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Apple edges Motorola with 3% global cell phone market share

post #1 of 87
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Apple moved ahead of rival Motorola in unit sales in the first quarter of 2010, with the iPhone taking a 3 percent share of the total cell phone market.

Apple's 8.75 million iPhones shipped in the first three months of 2010 managed to edge Motorola, which sold 8.5 million handsets during the same period, according to new data from iSuppli. Apple during the quarter was the No. 6 overall cell phone maker in the world, while Motorola came in at 8. iSuppli called Apple's growth in the global market a "changing of the guard" in the cell phone industry.

Apple was propelled by 130.7 percent year-over-year growth, up significantly from the 3.79 million iPhones sold in the first quarter of 2009. The Cupertino, Calif., company still remains behind Research in Motion, which has 3.6 percent of the market with 10.47 million BlackBerrys sold in the first quarter of 2010.

The numbers serve to illustrate what a small portion smartphones are of the overall cell phone market. The top global brand during the quarter was Nokia, which sold a total of 107.8 million cell phones and smartphones during the quarter. Competitors Apple and RIM, however, do not sell traditional cell phones.

"Smart phones represent the hottest segment of the cell phone market, with unit shipment growth of 35.5 percent expected in 2010, compared to 11.3 percent for the overall mobile handset business, noted Tina Teng, senior analyst, wireless communications, for iSuppli. "Because of this, companies that are exclusively focused on this area, like RIM and Apple, have managed to move up to near the top-tier of the global cell phone business. This shows that the smart phone is reshaping the competitive landscape of the wireless business."



The latest numbers also demonstrate how far Motorola has fallen: In the first quarter of 2007, the company was the second-largest cell phone shipper in the world, behind only Nokia. Recently, Motorola has shifted its focus to higher margin smartphones, like the Droid.

"While Motorolas ranking and share declined in the first quarter, the company did manage to make significant improvement in profit during the period, with its margin rising by 19 percentage points compared to the first quarter of 2009," Teng said. "This shows that Motorola is on the right track in its product mix, focusing on more profitable devices like Droid."

The report noted that the smartphone market is expected to continue to grow, which could result in both RIM and Apple ousting some of the biggest players in the global cell phone market. Within their sights is No. 4 Sony Ericsson, which has 3.6 percent of the market, but fell 27.6 percent year-over-year in the first quarter.

"It will be interesting to see how much more market share RIM and Apple can gain in 2010," Teng said.
post #2 of 87
Apple should find itself in 4th place this year. They would have beaten RIM already, except for the 2-for-1 promo by Verizon - but it is just a question of time before Apple go ahead of RIM and Sony-Ericcson.

Amazing, when you consider that Apple did not sell a single phone just 3 years back!
post #3 of 87
I find it interesting to read how large the gray market is. If the chart is correct, it's right about 15% ish of the total market. Seems like a fairly high % but I'll be the first to admit I don't follow that market all that closely.
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post #4 of 87
Quote:
Originally Posted by macarena View Post

Apple should find itself in 4th place this year. They would have beaten RIM already, except for the 2-for-1 promo by Verizon - but it is just a question of time before Apple go ahead of RIM and Sony-Ericcson.

Amazing, when you consider that Apple did not sell a single phone just 3 years back!

It really is amazing...and consider what a game changer it was 3 years ago! I was an early adopter and was very happy with just Apple's take on email, contact management and visual voice mail. Especially, contact management.

For my Real Estate Business that was worth the price of admission, right there.

I skipped the 3g version but have had the 3Gs for over a year now and love it...will be getting the 4G and an iPad!

Best!

Ps. I think RIM is still coming from a 'Pager' foundation...albeit more sophisticated. But not anywhere near as sophisticated as Apple!
post #5 of 87
Quote:
Originally Posted by macarena View Post

Amazing, when you consider that Apple did not sell a single phone just 3 years back!

Even more amazing considering that Apple only sells one model of smartphone at a time and zero dumbphones (a.k.a. "feature phones").
post #6 of 87
@ Neil Hughes,

Is there enough data from these companies to determine the average price and profit per unit. I'm curious to see how these companies are doing financially. For instance, the Droid could have made Motorola more profitable now than it was 3 years ago selling mostly dumb phones.


Quote:
Originally Posted by christopher126 View Post

I think RIM is still coming from a 'Pager' foundation...albeit more sophisticated. But not anywhere near as sophisticated as Apple!

