlook contacts on your phone if you don't have an Exchange server [1]. The camera app is tightly integrated with SkyDrive, too.
I understand that you cannot blame the developers of Windows Phone for this (given the sheer size of Microsoft the teams behind Windows Live and WP may well not share any personnel) but my initial experience as a user makes me wish they had paid as much attention to it as they did to the mobile OS itself.
My wife uses a Lumia 620 with outlook.com with no problems. As a casual user it's pretty good. She manually added contacts to the people thing and they appear on the phone when you next get a sync with outlook.com. I've not heard her complain at all about it so far.
Edit: just spoke to her and she actually used contacts transfer from Nokia to use BT to transfer it from her (drowned but still working well enough to get stuff off) Asha 302 that she was using before. You can also import contacts from the SIM with it but she didn't know that until afterwards.
This is mostly preaching to the choir anyway.
> Samsung's estimated $5.2bn haul from both its basic models and smartphones in the same period.
I don't thing profits on just their smartphones beat Apple's iPhone profits, even though their global marketshare is over twice that of Apple's, according to the same article. It may happen, and probably will, given time, it just hasn't happened yet.
Basically, Samsung's number includes its phone, tablet and computer sales (including Chromebook sales, which IIRC have been really high), while Apple's number only the estimated iPhone sales.
And note that the quarter after that, the 5 and 4s were the two top-selling global smart phone models.
Samsung does not control the complete stack. They have to rely on Google for the OS. They are forced to comply with Google's licensing agreement. Samsung is really trying hard to find an alternative by pursuing Bada, Tizen, etc. Samsung was really clever at creating TouchWiz - an overlay on top of the traditional Android. Users will get use to this interface and Samsung can eventually swap out the stack underneath it (already attempted with Tizen).
Google is a fool for letting Samsung get too powerful - to the point where Samsung can dictate terms and at the expense of Google's other partners. It's clear Google knows Samsung is a problem because most of the Nexus devices are now made by LG, Asus. However, LG also owns WebOS.
Android is proven and the hardware has matured, Google should start producing it's own hardware as its partners are looking at alternatives.
This only works if Samsung allows the user to download/install their purchased apps from earlier phones though. As well as Google Music and other services the user might expect.
> Google is a fool for letting Samsung get too powerful - to the point where Samsung can dictate terms and at the expense of Google's other partners.
When did this happen? Samsung is a huge partner of Android. They make 1 of 3 current Nexus devices and made the previous 2 Nexus phones (more than any other manufacturer). This is a completely unrelated thing.
Also, Samsung is one of the companies with a Google Experience version of their latest flagship (the S4) available on Google Play.
> Google should start producing it's own hardware as its partners are looking at alternatives.
Does Motorola count? The first few Google developed Motorola phones were just announced.
This is true. This is one of the many hurdles they need to overcome to switch to another platform.
> When did this happen? Samsung is a huge partner of Android. They make 1 of 3 current Nexus devices and made the previous 2 Nexus phones (more than any other manufacturer). This is a completely unrelated thing.
It's speculation really. The previous Nexus products were all made by Samsung. Why did Google suddenly start switching to other manufacturers? If Samsung made the best devices, why change?
If your company commands the most profits and market share of a platform - do you not want to use this as leverage to some degree? Better bargaining power gives you a competitive advantage over other players (LG, Asus, HTC, etc).
> Does Motorola count? The first few Google developed Motorola phones were just announced.
It sure does. They need to speed things along though.
Which is why Samsung has layered their own UI and apps atop the core Android experience, and the market has rewarded them for making it more consumer friendly.
Really? Because all the BS press I've seen at the time (and ever since) always mentioned how "iPhone is doomed" because of Android.
>Awhile later when Android took off a bit and all of the Android devices together sold more than the iPhone, people were quick to say how it's just one supplier (Apple) vs many suppliers producing Android phones.
Besides the fact that who the fuck compares the entire mobile industry with a single company, the reason they outsold the iPhone is because they make models that cover a wider price range.
iPhone just is, take it or leave it -- at best you can get the last model on discount (and even that keeps it price well). Android, they make models that a poor piss guy in Southern Banzania can buy too.
>Bit later, Samsung is doing really well with their Galaxy range, and suddenly Samsung alone is selling more devices than Apple. People then say how Samsung sells tons of different devices while Apple only sells one.
