Apple iPhone market share failure to grow in Q4 2010

[jk]

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

Sony built its brand as the 'first' with Walkmans. You could easily argue Sony's 'luxury technology' brand arose from the same personal consumer device origins as Apple; certainly Sony stereo components were never the highest end. The most recent invigoration of the franchise was the Playstation.

However, Microsoft's entry into the gaming box field (there were others, but none as well capitalized as Xbox) reduced the previously massive impact Playstation had on Sony's image and fortunes.

I've had close personal involvement with the CPU side on the Playstation; ultimately what killed that market dominance was again the technology curve.

In the beginning the Playstation was a significant, if not quantum leap upwards in terms of performance. The graphics processors combined with Sony's software game development programs produced a significantly superior product vs. existing console and PC games.

However as the technology curve progressed, it became easier and easier for competitors to stay in the same ballpark, until it was possible for Microsoft to build an Xbox essentially using off the shelf components which was competitive performance wise with PlayStation. The same technology curve issues allowed a much smaller company - Nintendo - to bring out a product with similar performance but with a better interface.

The resulting 3 way split of the market crushed not just the Playstation, but Sony's overall profitability.

sony was never THE premium brand in audio components, but the very high end there is more like an lvmh market.

nonetheless, it was very reputable for a time- the high end of the broad consumer market. its av eqpt was reliably at or near the top in various reviews. it could be depended upon, and on that rested its ability to charge a few more dollars. how did it lose its cachet in the audio and tv realm? i don't know, but it did.

[Milton Kuo]

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

sony was never THE premium brand in audio components, but the very high end there is more like an lvmh market.

nonetheless, it was very reputable for a time- the high end of the broad consumer market. its av eqpt was reliably at or near the top in various reviews. it could be depended upon, and on that rested its ability to charge a few more dollars. how did it lose its cachet in the audio and tv realm? i don't know, but it did.

I've always felt that Sony started going downhill when they became a media company with the purchase of Columbia Pictures and CBS Records. It seems that once Sony acquired those companies, there was an internal war between the engineering and media departments of the company. Instead of creating great products, it seemed a lot of engineering effort was spent developing technologies to prevent the copying of media. The MiniDisc was a product that had a chance to succeed but poor marketing and annoying DRM killed it before it ever had a chance in the U.S. Once the Apple iPod came out, it was over for Sony. Nowadays, a portable music player is called an iPod regardless of its manufacturer whereas portable music players used to be regularly called Walkmans. iPod has replaced Walkman in the lexicon for a portable music player.

It was also during the 1990's that Sony started to coast on the reputation it earned in the 1970's and 1980's. In an effort to increase market share, Sony created less-expensive products that still carried the Sony price premium but were not better than competing products. This diluted the value of the Sony brand -- buying a Sony product, at a higher price thanks to the Sony brand, no longer guaranteed a top-quality consumer electronics product.

[FrankL]

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

...

It looks like it has Apple scared. They've blocked sales of Samsung's Galaxy Tab in Australia over patent claims.

Apple runs increasingly scared of competition in their price segment.

Is this rightful protection of intellectual property, or signs of a company grasping at straws to maintain a near-monopoly in their price segment?

[KGW]

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

Look up PreWare on Wikipedia. . .

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?

[goadam1]

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

I own about 20 macs for my business. I have an iPhone, an iPad, an iMac at work, a pro tower for work and a macbookpro for portable work. My kids use and extra iPad. My wife has an air for work at home, an iPad, an iMac at work and an iPhone.

[c1ue]

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

2 pictures, both from Nielsen. One from June 2010 and the other from June 2011 respectively.

Note the Apple market share is identical.

Apple continues to grow because the overall market for smartphones is growing - not because of increased market share.

smartphone-share1 062010.png
smartphone-share1 062011.png

Note that it is true that many Android phones are cheaper, thus are affordable to a different demographic.

However, the high end Android phones are just as expensive as iPhones, thus the assumption that pricing is the only factor is incorrect.

[c1ue]

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

This is interesting, but unclear just how negative for Apple.