They have great management but it looks like their growth made be plateauing. Either way, Apple does look ready over take them in unit sales.
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post #7 of 87
Just to be picky, the Nokia number in the paragraph 4 should be 107,800,000.
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post #8 of 87
Apple-centric sites should not focus too much about quarter to quarter numbers because they will comeback to bite Apple in the end.

Unlike the iPod, which does not depend on another party, the sales of iPhone has gatekeepers -- the telephone companies all over the world.

In the US, for example, only AT&T customers can use iPhones right now. There are many more American consumers, companies, organizations, institutions, etc. that use other phone companies. Many of these phone companies sell RIMM, Adnoid, and all sorts of smartphones and no iPhone.

Do you really they will all switch to AT&T to have iPhone? Nope. So they will buy what they can get through those carriers. Apart from "customers who hate anything Apple, thus buy any other product", these customers get used to a brand, other than the iPhone.

Do not expect Present Obama, a diehard Blackberry user, to switch to the iPhone anytime soon. Not because he is another Apple hater (he uses iPods and give them away as gifts) but he got used to his Blackberry and would not part with it anytime soon. In fact, he liked it so much, he is the only President so far to get an exemption from the secret service to retain his Blackberry.

Btand loyalty is a known phenomena, like those who buy Coke over Pepsi, use Colgate, Tide, etc. People get use to things -- partly a power of years of use and further reinforced by advertisement. The things you use become part of you, your personality.

When it comes to cellphones, as noted above, the phone companies further restrict the universe and the choices one can make and get used to.

Thus, unless Apple will find a way to sell to all carriers in the US, it will be eclipsed eventually by the likes of Android phones, and may not be able to overtake RIM phones.

The same situation worldwide may happen, especially in countries. where there are incompatible telecommunication technologies.

Going back to "brand loyalty", it is difficult to dislodge Nokia worldwide, even if its numbers is slipping. My sister in Britain has been using Nokia for years before the iPhone, and her provider keeps on giving her free "advanced" cell phone every couple of years, so she keeps on giving her "old" phone to our relatives when she visits our country. If I have to guess, many customers are like her -- they become brand loyal, simply because of familiarity.

CGC
post #9 of 87
Quote:
Originally Posted by cgc0202 View Post

Apple-centric sites should not focus too much about quarter to quarter numbers because they will comeback to bite Apple in the end.

How will showing YoY quarterly comparisons "bite Apple in the end"? These are facts, nothing more. They won't sway anyone to do anything, except perhaps add to their stock investment choice. For 3 years now we've seen quarterly stats and for 3 years now the iPhone has been growing. Where has this bitten Apple in the ass?

Quote:
Do you really [think] they will all switch to AT&T to have iPhone? Nope.
[...]
Btand loyalty is a known phenomena...

First you say that people won't switch to a carrier to get the phone they want, then you say that brand loyalty is a known phenomena. DOES NOT COMPUTE It's been well documented that AT&T is gaining more customers and having less turnover since getting the iPhone.
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post #10 of 87
First you say that people won't switch to a carrier to get the phone they want, then you say that brand loyalty is a known phenomena. DOES NOT COMPUTE It's been well documented that AT&T is gaining more customers and having less turnover since getting the iPhone.[/QUOTE]

The last Strand report on cell phone market share showed that AT&T gained no market share from offering the iPhone. It might have prevented them from losing customers because of their service but not gaining customers.
post #11 of 87
Quote:
Originally Posted by macarena View Post

Apple should find itself in 4th place this year. They would have beaten RIM already, except for the 2-for-1 promo by Verizon - but it is just a question of time before Apple go ahead of RIM and Sony-Ericcson.

Amazing, when you consider that Apple did not sell a single phone just 3 years back!

It never was about market share

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post #12 of 87
Quote:
Originally Posted by TheShepherd View Post

The last Strand report on cell phone market share showed that AT&T gained no market share from offering the iPhone. It might have prevented them from losing customers because of their service but not gaining customers.

So you are saying that AT&T has not increased their subscriber count because of the iPhone. I don't think that is just improbable, but impossible. I and many people I know certainly jumped to AT&T specifically for the iPhone. Do you have that report?
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post #13 of 87
Quote:
Originally Posted by solipsism View Post

So you are saying that AT&T has not increased their subscriber count because of the iPhone. I don't think that is just improbable, but impossible. I and many people I know certainly jumped to AT&T specifically for the iPhone. Do you have that report?

