Massive Android activations not viewed as concern for Apple

Posted:
in iPhone edited January 2014
Though activations of new Android devices are now significantly outpacing iOS, it is viewed as representative of a larger trend of surging growth in the smartphone market, which will also benefit Apple.



Analyst Gene Munster with Piper Jaffray said Friday he remains comfortable with his estimate of 16 million iPhone units sold in the June quarter, despite Google's announcement on Thursday that Android activations are now greater than 550,000 per day. The search giant revealed in its quarterly earnings report that total Android activations for its June quarter were about 50 million units, up 57 percent quarter over quarter.



For comparison, Munster has projected Apple will have activated 29 million iOS-powered devices in the June quarter, including the iPhone, iPad and iPod touch. That would be an increase of just 2 percent quarter over quarter.



"Apple's numbers are deceivingly low given the shift in timing of the iPhone upgrade," Munster wrote in a note to investors. "We believe iOS devices would have been up ~20% (quarter over quarter) if iPhone 5 had shipped in June."



He believes there are two clear winners in the growing smartphone market with Google's Android and Apple's iOS. And in his view, Android activations are evidence of how significant that growth is, which is a trend that will benefit Apple and sales of its iPhone.



Munster also noted that Android is available on multiple devices in various configurations from a variety of hardware manufacturers. In contrast, the iPhone and iPad lineup is extremely limited, which makes a direct comparison somewhat unfair.



He also said that Android appears to be having great success in prepaid emerging markets, while Apple has not seen as strong of a performance in those countries. He does not, however, expect that Apple will introduce a new low-end iPhone this year, as some others have predicted.







Instead, Munster sees Apple shifting previous-generation iPhones into emerging markets in the next year. That aligns with one report that claimed Apple will keep around its iPhone 3GS, first released in 2009, after the debut of a fifth-generation iPhone this year.



When that fifth-generation iPhone is released this year, Munster expects to see a "huge spike" in iPhone sales in the September quarter. In that period, he sees total sales reaching 21 million.
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Comments

  • Reply 1 of 167
    steven n.steven n. Posts: 1,021member
    There can be only one. The mobile pie is actually big enough for 3-5 successful and highly profitable platforms.
  • Reply 2 of 167
    solipsismsolipsism Posts: 25,726member
    I think we could have over 30 million iPhone, iPod Touch, iPad and AppleTV devices activated for this quarter. That's only 330,000 activations per day but that's the bulk of the industry's profit.



    If anything I think Android users should thank Apple for creating a new road and settling the primitive market that for so long was occupied by the indigenous feature phone.
  • Reply 3 of 167
    jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by Steven N. View Post


    There can be only one. The mobile pie is actually big enough for 3-5 successful and highly profitable platforms.



    Agreed, although I'm very suspicious of the 550,000 activations per day figure since it can't be verified by anyone else - and Google refuses to provide any sales figures to back it up.



    Apple SOLD 16 million iPhones in the quarter and Google claims 50 million activations. Does anyone really believe that they sold 3 Android phones for every iPhone? Based on what I'm seeing in the real world, that doesn't seem remotely plausible.



    If Google were being honest, they're report how many phones were sold (and don't tell me they don't know - they get a record of how many Android licenses are issued each quarter). Or tell us how many activations are counted per phone. I'll bet the number is significantly greater than 1.



    Don't compare apples and oranges.
  • Reply 4 of 167
    fuwafuwafuwafuwa Posts: 163member
    With 10/90 Android rule, 1 good Android and 9 craps & turds, it's not compelling enough for developer to develop on Android.
  • Reply 5 of 167
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by Steven N. View Post


    There can be only one. The mobile pie is actually big enough for 3-5 successful and highly profitable platforms.



    I think that's bad business for Android. For Android to be desirable to consumers, devs, and vendors Android needs to have a strong dominance. It's the single vendor OSes that can be highly successful with a slice of the pie.



    Part of the reasoning is that Android, just like Windows first competes against all the vendors within their marketshare slice. This ultimately weakens the profit that can be had by a single vendor and will inevitable trickle down to devs and users in many negative ways.



    Windows has about 95% worldwide OS marketshare but the leading PC vendor, HP, only has around 20%. Imagine if they had that 20% taken from only 50% Windows marketshare.