The clear negative is the appearance of a competitor who does both software and hardware. The cancellation of this effect is the impact of Google making hardware on Android's hardware manufacturer OEMs.

This also may drive up Google's revenue, but will drive down Google's profitability. Software makers also in general do very poorly with hardware, and the cell phone market is extremely competitive (to put it mildly).

As always - a question of execution. If Google's strategy is to attack only Apple's market share - the Nexus and Nexus S were clearly aimed at iPhone - then this is something the big hardware makers could swallow. Especially if improvements to Android in this competition are available via the Android OS to them.

http://www.sfgate.com/cgi-bin/articl...BU6I1KNN89.DTL

Google moved to acquire Motorola Mobility today for $12.5 billion in cash, shifting the balance of power in the electronics industry and setting up a bruising battle with Apple for control of the mobile market. The surprise acquisition by Google, its largest ever by far, was described by the Mountain View company as a strategic move that will greatly augment its intellectual property and protect its Android mobile operating system from patent lawsuits.

"Our acquisition of Motorola will increase competition by strengthening Google's patent portfolio, which will enable us to better protect Android from anti-competitive threats from Microsoft, Apple and other companies," Google CEO Larry Page said in a statement.

The move comes as software and hardware manufacturers have become embroiled in costly litigation over patents. Analysts described the planned acquisition as a necessary defensive measure on Google's part.

It also marks a shift in strategy for Google, which had previously been content to license its Android operating system to manufacturers like Motorola, Samsung, HTC and LG and let them build the hardware. It's a model borrowed from companies like Microsoft, which built the Windows operating system and let other manufacturers build the desktop computers it runs on.

That approach contrasts sharply with Apple, which designs both the hardware and software for its iPhones and iPads.

"By acquiring Motorola, they are making a big statement that they want to become more like Apple and less like Microsoft," said Sandeep Aggarwal, an analyst with Digital Route LLC in San Francisco.

The acquisition, which is subject to the approval of the Federal Trade Commission, would give Mountain View's Google more than 17,000 patents with which to defend itself in the ongoing patent wars in the mobile space. Last week, Apple won an injunction that prevents Samsung's Galaxy Tab, an Android-based tablet computer, from being sold in Germany. Patent issues represent a long-term threat to Google's business, they said.

Trip Chowdhry, an analyst with Global Equities Research, said in an e-mail that the acquisition could mark the start of a "brutal" new phase in the mobile patent wars, as handset manufacturers look to integrate new technologies like near-field communications and mobile payments into their handsets.

Along with the announcement, Google provided quotations from top officials at Samsung, Sony Ericsson, HTC and LG saying the move strengthened Android's prospects.

"We welcome today's news, which demonstrates Google's deep commitment to defending Android, its partners, and the ecosystem," said J.K. Shin, president of Samsung's mobile communications division.

By acquiring a manufacturer like Motorola, Google also a chance to better integrate hardware and software - something that has been a competitive advantage for Apple, which makes both for the best-selling iPhone.

[seanm123]

