Android is winning… Is it?

  • Posted: 19 February 2011 02:59 AM #16

    Very interesting discussion. I hesitate to post a reply while on the run and with limited internet access, but so be it.

    As a frequent visitor in Europe, these stats are not surprising. Even a year ago, Nokia had more presence than it does today. The ‘burning platform’ analogy is accurate, sadly, Nokia may have tried to escape that platform by boarding a train going nowhere (MS). I’ll let that image linger.

    As for market share and wars, one missing component in much of the discussion (though not all, Mace addresses this) has been the real driver of market share, and the kill-zone for any handset manufacturer, the consumer.

    Who is buying these devices and how are they using them? Several articles have pointed out that it has been those with higher incomes, greater discretionary spending power, and relatively higher eduction,  who have led the charge in smart phone uptake (sorry, no time to post references but am happy to do so when opportunity permits). That appears to have shifted over time (a ‘secular trend’, as epidemiologists would say) to a broader income and educational range, driven in no small measure by aggressive pricing by Apple (relative to specs) and more than one option (e.g. 3GSs alongside 4’s and different storage capacities).

    The holy grail for a manufacturer is to not just meet but satiate consumer expectation. The iPhone is the iconic smart phone. Expectations are built around it, hence the rush to imitation in form factor by every other handset maker. Android emulates the iOS (they are fun to play with to boot, but it is an imitation).

    It is not as simple as Apple merely have to continue to be Apple in order to succeed, while everyone else has to be as ‘Apple-like’ as possible (although there is an element of this), Apple, having created the current consumer expectation of what a smart phone is, have to continue to be the first, and come the closest, to hitting the consumer expectation sweet spot. So far, they have consistently been on target and show no signs of letting up.

    The problem? For Apple, innovation, targeted innovation that keeps them ahead on meeting consumer expectation. Their arsenal, profits. Their tactical advantage, protected supply lines. So long as they continue to garner the lion’s share of the profits (and they are by a long shot), and can lock up essential supply of key components (starving the competition is collateral damage, but that’s a part of war), they maintain the high ground and are in the best position to remain a dominant force. They continue to fight on their own terms. Good for Apple.

    For the competition, Apple’s tactical advantage is their disadvantage. They still need two things, in my view, to change the terms of engagement to their advantage. One, there needs to be a champion handset maker who begins to make substantial profits, who can then innovate in ways that hit the consumer sweet spot similarly to Apple. Without profits, where is the capacity to invest in the R&D? Second, they need a differentiator, something that consumers desire that is not just a derivation on Apple’s offerings. This is not just a tech-spec, or performance tweak, but a product that is different, but no less appealing, than what Apple are offering. Thus far, neither has happened.

    An expansion in Android market share in the absence of a profiting handset maker with an alternative device, a market that today sees only Google making any real money on the Android platform, while its OEMs compete against each other, is uninteresting and is unlikely to benefit consumers. In the PC space, this formula resulted in the race to the bottom that saw the backs of several OEMs and have plummeted Dell’s market cap to new lows.

    I can’t speak for anyone else, but I am not seeing a real war yet, other than a propaganda war fuelled by some skirmishes. I remain hopeful that at least one handset maker will emerge from the Android scrum and that, perhaps Quixotically, the Nokia/MS tie-up will (pardon the expression) ignite.

    A fight for consumer expectations and loyalty among equivalent contestants is a thing to be wished for.

    Signature

    wab95

         
  • Posted: 19 February 2011 03:01 AM #17

    Perhaps I wasn’t clear in my statement. I was meaning 2 separate things in what you quoted.

    1. Firstly, I don’t think market share will diminish in the US. Perhaps Androids in the US may plateau, but I still think they will make up a larger part of the market even given the iPhone introduction on Verizon. I think that iPhones will take 16 million of the 80 million users on Verizon, but there are currently something like 40 million Android users on Verizon. Taking some of Verizons Android users (~40% being a stretch) will blunt the growth of overall Android sales in the US, but still Androids will outsell iPhones. The iPhone 5 will create a huge stir and sell millions of phones, but Androids will still sell more devices as happened with the release of the iPhone 4.

