Apple Has 93% of Mobile Profits

Barron's ^ | February 9, 2015, 9:48 A.M. ET | Tiernan Ray

[GeronL]

I have used both side by side. Samsung Galaxy 3S and onward are fine and about as good as an Iphone, even if just a little behind. They are not “copying” Apple.

[Swordmaker]

Why does that chart stop in first quarter of 201 just befor the sudden surge of iPhone sales starts and Samsung and LG sudden market losses? Apple now has 33% of the market in SOUTH KOREA, Samsung’s and LG’s home market. 24% in China, 51% in the US, and Samsung is under 4% in Japan!

[TexasGator]

Please tell me any advantages of the iPhone 6 over the Galaxy S2 that would cause me to consider upgrading.

[Mad Dawgg]

Oh I know. You get “Apple Smart” by spending more money than you need to.

[Swordmaker]

” However, Apple’s market share actually dropped in Apple’s home country during the period, hitting 32.6% in the September quarter, a 3.3% drop compared to last year”

Unfortunately, it turned out that Kantar's guesstimates for Android sales in the USA and world wide were wrong. When Samsung released its financials a week later they reported a shocking 29% drop in sales, not the increase that Kantar's had projected! Samsi went on to add another 17% reduction in sales in the following quarter.

[Swordmaker]

19% to be more accurate.

False. I don't lie. Multiple sources on the 85% figure, from Tim Cook in Apple's Financial call, to various analysts. Remember more that half of the iPhone 6 sales were in CHINA alone (!), an essentially new market for Apple, where the buyers were not Apple customers prior to buying the iPhone 6. I don't post data without being able to back it up.

19% is an historic convert factor, not applicable to the iPhone 6.

[Swordmaker]

SO ... as it turns out, when you remove Samsung old-style phones from the market figures, Apple has far surpassed Samsung. That’s why Samsung is losing money big time. And that’s also why Apple has 93% of the market’s profit for this kind of phone!

One correction, Star traveler. That 93% figure is the profits for ALL phones regardless of type, not just for the smartphone market.

[Star Traveler]

Okay, I see ... I’ll remember that ... :-) ...

[Star Traveler]

Someone is getting taken ... on one side or another, when the price is more on the resale (used) than it is new ... unless it is a recognized and valued collectible or something happened in the market for the new ones ... like a factory burned up, temporarily causing a shortage or a natural shortage drove the price up. Those circumstances are not the norm and they don’t match for the vast proportion of buys/sells.

As far as new versus old and used ... That’s from my personal observation, used stuff is junk about 99% of the time with a very few exceptions. And it’s basically not worth the time and resources looking for that 1% exception out there. If you sop imply accidental stubble over it when not looking, and you know it’s special and I’m that 1% category - then it would be worth it, I’ve run into the 1% accidentally myself.

[Mad Dawgg]

"As far as new versus old and used ... That’s from my personal observation, used stuff is junk about 99% of the time with a very few exceptions. And it’s basically not worth the time and resources looking for that 1% exception out there."

That is because you are unaware that most everything can be had for far less than what is considered the standard retail price. You have been conditioned by endless propaganda A.K.A. advertising that the only way you can get a deal is by buying new and paying a hefty price to do so because stuff that is cheaper is as you say "junk"...

Sadly you are not alone. It's Why most Americans can't afford to quit their jobs because they are debt up to their ears buy paying premium for stuff they really don't need in the first place. Once you learn that it is the exact opposite that is true and you can end up with all manner of fine things by not paying premium A.K.A. retail, then life gets easy.

Everyday I look for the deals. Everyday I find them. if I can't buy it wholesale then it better be something that will appreciate in value as I own it or makes me money in some other way if not no sale!

Almost everyone I know is always asking how can you get so much for so little. the simple answer is I work at it. Years back I went on a Trip to Las Vegas. I took my wife to the Flamingo Casino stayed for 3 days and all the trip cost me was meals. Why because I found a deal that was setup by the Flamingo they chartered a plane and would put you up free and fly you round trip. All you had to do was put down a 100 buck deposit and have 5000 bucks cash on you when you boarded the plane. How did I find that deal? I called all the travel agents in the area and told them I was looking for a Casino Charter flight and room deal and then waited for the calls.

It takes effort to buy smart and you got to ask for a deal not just stumble upon it.

[Swordmaker]

Oh I see. you think total cost of ownership is determined by tradein value.

You are an idiot who has a reading comprehension problem. Nowhere in what I wrote did I say that "total cost of ownership" is determined solely by trade in value. . . or resale value. It IS a major factor in calculating total cost of ownership. You subtract it from your costs, because it is a recovery of costs at the end of ownership.

• Product A bought for $1000. Projected useful life: two years. Liquidation value: $300. Gross out-of-pocket cost $1000 less $300 = $700. Perhaps it's a piece of crap you have to pay for multiple repair ten times while you own it at $100 a per repair, add $1000. Out of pocket $2000, minus liquidation $300 = total cost of ownership of this item $1700.