Seems like you mixed a bunch of thing nobody said (or merely some fanboys on some sites) and some legitimate concerns that still hold, and you mix and matched them to create a timeline.
The actual story was always "OMG, iPhone is Doomed" or "Android is Winning"
>The real issue is that Google/Android are out competing Apple in features, price and 'freedom'.
Apple never competed in "features" and "price. Heck, they don't do that even on their PC line, and that has been going for like 30 years.
They compete in high end, build quality, overal coherence, ecosystem and design.
By the way thanks for giving us the next goal post: build quality and overall coherence ;-)
"Us"? Let me get this right: I'm a "fanboi" (sic) for talking general business observations, but you are not while identifying directly with Samsung?
As for reaching that "next goal post", good luck.
For a consumer it's the only one that matters, and if you were satisfied before it was reached, why start being more demanding now?
In my view Apple is a premium product and the quality gap is closing in quickly. We've already reached a level where non-experts don't see any real difference or at least not enough to justify the price bump.
http://appleinsider.com/articles/13/07/27/samsung-has-not-de...
I'm not trying to overlook Samsung's success, but they _do_ sell tons of different devices while Apple only sell one (but 3 different versions), and profits _do_ matter.
I'm not sure about this but I believe Apple still beats Galaxy S4 in terms of profits and iPhone 5 released last year in September.
I also don't get this type of discussions. Technology evolves everyday. Apple used to beat other companies in terms of profits and market share, now Samsung is at the helm. Let's see what Apple can do this fall. As long as us, the consumer wins, I don't care who makes more money.
Profit
Selling more of 1 device or less of others
Market Share
Features/Benefits
Price
Experience/'Freedom'
I disagree about not caring who 'wins' though. If Apple wins, all developers have to build to Apple's closed platform. If Google wins, anybody can take Android and run the same apps (see: Amazon). Google winning is good for everyone. Apple winning is only good for Apple. Microsoft winning is also only good for Microsoft - so I wouldn't want them to win either.
You seem to be rooting for some sort of open source monopoly rather than a Google monopoly, but I think even that would be a bad thing. I'd much rather see a world where different business models and different development methodologies (open source vs. proprietary vs. hybrid, walled gardens vs. Wild West vs. everything in between, etc.) are all doing what they do best and competing with each other and learning from each other.
It's absolutely true that Android as you know it now simply would not exist if it didn't originally have the iPhone to draw inspiration from; this is pretty incontrovertible. I'm not saying that to denigrate Android in any way, but rather to point out that different approaches to product development have different pros and cons, and having all of those approaches coexisting and competing and evolving is a much better situation for everyone than having only one major player or one development methodology industry-wide. This is includes the seemingly-positive-but-not-really outcome where some form of "freedom" or "openness" becomes the monopoly.
Also, you should check your facts - Samsung has not exceeded Apple in smartphone profits. They have exceeded Apple in phone profits overall. You might as well throw washing machines into the mix if you are going to include profits from single purpose appliances that are not general purpose computers.
So basically because you "want Google to win" because you believe they are somehow different from any other corporation, you are trumpeting a false statistic in order to convince others that destiny is somehow at work, going in the direction you want.
If this isn't shilling for Google, I don't know what is.
As for your last point, I don't think regular consumers cares about open/closed platforms. They probably don't even know what that means. We're talking about mobile devices, not desktop computers. People want devices that just works, especially if those devices are built to make their lives easier, not harder. Android used to have a lot of problems but now they caught up to iOS (even surpassed it). Android is not where it is today because it is open[1]. Android would've had the same success if it was as closed as iOS.
In the general scheme of things, I agree with you. Android is not completely open and definitely not a free software, but it is better for consumers than iOS (and I'm an iOS user). But as long as there's a competition and either of those companies (Apple and Google) don't get to do whatever the hell they want, I'm saying that the consumer wins. It doesn't matter which company has the more open OS.
[1] Android had a lot of options in terms of devices, so their openness was a factor in their success, but it was not a major one.
Profits matter to the company. Not to you or me (unless you or I work for the company or have stock in them).
On the other hand, market share does affect consumers. The more popular your particular device is, the better it is for you (in terms of app availability, web compatibility, tech support etc...).
