It's statistically inevitable that unit sales volume growth will increasingly be at lower price points. Whether you like it or not, the better smartphones get at the bottom end, the less real value there is at the top end. Unless top end prices fall, the difference in cost relies increasingly on buyer sentiment and less on tangible differentiation.
It sounds like you're predicting a dearth of future innovation. Why would you assume that?
If 5-7" screened phones are counted as "phablets", then that would include the S4 range (apart from the mini), the HTC One, Sony Xperia Z and others, which could explain the 21% share attributed to "phablets" and which would include almost all the premium Android phones.
So are they or are they not included in any other category?
Last but not least: Stop with these ignorant articles. A 250$ Android phone is the best computer the vast majority of internet users ever had, calling it "junk" clearly shows a huge lack of knowledge of the current situation worldwide as well as total ignorance from a technical point of view, both hardware and software. At 250$, you have a dual core + 1gb ram + good screen and jelly bean software. That gives you a great way to browse the web, facebook, listen to music, twitter and radio. That's 90% of the market.
Android phones start at below $50, you are trying to beat up a market that barely exists seeing as how you brought up "ignorance".
The people who buy these phones often do not want to pay extra associated data costs so do not use any thing other than voice calls and SMS, just like they did with the feature phones these "smartphones" are replacing.
This shows up in usage stats where Android is the dark matter in the smartphone universe.
Maybe it's because the "market" exists to milk pension funds and other investors of their money and the volatility reports like these create helps them to do that with thousands of trades per second whenever a share price changes.
And what is the goal of this article? People try and try to bend numbers to their will, but the fact is that Samsung makes as much money as Apple and is only going up. That's an undeniable truth, at least for the foreseeable future and anything else is guessing.
iOS is growing, especially due to Apple's powerful ecosystem in few countries like the US, but outside of those few countries Apple loses a lot of power to the point that they have nothing more to offer than, say, Android. They need time to change that.
Meanwhile, on the smartphone arena something is pretty clear: Samsung alone sells 2 thirds of the number of iPhones being sold based on their Galaxy S and Note lines, so there's something in Android/Samsung that attracts people that could add to Apple's bottom line. And what is that? Big screen, only that. Some people here will fiercely deny that, because:
And that's ok (1 and 2), but the market has spoken and most users have to understand that they do not represent the entire market, all of us do. For each user that has and loves an iPhone with a 4" screen, another user that could have bought an iPhone, specifically said "no", because it has a smaller screen that severally limits the usability of a smartphone to anyone that browses the Web, reads or plays on their devices. Doesn't Apple have the talent to have both users? Then we have those that would prefer a bigger screen on an iPhone, but do not want Android, so they stay with Apple, for now.
This alone tells us that Apple has amazing growth margin on the high end, and together with Samsung's numbers, we know that flexibility also pays off. Apple can learn from that, the middle term: Choice on the high end, like on Macs, iPads, iPods.
And again, if it's all about money, Apple isn't ahead anymore. They might pull ahead this quarter, but if things do not change, Samsung electronics will definitely pull ahead next year. So, based on $, their strategy is at least as good as Apple's.
A) Samsung Electronics overall nets less than Apple. Samsung Mobile sells more phones and earns less than Apple.
Saying "Apple's powerful ecosystem in few countries like the US" is flatly ignorant. Apple has movies for sale and rent everywhere from Anguilla to Zimbabwe. Apps are everywhere. Music is nearly everywhere. Some content like TV has limited markets, but far better than any other global source. Third party content is also more available to iOS than any other platform. http://support.apple.com/kb/TS3599
C) You neglect to mention that Samsung has far wider distribution than Apple, and its recent success comes largely from violating IP worldwide. That’s now drawing to a close. It is failing with most of its new ventures, from Smart TV to Gear watches. Tizen is a mess, Android is a commodity business, and it will increasing need to pay Microsoft and other phone makers for IP licenses, on top of having razor thin profit margins and little prospects for turning that around. It’s spending unsustainable amounts on advertising and seeing limited benefits. Samsung faces competitors who are virtually identical to it. If Apple faces dire threats from commoditization, what future does Samsung have, given that it has little original anything, and that everything it has can be duped by LG or cloned by Lenovo and the masses of Chinese firms who excel at making cheap junk slightly cheaper? Samsung has no reputation for quality, or design, or even good software.
D) Virtually all of your facts are completely backward. Makes one wonder why you share your uninformed opinions.
Any premium phones under 5" are bringing up the curve to that ASP of $215.
It’s hard to imagine that 66% of the "smartphone" market averages $215, but that’s what IDC is saying. Clearly, most smartphones are basic feature phones that are fudging the line, creating a nonsense metric for smatphones that sounds good to Android fans but is really not at all connected to reality. Same thing with tablets, as I found in speaking to IDC.
daveinpublic wrote: »
Seems like android is doing pretty well sales wise on both the low end and the high end. I'm curious to see how they did with the new iPhones. I'm especially interested to see how they do next year, with the revamped iPhone 6! In the mean time, I think share matters. I'm talking about usage share. Who buys more, who browses more. Androids high numbers are good for google, that's more ad hits for them. It also keeps developers interested despite the low usage. Apple business model is working - evidenced by their enormous piles of cash. Let's face it, they make a couple billion in profit every week. I think the iPhone 5c was a good move. I'd like to see larger screen iPhones, with keyboards that have swype, and a little bit lower end - maybe an iPhone nano. But, apple seems to have their strategy mapped out. The consumer is winning big time right now. Thanks to apple who is driving all this crazy innovation.
sensi wrote: »
The usual delusional garbage... When iOS reach the one digit market share it will be another victory...
