Apple iPhone market share failure to grow in Q4 2010

[GRG55]

Re: Apple iPhone market share failure to grow in Q4 2010

...What you're forgetting is that since Apple has been serving the high end of the market, the wealthy/technophiles in other countries were already buying iPhones from the US (and Europe) to use in their own countries.

I myself have brought a number of new iPhones over to other countries upon request.

Were Apple to go downmarket - their market share would certainly increase. But doing so also greatly risks alienating their existing customers.



...

What you are forgetting is that wealthy technophiles import them when they aren't yet available locally. That happened throughout the Persian Gulf when the iPhone was first introduced only in Dubai. Once it is available in the local market there's little incentive to import and the numbers being imported are inconsequential, including the few that you smuggled. In the Gulf people who wanted them first had to get a telephone package from the UAE phone company Etisalat and pay the roaming charges back in their home country - the phone is useless without the data package.

Your commentary is fully supportive of my point. The iPhone is not a mass market product. That is why the scenario where they go downmarket with the latest generation releases won't happen.

You are comparing Hush Puppies to Guccis, or Timex to Rolex. People don't buy the latter because Hush Puppies are lousy shoes, or because Timex watches don't tell the time properly.

In a world of growing plutocracy, high end boutique products like the iPhone are going to do quite well. You'll notice that in the USA it is WalMart that has been suffering for the past couple of years, not Tiffany's.

Quite some years ago it was Sony that held this position in the consumer electronics market - innovative products that were premium even to their Japanese competitors such as Akai and Panasonic. It was a computer company, Apple, that came out of left field and wiped out Sony's lock on the personal audio player market. Maybe somebody will "do an Apple" to Apple...but I don't think it's going to be Google...

[Munger]

Re: Apple iPhone market share failure to grow in Q4 2010

I tend to agree with C1ue here. Apple is trying like hell to create an economic moat around their iOS platform -- the subscription fee debacle of a few weeks ago being the most recent example. The problem is, they are alienating their developers in the process, just as the did in the late 80s when fighting Microsoft.

Apple makes great devices, but it is too hard to fight 100 hardware makers using a free operating system. Of course, they occupy the premium spot -- like Rolex, Mercedez-Benz, etc. But eventually they will be reduced to a large niche competitor -- albeit one with huge margins.

[jk]

Re: Apple iPhone market share failure to grow in Q4 2010

I actually expect the Android trend to slow down because I fully expect Google to start charging more for it...

google can't very well charge less for it. it's free. that's been part of its appeal to handset makers, tablet makers, etc. i'm not aware of any plans on their part to charge for it. they and their app developers make most of their money from ads, some from charging for apps. the open ecology will let a thousand flowers bloom.

[c1ue]

Re: Apple iPhone market share failure to grow in Q4 2010

What you are forgetting is that wealthy technophiles import them when they aren't yet available locally. That happened throughout the Persian Gulf when the iPhone was first introduced only in Dubai. Once it is available in the local market there's little incentive to import and the numbers being imported are inconsequential, including the few that you smuggled. In the Gulf people who wanted them first had to get a telephone package from the UAE phone company Etisalat and pay the roaming charges back in their home country - the phone is useless without the data package.

Your commentary is fully supportive of my point. The iPhone is not a mass market product. That is why the scenario where they go downmarket with the latest generation releases won't happen.

You are comparing Hush Puppies to Guccis, or Timex to Rolex. People don't buy the latter because Hush Puppies are lousy shoes, or because Timex watches don't tell the time properly.

My friend, your commentary is a little incoherent.

If people already import the iPhones, then all that happens once iPhones are officially available where they live is a transfer from market share in the import nation to a small market share in the new iPhone market nation.

As for what I did - I brought them as favors for people. But I was told (by a customs official no less) that he'd look the other way if I brought 10, so long as I gave him one.

Clearly the 'smuggling' as you call it is more than you think. And for that matter, why is it 'smuggling'? Once you own the phone, it should not matter where you take it. You paid for it after all.

As for your example - it makes no sense to me. If a local cell phone company has no data capability, there can be no data roaming capability.

If there is a data capability available for roaming, then the only reason it isn't "officially" available is political. There are no technical reasons, and clearly there are financial incentives.

In a world of growing plutocracy, high end boutique products like the iPhone are going to do quite well.

That is possible, but iPhone isn't the high end. That would be Vertu.

Quite some years ago it was Sony that held this position in the consumer electronics market - innovative products that were premium even to their Japanese competitors such as Akai and Panasonic. It was a computer company, Apple, that came out of left field and wiped out Sony's lock on the personal audio player market. Maybe somebody will "do an Apple" to Apple...but I don't think it's going to be Google...