Profits matter for consumers as much as market share does, even if they don't realize it. The phone hardware business is a very expensive and difficult market. Companies like HTC demonstrate just how hard it is to stay in the game, and just how expensive it is. Being profitable is a requirement to produce at the massive economies of scale necessary to compete in the smart phone market (or you have to sell less units while charging a lot more for them, but you still require that profit to keep churning out new phones). The only reason Blackberry, for example, still exists at all is that they were so profitable for so many years, and able to build up a cash hoard; without that, they'd already have disappeared.
Absolutely. I wasn't trying to say that profits matter to consumers (Indirectly it may effect them though, because more profits means more freedom for a company to try new things without being too worried about wasting money).
>On the other hand, market share does affect consumers. The more popular your particular device is, the better it is for you.
I agree, but I don't think it matters all that much. Just look at the current situation. Can you honestly say that Windows' ecosystem is better than Mac's, despite the indisputable market share of Windows? Same goes with Android vs iOS (although they're pretty close). An argument could be made that Microsoft only makes the software while Apple does both software and hardware, but Mac support, ecosystem, app quality is miles ahead of Windows, in my opinion.
My point was that market share doesn't exactly translate into better services, better app quality etc. It is certainly a factor though, no point in denying that.
....before the site realized that it was comparing Apple's after tax net income to Samsung Electronics pre-tax operational income.
Samsung DID NOT provide net profit numbers.
:)
I have a couple of ideas (price tag on the iphone was too high, market size is bigger and attracts more competitors, technology is more difficult because it deals with both hardware and software, etc), but no definitive answer. That's something that will be discussed in business schools for a long time.
And there are another group of players in the phone market, the operators, the more you push them around the more interest they have in establishing alternatives to your products.
With the iPhone, we get the old model and how you sell cellphones is different. I get the feeling the payoff for independent shops is a whole lot better for an Android then an iPhone. I can see where Apple is trying to get more phones sold in its stores.
Perhaps the rumors about the new low-end iPhone are true. I can see that driving sales particularly if it is advantageous to local retailers. Something that can be sold for pay-as-you-go customers would boost sales.
their strategy of "older models will play the role of lower price phones" really don't cut it.For one thing, i want to buy something that will get the same support time than a new thing.
There's a big issue with everybody not wanting to own the same phones. In mp3 players there were not very many decent alternatives. In smart phones there are at least five or six good phones available at any given time (and if you're in China, as an example, nationalism plays a big role in people supporting domestic upstarts, along with much cheaper prices).
Bottom line, it's impossible for one phone model to dominate a billion unit market across so many economic groups and country-based preferences. Was never going to happen under any circumstances.
No such opening existed in the mp3 market.
Android is definitely one reason, and one could say that samsung AND google won against Apple. That what i meant when i said the business is much more complicated as it requires to be excellent and competitive both in hardware and software.
I agree with your point that Samsung really upped the ante on Android hardware. The GS1 and GS2 were a tipping point on Android hardware performance and quality -- now that Qualcomm is making high performance parts and everyone is doing competitive product design Samsung are less necessary to Android (but still dominating).
Zune could have been amazing! They had a nice big screen, a hardware accelerated UI with rich transitions. They were lightyears ahead of Apple/iPod on technology. Obviously they completely bombed in the market, but imagine if they had found success because of their better technology -- it would have been really hard for Apple to respond since the iPod OS was such a low level affair (plus Apple never would have made a brown iPod!).
Compare this to say GM, which makes a very wide range of products in multiple market segments Lexus doesn't attempt to even exist it, and frequently at the same to much lower prices in the market segments that they have in common.
So, with Apple, you basically have 3 device sizes to choose from, with or without WAN modems, at 4 incremental price points, all with fairly similar specs that tend towards the higher end.
Samsung and other Android phone makers have tens to hundreds of devices that range the gamut from tiny to huge. Want a 6" phone/tablet with a stylus? Android has it. Want a head unit that goes in your car and runs Android? Sure.
And with more choices * on average lower price points = more market penetration.
I'd on a per-car, Lexus makes more than GM, and in the same way, on a per-device basis, Apple makes more than Samsung.