I do but it's copyrighted with a warning not to redistribute it. It was free so you can get a copy by registering with www.strandconsult.dk/
post #14 of 87
There is brand loyalty for your type of phone as well as the carrier that you are on. Sometimes though, you have to choose. If I am a blackberry user, I could go to any carrier and get a blackberry. If I was an iPhone user, I can ONLY chose AT&T. I know many people that have stronger loyalty to the device than the carrier, so they switched to AT&T to get the iPhone.

On the other hand, I am more loyal to my carrier, as AT&T coverage here sucks, so I'm stuck with an Android based phone. Although, every day, I question whether spotty coverage with a great phone would be better than great coverage with a spotty phone.
post #15 of 87
As the 'smarter' phones gain share Apple are well positioned. These figures still show how many dumb phones are out there but this will change over time I suspect.
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post #16 of 87
It would make sense for Apple to consider at least TMobile if it's about gsm vs cdma.

If Apple offered the iphone on different carriers, it would be EASY money.
post #17 of 87
Quote:
Originally Posted by chronster View Post

It would make sense for Apple to consider at least TMobile if it's about gsm vs cdma.

If Apple offered the iphone on different carriers, it would be EASY money.

We don't know that.

AT&T is undoubtedly giving Apple a very sweet deal in order to get exclusivity. I have no idea what it is, but let's say it amounts to $100 extra per phone.

If Apple were to add T-mobile (or Verizon, for that matter), they would lose that extra subsidy. If AT&T sold 10 million phones, that's $1 billion in extra revenue which would be lost. Adding a new carrier would have to be enough to make up that difference.

No one outside of Apple and AT&T know the actual numbers, but the point is that it's not free money - something would have to be given up and it's up to Apple to decide if the gains are worth the cost.
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post #18 of 87
Quote:
Originally Posted by jragosta View Post

We don't know that.

AT&T is undoubtedly giving Apple a very sweet deal in order to get exclusivity. I have no idea what it is, but let's say it amounts to $100 extra per phone.

If Apple were to add T-mobile (or Verizon, for that matter), they would lose that extra subsidy. If AT&T sold 10 million phones, that's $1 billion in extra revenue which would be lost. Adding a new carrier would have to be enough to make up that difference.

No one outside of Apple and AT&T know the actual numbers, but the point is that it's not free money - something would have to be given up and it's up to Apple to decide if the gains are worth the cost.

You're correct in that these exclusivity deals are common so it's logical to assume they find it to be more profitable, but I think his point is also valid regarding as the cost of adding the 1700MHz radio to the iPhone is negligible compared to the cost of creating a CDMA-based iPhone.
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post #19 of 87
Quote:
Originally Posted by solipsism View Post

@ Neil Hughes,

Is there enough data from these companies to determine the average price and profit per unit. I'm curious to see how these companies are doing financially. For instance, the Droid could Motorola more profitable now than it was 3 years ago selling mostly dumb phones.

As an investor I would be interested in these figures too.

I suspect that Apple has the highest profit per unit, and highest profit within the smartphone category.



What also surprises me is how little the the completion understands what Apple does:

1) identify a market potential
2) determine why that potential isn't being realized (what others are doing wrong)
3) determine what is needed to do it right
4) determine how to do it at a reasonable (high) profit
5) just do it!


One can only imagine what Apple would provide if they decided to get into:

-- the cable network market
-- the TV market
-- the automobile market


To see examples of what I am talking about, just look at:

-- the I/O connections on the back of an iMac (a powerful computer) vs an HDTV, VCR, DVR, Cable Box (a dedicated appliance)
-- the remote control (or remote control app) for the above
-- the setup procedure for the above
-- the manual for the above


It's the User Experience, Stupids!

.
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post #20 of 87
Quote:
Originally Posted by bjojade View Post

There is brand loyalty for your type of phone as well as the carrier that you are on. Sometimes though, you have to choose. If I am a blackberry user, I could go to any carrier and get a blackberry. If I was an iPhone user, I can ONLY chose AT&T. I know many people that have stronger loyalty to the device than the carrier, so they switched to AT&T to get the iPhone.

On the other hand, I am more loyal to my carrier, as AT&T coverage here sucks, so I'm stuck with an Android based phone. Although, every day, I question whether spotty coverage with a great phone would be better than great coverage with a spotty phone.

