If you were deciding among an XBox, A Wii or a Playstation, would you check the profit? How does that count?
Bad examples, gaming consoles are sold at either a loss or very low margin, the money is made on the games. The reason why that business model works is because you absolutely have to buy games for the console to be of any use.
Samsung has stopped breaking out unit sales in its earnings reports, but estimates from research group Strategy Analytics late Friday pegged the company's quarterly mobile phone shipments at 88 million for the third quarter. Of those devices, 27.8 million were presumed to be smartphones.
I would say that the 27.8mil smartphones is just a guess by an analyst as Samsung doesn't give any "real" numbers anymore.
Samsung's profit for its mobile phone division went from $1.05 billion USD in Q3 '10 to $2.3 billion USD in Q3 '11. I'd say that's a pretty massive jump for them.
From being told by every pundit and analyst not to enter the mobile handset market because they would destroy the company to being #2 smartphone maker in the world is a success in any book. But somehow, by the tone of these posts, Apple has failed? Really?
ZTE are Chinese. Eventually everything will be Chinese.
IF ZTE starts copying Apple in China and selling the ripoffs to that large market, what success do you think Apple will have for patent protect in the Chinese courts?
Samsung's profit for its mobile phone division went from $1.05 billion USD in Q3 '10 to $2.3 billion USD in Q3 '11. I'd say that's a pretty massive jump for them.
I don't get the kind of Apple fans who want them to make profits over market share, and eulogise the iPhones margin's and Apple's profits. Apple should continue with high end ( even higher end) devices, and also go for the low medium end devices. It needs to increase market share, which is what Tim Cook himself points out.
Because it's a brilliant strategy. Every market contains good (high-margin) and bad (low-margin) parts. Apple monopolises the good parts and ignores the bad parts (it's this, and not screwing their customers, that gives them their high margins), this pushes the competitors into the bad parts. This is unsustainable, since margins become razor thin if you only have the extremely price-conscious, product-apathetic section of the market. Innovation stops and the market becomes ripe for disruption. Apple wins by ceding bad markets to its competitors.
Low-margins are not good for customers. Imagine you're a Nokia user right now and have invested a huge amount of your time and effort in Symbian. Well, now you're feeling the effect of being part of Nokia's low-margin, unsustainable ecosystem. Enjoy.
Bad examples, gaming consoles are sold at either a loss or very low margin, the money is made on the games. The reason why that business model works is because you absolutely have to buy games for the console to be of any use.
OK, but the point is the same. Does anybody check the profitability of an item prior to purchase? My point was that consumers don't use manufacturer profitability as a factor in making purchases, maybe except for exceptional situations.
For those who wonder why Samsung is fighting Apple tooth and nail in court or why Apple seems to be targeting Samsung more than anyone else, the answer should be clear. Apple went after HTC first when the Taiwan company was the first successful Android maker. The moment that Galaxy had a hint of success, the sights on Apple's legal guns switched to South Korea.
For those who wonder why Samsung is fighting Apple tooth and nail in court or why Apple seems to be targeting Samsung more than anyone else, the answer should be clear. Apple went after HTC first when the Taiwan company was the first successful Android maker. The moment that Galaxy had a hint of success, the sights on Apple's legal guns switched to South Korea.
The stakes are very, very high.
So what will happen if Apple legal team go against someone with a BETTER legal team than them, and lose? Will Apple need a new plan instead of suing successful rivals out of the market?
A street racers' proverb was 'No matter how much you got in your car, there are someone out there with more'.
OK, but the point is the same. Does anybody check the profitability of an item prior to purchase? My point was that consumers don't use manufacturer profitability as a factor in making purchases, maybe except for exceptional situations.
I don't think people here argue that they buy Apple products because Apple is profitable. Usually profitability is brought up when somebody argues that Apple is "losing." Profitability is a sign of sustainability and longevity. Being the most profitable vendor means that Apple isn't going anywhere. It means it has leverage. Having the most marketshare does not mean the same thing. A company can have the most marketshare and be failing. I think it's disingenuous to suggest that people here think that Apple's profitability is part of a purchasing consideration or to imply that that's the only thing people should be concerned about.