Apple ships absolutely enormous volumes of devices to virtually every strata of the economy, selling the "premium" iPhone 5 (which is still owned by kids with burger-flipping jobs -- my jobless niece in a working-class family has one), to the last generation iPhone 4S discount device, to the even older generation iPhone 4 ultra-discount device. Then there's the incredible value iPod Touch that Samsung can't compete with.
They may not offer dollar-store products, but they're more like the Old Navy of brands than any sort of elitist assumptions.
They make good products and they stay away from the very low end (though they do still pitch a three year old device), but luxury comments aren't rationally supported.
Worth noting that Samsung's smartphone ASP (average selling price) is just under $500. Apple's is currently $580. The narrative that Samsung made bank on waves on discount devices just aren't supported by economics, and the models are much closer than many seem to think.
Not for a lack of trying: http://www.samsung.com/us/mobile/galaxy-players
As no-contract pricing starts to become competitive, Apple will do what is necessary with their discount entrant. But right now for a guy walking into Verizon or AT&T or many other cell providers around the globe, the iPhone 4 is as cheap as they can get.
As I said before, the ASP of Samsung smartphones approaches $500. This myth that everyone else is desperately pitching dollar phones is just nonsense. Yet so far this little thread offshoot has seen Apple compared with Lexus, Louis Vuitton, and Bentley.
Trust me, the China markets for cheap Android phones and iPhones are completely disjoint. The biggest competitor iPhone has in the high end market seems to be...weirdly enough, the Galaxy Note.
Completely different thing (as many Apple-centric journalists like to point out).
Apple has never been a dominant force in market share but it has been the profit leader for many years until, apparently, now.
Apple is run pretty decently; I'm sure they'll take advantage of opportunities as they see them. It might make sense for them to focus on high-end phones and invest in other non-phone products then to regain the "most profit on phones" crown.
So Blackberry needs to make 20 different models and they can beat Samsung? That doesn't make much sense.
From the article:
"The California company made an estimated $3.2bn (£2.1bn) profit from iPhone sales in the second quarter of the year, according to the research firm Strategy Analytics, a marked drop from $4.6bn a year ago" So, Apple 2012 Q2 : $4.6bn
"The same trend has squeezed Samsung's handset profits, which are down from an estimated $5.6bn in the second quarter of 2012" Samsung 2012 Q2 : $5.6bn
Interesting figures anyway, Apple's drop of over $1bn is interesting, they've dropped over 3x as much as Samsung did.
So Apple out-earned Samsung in phones last year, $4.6b to $3.64b.
http://techcrunch.com/2012/07/26/samsungs-q2-2012-earnings-s...
It would be like if Apple built your car, held your insurance policy, and owned the apartment complex you lived in. None of that comes close to having to buy digital apps on your Apple phone from Apple.
While I agree a direct comparison is unwarranted, the future of Apple's closed ecosystem is slightly worrying.
No matter what you think of Apple, or Google, and their respective ecosystems, I'm curious what people think of Samsungs popularity. They're a massive South Korean company that until recently was well known mostly for ripping off other companies products and out-marketing them (I'm not making this up, these accusations go back decades now covering a variety of consumer products, go ahead and Google it). Some people, myself included, don't really believe this practice ever ended. Say something were to happen to Apple and Samsung truly pulled away as the technology leader in the future. Are you as a consumer happy putting your eggs in that basket, so to speak? Do you think Samsung is going to embrace a culture of innovation, vision and design? I honestly don't see it. As a designer, I've stayed clear of Samsung products because they just come off as cheap (or expensive) imitations. As a market leader, you have the privilege to introduce consumers to exciting new technologies, UI innovations and ideas. Samsung isn't built for that. Their idea of great design is hiring 1,000 good designers and taking a little bit from each one. That's not how design works. You have to have a unified vision with a great idea behind it. Consistency is so important. I don't care if Apple is the leader for the next decade but I'd rather a more creative company took the reins.
Without Google, Samsung has no trump cars in the hand. They know it, which is why they put any money at all in to other OSs.
What is amazing is that Google is letting them dominate the Android market so completely. If Google hopes that a strong Samsung will ward off a strong Apple, they better watch their own back.
Windows 3.0 and 95 were built on top of DOS which already had the majority of the market. Apple never had a large portion of the world-market in the 80s and 90s.
Samsung doesn't make the operating system but only the phones. Google doesn't profit directly from Android. So neither of those two companies are similar to Microsoft of the 80s.