IDC says the high end "cream" of Android premium phablets that account for 21% or "a whopping 54.8 million of the total number of Q3 smartphone shipments, 1.6 times as many phones as Apple sold in the quarter," have an ASP of $443 ASP, $192 less than the iPhone.
?So even when you compare iPhones to the biggest and best of Android, you’re still including lots of mid-grade stuff that delivers a poor experience and doesn’t contribute toward a viable platform (great apps and games).
Going forward, Samsung is saying its high end has peaked, while Apple keeps growing (and its only high end). That’s an ominous trend, especially as Samsung attempts to break Android in half by jumping on its own Tizen platform.
I know its your job to say that Android midrange phones deliver 'a poor experience'- but they really are quite good. And at the $443 range you're actually getting some very capable Android phones. But yes, Apple does deliver an excellent and substantially pricier experience, I don't think anyone disputes that. Apple fans saying 'Android stinks' to me is a lot like the Android fans who say Apple stinks... they are all wrong
I think you are right about the high end stuff. The areas of the world that are high end oriented are fairly well saturated- pretty much anyone who wants a phone has one. So the 'new' high enders are people moving from feature phones to the 'big leagues' I think your prior article showed a big decline in feature phones- and a good number of those people are choosing Apple to move up to. If Apple does release a bigger screened phone they'll put a tight squeeze on Samsung.
I dont like the header. Even as an Apple user I find the word Junk Phone insulting. Especially when you put the range up to $215. Which is ridiculous. Because you can call Sub $100 Junk. But there are a lot of phones at $215 which are very capable. They may not have the best design and quality software ecosystem like Apple. But they are anything but JUNK.
And it is exactly these kind of Attitude that makes more people hate apple for no logical reason.
That is where you need to take a step back and ask yourself what matters to *you* If you love Apple products and love using them and the Apple experience I'd say stop worrying about blogs, Apple share price, and what Wall Street says. Apple is going to continue delivering great phones and great experiences for many many years to come. Period. Kick back and enjoy.
If you are primarily an investor, and your primary interest in Apple is not using their products but rather buying their shares in the hopes that you can sell them for more money at a later date- all those blogs and articles probably should concern you, and just take all of your 'Apple passion' out of the argument. Apple's current valuation is based on them selling an insane amount of phones at profit margins much higher than other competitors in the market. Continuing to do as well as they are currently doing will not drive their stock price up- it will generally mean they are correctly valued and the stock price will remain relatively flat. In order for them to increase their valuation Apple will either need to sell substantially more phones at their current margins, or sell the same number of phones for higher margins. If they start selling few phones, or sell a similar number of phones at lower margins- their valuation goes down. Their valuation going down does not mean their phones are lousy, or Apple 'sucks' or anything along those lines- it just means they are selling fewer.
The high end smartphone binge has been an amazing ride but is slowing down. Growth rates of 200%, 140%, 80% yoy were tremendous- but they are a thing of the past. Now even 20ish percent gain yoy is a pretty darn good feat. So the 'upside' is viewed as limited (Apple is not going to double phone sales yoy) while the 'downside' remains a possibility. High margins in a competitive industry are generally not sustainable. The wild card for Apple is that they have a knack for coming out with a breakthrough that can reinvigorate sales and add a surprise new revenue stream. *NOBODY* knows the right answer. If they did there would not be a stock market. So as an investor your job is to try to take in as much information as you can, and invest where you think you can get the most returns while taking on the least risk. The phone market gets a lot of attention because it moves so fast- in your own example Nokia and Blackberry highlight the risks of choosing the wrong side. You just choose to focus on the 'phone wars' If you want to see people arguing about Porsche, Kia, or any thing imaginable- go to investment sites like investor's business daily (investors.com) or the Motley Fool (fool.com). You'll get a lot of great arguments on both sides of any argument (and in time half of them will be proven to have been 'terrible' arguments). Apple's products are generally so well loved that quite a few people let their passion for the product translate into passion for what the share price is doing. Plain and simple- that's a mistake if you are going to invest, but it can be acceptably fun if you're just going to 'talk' on a blog. Saying 'Apple is freakin' *awesome* so their share price should be umpty gajillion dollars, no price is high enough to value Apple! is a lot different then putting your life savings in the stock with that expectation.
Since it generally sounds like you get quite stressed about it.....
Enjoying great products is a lot less stressful than investing. Apple isn't going anywhere anytime soon regardless of what their share price does.
Think about it... In order for Apple to go away soon someone would have to deliver a vastly superior offering- so you'd get that instead. Win/win (plenty of people that loved their Blackberry's in the day are now loving their iPhones)
does IDC keep track of total smartphones not subsidized by mobile operators?
Wonder how much of the 66% "junk" devices of Android 81% marketshare are losing money?
For comparison, I wonder what % of PCs manufactured which compose Windows 87% marketshare are considered "junk" PC's.
Wonder how much of those % "junk" PCs which compose Windows 87% marketshare are losing money?
correlation? I think so.
That is where you need to take a step back and ask yourself what matters to *you* . . .
I wonder if you chime in on most of the other tech sites, where (they believe) Google has already won the smartphone wars with its 80% market share.
Is it informative, or even intellectually honest, to compare the market shares of the iPhone and a piece of garbage phone from Pantech? Of course not. Then why do tech bloggers persist in doing so? And why do you object to the author pointing out their persistent distortions?
Someone needs to learn the definition of a feature phone versus a smartphone. Feature phones aren't included in this IDC data, they report that separately under 'mobile phones'.
Suggest you go read about Micromax (India) and Coolpad (China) to learn what kind of smartphones people buy for much less than $215
The 3Q for Samsung and 4Q results from Apple came out fairly recently.
Samsung Electronic's net profit was approx. $7.7 billion and Apple's was $7.5 The Operating profit for Apple was higher, but you've stated net profit, where Samsung beat Apple.