    Android needs to figure out how to get on top or risk a mass exodus from vendors to the safer and more profitable options.
  • Reply 6 of 167
    chabigchabig Posts: 619member
    Quote:
    Originally Posted by solipsism View Post


    I think we could have over 30 million iPhone, iPod Touch, iPad and AppleTV devices activated for this quarter. That's only 330,000 activations per day but that's the bulk of the industry's profit.



    If anything I think Android users should thank Apple for creating a new road and settling the primitive market that for so long was occupied by the indigenous feature phone.



    The analyst (Munster) was quoted in the article saying that Apple activated 29 million iOS devices in June alone. June has 30 days. That's almost 1 million per day...still well ahead of Android. (Edit: I now think the quote was wrong and he meant the June quarter.)
  • Reply 7 of 167
    cloudgazercloudgazer Posts: 2,161member
    Quote:
    Originally Posted by jragosta View Post


    Apple SOLD 16 million iPhones in the quarter and Google claims 50 million activations. Does anyone really believe that they sold 3 Android phones for every iPhone? Based on what I'm seeing in the real world, that doesn't seem remotely plausible.



    It's definitely not true in the USA or the EU, but it could be true in Asia. It would really be nice if Google provided some kind of geographic breakdown, or carrier breakdown, or OEM breakdown. Any granularity at all really.
  • Reply 8 of 167
    nofeernofeer Posts: 2,422member
    perhaps we can get a breakdown by

    android operating system,



    and buy one get one



    price target



    android is attacking the middle and now low end just to get the phones in peoples hands



    BUT

    with iphone 4, 3gs at $50 or free that will help and apple is thinking hard and deep about the prepaid market like india, and china



    both will grow they both have momentum and RIM, nokia to the wayside MS will buy market share.
  • Reply 9 of 167
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by chabig View Post


    The analyst (Munster) was quoted in the article saying that Apple activated 29 million iOS devices in June alone. June has 30 days. That's almost 1 million per day...still well ahead of Android.



    I read that to mean June quarter. So how did they get that? If Apple does sell 20 million iPhones for the june quarter that's only about 6-7 million iPhones per month. How does he account for the other 23-24 million iOS-based activations?
  • Reply 10 of 167
    gwydiongwydion Posts: 1,067member
    Quote:
    Originally Posted by jragosta View Post


    Or tell us how many activations are counted per phone. I'll bet the number is significantly greater than 1.





    Why do you bet that? What do you think an activation is?
  • Reply 11 of 167
    mrmj2umrmj2u Posts: 34member
    These numbers are deceiving. They are new phone activations which to me could mean that the massive number of phones being activated could be replacements for poorly built phones. I and many of my friends who have iPhones have had the same device for over two years now. I'm constantly seeing my other friends who have the latest flavor of 'droid' going back to the store or calling their insurance for a replacement device. Each of these replacements are then activated and feed this number of 'new phone activations.' People in this situation are not in a position to switch phones all together because that would mean more money out of their pockets.
  • Reply 12 of 167
    akhomerunakhomerun Posts: 386member
    Quote:
    Originally Posted by jragosta View Post


    Agreed, although I'm very suspicious of the 550,000 activations per day figure since it can't be verified by anyone else - and Google refuses to provide any sales figures to back it up.



    Apple SOLD 16 million iPhones in the quarter and Google claims 50 million activations. Does anyone really believe that they sold 3 Android phones for every iPhone? Based on what I'm seeing in the real world, that doesn't seem remotely plausible.



    If Google were being honest, they're report how many phones were sold (and don't tell me they don't know - they get a record of how many Android licenses are issued each quarter). Or tell us how many activations are counted per phone. I'll bet the number is significantly greater than 1.



    Don't compare apples and oranges.



    Of course, we all know that Apple takes 50% of the smartphone profits, so even Android's inflated numbers are no match for the profit numbers.



    Apple's numbers are extremely impressive given that they are only on two networks. You can buy Android phones on every cell phone network including prepaid and regional networks.



    I imagine the Sprint iPhone should be around the corner, and I'm not sure why there isn't a T-Mobile one yet either (maybe Apple is now figuring AT&T will just eat them up)
  • Reply 13 of 167
    solipsismsolipsism Posts: 25,726member
    Quote:
    Originally Posted by Gwydion View Post


    Why do you bet that? What do you think an activation is?