That said, having high-margins does not mean, as you imply, that Apple is screwing people. Some markets are high-margin, some are low-margin. In low-margin markets an item is priced close to its component costs whereas in high-margin markets the value is perceived to be in something else. Quite clearly, people don't buy iPhones because they want a touchscreen, a CPU, a battery and a camera, plus assembly. They're buying the latest OS version and the promise of regular updates. They're buying access to a well-stocked, curated app market. They're buying into a set of services. They're buying exceptional support. They're buying into a media ecosystem. They're buying into an incredible track record of innovation, much of which has been delivered to existing users free of cost. And, yes, they're buying into a brand and everything that comes with that. The value of those things has little to do with the cost of hardware components or the cost of the components plus the cost of running the services.
The thing is - that argument is made by Apple fans ( but only when market share is in decline) but not by Apple, who never mention gross margin outside of financial conference calls where they have to. When Tim Cook gets up on stage he shows graphs of Apple's market share, he doesn't sugar the pill. He shows Apple at a mere 5% of all mobile shipments, and says he wants to go higher as all phones will be smart some day. That means going cheaper.
This doesn't sully Apple's brand because they still have the high end stuff ( similar to iPods).
It doesn't necessarily mean going cheaper. It can also mean convincing the remaining 95% that Apple has something worth spending more for. I think the point of showing iPhone as a percentage of the phone market, rather than the smartphone market, is that they're going after non-consumption. They can convince people with non-smart phones of the value proposition of owning an iPhone rather than compete with Android and other smartphones.
So what will happen if Apple legal team go against someone with a BETTER legal team than them, and lose? Will Apple need a new plan instead of suing successful rivals out of the market?
A street racers' proverb was 'No matter how much you got in your car, there are someone out there with more'.
Like I implied, interesting times ahead. Never in history have we seen such a high stakes legal battle between a manufacturer and its largest customer, particularly when the supply relationship intersects with the market in conflict.
Comments
£319 for a 3GS 8GB sim free.
The android phones vary wildly, but the lowest I've found is £200 (Samsung Galaxy Ace). HTCs start at £300 and go up from there.
£319 is right. If Apple continue the 3GS next year if the Ip5 comes out selling at ( say) £250 they could take back a lot of market.
If you were deciding among an XBox, A Wii or a Playstation, would you check the profit? How does that count?
Bad examples, gaming consoles are sold at either a loss or very low margin, the money is made on the games. The reason why that business model works is because you absolutely have to buy games for the console to be of any use.
Samsung has stopped breaking out unit sales in its earnings reports, but estimates from research group Strategy Analytics late Friday pegged the company's quarterly mobile phone shipments at 88 million for the third quarter. Of those devices, 27.8 million were presumed to be smartphones.
I would say that the 27.8mil smartphones is just a guess by an analyst as Samsung doesn't give any "real" numbers anymore.
Samsung's profit for its mobile phone division went from $1.05 billion USD in Q3 '10 to $2.3 billion USD in Q3 '11. I'd say that's a pretty massive jump for them.
http://www.samsung.com/us/aboutsamsu...erence_eng.pdf
Samsung 3Q profit slides 23 percent
http://www.sfgate.com/cgi-bin/articl...f021406D34.DTL
ZTE are Chinese. Eventually everything will be Chinese.
IF ZTE starts copying Apple in China and selling the ripoffs to that large market, what success do you think Apple will have for patent protect in the Chinese courts?
Samsung's profit for its mobile phone division went from $1.05 billion USD in Q3 '10 to $2.3 billion USD in Q3 '11. I'd say that's a pretty massive jump for them.
http://www.samsung.com/us/aboutsamsu...erence_eng.pdf
Samsung 3Q profit slides 23 percent
http://www.sfgate.com/cgi-bin/articl...f021406D34.DTL
The topic at hand is mobile phones.
I don't get the kind of Apple fans who want them to make profits over market share, and eulogise the iPhones margin's and Apple's profits. Apple should continue with high end ( even higher end) devices, and also go for the low medium end devices. It needs to increase market share, which is what Tim Cook himself points out.
Because it's a brilliant strategy. Every market contains good (high-margin) and bad (low-margin) parts. Apple monopolises the good parts and ignores the bad parts (it's this, and not screwing their customers, that gives them their high margins), this pushes the competitors into the bad parts. This is unsustainable, since margins become razor thin if you only have the extremely price-conscious, product-apathetic section of the market. Innovation stops and the market becomes ripe for disruption. Apple wins by ceding bad markets to its competitors.