DOS was incredible strong in the enterprise sector and that's how Windows really grew. Mac was weak in that sector. Android isn't built on top of anything similar to DOS. It also isn't stronger in the enterprise sector than iOS.
The battle between Windows and Mac was not about "free" versus proprietary. Hardware vendors didn't get Windows for free. Microsoft made its money selling Windows.
Windows didn't "win" because of just one company. Although IBM did push DOS, they didn't push Windows. Windows "won" because of many companies.
Apple wasn't the largest IT-giant in the 80s and 90s. It is now. It has a fortune in the bank and plenty of smart people.
It isn't really Android that has the majority marketshare. It is Samsung! I.e. one hardware company.
So it really isn't anything like Windows and Mac from 80s and 90s. This is something different.
It is however a battle of marketshare involving Apple, and right now they are losing share to something that looks similar to iOS, just like they lost to Windows that looked similar to Mac in the 90s. However, the situation and premises are not the same.
What will be interesting now, is if Samsung and Google will continue to get along and if Samsung will want to differentiate themselves more from stock Android. I think they'll have to, in order to compete against even cheaper phones in the long run; The Android market could implode in a massive price-war with profit margins dropping to 0 everywhere.
Apple can also still fight back. iOS is a reasonably solid foundation, and right now Samsung is their only real competitor. Traditionally, these devices compete on Software, design, and hardware capabilities. Apple is a much stronger software and design company than Samsung... So who knows how this will end?
The Apple II predated the IBM PC. Apple had virtually the entire market in the '80s.
That lasted until Apple started suing them. Then the Asian manufacturers switched to making PCs and peripherals.
Android = Windows = An OS that runs on many different brands of hardware.
iOS = Mac OS = An OS that runs on exactly one brand of hardware.
Does every facet of the Android/Windows ecosystem have to match for this huge similarity to have major effects on the market? No. How can you deny that this makes a difference? Where would Samsung be without Android?
Not that it matters, but - Google does profit from Android (directly, indirectly - who cares?) by giving support and early access only to those device manufacturers who play ball by installing certain Google apps by default.
When Apple released their graphical OS, Windows had zero market share. Windows wasn't even a product, but even when it was - people didn't buy it to run DOS apps, they bought it to run Windows apps. It was cheaper and it worked well enough.
That's why Android is comparable to Windows here. It was released later than iOS which already had market share, any hardware vendor can integrate with it, like Windows...and it's more developer friendly, like Windows (compared to the Mac OS). It's also better than good enough, like Windows. And those will be the direct reasons that will eventually let Android overtake iOS as an application platform.
What made Windows viable was Microsoft's heavy investment in providing first class Apps with the Office suite. Arguably Google did this with email and maps apps for Android, but even feature phones have those. They're not a platform differentiator. With iOS you had Garageband, Pages, Numbers and even some first class thirdarty apps out within days of the launch of the App Store. Even now iOS has far more high quality apps and games than Android. If you were to look at comparative app availability and quality between iOS and Android now, and compare that to similar comparative metrics for Windows and Mac OS at similar stages in the 90s, iOS would look a lot more like Windows that it would look like MacOS, whatever you think about 'developer friendliness'. Android being more 'open' may make it more like windows in some ways, but so far that has still yet to translate into it moving ahead as an app platform, and even if/when it does that will no more spell doom for iOS than iOSs current success there spells doom for Android now.
In any case, I hope that everyone can get what they want. For me personally that means: Give me absolute control over what is running on the device.
LG, Sony and HTC are making modest amounts of money on phones. HTC has nosedived to that level and the other two have turned around losses to be there. They need to do better, but they have little reason to pack it in.
http://allthingsd.com/20130705/htc-profit-misses-expectation...
They're still profitable, but for how long? If they don't engineer a turnaround, they'll be solidly in the red a year from now.
At that point, they have plenty of reasons to pack it in.
The last time I renewed my subscription, I didn't get the iPhone 5. It's only a marginal improvement over my iPhone 4, iOS was mostly frozen (until now), but it still has a premium price. So, I got a Lumia 820 instead. It was around half the price of an iPhone 5, has a nice display, a fresh and innovative OS (with its own limitations), and is a solid device. I am still primarily using my iPhone 4, but taking the competition into account, the iPhone 5 not worth the ~650 Euro to me. Apple should get ahead of the pack again or lower its prices.