    2.70-75% market share.
    What I was meaning by this was worldwide market share and I will explain.

    The evidence lies in the growth curves of the products. With a potential 1 billion smartphones by the end of 2011. Androids growth curve with its 20 something producers is outproducing and outselling the lone iOS manufacturer Apple worldwide. There were about 300 million smartphones in 2010 shipped. In Q4 100 million of those 300 shipped. Android OS accounted for nearly 1/3 of those ~33million, while iPhone accounted for 1/6th 14.5 million. In Q3 Android OS accounted for 9 million vs iPhone 5.5 million. In Q2 Android OS accounted for 10.5 million vs iPhone 8.7 million when the iPhone 4 came out. So in 2 of the quarters last year the growth curve was accelerating to even larger than a 2:1 margin. With another 700 million projected smartphone sales in 2011, Apple may sell 100 - 120 million phones next year more than doubling what they have sold this year, but Android OS devices will sell 250 - 300 million or more.

    Android market share is growing at a rate which is 2 times that of the iPhone currently. What this will eventually mean is that they will have a 2 times greater market share than Apple if nothing changes. 66% to 33% even if lowballed by todays accelerating growth expectations for each platform.

    Things are changing and Android OS phones are currently on an upswing. I don’t see any blips in this future except the intro of the iPhone 5, do you? But still Android will outsell the iPhone 5 as they did the iPhone 4.

    As we all know, things always change. RIM is regressing sad to say. Windows mobile seems dead in the water. I don’t see another competitor near on the horizon for now. For me the growth curve 2:1 over Apple seems to be solid for the next little bit because we are talking about worldwide sales and not US. Two Years out .....pretty much Apple iOS and Google Android OS phones will be the completely dominating players with some minor hangers on in the smartphone market. 

    Real Clincher for Android Growth - Emerging world.
    Given that the growth curve of Androids seems to favor further expansion of the Android OS worldwide over the next couple quarters an perhaps over the next year, Androids will makeup 2/3 of the total smartphones in short order. Apple would have about 1/3 ish over time. The key is that Androids growth curve becomes even steeper in the emerging world. The makers of the Android will be able to take greater market share from the emerging world than Apple will, places like India, China, Brasil and many of the 3rd world countries strictly based upon unit price and similar powerful features.

    Quality of the devices will fall to accomodate the needs of such places. It isn’t in Apples interests to try to flood the market with cheapy handsets at cut rate prices, but dozens of knockoff Androids will flood the emerging world relatively unopposed. The android will become the poormans iPhone!. But it won’t be so poor, because the Android offers tremendous power.

    Having lived in the 3rd world for 9 years gives one insight into how things work and what the capacities of these places are. Mobile computing will be the future of such places where IT infrastructure is so much less pervasive. These devices will allow much of the world to bypass the last couple of decades of IT and computing in developed nations.

    So when I say Android will take 70-75% of the world market it isn’t really a flippant whim of mine or delusional, but based on my understanding of the needs of the 4-5 billion poor people of the world. Apple simply can’t and won’t cater to the hoards with no money, but there are lots of innovators who will and they won’t be using iOS to do it.

    Don’t get me wrong Apple will make a boat load of money and still take the bulk of the profits, but the low end of the market will not be Apples market. I could be wrong, but I don’t think I am.

         
  • Avatar

    Posted: 19 February 2011 03:57 AM #18

    PAYG iPhone could change your scenario, though.

    iPhone makes the cheapest and best pocket computer in the world (iPod touch).  Tack on some basic telephony and attractive PAYG options and suddenly, you get an iOS alternative to Android at one heck of a price.  It’d be interesting to see how that plays out, if Apple ever decided to try that route.  Don’t forget, if iOS scales into many more millions of units per year, Apple will gain increasingly ridiculous cost leverage from potentially becoming the largest single manufacturer of mobile devices in the world (that is, if it isn’t already by units).

    Also, at least one “developing nation” (China) loves iProducts to ribbons.  That’s saying something.