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

Wow! that did not take long. HP is killing WebOS devices

PALO ALTO, Calif.--(BUSINESS WIRE)--HP (NYSE: HPQ) today commented on the recent announcement by Autonomy Corporation plc (LSE: AU.L). HP confirms that it is in discussions with Autonomy regarding a possible offer for the company.
HP also reported that it plans to announce that its board of directors has authorized the exploration of strategic alternatives for its Personal Systems Group (PSG). HP will consider a broad range of options that may include, among others, a full or partial separation of PSG from HP through a spin-off or other transaction.
In addition, HP reported that it plans to announce that it will discontinue operations for webOS devices, specifically the TouchPad and webOS phones. HP will continue to explore options to optimize the value of webOS software going forward.
HP today announced preliminary results for the third fiscal quarter 2011, with revenue of $31.2 billion compared with $30.7 billion one year ago.
In the third quarter, preliminary GAAP diluted earnings per share (EPS) was $0.93 and non-GAAP diluted EPS was $1.10, compared with third quarter fiscal 2010 GAAP diluted EPS of $0.75 and non-GAAP diluted EPS of $1.08. Non-GAAP diluted EPS estimates exclude after-tax costs related primarily to the amortization of purchased intangible assets of approximately $0.17 per share and $0.33 per share in the third quarter of fiscal 2011 and fiscal 2010, respectively.
For the fourth fiscal quarter of 2011, HP estimates revenue of approximately $32.1 billion to $32.5 billion, GAAP diluted EPS in the range of $0.44 to $0.55, and non-GAAP diluted EPS in the range of $1.12 to $1.16. Non-GAAP diluted EPS guidance excludes after-tax costs of approximately $0.61 to $0.68 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.
HP estimates full-year FY11 revenue will be approximately $127.2 billion to $127.6 billion, down from its previous estimate of $129 billion to $130 billion. FY11 GAAP diluted EPS is expected to be in the range of $3.59 to $3.70, down from its previous estimate of at least $4.27, and FY11 non-GAAP diluted EPS is expected to be in the range of $4.82 to $4.86, down from its previous estimate of at least $5.00. FY11 non-GAAP diluted EPS estimates exclude after-tax costs of approximately $1.16 to 1.23 per share, related primarily to restructuring and shutdown costs associated with webOS devices, the amortization and impairment of purchased intangibles, restructuring charges and acquisition-related charges.

[c1ue]

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

Wow! that did not take long. HP is killing WebOS devices

No doubt because of this:

http://www.pdfdevices.com/best-buy-n...ls-to-impress/

HP TouchPad, HP’s webOS wonder has failed to make a mark on the market. In spite of the webOS “potential”, quick updates that fix the initial issues on HP TouchPad, multiple discounts, and even a $100 price cut, HP TouchPad sales are low, low, low. This information comes from AllThingsD, a reliable blog run by The Wall Street Journal.

As reported on AllThingsD, a Best Buy insider informs them that the top US retailer had ordered 270,000 HP TouchPad units thinking they would sell like hot cakes. Till now, post discounts and coupons, Best Buy has only managed to sell 25,000 TouchPads. That’s less than 10% of the stock. Another person with access to Best Buy’s HP sales numbers calls this figure “charitable” as it does not account for units customers brought back to store for refunds.

Apparently Best Buy is very disappointed with HP’s product and is unwilling to pay for the HP TouchPad units sitting at their stores, consuming expensive space. They have asked HP to take the units back but HP is asking the retailer to have patience. There’s news that a senior HP executive, possibly executive VP Todd Bradley, may come down to Minneapolis to discuss the matter with Best Buy executives.

Other retailers aren’t doing any better with HP TouchPad either. Even after a $120 discount on the tablet at Woots, only 612 units were sold. Walmart, Fry’s and Micro Center aren’t seeing a lot of movement either. Analyst Rich Doherty, head of the Envisioneering Group says that HP’s “wildcat pricing moves” on the TouchPad are prompting consumers to hold on for what happens in the next few months. They’re clearly expecting the price to fall further and it may well happen as things stand.

Will HP’s webOS licensing plans make things any better for HP? Maybe. But as far as the HP TouchPad goes, customers don’t want an OS that will become remarkable down the line; they want software that is awesome right now.

Wait for the holiday season. Lots of tablets will be toeing the $300 line, if only for retailers to offload slow moving inventory.

I haven't actually seen a Touchpad, but from what I've heard from others - its lack of intrinsic cell phone capability is a big barrier.

[jk]

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

knowing that they're killing the system should certainly help sales.[/-sarcasm]

[c1ue]

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

Ouch.

http://www.spiegel.de/international/...783345,00.html

The iPad is for show-offs. And the iPhone 4 makes it difficult to make a simple telephone call. Apple used to be hip, stylish and ahead of the curve. Now, though, it has become totally uncool -- and not just since Steve Jobs stepped down.

It happened again just recently. Yet another elderly member of Germany's parliament sauntered up, pulled out a neat leather case and whispered conspiratorially: "I've got one now, too."