Which one can be corrected over time?
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post #21 of 87
Quote:
Originally Posted by AppleInsider View Post

The numbers serve to illustrate what a small portion smartphones are of the overall cell phone market. The top global brand during the quarter was Nokia, which sold a total of 107.8 million cell phones and smartphones during the quarter. Competitors Apple and RIM, however, do not sell traditional cell phones.

Isn't that the Nokia mentality fallacy?

Small by unit number shipped doesn't equal small in profit per handset -
It would be really interesting to see those figures giving ranking by profit made rather than handset number sold.
post #22 of 87
Quote:
Originally Posted by Dick Applebaum View Post

As an investor I would be interested in these figures too.

I suspect that Apple has the highest profit per unit, and highest profit within the smartphone category.



What also surprises me is how little the the completion understands what Apple does:

1) identify a market potential
2) determine why that potential isn't being realized (what others are doing wrong)
3) determine what is needed to do it right
4) determine how to do it at a reasonable (high) profit
5) just do it!


One can only imagine what Apple would provide if they decided to get into:

-- the cable network market
-- the TV market
-- the automobile market


To see examples of what I am talking about, just look at:

-- the I/O connections on the back of an iMac (a powerful computer) vs an HDTV, VCR, DVR, Cable Box (a dedicated appliance)
-- the remote control (or remote control app) for the above
-- the setup procedure for the above
-- the manual for the above


It's the User Experience, Stupids!

.

Agreed that's it in a nutshell! I think HP is getting the message with their acquisition of Palm's WebOS....still no one does it like Apple....I find cell phones, cable boxes, TV interfaces and most electronic equipment infuriating with their complex remotes, cables and crappy software. I wish Apple would hurry up and make a TV. Probably won't happen though!

I won't buy any software, or electronics unless it's made by Apple. Obviously, I've had to buy a flat screenTV, camera, printer and a DVD player. But I really try not to buy other stuff!

Best
post #23 of 87
Quote:
Originally Posted by solipsism View Post

How will showing YoY quarterly comparisons "bite Apple in the end"? These are facts, nothing more. They won't sway anyone to do anything, except perhaps add to their stock investment choice. For 3 years now we've seen quarterly stats and for 3 years now the iPhone has been growing. Where has this bitten Apple in the ass?

Let us take the theoretical numbers: Let's assume that a product sold

10,000 units (Q1 2007)
100,00 units (Q1 2008)
500,00 units (Q1 2009)
1,000,00 units (Q1 2010)
1,500,00 units (Q1 2011) -- forecast
etc

Calculate the sales growth rate. The numbers for Apple, or any other company would be different, obviously but I hope you get the point.

The growth rate is phenomenal during the early stages, but if the market is restricted, i.e., simply one carrier, the growth rate will eventually follow a sigmoidal curve. A phenomenon that many people would not know. One clueless journalist may then prepare a figure showing the eventual decline in the growth rate of an Apple product, and conclude incorrectly that there is a declining interest in the product. Example, the mature iPod market. Apple iPod share still is predominant by a wide margin from any other competitor.

And yet, an obscure company may have a very good growth rate but still outsell the predominant company. Example: Nokia, RIM vs Appke iPhone.

If you accept the premise of this article, that iPhone outsold Motorala, then be prepared to accept the possibilitythat Android may outsell iPhone eventually simply because there are more phone manufacturers that feed contract Androids to willing telecommunications company worldwide.

As I noted in another post in another thread. The iPhone might have defeated Motorola. So, why then not accept the fact that the iPhone was defeated by five other companies worldwide, Nokia beating Apple by a wide margin? It is like the "losers" of a raise competing among themselves who is the better.

As to the phenomenal 130% growth rate of iPhone, YoY, consider that during the period last year, 2009; the world economy was still in the midst of the worst recession. What made a difference in Apple was that the iPhone market was being marketed worldwide with a version better than the 2G.

If you standardize the growth rate or the percent share per total phone customer base, considering the worldwide expansion, you might be surprised what you will find.

Quote:
Originally Posted by solipsism View Post

First you say that people won't switch to a carrier to get the phone they want, then you say that brand loyalty is a known phenomena. DOES NOT COMPUTE It's been well documented that AT&T is gaining more customers and having less turnover since getting the iPhone.

There may be people who would switch carriers, that is not unheard of; however, considering more than two hundred million phone customers in the US, what is a few millions, or a few hundreds of thousands?

If memory serves me, the number or at least the growth rate of "new iPhone customers" might have been declining. [You are known for being able to tract information, so you may eitehr prove or disprove me on this.]