    Now, if you’re talking one day Android devices being able to be produced at $99 with semi-similar specs as your typical 1GHz SoC unit today, then yeah, Apple will never play in that market.  But there’s just no money there.  Btw, I’m not disagreeing with you.  I still think Android will become the next Symbian.  But as I’ve said before, Symbian hasn’t meant much to Apple.

    [ Edited: 19 February 2011 04:00 AM by Mav ]

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.

         
  • Posted: 19 February 2011 04:14 AM #19

    iPod touch with basic telephony could be interesting, but I still think too costly. When I talk about the 3rd world I am talking devices that are underpowered, older tech and cheaper parts and maybe fewer bells and whistles cheaper construction and for $50 bucks or less total production cost.

    Apple just would never go to the cheap plasticy knockoffs, but these devices will run Android.

    Most people would dream of a nice Apple device or even a high end Android, but they simply have to go with what is affordable. I even read an article where India was trying to provide a $30 dollar device for their population.

    Some company will provide a relatively sophisticated Android OS which approximates an iOS device. Technically inferior perhaps, but still powerful for the masses.

    I agree with you that Android dominating the market in the way I describe is irrelevant to Apple. They will stick to their business model which has been so successful. They will stick with where the money is. And they will not stay stagnant. They will innovate, because that is what they do and they have the money to assemble the latest greatest tech in an appealing way. In another 10 years we won’t even be talking about this paradigm because Apple will be onto some other product that makes all of the current ones irrelevant. All 2-3 billion of these devices will become obsolete. Heck 4 years from now all of the devices we are talking about will be obsolete. Competition is grand.

         
  • Avatar

    Posted: 19 February 2011 05:08 AM #20

    paikinho - 19 February 2011 07:01 AM

    ...there are currently something like 40 million Android users on Verizon.

    Where are you pulling this number from?

    Verizon said today in its Q4 earnings report that only 26% of its 83 million “retail postpaid” subscribers have smartphone devices.
    Source

    .26 x 83 million = 21.58 million
    Android, Blackberry, Windows Mobile, etc. Even if you want to be very generous, I doubt there are more than 15 million Android users on Verizon.

    70-75% market share. What I was meaning by this was worldwide market share…

    We’ve discussed at length how unimportant market share can be. Symbian has led worldwide smart phone market share for the past few years. Nokia has not done very well despite their lead. Apple has the “share” that counts: profit share. (I notice you acknowledge this at the very end of your post)

    Real Clincher for Android Growth - Emerging world…The makers of the Android will be able to take greater market share from the emerging world than Apple will, places like India, China, Brasil and many of the 3rd world countries strictly based upon unit price and similar powerful features...Quality of the devices will fall to accomodate the needs of such places…The android will become the poormans iPhone!. But it won’t be so poor, because the Android offers tremendous power.

    Yes. The makers of Android devices will sell many more cheap phones for little profit while Apple will sell fewer (but still many) for much profit. The quality of the devices will be no where close to the iPhone’s and will in no way have “similar powerful features”. Where have you even begun to see this happening and why would you think it will happen in the future?

    Mobile computing will be the future of such places where IT infrastructure is so much less pervasive. These devices will allow much of the world to bypass the last couple of decades of IT and computing in developed nations.

    I agree.

    So when I say Android will take 70-75% of the world market it isn’t really a flippant whim of mine or delusional, but based on my understanding of the needs of the 4-5 billion poor people of the world. Apple simply can’t and won’t cater to the hoards with no money, but there are lots of innovators who will and they won’t be using iOS to do it.

    I’m sure you realize that “Android” is fragmented in more ways than one. Probably the most significant type of fragmentation today are the variants of the OS that are installed in devices catering to “the hoards with no money”.

    I won’t dispute your numbers. I’ll just ask why you think these numbers mean anything important to Android or Google? How will these “hoards” contribute to Google’s success? How will people with no money contribute the $10 per user Google expects from each Android activation?

    There is actually a chance that if your predictions come true, it may be a Pyrrhic victory of sorts for Google. How will investors & Wall Street react to lukewarm revenue from Android despite growing reports of billions of Android users? Perhaps Android will succeed while GOOG share prices stagnate.

    I’m investing real money on AAPL with the confidence that they will “win” on the essentials of the mobile device war. Are you investing your money on GOOG?