Apple did what it did more from its FARTS takeover from the music industry (and the huge strategic error said industry made) than any technological advantage. No doubt Sony's large music IP portfolio played a part in their behavior.

As for who will 'do an Apple' - Android isn't going to be the killer of Mac, just as Windows wasn't itself the killer. The killer of the Macs were all those companies making cheaper and ever more powerful PCs, much as the Apple killer is going to be Samsung, or LG, or some other gigantic multinational.

Even Nokia - I wouldn't discount just yet.

Nokia has more than enough money to continue goofing up for several more years, and still be able to put together a credible competitor.

google can't very well charge less for it. it's free. that's been part of its appeal to handset makers, tablet makers, etc. i'm not aware of any plans on their part to charge for it. they and their app developers make most of their money from ads, some from charging for apps. the open ecology will let a thousand flowers bloom.

I wasn't saying charge less, I was saying charge more. Supporting Android for its many and varied customers is a non-trivial process.

As for money from ads - for mobile it is inconsequential.

As I've noted before: if a company like Shazam with 100-ish employees and 15 million users can't even break even from ads, clearly that business model isn't going to work.

[jk]

Re: Apple iPhone market share failure to grow in Q4 2010

c1ue, sorry i didn't use an emoticon to signal i was making a joke. in alice in wonderland, the mad hatter asks alice if she'd like more tea. she says she can't very well have more, since she hadn't had any at all. to which he replied, no, she couldn't very well have less.

[seanm123]

Re: Apple iPhone market share failure to grow in Q4 2010

Open Source takes the world by storm.From a software perspective Open Source application development is only becoming more and more popular and for the Android it is white hot right now.

Android's greatest strength is it's Open Source developer community. Android development is easy to learn, makes use of open source technologies and the online community constantly provides free examples of working code that can be modified and adopted free of charge. It is worth mentioning that the Android OS is itself an embedded operating system that is based on the Linux kernel for core system services.

Apple iOS is a closed platform that you must own a MAC to develop on and the iOS software restricts the amount of development you can do on it. Getting your iPhone application approved and loaded up into iTunes is no easy feat.

Open Source communities like Linux and Java have evolved considerably in the last decade. From the Web 2.0 point of view Both Twitter and Facebook are built upon open source and have thrived.

My personal opinion is RIM, Apple and Microsoft will only be in the rear view mirror for Google's Android, and Android is only picking up speed, with Symbian to be in second place in the race.

Whether Google can monetize Android or not remains to be seen. Might want to ask Linus Torvalds.

[KGW]

Re: Apple iPhone market share failure to grow in Q4 2010

Now that HP is setting up webOS for its phones, tablets, and computers, I think there will be a new pony in the area. . .When I show my Palm Pre Plus to my totally Apple addicted bro-in-law, about all he can say is it's not an Apple When I show him how it does everything an iphone does, and more (mobile hotspot), in just as elegant a manner, he goes off to talk to someone else.

[renewable]

Re: Apple iPhone market share failure to grow in Q4 2010

Now that HP is setting up webOS for its phones, tablets, and computers, I think there will be a new pony in the area. . .When I show my Palm Pre Plus to my totally Apple addicted bro-in-law, about all he can say is it's not an Apple When I show him how it does everything an iphone does, and more (mobile hotspot), in just as elegant a manner, he goes off to talk to someone else.

No chance. This is an evolutionary dead end. Years behind other closed proprietary OSs, no real app market, etc. Developers & geeks will choose the system that is essentially the same linux underneath but without the closed top level layer (Android).

I've seen so many 'short apple' threads on here over the years. They've all been wrong.

If I could short webOS, I would. Massively. It's toast.

[KGW]

Re: Apple iPhone market share failure to grow in Q4 2010

webOS is not a closed, proprietary OS, just the opposite in fact. There is a flourishing community of developers known as the "HomeBrew" community.

[c1ue]

Re: Apple iPhone market share failure to grow in Q4 2010

Either Gartner has it in for Apple, or...

http://timesofindia.indiatimes.com/t...ow/8016271.cms

BERLIN: Almost half of all smartphones worldwide will use Google's Android operating system by the end of 2012, forecasts technology research company Gartner.

Already this year, Android should hit a market share of 38.5 per cent, making it the most popular operating system, according to Gartner.

Gartner forecasts that smartphones, which offer more computing power than standard phones, will already claim a 26 per-cent market share this year, growing to almost half the market (47 per cent) by 2015.

And, since the various manufacturers of Android devices will be fighting for market share, customers will probably benefit from falling prices, says Gartner analyst Roberta Coza.

"Android's position in the high end market will stay strong, but the long-term growth possibilities will be in the lower to middle price segments."