For one reason or another, I am sure you have heard how loud some Verizon customers "hate" AT&T, and would like to have an iPhone version for their company. Do you really think that these Verizon loyalists, who wanted so much to have an iPhone would switch to AT&T, if an iPhone for Verizon was available. I am sure you also have heard of those who had to give up their iPhone, after switching, because they were fed up with AT&T service. Or those who would leave AT&T once the iPhone is available in the carrier of their choice.

These are good examples of "brand loyalty" no matter how misplaced it might be.

You might be astounded how much increase in the total sales of the iPhone in the US, if Apple does decide to manufacture a version, perhaps for Verizon, or even Sprint or T-Mobile. I am sure there are reasons why Apple has not done so already. Perhaps, it is a "contract agreement" or the possibility that Apple has to tap the worldmarket. Or, it is possible that since Apple is really still a very new telephone manufacturer company, it may have decided to make a full handle of one technology, GSM, that happens to be the predominant worldwide.

The reality however is that most telephone manufacturers, Nokia, RIM, and all the Asians, and even the lowly and now merged Palm were able to create phones that will cater to variants of the same technology or different technologies, e.g,, Nexus One phones for GSM, including the T-Mobile variant, as well as the variants of CDMs specific for Verizon, Sprint. Similarly, other phone companies, e.g, RIM, were willing to manufacture a CDMA variant specific for the large China market.

Quote:
Originally Posted by solipsism View Post

So you are saying that AT&T has not increased their subscriber count because of the iPhone. I don't think that is just improbable, but impossible. I and many people I know certainly jumped to AT&T specifically for the iPhone. Do you have that report?

Our anecdotal experiences should not become the foundation of how the general population may behave. If I am not mistaken, many here have criticized the "geek POV" to mirror the buying patterns of the average consumer.

"I act [this way], therefore they must..."

When studying a river, do not be too enthralled with the eddies, or its tributaries and miss the general flow of the river.

CGC
post #24 of 87
Quote:
Originally Posted by t0mat0 View Post

Isn't that the Nokia mentality fallacy?

Small by unit number shipped doesn't equal small in profit per handset -
It would be really interesting to see those figures giving ranking by profit made rather than handset number sold.

This is one of the reasons why I stated earlier why Apple-centric sites should not gloat too much about Apple beating Motorola or some other phone manufacturer, especially when it comes to market share of all phones. And, in fact, even in thee more rarified :"high end" phone market.

The carriers, as gatekeepers, preclude any true competition.

For example, to my knowledge, RIM has consistently outsold the iPhone for many quarters now. Two possible reasons, RIM phones are sold by more telephone carriers. Also, many of those who may have gotten used to a RIM phone may be hesitant to "learn" new technologies (the maladay called "complacency") because they have gotten used to a product (brand loyalty).

Many claim that such phone sales grwoth came about only because of gimmicks like "two for 1", but how does that matter to the phone carriers, If both two phones are activated?

CGC
post #25 of 87
Quote:
Originally Posted by t0mat0 View Post

Isn't that the Nokia mentality fallacy?

Small by unit number shipped doesn't equal small in profit per handset -
It would be really interesting to see those figures giving ranking by profit made rather than handset number sold.

This is one of the reasons why I stated earlier why Apple-centric sites should not gloat too much about Apple beating Motorola or some other phone manufacturer, especially when it comes to market share of all phones. And, in fact, even in thee more rarified :"high end" phone market.

The carriers, as gatekeepers, preclude any true competition.

For example, to my knowledge, RIM has consistently outsold the iPhone for many quarters now. Two possible reasons, RIM phones are sold by more telephone carriers. Also, many of those who may have gotten used to a RIM phone may be hesitant to "learn" new technologies (the maladay called "complacency") because they have gotten used to a product (brand loyalty).

Many claim that such phone sales grwoth came about only because of gimmicks like "2 for 1", but how does that matter to the phone carriers, If both two phones are activated?

Quote:
Originally Posted by jragosta View Post

We don't know that.

AT&T is undoubtedly giving Apple a very sweet deal in order to get exclusivity. I have no idea what it is, but let's say it amounts to $100 extra per phone.

I would understand if Apple is truly bound without any loop hole to its contract with AT&T such that it has no recourse but to have exclusive contract until 2012.