         
  • Avatar

    Posted: 19 February 2011 08:28 AM #21

    Drew Bear - 19 February 2011 09:08 AM
    paikinho - 19 February 2011 07:01 AM

    ... So when I say Android will take 70-75% of the world market it isn’t really a flippant whim of mine or delusional, but based on my understanding of the needs of the 4-5 billion poor people of the world. Apple simply can’t and won’t cater to the hoards with no money, but there are lots of innovators who will and they won’t be using iOS to do it.

    I’m sure you realize that “Android” is fragmented in more ways than one. Probably the most significant type of fragmentation today are the variants of the OS that are installed in devices catering to “the hoards with no money” ... I won’t dispute your numbers ... There is actually a chance that if your predictions come true, it may be a Pyrrhic victory of sorts for Google ...

    Would like to add that some fragmented Android are so different that they shouldn’t be considered as Android.  Even Elsop, CEO Nokia, put these phones in a separate category, low end Android phones as opposed to the mid range Android phones.  I would be ecstatic if the market share distribution is, 20% iPhone, 20% mid-range Android, 50% Chinese/Indian Android and 10% others.  Please don’t ask me to justify these numbers as I pluck them out of thin air.

    Signature

    Stay Hungry. Stay Foolish.  - Steve Jobs

         
  • Posted: 19 February 2011 10:57 AM #22

    paikinho - 19 February 2011 07:01 AM

    ...there are currently
    something like 40 million Android users on Verizon.</blockquote>

    Where are you pulling this number from?

    Ah… sorry about the mistake… late night. I read an analysis somewhere in the last couple weeks that used the term 40 million androids or or perhaps it was smartphones users expected in the next year or something on Verizon’s network. The analysis was mainly about the explosion of androids and I obviously muddled it all in my brain.


    Thanks for clarifying. I also read that somewhere around 40% of the Android users anticipate trying the iPhone on Verizon.

    70-75% market share. What I was meaning by this was worldwide
    market share…

    We’ve discussed at length how unimportant market share can be. Symbian has
    led worldwide smart phone market share for the past few years. Nokia has not
    done very well despite their lead. Apple has the “share” that counts:
    profit share. (I notice you acknowledge this at the very end of your post)

    I suppose you have discussed market share in depth and I made a statement about androids and market share which someone didn’t agree with so I was clarifying what my thoughts were.

    Android devices are more geared to commoditization especially in the developing world. Androids will play a role like Symbian albeit a much superior role to Symbian. The devices will be far more powerful and bring meaningful computing power to the hands of the masses in the 3rd world, where people can’t afford a PC’s. But they will have a mobile computer which can do far more than a full desktop was capable of 7 or so years ago and it can go in a pocket. This is really powerful for people who have not yet had a chance to tap into the internet yet.

    Real Clincher for Android Growth - Emerging world…The makers
    of the Android will be able to take greater market share from the emerging
    world than Apple will, places like India, China, Brasil and many of the 3rd
    world countries strictly based upon unit price and similar powerful
    features
    ...Quality of the devices will fall to accomodate the needs of
    such places…The android will become the poormans iPhone!. But it won’t be
    so poor, because the Android offers tremendous power.

    Yes. The makers of Android devices will sell many more cheap phones for
    little profit while Apple will sell fewer (but still many) for much profit.
    The quality of the devices will be no where close to the iPhone’s and will
    in no way have “similar powerful features”. Where have you even begun to
    see this happening and why would you think it will happen in the future?

    That is my point exactly. Hordes of Android OS devices will be sold and eat up market share….that is all. My original assertion was only about how much market the Android could potentially make up. I made no assertions about build quality being equal or profits being similar. There won’t be much profit. There will be lots of market share. They will be lower quality by quite a bit than today’s devices, but at a price point that is tiny too. They will be powerful although nothing compared to their more sophisticated bretheren in the US and Europe.

    The true power of the devices will derive from the devices ability to transform peoples lives and help them join the rest of the networked world in a meaningful way.