    It's a legitimate concern to know what counts as an activation. If you buy an Android phone and it's returned a week later because it's faulty for a replacement Android phone is that 2 activations? If you return it for an iPhone does that still count as 1 activation? Does flashing the ROM to then root the device count as an activation? Does each new gmail account added to the device (e.g., selling it) count as an activation?
  • Reply 14 of 167
    gwydiongwydion Posts: 1,067member
    Quote:
    Originally Posted by akhomerun View Post


    Apple's numbers are extremely impressive given that they are only on two networks. You can buy Android phones on every cell phone network including prepaid and regional networks.



    There is a world outside USA
  • Reply 15 of 167
    As much as I hate to admit this, under the current roll-out strategy the iphone in the long run is going to be marginalized and end up with a static (i.e. replacement level) and then eventually greatly reduced market share.



    Go to any cell store in the USA and you're slammed with tons of visually impressive Android devices. I have had bad success lately convincing people to go with iphone (which I still don't understand but that Droid marketing is very very successful on Verizon). The android selection is so large, prices initially cheaper, that the single iphone just looks pathetic next too all these crappy functioning but visually impressive devices.



    Hope I am wrong. But I don't believe the iphone is going to stay at it's current level given the onslaught of devices it faces.
  • Reply 16 of 167
    gwydiongwydion Posts: 1,067member
    Quote:
    Originally Posted by solipsism View Post


    It's a legitimate concern to know what counts as an activation. If you buy an Android phone and it's returned a week later because it's faulty for a replacement Android phone is that 2 activations? If you return it for an iPhone does that still count as 1 activation? Does flashing the ROM to then root the device count as an activation? Does each new gmail account added to the device (e.g., selling it) count as an activation?



    Upgrades, rom installations or devices withouth google services doesn't account for activations
  • Reply 16 of 167
    niksternikster Posts: 14member
    Quote:
    Originally Posted by jragosta View Post


    Agreed, although I'm very suspicious of the 550,000 activations per day figure since it can't be verified by anyone else - and Google refuses to provide any sales figures to back it up.



    Apple SOLD 16 million iPhones in the quarter and Google claims 50 million activations. Does anyone really believe that they sold 3 Android phones for every iPhone? Based on what I'm seeing in the real world, that doesn't seem remotely plausible.



    If Google were being honest, they're report how many phones were sold (and don't tell me they don't know - they get a record of how many Android licenses are issued each quarter). Or tell us how many activations are counted per phone. I'll bet the number is significantly greater than 1.



    Don't compare apples and oranges.



    I doubt the number of activations is much bigger than 1 - unless they're stupid enough to count used android sales, which are pretty significant at least where I live. In that sense Apple should maybe counter with "activations" for iPhones - I know 2nd hand 3GS, and 2G are hot sellers around these parts...



    Nevertheless, I can believe these numbers on one factoid alone: Android phones cost as little as half as much as an iPhone. I can get a $300 Android device here; the iPhone costs $660 and up.



    Price isn't that big a factor in subsidy-countries like the USA and much of western Europe. But it's a HUGE deal here in SE Asia.



    I also know that anyone who can afford it has an iPhone. Android phones are for those who can't afford an iPhone, and for a handful of people who want to be "different".



    In summary - iOS is doing just fine. In fact, considering how many competitors are making Android phones, Apple is currently wiping the floor with the competition. Android remains the "iPhone alternative" by default.
  • Reply 18 of 167
    pokepoke Posts: 506member
    Quote:
    Originally Posted by solipsism View Post


    It's a legitimate concern to know what counts as an activation. If you buy an Android phone and it's returned a week later because it's faulty for a replacement Android phone is that 2 activations? If you return it for an iPhone does that still count as 1 activation? Does flashing the ROM to then root the device count as an activation? Does each new gmail account added to the device (e.g., selling it) count as an activation?



    There were a number of reports that "activations" were instances of a manufacturer putting Android on a device and not consumers registering the phone. Google denied that it included upgrades though.
  • Reply 19 of 167
    gwydiongwydion Posts: 1,067member
    Quote:
    Originally Posted by poke View Post


    There were a number of reports that "activations" were instances of a manufacturer putting Android on a device and not consumers registering the phone. Google denied that it included upgrades though.



    Which reports?
  • Reply 20 of 167
    island hermitisland hermit Posts: 6,217member
    Quote:
    Originally Posted by Gwydion View Post


    Upgrades, rom installations or devices withouth google services doesn't account for activations



    Source?
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