However, if there is not such iron-clad contract, Apple may win the battle but lose the war. No matter how profitable such a deal might be with AT&T, it may lose potential iPhone customers in other carriers.

The technology is there to create iPhones for other GSM or CDMA variants.
Technology shall improve not only for the iPhone but also for others like the Android, perhaps even the HP-Palms, etc.
If these technologies may become good enough, customers that do not want to switch customers will be satisfied with the available brand, other than iPhone
Even if the iPhone becomes avalaible to other phone carriers, those customers who already got accustomed ("good neough" conditioning creating "brand loyalty") may no longer be as intrigued to switch brands)

When it comes to "virgin territories", those who got rich may not always be because they are the best or most cunning, it may only because they were there first.


CGC

Edit: read observation by "newbee" below. Thanks. I meant to state, as corrected: " Apple may win the battle but lose the war."
post #26 of 87
Quote:
Originally Posted by cgc0202 View Post

Let us take the theoretical numbers: Let's assume that a product sold

10,000 units (Q1 2007)
100,00 units (Q1 2008)
500,00 units (Q1 2009)
1,000,00 units (Q1 2010)
1,500,00 units (Q1 2011) -- forecast
etc

Calculate the sales growth rate. The numbers for Apple, or any other company would be different, obviously but I hope you get the point.

Sold 10,000 units (Q1 2007)
Growth of 90,000 units YoY (Q1 2008)
Growth of 400,00 units more YoY (Q1 2009)
Growth of 500,00 units more YoY (Q1 2010)
Growth of 500,00 units more YoY (Q1 2011

What you're talking about is growth represented as a percentage.

This is a completely different than simply stating the growth in units. It's also one that is only viable when all other relevant data is represented. Your original comment was ,"Apple-centric sites should not focus too much about quarter to quarter numbers because they will comeback to bite Apple in the end." This article has represented all the viable data points about growth, not just the percentages so I don't see what could possibly "bit them in the end".

Quote:
You might be astounded how much increase in the total sales of the iPhone in the US, if Apple does decide to manufacture a version, perhaps for Verizon, or even Sprint or T-Mobile.

It's unlikely that I would be astounded. I expect at least a 15 point jump if they do announce a Verizon iPhone. I have also stated, among other things, that Apple's inability to keep iPhone supplies up may be a reason why they haven't offered a Verizon iPhone; they simply can't produce enough as it is and Verizon's sales would likely trounce AT&T's sales. And if they do, it will be off cycle from the 3GSM iPhone.

However, that does not mean that people ARE NOT going to AT&T specifically to get the iPhone. There are plenty of reports showing that people are leaving other carriers to get the iPhone and that smartphone sales are up because of the iPhone.
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post #27 of 87
Quote:
Originally Posted by cgc0202 View Post

Many claim that such phone sales grwoth came about only because of gimmicks like "two for 1", but how does that matter to the phone carriers, If both two phones are activated?

There is a causality that makes that hard to refute.

You have it backwards, BOGO is good for the carriers because they get two contracts out of it. It's potentially bad for the vendor and potentially a bad sign for investors as it usually means they have lowered the wholesale price to push more product in an attempt to increase their bottom line. RiM has great management and have done exactly that, but at the expense of their per unit profit. This growth is typically harder to maintain.
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post #28 of 87
Quote:
Originally Posted by macarena View Post

Apple should find itself in 4th place this year. They would have beaten RIM already, except for the 2-for-1 promo by Verizon - but it is just a question of time before Apple go ahead of RIM and Sony-Ericcson.

Amazing, when you consider that Apple did not sell a single phone just 3 years back!

What's really amazing is that Apple has 3% of the world cellphone market but is actually getting about 30% of the world cellphone profits (sorry can't remember the figure exactly, but I know its between 25% and 33%.)
Apple really knows how to skim the cream and maximize profits (and all the haters keep whining about how they are so stupid, blowing it, etc.)
post #29 of 87
Quote:
Originally Posted by solipsism View Post

There is a causality that makes that hard to refute.

You have it backwards, BOGO is good for the carriers because they get two contracts out of it. It's potentially bad for the vendor and potentially a bad sign for investors as it usually means they have lowered the wholesale price to push more product in an attempt to increase their bottom line. RiM has great management and have done exactly that, but at the expense of their per unit profit. This growth is typically harder to maintain.

RIM are an interesting case. They're the only major manufacturer that get a cut of subscription fees. RIM can afford to offer a lower price per unit because they know that they can make it back from ongoing fees.