Low-margins are not good for customers. Imagine you're a Nokia user right now and have invested a huge amount of your time and effort in Symbian. Well, now you're feeling the effect of being part of Nokia's low-margin, unsustainable ecosystem. Enjoy.
Bad examples, gaming consoles are sold at either a loss or very low margin, the money is made on the games. The reason why that business model works is because you absolutely have to buy games for the console to be of any use.
OK, but the point is the same. Does anybody check the profitability of an item prior to purchase? My point was that consumers don't use manufacturer profitability as a factor in making purchases, maybe except for exceptional situations.
The stakes are very, very high.
For those who wonder why Samsung is fighting Apple tooth and nail in court or why Apple seems to be targeting Samsung more than anyone else, the answer should be clear. Apple went after HTC first when the Taiwan company was the first successful Android maker. The moment that Galaxy had a hint of success, the sights on Apple's legal guns switched to South Korea.
The stakes are very, very high.
So what will happen if Apple legal team go against someone with a BETTER legal team than them, and lose? Will Apple need a new plan instead of suing successful rivals out of the market?
A street racers' proverb was 'No matter how much you got in your car, there are someone out there with more'.
Asus is already in the Android business, just not with phones:
Asus EeePad Transformer currently Amazon?s best-selling tablet
http://www.eurodroid.com/2011/06/22/...elling-tablet/
Asus Transformer Tablet: Surprising Second Best in Sales After Apple iPad
http://www.pcworld.com/article/23592...pple_ipad.html
Yep, what a shame their joint venture with Garmin is now dead and buried. Same goes for Sony Erickson.
Say, Sony bought shares from Erickson and all Xperia handsets will be labeled Sony from 2012. Should Asus phone go it alone as well?
OK, but the point is the same. Does anybody check the profitability of an item prior to purchase? My point was that consumers don't use manufacturer profitability as a factor in making purchases, maybe except for exceptional situations.
I don't think people here argue that they buy Apple products because Apple is profitable. Usually profitability is brought up when somebody argues that Apple is "losing." Profitability is a sign of sustainability and longevity. Being the most profitable vendor means that Apple isn't going anywhere. It means it has leverage. Having the most marketshare does not mean the same thing. A company can have the most marketshare and be failing. I think it's disingenuous to suggest that people here think that Apple's profitability is part of a purchasing consideration or to imply that that's the only thing people should be concerned about.
That said, having high-margins does not mean, as you imply, that Apple is screwing people. Some markets are high-margin, some are low-margin. In low-margin markets an item is priced close to its component costs whereas in high-margin markets the value is perceived to be in something else. Quite clearly, people don't buy iPhones because they want a touchscreen, a CPU, a battery and a camera, plus assembly. They're buying the latest OS version and the promise of regular updates. They're buying access to a well-stocked, curated app market. They're buying into a set of services. They're buying exceptional support. They're buying into a media ecosystem. They're buying into an incredible track record of innovation, much of which has been delivered to existing users free of cost. And, yes, they're buying into a brand and everything that comes with that. The value of those things has little to do with the cost of hardware components or the cost of the components plus the cost of running the services.
The thing is - that argument is made by Apple fans ( but only when market share is in decline) but not by Apple, who never mention gross margin outside of financial conference calls where they have to. When Tim Cook gets up on stage he shows graphs of Apple's market share, he doesn't sugar the pill. He shows Apple at a mere 5% of all mobile shipments, and says he wants to go higher as all phones will be smart some day. That means going cheaper.
This doesn't sully Apple's brand because they still have the high end stuff ( similar to iPods).
It doesn't necessarily mean going cheaper. It can also mean convincing the remaining 95% that Apple has something worth spending more for. I think the point of showing iPhone as a percentage of the phone market, rather than the smartphone market, is that they're going after non-consumption. They can convince people with non-smart phones of the value proposition of owning an iPhone rather than compete with Android and other smartphones.
So what will happen if Apple legal team go against someone with a BETTER legal team than them, and lose? Will Apple need a new plan instead of suing successful rivals out of the market?
A street racers' proverb was 'No matter how much you got in your car, there are someone out there with more'.
Like I implied, interesting times ahead. Never in history have we seen such a high stakes legal battle between a manufacturer and its largest customer, particularly when the supply relationship intersects with the market in conflict.