Posted on 02/26/2015 7:06:24 AM PST by aMorePerfectUnion
Google’s Android has gobbled up market share world wide, now accounting for over 80% of all smartphone shipped globally. But when it comes to actually making money, Apple is eating all the profits as it continues its focus on premium devices.
Today Strategy Analytics said that Apple in Q4 last year accounted for 89% of all smartphone profits, equating to $18.8 billion, with Android taking only 11%, or $2.4 billion.
The blow for Android is softened only slightly less so only by the fact that other platform players like Microsoft, Blackberry and Firefox seemingly made no profit at all.
Of course, Android OS is open source and allows for market competition across vendors. This drives down cost (and profit) making great devices available to more people as well as keeping Apple honest and making great devices at a premium.
Capitalism at its best. Do you want a Porsche, BMW, Ford or a Skoda? Apple is more like a Porsche, Samsung BMW, with other Android devices available for dirt. Android provides more price points for products allowing people to buy what they can afford. This doesn’t worry Google and I disagree with some of the analysis. Long term it might be difficult for people to justify the cost of an Apple device, 99% of desired features will be available in a cheap device - which will be Android based.
I’m an Android guy, I don’t believe the Apple premium is worth it - especially considering the “walled garden” they keep you in. If you’re ok with the costs then Apple does provide a better unified experience across devices/technologies. I love my S5 and don’t want to be trapped in (and controlled by) a proprietary Apple world.
Interesting — as you may recall, the late Steve Jobs didn’t want Apple in the Netbook business until they had a product that would redefine the category (and btw, generate Apple margins); the netbook margins wound up being about the same as the margin on retail sales of bananas, which had been the same area that normal CPUs had been at for a while already. Apple didn’t invent the mp3/portable digital music player, but the iPod redefined the category and nabbed the profits (and Apple margins). Apple didn’t invent the cell phone or the smart phone, but when the iPhone came out... (etc)
+1. That Galaxy Note III represents the convergence of smart phone and PDA that I’d been looking for. Mine’s great.
“Capitalism at its best.”
Agreed.
“Do you want a Porsche, BMW, Ford or a Skoda? Apple is more like a Porsche, Samsung BMW, with other Android devices available for dirt.”
If your BMW can’t produce cars at a profit, the future doesn’t bode well.
“Android provides more price points for products allowing people to buy what they can afford.”
Agreed.
“This doesn’t worry Google and I disagree with some of the analysis.”
Google doesn’t have much to lose.
“Long term it might be difficult for people to justify the cost of an Apple device, 99% of desired features will be available in a cheap device - which will be Android based.”
That does presume a static world, unguarded by new patents.
“I’m an Android guy, I don’t believe the Apple premium is worth it - especially considering the “walled garden” they keep you in.”
It is insignificant to me and most. Perhaps you are doing sophisticated things that are unattainable in the Apple system?
“If you’re ok with the costs then Apple does provide a better unified experience across devices/technologies. I love my S5 and don’t want to be trapped in (and controlled by) a proprietary Apple world.”
I focus on value. Cost is not a big deal to us, fortunately. I want it to work and not be vulnerable to malware in all its forms. And be beautiful and effective. It does all that for us.
What are you doing with your S5 (if you don’t mind my asking) that you would be unable to do with an iPhone? What would be missing that would alter your world dramatically?
I’m fine with people using all the different phones - even the MS Monster. Competition makes everyone better... at least the survivors.
“paper phone running Android”
I don’t know... it looks like they stole that from Daytimer...
A company exists on profits ... and Apple has it all ... :-) ...
Of course, the reason why Apple has all the profits, is because they have a growing customer market, and that growing market keeps repeating sales.
That “exit sign”, by the way, is the same exit sign that these APPLE TROLLS have been using for the last 30 years ... LOL ...
You highlight the brain dead nature of the doom and bloomer’s “analysis.” They act as if Apple will only make iPhones from now until they go out of business. That’s not even true now, but they cling to their silly position.
I don’t care one way or the other since I don’t own a cell phone. I can’t get worked up over any of it and I find those that do amusing.
“PROFITS” for a business ... means ... you can stay in business FOREVER with “profits”!
You said, “Apple will be gone in 5 years . mark my words.”
There was a poster on Free Republic that said Apple would be gone “next year” ... and he was saying that, year after year, from about ten years ago, up until just recently,
After saying that for year after year ... he finally gave up ... LOL ... He’s not been posting that recently ... :-) ...
I’m developing a smartphone OS faster than apple cheaper than Android to kill Apple lol
Good luck on that one ... :-) ...
Do keep me posted on that new Phone OS. If you get some reviews on it from other tech reviewers, let us know on Free Republic!