The correct response to this would have been: "Yeah, so what?" But politeness demanded a feigned: "Great." People who purchase Apple products feel like they've joined some kind of elite club -- and they apparently want everybody to know about it. The iPad has attained the social cachet once enjoyed by things like color TVs and inline skates. It's almost like you can hear its owners shouting triumphantly: "I'm hip! I'm in front! And I can afford it, too!"

More than half of the members of the Bundestag, Germany's parliament, can now be seen gliding their fingers over iPad touch screens. Of course, it's not about looking something up or even working. No, this moment, this brief time in which the briefcase is opened and the iPad is taken out is only about showing the rest of the world: I'm with it. I'm connected. Using an iPad looks more impressive on TV than flipping through ring binders.

It's the same with pulse-monitoring watches, red wine and handbags: It's not about functions, uses or taste. No, it's about showing off. Indeed, the iPad is the must-have, cool-kid item of the 21st century.

Though you can't even use Flash on them, some people touch every Apple gadget with an almost religious awe. Having one frees you of any digital inferiority complexes. Indeed, you soon won't be able to attend a seminar, sit in on a meeting or take a train ride without seeing some hot-shot open up his iPad case.

It's curious, too, especially when you consider the fact that you can't really write properly on an iPad, that it's not easy to make phone calls with it and that it requires you to sign up for an additional cell phone contract if you want to get Internet access while on the go.

Apple is Like Sushi

The economic victory parade of the iPad and iPhone is accompanied by a dreadful emotional letdown, a bit like with the latte macchiato before it. Something that was pleasingly different, that gave its supporters a certain feeling of hipness, has been sucked dry by its sheer ubiquity. What was once cool has now become the epitome of uncool. If everybody has something, it can no longer set you apart. The most valuable company in the world produces exactly what all the other most valuable companies in the world have produced: soulless junk. Apple is like sushi: What was once exclusive is now as common as a lower back tattoo.

Back in the day, when everything was better, the Macintosh enjoyed a reputation for being a well-designed tool for graphic designers. Apple was a protest against the evil empire embodied by Bill Gates. Its sleek devices were designed by people like Hartmut Esslinger of Frog Design, and inspired by Dieter Rams of Braun fame. They turned the brand into a statement. They combined functionality with a feeling of Californian liberalism.

Mac users basked in a feeling of belonging to a select group. Steve Jobs, the eternal hippie, was the chummy opposite of the hyper-ambitious nerd Bill Gates. People happily paid more for the products so that they could feel they were somehow on the right side. The high prices were always also a kind of donation. And it fitted perfectly that the Silicon Valley company was on the verge of going bankrupt in the 1990s.

An Obvious Master Plan

Apple's history of massive success first started with the iPod. Even skeptics had to concede that it took marketing genius to transform something as dirt-cheap as an MP3 player into a outrageously pricey luxury good. The iPod's rise was accompanied by that of iTunes. It was obviously part of a master plan that aimed to have customers only spend money in the hermetically sealed Mac world.

For Apple, value-creation cycles, restricting freedom of choice and gathering mountains of user data have all been part of the same thing for a long time. Sure, Google might have its tentacles all over the place. But Apple is worse. Without any democratic mandate, Apple officials determine what content will be made available via its App Store. Indeed, things that would be enough to trigger a major scandal at your average multinational don't seem to stick to Apple. There's hardly a single German publisher that wouldn't prostrate itself before Apple, because the lords of the apps are the only people who can grant access to the revenue sources of the future.

The first cracks in this love affair between Man and Mac came with the launch of the iPhone 4. As usual, the Mac-devoted media -- including yours truly -- took over the job of providing free marketing for the product. And, as with the launch of any new Apple product, that of the iPhone 4 was celebrated as a global spectacle. But one thing was ignored: The iPhone 4 is the first cell phone in ages that I have trouble making calls with. Half of my calls are dropped.

Communicating gets particularly bizarre when two people try to talk to each other using iPhones. Using carrier pigeons would be faster. Steve Jobs explains that it isn't the phone that's the problem but, rather, its users, who don't hold the miracle device right.