And let's not forget that RIM are a global company. The BOGOF offer isn't available worldwide.
post #30 of 87
Quote:
Originally Posted by cgc0202 View Post


However, if there is not such iron-clad contract, Apple may win the montary but lose the war.

CGC

In any business I ever heard of .... the montary is the war. ( I assume you meant monetary) If not, feel free to enlighten me.
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post #31 of 87
Quote:
Originally Posted by t0mat0 View Post


Small by unit number shipped doesn't equal small in profit per handset -
It would be really interesting to see those figures giving ranking by profit made rather than handset number sold.


Why would consumers be interested in that? This isn't an investment strategy site.
post #32 of 87
Quote:
Originally Posted by Stevie View Post

Why would consumers be interested in that? This isn't an investment strategy site.

Do you not read the articles on AI. They do a great deal of investor-based articles. Usually written by Neil Hughes.
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post #33 of 87
Quote:
Originally Posted by TheShepherd View Post

First you say that people won't switch to a carrier to get the phone they want, then you say that brand loyalty is a known phenomena. DOES NOT COMPUTE It's been well documented that AT&T is gaining more customers and having less turnover since getting the iPhone.

The last Strand report on cell phone market share showed that AT&T gained no market share from offering the iPhone. It might have prevented them from losing customers because of their service but not gaining customers.

I take all Strand reports with a grain of salt. Seems like he has a bone to pick with Apple.

For every quarter since iPhone arrived in 2007, AT&T has added postpaid subscribers and said 33-40%+ of iPhone subscribers were new to AT&T. New iPhone subscribers in some quarters was more than new postpaid subscribers due to churn (people leaving) and AT&T subscribers upgrading to iPhone. AT&T has also reduced postpaid churn by 18-20%.

Of course, it's possible that all those people would've joined AT&T even without iPhone, and that people would've stopped leaving AT&T without iPhone. But when you look at what happened at Verizon Wireless (increased postpaid churn by 20%), Sprint (continued postpaid subscriber losses), and T-Mobile (minimal gains) during these last 3 years, you'd find it very unlikely.
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post #34 of 87
Quote:
Originally Posted by cvaldes1831 View Post

Even more amazing considering that Apple only sells one model of smartphone at a time and zero dumbphones (a.k.a. "feature phones").

Are people still saying this rubbish, go to the Apple store, they sell more than one model of the iPhone
post #35 of 87
Quote:
Originally Posted by extremeskater View Post

It looks like someone in Verizon got the bright idea to force users to get a data plan on most of their phones including ones often used by teens simply for voice and text.

I can see the necessity for heavily subsidized phones, like the iPhone and Droid Incredible, but I don't think they offer many phones that are being subsidized by ~$300.

I'm also surprised AT&T hasn't raised the ETF fee to more closely match Verizon. I assume their subsidization of the iPhone is more than $175.
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post #36 of 87
Nothing personal intended here, but I find your posts confusing. They sound all technical and stuff but they don't convey much meaning to me. This part here where you mention the "sigmoid curve" and how folks don't understand it:
Quote:
Originally Posted by cgc0202 View Post

... The growth rate is phenomenal during the early stages, but if the market is restricted, i.e., simply one carrier, the growth rate will eventually follow a sigmoidal curve. A phenomenon that many people would not know. One clueless journalist may then prepare a figure showing the eventual decline in the growth rate of an Apple product, and conclude incorrectly that there is a declining interest in the product. Example, the mature iPod market. Apple iPod share still is predominant by a wide margin from any other competitor. ...

Couldn't you just say "S-curve" instead and talk about how this really means that sales will plateau once the market is saturated? How is that something that others don't know or wouldn't understand?

You also talk about how brand loyalty prevents switching, but the whole story of AT&T's success in the years since the iPhone is the absolutely unprecedented numbers of "switchers." I get the logical point you are trying to make and it's technically true, but it ignores what's actually happening.

All this theoretical stuff means nothing if what's happening is actually the reverse of your predictions and it seems to me that in general, it is.

Brand loyalty theoretically can prevent people from switching, and the constraints and antics of various carriers can also easily affect the uptake of new devices, but I don't see that this is actually happening with the iPhone nor does it seem likely to affect iPhone sales at all in the near future. These are interesting theories overall, but I don't see the substance.
post #37 of 87
Quote:
Originally Posted by cgc0202 View Post

The growth rate is phenomenal during the early stages, but if the market is restricted, i.e., simply one carrier, the growth rate will eventually follow a sigmoidal curve. A phenomenon that many people would not know.