Some people will say that with Apple you only pay for the brand, but I still believe they make better products in some categories (e.g. the MacBook Air and MacBook Pro Retina).
I know engineers don't understand marketing very well, but they should at least understand the very simple principle of brand building.
This is particularly serious when, like Apple, you refuse to make your key services cross-platform. For example, I can't really use iMessage because at this point very few of the people I correspond with use iPhones.
So at exactly what point should Apple start to worry enough about being relegated to niche status to start addressing the middle segment of the market more seriously?
"Reality" is that indie devs are struggling on both platforms, big game makers are doing well on both platforms, and the apps that matter the most on both platforms are increasingly those made by Google itself. Apple's sliding market share means their proprietary ecosystem is increasingly irrelevant to even iOS users.
It is not obvious that Apple could win, or even survive, by going after the low end, or by being more general. Apple is great as a premium brand, but as a shoddy value brand like Samsung? Their attempt at getting a majority of phone profit share would wind up killing their brand and destroy the money they make in non-phone products. This is especially true in Asian countries like China where the iPhone is still a must have for the high end; where Google also happens to be less relevant (for better or worse).
How many iOS users even bother with iMessage? Just install WeChat and forget about it.
I've made no such claim. My claim is that the network effects which have previously helped Apple (iTunes, iCloud, iMessage, exclusive apps etc) depend on a non-niche market share and inter-product synergy. They're approaching a dangerous tipping point here, IMO. How many iPhone users no longer sync to iTunes, for example?
It is not obvious that Apple could win, or even survive, by going after the low end, or by being more general. Apple is great as a premium brand, but as a shoddy value brand like Samsung?
They've done nothing but lose ground since Jobs died. The time to try alternative strategies is now. Plus, there's a lot of livable room between a premium brand and junk brand. Apple can continue to charge a premium over Android, IMO, but not the extreme premium they've enjoyed since 2007.
How many iOS users even bother with iMessage? Just install WeChat and forget about it.
Apple should care about this because it's one fewer thing keeping people from easily switching to another brand. More and more the apps people care about are available on other platforms and that shifts the debate to cost and/or other features like screen size, stylus support etc.
Over 250 million. 2 billion iMessages are sent per day.
So what you are telling me follow GM path?
Other phones are commodities and it's their nmanufacturers issue, not Apple's. I have S3 and can't wait to switch back to iPhone. It's like Mac vs. PC again. The thing frozes on me, is too complicated, has weak support, weak warranty, hey even looks cheap. I'd rather pay more for a product that's pure pleaseure to use vs. have frustrating experience with something that's just assembled without giving a second thought to the added value department.
Samsung looks a lot more like Kia or Hyundai than GM.
What do you compare them with? Cheap plastic crap?
I shopped around for high end Android models a couple of months ago, and they are just as expensive as the iPhone (but with worse build quality (plastic vs metal to begin with)).
Compared to how Apple II got obsolete in the personal computer market in 1980s, iPhone/iPad has much brighter future from its solid ecosystem.
It's just the time for Apple to start selling low-priced iPhone models to compete against Google in developing countries.
And to be honest, I'm just sick to death of how every Apple discussion (and on every forum) ends up as a heated flamewar against brainwashed sheeple who value brand loyalty above their own sanity. And I'm not singling Apple customers out; I'm talking about Samsung / Android zealots in Apple threads as well.
It's as if we, the developed world, have nothing better to do with our time than start arguments on the internet about inconsequential bullshit because someone dared criticize our favorite brand.
It's almost as if it was human nature to pick inconsequential things to strongly identify with for the sake of creating arbitrary us-them divides to fight over. (http://lesswrong.com/lw/mg/the_twoparty_swindle/)
They compared estimates (made up numbers remember) but for Apple they used some calculation of net profit, for Samsung they did not. A choice quote
"In other words, in order to report that "Samsung has finally succeeded in becoming the handset industry's largest and most profitable vendor," Strategy Analytics had to compare Samsung's entire PC and device business with only half of Apple's."
So basically anti-Apple propaganda, all lies and lapped up by the fandroids.
Fascinatingly a submission reporting this story has been flagged so it can no longer be upvoted.