A Community of Believers Detached from Reality

Firms everywhere get sued whenever their products don't do what they're supposed to. Apple enjoys legions of militant fans who point out to any Apple critics that they're just too dumb to use it right. Apple and its customers are today's L. Ron Hubbard and Scientology: a community of believers completely detached from reality. The lines that used to form in front of St. Peter's Cathedral in Rome can now be found outside the Apple Store.

What started with the iPhone 4 has now come to encompass all Apple products. They no longer run smoothly with each other -- and not at all if they are of different generations. Take, for example, iCal, the Mac calendar. The idea behind it is that up to four people can keep a shared calendar, that it will ideally be updated after each new entry is made, and that it syncs on your Apple computer, your Apple iPhone and your Apple iPad.

Thankfully, I have Stefan to help me. "No problem," he says. "We'll do that with the cloud." Stefan is a freelance computer technician, therapist and extortionist. Unfortunately, his first standard phrase ("That'll be fixed in no time!") is never true. That's because his second standard line is: "We have to reset it." All devices have to be in the same place at the same time. Only then can they all be reformatted so that they can all have the same new software versions. This is a serious logistical effort, and it promises the exact opposite of mobile communication: immobile silence.

And every time it's the same song and dance: a lot of effort, a lot of time, a lot of praying -- followed by the inevitable letdown. At a certain point, the entire calendar is messed up, but only on one computer. And then on all the iPhones. Now there are 12 copies of all the phone numbers in the address book, and the data volume makes each search take an eternity. Stefan is relieved. "Great," he says. "At least the phone numbers are still there." Next week, we'll have to start all over from scratch again.

Incidentally, Stefan doesn't use an iPad. "What for?" he says. Good question.

Digging Out the Nokia

Happiness lies in simplifying your life. The Volkswagen Golf will start being interesting again once everyone is driving Porsches. At least it runs. And it doesn't leave a lingering, hollow feeling of having been scammed because you have to run all the way across town to get your hands on a copy of the exotic program "Keynote," which doesn't install itself even after three calls to the help hotline because you first have to completely delete the test version from your computer and even that doesn't work.

And how are you supposed to get an installation CD into an iPad anyway, if it doesn't have either a drive or a USB port? Buy the app, dummy. But why? I just bought the same program on a CD. Doesn't matter. You have to buy the app. It gradually becomes clear why Apple is the darling of the stock exchanges. What we have here is a game resembling a chain letter designed to go on forever, one that people have to keep forwarding if they want to feel like they're ahead. Apple is a drug, and everyone is hooked.

Almost everyone, that is. Yesterday, I dug out my old Nokia phone from a drawer. Finally I can make phone calls again! Is there life without Apple? I'm not sure, but I'm sure going to give it a try.

Most interesting: 1,200 recommendations. 172 tweets.

[Munger]

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

I am no fanboy, but this article is pretty absurd. That's the thing about Apple: people tend to either love them irrationally or hate them irrationally. This writer obviously falls into the latter category.

I don't think Apple can sustain this share price over the long run. But I have an iPad, and I use it all the time. I don't bring it in public to "show off." It's small, light, fast, can remain unplugged for 12 hours and boots up instantly. But apparently the author knows better -- I just want to be a "cool kid."

[jk]

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

Ouch.

http://www.spiegel.de/international/...783345,00.html

Most interesting: 1,200 recommendations. 172 tweets.

i don't have any apple products, but i don't find the number of recommendations interesting- they're all android fans. these religious wars are boring. the future market share will tell us everything.

[c1ue]

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

i don't have any apple products, but i don't find the number of recommendations interesting- they're all android fans. these religious wars are boring. the future market share will tell us everything.

I think it is amusing that you call Der Spiegel International readers Android fans.

[jk]

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

I think it is amusing that you call Der Spiegel International readers Android fans.

no, i was calling der spiegel readers who bother to recommend that article android fans. i have an android phone myself, and for a while frequented some android websites. the android people are just as rabid as the apple fanboys.