I tried the iPhone thing when it came out. When the next upgrade time came around, I switched to Android and have been happy ever since. On my 3rd Android phone now, and each has been better than the last.
Thanks . Will do.
Well, for Android device makers, there’s going to be profits, I don’t think that is in question - just how much (we’re still talking about a lot of money). I don’t see it as any different than any other market. Android isn’t going away, it’s also doing a lot more than phones (cars, TV’s, watches, etc.). Google makes loads from application sales as well.
On patents, I agree, although that is Apple’s biggest challenge - to continuously come up with big ideas and execute on them. All electronic gadgets become a commodity at some point. Of course Google has their own patents too. I’m guessing that these recent profits are because of bigger screens, everyone with an iPhone probably wanted that. So we’ll see if the sales numbers continue or wane.
Cost is not insignificant to most, although it is insignificant to people that can (truly) afford Apple products. It’s the same reason every higher end vehicle has specific support for Apple products - the owners all have iPhones (almost exclusively). Cheap cars not so much.
My background is embedded software engineering. I work on automotive projects (infotainment systems). I have to deal with a lot of open standards. I HAVE to support Apple products. It’s like supporting the same features twice, once for open standards and once for Apple stuff. Apple is difficult to work with, lots of NDA’s/red tape type issues. I like the fact that I can grab a Windows/Linux machine and develop an Android application, along with developing it on any generic (cheap) Android device. Android is very friendly with other devices, like projecting on my LG TV, being a DLNA controller of my home media servers, etc. - no extra devices needed, all free software based on open standards. To write an iPhone app I’d have to buy a Mac first...no thanks, I’m not going to spend an extra grand for the same hardware. This is what they do, it is what they’ve always done. Control the HW/SW and entire ecosystem...and charge a premium for it. I can do the same for much less, even if it isn’t quite as polished.
It’s somewhat a personal thing, I refuse to give them my money partly because of the annoyances they cause me for work!! There’s probably nothing, from a user perspective, that I couldn’t do with Apple products. Although I could argue the opposite, that there’s nothing that an iPhone can do that I can’t do on Android, at least that matters to me - so why pay more for it? It really adds up when you want to develop for it or inter-operate with other devices.
From a technical perspective, I love being able to have the OS source code, dig into it - it’s a form of freedom. If we have a bug we don’t have to wait for Apple. I can extend it, improve it, submit back to Google (free engineer time for them). From a security point of view, Apple is not immune and Android is not as bad as some make out. Newer versions utilize SELinux technologies and in general it is solid. Any device is vulnerable, how many of those iPhone software updates fix security issues (they never tell you about)? I get to hear about Android ones, very quietly from Google, but it is harder to keep quiet because it’s open source.
I’d never say Apple products are crap, that would be dumb, although it is the same to say that of Android. Most people have no idea just how complex these things are and the engineering effort required to bring them to market. They’re brilliant.
I had an iPhone and it was okay. I use a Samsung Galaxy S4 now and it’s great. I don’t own any Apple stock anymore, so I don’t care about their profit margins.
As a consumer, I think Samsung has plenty satisfactory build quality and a definite technological edge with much more flexibility.
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Apple just took 33% of the market in South Korea last quarter. . . Samsung's and LG's home market. And Apple is now the # 2 best selling phone in China after Xiaomi, a iPhone copycat. Still think Apple's days are numbered?
Samsung DID have a major new release in the 3rd Quarter of 2014 and lost 27% and then lost another 19% in the 4th Quarter. This following losses in the 2nd quarter. Their losses are continuing in the 1st quarter of 2015.
No, Democrat_media, Android doesn't have 80% of the world's smartphones. They have 80% of the world's mobile phones, but not 80% of the world's smartphones. There is a difference with a big distinction.
In late 2013, during the Apple v. Samsung, During discovery, Judge Lucy Koh ordered Samsung to reveal their product mix of their phone sales. It turns out that Samsung sells about 30% Android Smartphones, 40% Android Feature Phones, and 30% Android dumb phones. . . and the mix is about the same for those companies like LG, SonyEricsson, Lenovo, who also make any smartphones . . . because they compete for the same market space as Samsung.
There are another 225 or so Android phone makers, the vast majority of which do not make Smartphones at all, but turn out either Android Feature Phones or Android Dumb phones, competing for the huge low-end and mid-range phone markets.
That is the approximate mix of Android phones in the market. . . much of the third world where they use Android phones have only limited Internet access. . . and can afford only Feature phones or the very cheap dumb flip or candy bar phones. . . yet when they count the Android market, they mix them all and count them as "SMARTPHONES", when they clearly are not.
When Samsung's fortunes turned for the worse in early 2014, they CUT their high end production because it was not selling. . . and increased the numbers of their low end and middle market phones, the dumb and feature phones.
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