Apple and Samsung 'rule the roost' with 90% of mobile industry's profits
Apple and Samsung are expected to collectively earn 90 percent of profits in the mobile handset industry this year, with no formidable challengers in sight.
UBS Investment Research published a note on Thursday in which it estimated that Apple and Samsung will enjoy 90 percent of the mobile handset industry's earnings before interest in taxes. In addition, the two companies are said to currently account for more than 50 percent of total industry revenues.
Samsung and Apple's share of profits are expected to grow as Samsung's margins are projected to improve to the high teens. Apple's margins, meanwhile, lead the industry, allowing it to take 75 percent of mobile phone profits with just 9 percent of units sold.
UBS has increased its estimated iPhone sales for Apple's fiscal year 2013 to 156.5 million, up from its prior estimate of 149.5 million. The firm expects that Apple is preparing to build a record number of sixth-generation iPhones for its biggest product launch ever later this year.
"Apple has been consistently accelerating the pace of each successive iPhone launch, expanding both country and carrier rollouts within a shorter timeframe," analyst Maynard Um wrote. "For the iPhone 4S Apple launched in 29 countries within 2 weeks of the initial launch, the iPhone 4 was launched in 2 countries within 6 weeks of launch, and the iPhone 3GS was launched in 14 countries within 1 week of its initial launch."
UBS expects the next iPhone will be a completely redesigned model that will drive a stronger-than-average upgrade cycle for existing iPhone users. The updated hardware is also expected to encourage other smartphone and non-smartphone users to switch to Apple.
The only other handset manufacturers outside of Apple and Samsung that UBS sees making a potential splash in 2012 are Huawei and HTC. As for Nokia, the Finnish handset maker is projected to sell only 2.9 million of its Windows Phone-based Lumia smartphones in the first quarter of the year.
[ View article on AppleInsider ]
Comments
I'm starting to wonder if all the tech reviewers who fawn over the Metro interface are just totally out of touch with mainstream consumers. Maybe mainstream consumers look at a bunch of monochromatic boxes with tons of text and feel simultaneously bored and overloaded with information. Maybe consumers really just prefer the simple yet colorful grid of icons approach that Apple has taken and Samsung has aped.
If that's true -- if the failure of WP7 (and the Zune before it) is as much about consumer dislike of the critically acclaimed Metro interface as about first mover advantages and all the rest -- then that also suggests Windows 8 tablets could be a big flop.
It's really becoming very hard to see how Windows Phone ever gets anywhere.
I'm starting to wonder if all the tech reviewers who fawn over the Metro interface are just totally out of touch with mainstream consumers. Maybe mainstream consumers look at a bunch of monochromatic boxes with tons of text and feel simultaneously bored and overloaded with information. Maybe consumers really just prefer the simple yet colorful grid of icons approach that Apple has taken and Samsung has aped.
If that's true -- if the failure of WP7 (and the Zune before it) is as much about consumer dislike of the critically acclaimed Metro interface as about first mover advantages and all the rest -- then that also suggests Windows 8 tablets could be a big flop.
Microsoft made a lot of mistakes with it. As well as being late to launch they restricted themselves to AT&T, then slowly added other vendors. They needed to go the Andriod or Xbox route and get as many vendors and service providers on board as possible, heavily push a couple of loss leaders in order to gain a foothold in the market. Even now they are restricting themselves (high end Lumia only available on AT&T and now delayed another month). It's dumb, but don't think people expected anything different.
Enterprises are increasingly moving to the iOS devices, along with a number of BYOD initiatives - which increases the iOS infrastructure.
Apple controls industry profits, Samsung comes a DISTANT second and most of the others barely break even.
To give Apple and Samsung logical equivalence in this headline is nuts (Apple is 5x Samsung in this).
The thing missing from the percentages though is the total $; Q4 is bigger than Q3. With China's surge, Q1 might start to gain some steam as well around Lunar New Year.
Thanks to Apple's innovation, and the Sammy photocopier.....
Thanks to Samsung's technology and manufacturing innovation, and Apple's marketing pull....
WP8 is targeted at the enterprise, where MS had a lock in the past. I don't see them making appreciable gains from their current (3rd-party license) phones in the enterprise space.
Enterprises are increasingly moving to the iOS devices, along with a number of BYOD initiatives - which increases the iOS infrastructure.
Yeah, I used to think that enterprise IT, particularly the ultra-conservative, head-up-the-a$$, user-hostile variety (which is the kind we have at my employer) would be the natural target for both Windows Phone and Windows Tablets, and that since those folks are *so* loyal to MS, that MS would have a guaranteed big slice of the market.
But now I'm thinking that perhaps the flaw in my logic is that these ultra-conservative IT groups, by definition, do not jump on new products. They are the types of organizations that will only buy new stuff -- even new MS stuff --- after it has become widely adopted. But this is bad new for MS, because without appealing to leading edge buyers, they are unable to ever gain traction, which means their products never become widely adopted, which means that the ultra-conservative IT groups won't buy them.