    Hardware wise, Androids or iPhones are more powerful than my dual pentium pro server I built in 1997. Every smartphone is more powerful than many of the supercomputers from the past. People in emerging nations will not use these phones in entirely predictable ways. They will squeeze every bit of power out of these tiny computer to do things that people here have never even thought of. A whole new generation of innovation will be unleashed by the newcomers because they will make the devices do what they need them to do.

    I say similar powerful features because, anything one can do currently, these phones should be capable of. They will be running basically the same Android OS with access to the same apps, just on underpowered hardware. In 3 years, phones will have moved from where they are now in our country. But emerging markets will be using the tech available today to build devices of their tomorrow. Do you find your device lacking? I don’t think so.

    India is working on a cheap device they hope to deliver for 30 bucks is where I have seen it. Not a phone, but a tablet. It won’t be the newest whiz bang device currently on our market, but it will be running android OS.

    My point is not to say that the emerging world will have the same stuff as we do. But the Android OS gets them most of the way to parity when you see where people are coming from.

         
  • Posted: 19 February 2011 11:19 AM #23

    So when I say Android will take 70-75% of the world market it
    isn’t really a flippant whim of mine or delusional, but based on my
    understanding of the needs of the 4-5 billion poor people of the world.
    Apple simply can’t and won’t cater to the hoards with no money, but there
    are lots of innovators who will and they won’t be using iOS to do
    it.

    I’m sure you realize that “Android” is fragmented in more ways than one.
    Probably the most significant type of fragmentation today are the variants
    of the OS that are installed in devices catering to “the hoards with no
    money”.

    Yes. I don’t speak to fragmentation which appears is likely to plague Google, although I think that google is working on merging tablet and phone and by doing a marketplace for apps similar to Apples, the will likely enforce some sort of standardization since users will wish to have access to the apps. Still fragmentation is a bigger issue for google and relatively a non-issue for apple.

    I do think fragmentation will be less of an issue over time as Google seems likely to try and rein it in.

    I won’t dispute your numbers. I’ll just ask why you think these numbers
    mean anything important to Android or Google? How will these “hoards”
    contribute to Google’s success? How will people with no money contribute
    the $10 per user Google expects from each Android activation?

    My market share numbers and percentages are a gross generalization of predictions I have read. My point is not to codify anything, but to lay a case for a likely scenario where Androids could make up a larger chunk of the worlds Smartphones. And I lay my case based not on what many have focused on already which is the developed world.

    How are these numbers important? That will be determined because there is a certain unpredictability about having these devices in so many hands. What will it mean? I don’t know? Having lots of poor people with Androids doesn’t lend to stellar profitability in today’s paradigm. But you can be certain that wealth generation and improvement in lifestyles will result from having such powerful devices in the hands of so many. It is kind of exciting.

    Google won’t get $10 per user from such users.

    There is actually a chance that if your predictions come true, it may be a
    Pyrrhic victory of sorts for Google. How will investors & Wall Street react
    to lukewarm revenue from Android despite growing reports of billions of
    Android users? Perhaps Android will succeed while GOOG share prices
    stagnate.

    I think Apple has a much much much better model for generating revenue. Google is somewhat bottlenecked currently. I don’t believe that will remain the same, but for the most part Google is a single car family.

    Google will continue to make good profits and the company as an aggregate has a good model. Android OS is a great move in the right direction for them. Now we will see what they do with it and how it evolves. I suspect they will take many cues from Apple. I don’t believe they will be pushing up the daisies in the next 10 or so year.

    Apple has perfected an obscenely great model for generating revenue.

    I’m investing real money on AAPL with the confidence that they will
    “win” on the essentials of the mobile device war. Are you investing your
    money on GOOG

    I have been telling my sweetie that we need to invest copiously in apple, but no dice so far. I keep pointing it out every time apple soars to the stratosphere.
    We don’t have google stock either. We just need more money for investments. Instead we invested in houses…..gack! I’m feeling all hogtied.

         
  • Posted: 19 February 2011 11:28 AM #24

    Would like to add that some fragmented Android are so different that they shouldn?t be considered as Android.  Even Elsop, CEO Nokia, put these phones in a separate category, low end Android phones as opposed to the mid range Android phones.  I would be ecstatic if the market share distribution is, 20% iPhone, 20% mid-range Android, 50% Chinese/Indian Android and 10% others.  Please don?t ask me to justify these numbers as I pluck them out of thin air.