• Product B of similar type but higher quality to Product A, bought for $1200. Projected useful life: two years. Liquidation value: $800. During your period of ownership one repair at $200. Out of pocket $1400, minus liquidation $800 = total cost of ownership for the more expensive product $600.

The more expensive Product B cotst $1100 less to own that the cheaper Product A! That's a huge savings of $1100. . . but I exaggerated it a bit to demonstrate why a cheaper, lower quality product can cost a LOT more than a quality product.

BUT THAT IS A COMPARISON OF TOTAL COST OF OWNERSHIP DONE BY AN ECONOMIST!

This is what happens when an ignorant amateur (you) tries to tell an educated professional (me) how to do his job. He gets an education, if he chooses to PAY ATTENTION or he gets his head handed to him. . .

[TexasGator]

“False. I don’t lie. Multiple sources on the 85% figure, from Tim Cook in Apple’s Financial call,”

Cook. Jan 27, 2015.

“At this point in the — just shortly after the quarter — we don’t have all of our research in from all of the people that bought [iPhones] last quarter yet, but in the aggregate, as I’ve mentioned before, we saw more new customers to iPhone than we had ever seen before, and we had a higher rate of Android switchers than we had in the three previous launches, and it’s not that we had more in the fourth one — I don’t know what those numbers are, it wasn’t something we were looking at.”

[Swordmaker]

Temp tech smartphones do not. Because they are designed that way.

You really don't pay attention to what was written, do you? Seven and a half years of continuous phone use, and still going strong on my original iPhone AS A PHONE, now still being used as an iPod touch, retired only because the phone technology advanced beyond its capabilities. . . And it's still on its original battery.

[TexasGator]

You do realize that for each transaction the phone company was subsidizing $450 and it was you that was paying it since the phone company is not giving away subsidies.

[TexasGator]

6 Plus vesus Galaxy:

The Galaxy Note 4 may be the phablet for you if you want a phone that…
•Has a faster CPU clock speed (3.86 times faster)
•Has higher pixel density (28.43% higher pixel density)
•Has a bigger screen (3.64% bigger screen)
•Has more photo megapixels (2x more megapixels)
•Has a higher resolution (1.76x higher resolution)
•Has an external memory slot
•Has a removable battery

http://blog.newegg.com/head-to-head-apples-iphone-6-plus-vs-samsungs-galaxy-note-4/

[Mad Dawgg]

BUT THAT IS A COMPARISON OF TOTAL COST OF OWNERSHIP DONE BY AN ECONOMIST! This is what happens when an ignorant amateur (you) tries to tell an educated professional (me) how to do his job. He gets an education, if he chooses to PAY ATTENTION or he gets his head handed to him. . .

OK so total cost of ownership is ALL costs nice. Thank you for confirming that.

So then when you buy a iPhone the cost is whatever you pay down and then the 2 year contract. So if it is then 50 bucks a month for the cell service and you paid 300 down your total cost of ownership on that iphone is 300 plus the 1200 bucks for the contract because you agreed to it.

So then you trade it in. And you get your new phone for (hahahahah) free and then of course a two year contract so now your cost of ownership of that smartphone is 1500 bucks (what you paid for the one you traded in) plus the 1200 buck contact. So your new smartphone now has a total cost to you of 2700 dollars as a cost of ownership.

Is that what you call "Apple Smart"? hahahah

See if you encumber yourself with a contract you can't just say well that is not part of the ownership of the phone.

how is the economics degree working for your there Sparky?

[Mad Dawgg]

"retired only because the phone technology advanced beyond its capabilities. . ."

QED thanks for proving the point!

[Mad Dawgg]

He also agreed to a two year contract and even at 50 bucks a month that is 1200 bucks added to the cost of the phone.

Part of the cost of ownership.

[Mad Dawgg]

Hey Tex I got an Idea to make some serious jack. We go and get the new iPhone 6 plus from AT&T for 299 bucks then we sell it to the sparkys brand new in the box never opened for 500 bucks. That way they get a deal and we make cash on the Apple suckers err I mean Lovers!

[Swordmaker]

You do realize that for each transaction the phone company was subsidizing $450 and it was you that was paying it since the phone company is not giving away subsidies.

And they do the same for every phone in their inventory. We are comparing Oranges to oranges. As a matter of fact, they make more money on lower cost smartphones than they do on iPhones. That's why the carriers preferentially push them rather than iPhones. Samsung pays huge spiffs to sell their phones. The carriers still charge the same regardless whether the customers select a cheap phone or a high end iPhone. The down payment doesn't make a big difference. . . and the monthly charges are identical for smartphone service whether you have a low or high end phone. My out-of-pocket with my carrier would be no different no matter which smartphone I select. When your two year contract ended did your carrier ever LOWER the monthly price? You've paid off the phone, haven't you? Then it should go down.

The point is that unique among cellular phones, two or even four year old iPhones can be sold for much more than the costs of upgrading to the latest models.