In short, MS is screwed. They're too late and their products are too unappealing to consumers. Game over.
It's really becoming very hard to see how Windows Phone ever gets anywhere.
The question really comes down to if the "average consumer" sees Windows in a good or bad light. I favored BB's over WinMo for my needs, but I did know a few people who were very loyal to WinMo. If they bought into Android and were disappointed, maybe they will consider switching back.
It is apparently a nice, fresh approach. But, if it is anything like what MS did to Excel with the ribbon interface, I would be more likely to expect pitchforks and torches in Redmond.
It was the same the last time this story "broke" - "Apple and Samsung control industry profilts" NOOOO!
Apple controls industry profits, Samsung comes a DISTANT second and most of the others barely break even.
To give Apple and Samsung logical equivalence in this headline is nuts (Apple is 5x Samsung in this).
more like 4x, but agree that it's somewhat unfair to give the same weight to Samsung.
Yeah, I used to think that enterprise IT, particularly the ultra-conservative, head-up-the-a$$, user-hostile variety (which is the kind we have at my employer) would be the natural target for both Windows Phone and Windows Tablets, and that since those folks are *so* loyal to MS, that MS would have a guaranteed big slice of the market.
But now I'm thinking that perhaps the flaw in my logic is that these ultra-conservative IT groups, by definition, do not jump on new products. T
Apple has defined the Tablet space as mini-apps that get the job done, and are often tailored to different vertical markets. MS can't win in that space; how will it sell more Office?
The question really comes down to if the "average consumer" sees Windows in a good or bad light.
Oh this one's easy.
Outside of games and game-boxes, MS has lousy, boring, uninspired mindshare. They have ZERO cachet. They're slow, and they don't understand design or marketing.
All they do is REACT, REACT, and then REACT some more.
Hence, the Rise of Apple, and the slow slide of MS into irrelevance. This aint 1995.
with no formidable challengers in sight.
I wouldn't exactly say that. Sony, Motorola/Google and Nokia/Microsoft are all very large companies. It's hard to believe that they are not going to put up a fight with so much money at stake. They're all churning out some very good phones at the moment and they've all started to adopt an Apple-like "eco system" approach to their phones and content. I simply don't believe that Apple will be able to hang on to 75% of the profits forever.
Oh this one's easy.
Outside of games and game-boxes, MS has lousy, boring, uninspired mindshare. They have ZERO cachet. They're slow, and they don't understand design or marketing.
All they do is REACT, REACT, and then REACT some more.
Hence, the Rise of Apple, and the slow slide of MS into irrelevance. This aint 1995.
But yet they still dominate the desktop. A large percentage of people (likely a safe majority) don't want an Apple product for a number of different reasons. They might not *want* a MS product, but they whine that Linux is hard, and they fall prey to the Windows Everywhere mantra.
It is a bad choice in my mind, and I don't understand the logic, but it is pervasive in many groups.
I was working with a very expensive instrument last week, and it used Windows for absolutely no good reason. Legacy is a hard thing to overcome, and little things like .net have a big impact on a number of companies.
Apple 'rules the roost' with 75% of mobile industry profits
And, just wait until the iPhone 5 comes out. Apple is going to have a monster 2H of the year
The correct headline:
Apple 'rules the roost' with 75% of mobile industry profits
And, just wait until the iPhone 5 comes out. Apple is going to have a monster 2H of the year
Indeed. They're doing so well that it's already out!
Just like Bill Gates' and my combined total earnings this year are mind-boggling.
The correct headline:
Apple 'rules the roost' with 75% of mobile industry profits
And, just wait until the iPhone 5 comes out. Apple is going to have a monster 2H of the year
I agree. I think that adding in the distant second-place entrant dilutes the impact. If Samsung were anywhere close, then by all means.
But if this were a political race, and the stats were the same as here, the second-place guy would be presumed dead. 75% to 15%? That is not even in the same league.
Windows Phone will only gain market share if Microsoft decide to heavily subsidise handsets to grab market share, or use substantial revenues from other product lines to heavily advertise like Apple did with the iPod.
The question is, where would the money come from? They have declining desktop OS revenues, declining Office application revenues and it would be hard to see the justification when they need to be more creative on all product lines just to stand still!!
In a way, MicroSoft is an appropriate name. Micro, as in small, relating to the very small market share they will gain and Soft, because they are a very Soft target for iOS and Android to squeeze.
I think there will ultimately be only 2 platforms for smartphones, iOS for the top to middle end, and Android for the lower-middle to bottom end.
I don't think it is about what will Apple come up with for iPhone 5 (or the new iPhone), but what will they come up with for iOS 6 (or the new iOS !?!). User experience is the key to market share. iOS 5.1 is still the best I have seen, but no doubt there is something much better en-route to your device later this year!!