I posted the following charts from Asymco (one of the best AAPL analysis sites on the net) on another thread about Apple becoming the number 4 handset (not just smartphones) vendor in the world but I'll post them here again. This whole iOS vs. Android "war" needs to be viewed from a wider perspective than just number of units shipped. It may
seem like all these Android phone makers are in an alliance to take on Apple, but the truth is that they're beating up on each other to a pulp with much lower margins than Apple and giving away phones to merely gain units market share. It's no wonder Google uses the term "activation" instead of units actually
sold.
UNIT
SALES
PROFITS (Earnings Before Interest and Taxes)
There's another interesting article from Asymco titled 'Android's Pursuit of the Biggest Losers' that needs to be read to gain the bigger perspective on all of this.
http://www.asymco.com/2010/08/17/and...iggest-losers/
In the last quarter, let's consider that Motorola sold 9.1 million phones (3.8 million smartphones) and turned a paltry profit of $3 million. Sure, Motorola apparently has other internal problems because we can safely assume that the likes of Samsung and HTC are making more per smartphone than Motorola, but this still brings up the point that it's a race to the bottom for the Android handset makers. In reality, the Android phone makers are competing more with each other than they are with the iPhone. One more Droid sold means one less Evo or Captivate and vice versa as well as one less iPhone or a Symbian phone or a RIM.
There's a good reason why Nokia won't adopt the Android, why Samsung is also adopting the WP7 and developing their own OS/platform called Bada, and why HP also refused to take on Android and acquire Palm's webOS. These giants looked at Android long-term and decided that Android is a losing proposition - revenue-wise and profit-wise. It also seems LG, the world's third largest handset maker, has also decided to focus on WP7 rather than Android. Samsung and HTC are also offering WP7 phones, further scattering their development, manufacturing, and marketing resources and pulling away their focus from Android.
On top of this, these upper tier phone vendors have to look over their shoulders and cast their wary eyes on the coming flood of super cheap Android phones from a horde of smaller phone makers in China, India and other developing nations. With dozens, perhaps hundreds, of phone makers all offering various versions of Android with their own UI's and features, the fragmentation and the ensuing chaos won't be a pretty sight. Let's remember these "other" phone makers that we've never heard of are already producing well over 300 million phones per year.
We all know that all cellphones will eventually become smartphones in the years ahead. Well, since Android is free, you can expect every phone maker in the third world to adopt it as well. Without a doubt, Android will become the de facto standard third world phone unless Nokia can somehow stem the tide. But that seems rather unlikely. The governments in China and India will give their local phone manufacturers favorable terms so they can dominate the local markets. The affluent and the growing middle class in these countries will go for the brand and differentiated products and ecosystem. Yes, they'll want Apple and will gladly pay a lot more for one.
And the likes of HP, Samsung, LG, RIM, and Nokia want to be where Apple is at, not where things are going with Android. They look at Android and see that it benefits no one except Google in a roundabout way - more ad hits to generate Google's ad revenues. They have no desire to compete with the coming flood of cheap Android phones from these no-name phone makers based in the third world. After all, it's about making money, not a charity.