Here is iPhone's YOY unit sales growth beginning with 2008 Apr-Jun qtr:
166%, 516% (iPhone 3G launch), 88%, 123%, 626% (iPhone 3GS launch), 7%, 100%, and 131%.

Except for one quarter, Apple managed to at least double (or almost double) sales YOY by appropriately setting launch dates throughout the world. The one no-doubling quarter occurred because in 2008 it was the launch quarter and in 2009, it was not. Regardless, did anyone notice it?

Apple doesn't really care about market share per se, and it's focus isn't on market share. Nokia talks about market share in its quarterly results press release. Apple talks about units sold, ASP and profit. You can see the difference. However, Apple does care a lot about having enough iPhone OS units in the market so that developers will develop Apps for it, because Apps are essential to the PLATFORM Apple is building. So Apple keeps bringing up 85 million (even though some original iPhones have been turned into no-phone-service-iPod-touch or put in drawers) to remind developers of the right perspective. The platform is what Apple believes is its sustainable advantage over all its smartphone competitors.

A platform is more than just a common OS. It includes common UI items/gestures, common Apps, continued OS upgrades, common SDK (and continued SDK upgrades), common peripherals, common product naming, etc. Google is also trying to build a platform, but by giving freedom to each hardware mfr to add a different UI, and freedom to each carrier to not provide OS upgrades and refuse basic apps, and by having a second different OS/SDK for tablets, Android is a much more fragmented platform. (Here's a research topic: How much fragmentation can a platform withstand before it loses most of its benefits?) RIM also has a "platform" but their platform is really split by having keyboard-based phones, and touchscreen-based phones. And their touchscreen-based product (Storm) and SDK are poor. Nokia is building multiple platforms, and by moving to a new UI for Symbian^3 and the new MeeGo, they will for the most part, be starting again. HP recognizes the importance of platform and that's why they just bought Palm. But they have much work to do. With regard to building a platform, Apple is ahead and continuing to move further forward.
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post #38 of 87
Quote:
Originally Posted by mark2005 View Post

The one no-doubling quarter occurred because in 2008 it was the launch quarter and in 2009, it was not. Regardless, did anyone notice it?

That first quarter that you couldn't find an iPhone anywhere. They literally had stopped producing them sometime before April. It shows it was up 166% but remember that they only sold the original iPhone for a weekend before that quarter ended.

I recall this vividly because even though the 3G iPhone was imminent for release in July I (and many others, included NasserAE) were able to sell their original iPhone for more than retail price.


edit: It looks like it was Friday after 5pm sales and all of Saturday before that quarter ended.
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post #39 of 87
Quote:
Originally Posted by mark2005 View Post

Apple doesn't really care about market share per se, and it's focus isn't on market share. Nokia talks about market share in its quarterly results press release. Apple talks about units sold, ASP and profit. You can see the difference. However, Apple does care a lot about having enough iPhone OS units in the market so that developers will develop Apps for it, because Apps are essential to the PLATFORM Apple is building. So Apple keeps bringing up 85 million (even though some original iPhones have been turned into no-phone-service-iPod-touch or put in drawers) to remind developers of the right perspective. The platform is what Apple believes is its sustainable advantage over all its smartphone competitors.

If Apple doesn't care about market share, then why did Steve Jobs mention it in the original iPhone announcement, and why does he mention it during his other announcements?
post #40 of 87
This is just a convoluted and overly complicated way to say that you want the iPhone on Verizon.

It would be more interesting if it were not for the fact that this past quarter AT&T added a record number of iPhone's. AT&T had less churn than Verizon and AT&T added more subscribers than Verizon. I'm not saying that Apple should not expand the iPhone to more carriers, there is little reason why they could not use T-Mobile. At the same time people keep coming up with these ATT/Apple dooms day scenarios that never play out.

Quote:
Originally Posted by cgc0202 View Post

For one reason or another, I am sure you have heard how loud some Verizon customers "hate" AT&T, and would like to have an iPhone version for their company. Do you really think that these Verizon loyalists, who wanted so much to have an iPhone would switch to AT&T, if an iPhone for Verizon was available. I am sure you also have heard of those who had to give up their iPhone, after switching, because they were fed up with AT&T service. Or those who would leave AT&T once the iPhone is available in the carrier of their choice.
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