Apple's operating system, iOS, which this year beat Nokia's Symbian system by garnering 19.4 per cent market share to Nokia's 19.2 per cent to claim the market leader position, will be able to hold on to second place behind Android until 2014, forecast analysts.

After that, its market share will slip, since Apple is more interested in keeping high margins than in having a big share of the market. That will means its business will be limited in developing economies like India or Africa.

But in 2015, Microsoft could very well beat the maker of the iPhone with its new Windows Phone 7 system. Gartner forecasts a market share of 19.5 per cent for Microsoft versus 17.2 per cent for Apple.

Gartner suggests that success might stem from Microsoft's alliance with Nokia, which hopes to push Windows Phones in middle-price-segment markets. Before that deal, Gartner had expected Microsoft to experience another drastic loss in market share.

Now IDC says Microsoft's market share in 2015 could touch 20.9 per cent. But its numbers are still not expected to reach the highs that Symbian once enjoyed. That platform, which Nokia now hopes to operate in a partnership with Microsoft, will probably not play a role in 2015, according to Gartner estimates.

Experts forecast that the operating system, which has a 19.2 per cent market share today, will see that dwindle down to just 0.1 per cent by 2015.

[touchring]

Re: Apple iPhone market share failure to grow in Q4 2010

If you mean Japan, Apple is doing relatively well there - albeit because the definition of the smartphone excludes almost all Japanese phone models with similar capability.

However, in China Apple is doing quite poorly:

http://tech.fortune.cnn.com/2010/12/...disappointing/

Android in China: 4-5 million sold in last quarter. Apple in China: 500,000.

Sure doesn't look like an iPhone domination in China.



I've never said the iPhone was a crappy device - much as the Mac, they are both well integrated systems. But then again, the same can be said for Japanese cell phones - as I note above, most Japanese cell phones have smartphone like capability despite a lack of equivalent hardware due to the tight integration.

The problem is that as time and technology improves (note Android only went public 15 months ago vs. iPhone 32 months ago, plus the distributed vs. integrated model), iPhone will only improve incrementally while Android will continue to improve geometrically.

I actually expect the Android trend to slow down because I fully expect Google to start charging more for it, but as with the PC market - the economics of technology improvement will erase the iPhone vs Android distinction.

Google makes much more money from advertising than the OS itself. Do you know how much Google makes if you click a bank loan ad? They could make a couple bucks on just one ad.

[GRG55]

Re: Apple iPhone market share failure to grow in Q4 2010

Either Gartner has it in for Apple, or...

http://timesofindia.indiatimes.com/t...ow/8016271.cms

...Apple's operating system, iOS, which this year beat Nokia's Symbian system by garnering 19.4 per cent market share to Nokia's 19.2 per cent to claim the market leader position, will be able to hold on to second place behind Android until 2014, forecast analysts.

After that, its market share will slip, since Apple is more interested in keeping high margins than in having a big share of the market. That will means its business will be limited in developing economies like India or Africa.

But in 2015, Microsoft could very well beat the maker of the iPhone with its new Windows Phone 7 system. Gartner forecasts a market share of 19.5 per cent for Microsoft versus 17.2 per cent for Apple.

Gartner suggests that success might stem from Microsoft's alliance with Nokia, which hopes to push Windows Phones in middle-price-segment markets. Before that deal, Gartner had expected Microsoft to experience another drastic loss in market share...

After a couple of months using a Nokia N8 my opinion of it has not changed. It is piece of crap phone. The software is utter garbage.

I am not sure if the alliance with Microsoft is going to save Nokia [or MS], but after years of losing market share because of their lousy smartphone software Nokia had to do something...

[renewable]

Re: Apple iPhone market share failure to grow in Q4 2010

c1ue, how has your bearish outlook on Apple since 2007 done so far?

http://biz.yahoo.com/ap/070905/apple_ipods.html?.v=21

Ouch - so everyone who lined up to buy an iPhone just paid $200 extra for an inferior product and the privilege of beta testing for 1 month.

It looks like Apple has failed to re-ignite hype; now I again search for a re-entry into an Apple bear straddle.

[seanm123]

Re: Apple iPhone market share failure to grow in Q4 2010

Careful there don't sell on the news before you buy the rumor.

http://www.macobserver.com/tmo/artic...s_data_center/

[renewable]

Re: Apple iPhone market share failure to grow in Q4 2010

webOS is not a closed, proprietary OS, just the opposite in fact. There is a flourishing community of developers known as the "HomeBrew" community.

Really? Wikipedia describes webOS as "webOS is a proprietary mobile operating system running on the Linux kernel, initially developed by Palm, which was later acquired by HP". I'd be interested to see any links asserting that it is open source?