    I could see such a scenario. The need of india/china and asia in general are going to be different than those of the westernized world.

    Sound plucking methinks.

    That 20% iPhone would result in me doing some more plucking.

    Apple would sell ~300 million phone devices for 90 billion in profits and the app store would generate another 7 or so billion in profits.

         
  • Avatar

    Posted: 19 February 2011 03:48 PM #25

    JDSoCal - 18 February 2011 02:24 AM

    I’d really like to see Apple-to-Apples comparisons, no pun intended. How has Apple fared against Android on AT&T, and how well will it do versus them Verizon? It is simply silly to compare a phone that is (barely) on two networks to an OS on lots of phones on all networks.

    Head-to-head is all that matters, and I think when all is said and done, iPhones will beat out Android phones on the networks they share.

    For a good answer to your question, I suggest you check out this astonishing graph from asymco’s 01-11-11 blog For every AT&T Android user there are 15 iPhone users: What will be the ratio at Verizon?, made from comScore data to show the relative consumption of Android vs. iOS by the subscribers of the four major US operators.

    In addition to that eloquent graph, he made other cogent points, viz,:
    - As of November, the ratio of iOS to Android users was more than 15 to 1 at AT&T.
    - iOS at AT&T has twice the users as Android at Verizon
    - Since Verizon and AT&T have nearly the same number of subscribers (excluding RIM, which is common to both) AT&T has a far larger penetration of smartphones (16.5 million vs. 7 million), so is the cause iOS itself or the delay with the timing of Android launch at Verizon?

    He also made some other interesting observations:
    - Other data from comScore shows that much of the gains for Android at Verizon have been at the cost of RIM, so Android has not been entirely additive. Will there be a similar platform switching going on or will iOS be additive to the Android base?
    - Although T-Mobile had the Android franchise to itself for all of 2009, it was overtaken by Verizon within four months
    - T-Mobile Android consumption has also been nearly matched by Sprint within a year
    - The rapid eclipse of T-Mobile smartphone penetration makes one wonder how effective Android is as a differentiator for carrier and device vendor alike. (It also explains their new pricing model.)

    I also noted that the iOS slope and the cumulative Android slopes are fairly parallel, and that the cumulative Android numbers currently total about slightly less than iOS’s number, so it doesn’t look likely to me from this history that Verizon’s Android subscriber rate will do any relative gaining against iOS’s, and will likely suffer a slope drop-off relative to Verizon’s iPhone’s (after iPhone 5 is launched this summer).

    [ Edited: 19 February 2011 04:35 PM by BurmaYank ]

    Signature

    Dave J.

    - my most favorite Chinese Cookie fortune:  “Stiff in opinion; always in the wrong.”

    - my second most favorite Chinese Cookie fortune:  “There is something seeing and there is something being seen.”

         
  • Avatar

    Posted: 19 February 2011 03:58 PM #26

    Another sign that Android is winning: developers are stampeding to make apps for Android…aren’t they?

    While the mobile handset race is now being frequently described as a two horse race between Apple’s iOS and Google’s Android licensees, the mobile software world has four major contenders, with RIM’s BlackBerry App World and Nokia’s Ovi Store maintaining their lead over Google’s Android Market.

    At the top of the charts is Apple’s App Store, with a 82.7 percent share of the market on revenues of $1.78 billion, aided in part by sales of new iPad apps.

    In second place is RIM’s BlackBerry App World with 7.7 percent share and revenues of $165 million. While offering a smaller catalog of titles, RIM’s software is priced higher and aimed at an audience of business users.

    In third place is Nokia’s Ovi Store, driven mainly through sales of Symbian software. IHS assigned Nokia a 4.9 percent share of the app market on software sales of $105 million.

    Google’s Android Market took fourth place, registering a 4.7 percent share on revenues of $102 million, representing growth of 861.5 percent compared to 2009. The discrepancy between Google’s strong showing in handset sales and minority position in software sales was alluded to by Google itself, which has said it is “not happy” with the number of apps Android users are buying.

    So the #1 & #2 market share leaders in smart phones are a very distant #3 & #4 in app sales. Yet there’s so much written about unit market share and so little about profit share or app share.

    Apple’s rivals battle for iOS scraps as app market sales grow to $2.2 billion

         
  • Posted: 19 February 2011 04:29 PM #27

    Another sign that Android is winning
    ————
    I wish everyone could get away from this…Android wins iOS loses….iOS wins Android loses, tit for tat glee over the continually rolling out new numbers. This is kind of mute since both platforms have a solid foothold and seem to be spreading to take over much of the phone market in general. Smartphones will be the phones of the next generation. Android OS and iOS seem to be the big fish in the pond, but others will continue to exist and fill need of users for the time being too.

    Besides we are talking about a dynamic and ever shifting market. Trends can be observed. 2 types of phone seem to be out-competing the rest for the moment. Consumers are reaping the rewards of this intense competition.

    It isn’t even useful or accurate to couch the battle for the Smartphone market or any market for that matter in such terms of a sort of win-lose “survival of the fittest” mantra.
    Firstly, darwin never talked about survival of the fittest, but survival of the fit. That is why we have variation. One good design doesn’t extinct all others. It doesn’t happen in nature or in markets. It could be difficult to find an example in a free market system where one product eliminated all others and there was only one producer left standing. I’m sure someone could find an example, but I can recall one.

    All of the makers are trying to leverage what they do to earn more money. Apple is making more money at it and seems to have perfected their strategy. Google is trying a different strategy, but its full fruition is yet to be determined. For now they have to be pleased that the number of units being sold is enormous probably well beyond expectation. I’m not sure Google understands how to best milk money from this process, but they will figure it out…probably by taking some cues from Apple and by thinking up some unique approaches of their own as well.

         
  • Avatar

    Posted: 19 February 2011 04:49 PM #28

    paikinho - 19 February 2011 08:29 PM

    “Firstly, darwin never talked about survival of the fittest, but survival of the fit…”

    That’s a valuable point to remind us all of - Thank you!

    But your next point seems much less true:

    “”... One good design doesn’t extinct all others. It doesn’t happen in nature or in markets. It could be difficult to find an example in a free market system where one product eliminated all others and there was only one producer left standing. I’m sure someone could find an example, but I can recall one.”

    It’s not hard to recall that VHS extincted (the technically superior) Sony Betamax.  BlueRay extincted HD DVD. Variation in the population was lost by the total domination of one of the competitors.

    Signature

    Dave J.

    - my most favorite Chinese Cookie fortune:  “Stiff in opinion; always in the wrong.”

    - my second most favorite Chinese Cookie fortune:  “There is something seeing and there is something being seen.”

         
  • Avatar

    Posted: 19 February 2011 04:59 PM #29

    paikinho - 19 February 2011 08:29 PM

    I wish everyone could get away from this…Android wins iOS loses….iOS wins Android loses…

    I’ve never read anyone (including people here) write that “iOS wins Android loses”. The “Android wins iOS loses” meme, however, is everywhere.

    Although you did eventually clarify your position, your initial comments and predictions of 70-75% Android market share implied dominance or victory. Most writers who share your outlook don’t imply, they categorically state that Android will drive iOS into insignificance…just like Windows did to Mac OS.

    We’re trying to dispel an anti-Apple meme, not start a new anti-Google meme.

         
  • Avatar

    Posted: 19 February 2011 05:01 PM #30

    This is a little bit different though.  The handset market is over one billion units.

    And to continue your analogy, you can still buy regular ol’ DVD players.  It’s not quite like when CDs all but destroyed cassettes. 

    I don’t exactly like how Android started, what with Schmidt on Apple’s board, but philosophically I have no problem with, somewhere down the road, Android being able to be work on a basic $100 pocket computer that connects to the Internet.  I’m all for democratization of technology or whatever.  It’s yet to be seen if hitting that $100 or under price point for a genuinely useful pocket computer can actually happen, though.

    Signature

    The Summer of AAPL is here.  Enjoy it (responsibly) while it lasts.
    AFB Night Owl Team™
    Thanks, Steve.