iOS marketshare slipping?

[Deleted member 13524]

I just saw the Kantar smartphone marketshare results, and this is the table they have to show:

I can't help but notice that iOS lost marketshare in every single one of the markets portrayed in that table.

In the article, they do mention that iOS gained marketshare in Japan, though. But in that table, we do see iOS steadily losing marketshare to Android and even Windows Phone in Italy.
Furthermore, these results point to Q4 2013, where we saw the release of iphone 5S/C and no relevant new phones from the key Android players.

 

[Helmore]

Did we expect any different? I think that pretty much everyone expected Apple's share of the smartphone pie to decrease as long as they aren't catering to the low end of the market. But to be honest, would they really want to cater to the low end? Margins are incredibly low there and I'd guess that those people that buy a low end phone also end up getting you less App Store income (just a guess, not based on anything really). Volume would have to make up for that of course. I think that as long as Apple continues to make record breaking sales, like they're doing now, they don't have too much to worry about. Despite their slip in market share, their App Store can still be considered the number one.

 

[Mize]

Personally I think it's more than that. Itunes/video player on iOS7 and OSX have steadily gone downhill in terms of HMI and bizarre convoluted usage. I have an iPad and several Android tablets and have gone from strongly preferring my iPad for watching videos while doing cardio to preferring Android because of how much Apple has dorked their HMI. I supposed they're trying to be innovative, but, for me at least, iOS7 is a big step backwards.

 

[Mariner]

My sister has gone the other way. After using a few (budget-ish) Android phones over the years, she has inherited her husband's iPhone 4s (following his purchase of the mind-bogglingly expensive 5s) and absolutely loves it because it is pretty stable and links up well with their iPad and AppleTV.

That said, her previous phone was a relatively outdated Galaxy S and, although I'd installed CM9 on it for her, she always claimed to be too busy (or just not bothered enough) to let me install newer ROMs!

Thinking about things, I'd have to say that quite a few of my friends have moved across to using iPhones and other Apple devices over the past year or two and my older sister even intends to buy herself a MacBook soon.

Doesn't appeal to me as I prefer to mess around and hack cheaper devices - more bang per buck.

 

[UniversalTruth]

Not surprising, more people get enlightened NOT to follow the fruit.co

Anyways, from psychological standpoint, it would be interesting to guess why so few people support them in Spain, Italy, Germany and China, while those in USA, Australia and Great Britain think otherwise

Seems like the Iron curtain dividing Eastern Europe with their Communist manufacturing, and Western Europe with their Capitalist

 

[Helmore]

Do you even know where the Iron Curtain used to be?

I do think it's interesting to see these differences in market share between the different countries. Makes me wonder about the reason behind the differences.

 

[Sinistar]

A little off topic since this thread is about market share, and not sales.

http://www.theverge.com/2014/1/27/5350106/apple-q1-2014-earnings

iPhone sales broke 50 million for the first time in a single quarter, reaching 51 million, while iPad sales also set a new record of 26 million.

 

[Helmore]

I don't think that's exactly off topic Sinistar. I think that as long as Apple will continue to break its own sales records, they'll do fine. Especially if they manage to do so while only catering to the high end of the market. If they do that, it won't hurt them that bad that they're slipping in market share. There will still be plenty of developer interest in their iOS platform.

 

[zed]

Im not surprised. whilst the hardwares good (ignore the small screen) I was using IOS7.1 recently, compared to the latest android versions its a giant leap backwards
I would like to see how many iphone5c sold, i would be shocked if its greater than 10% of the iphone5s

 

[silent_guy]

Anyways, from psychological standpoint, it would be interesting to guess why so few people support them in Spain, Italy, Germany and China, while those in USA, Australia and Great Britain think otherwise

In the US, phones are subsidizes so the price matters much less and you don't need to pay $700 for a phone up front. That makes an iPhone similar in price.

Corollary: when price doesn't matter, people are more likely to choose quali^H^HApple.

 

[Arwin]

I've considered it an inevitability. Their main advantage has been the combination of OS with good hardware and a huge head-start in seeing the importance of a new UI paradigm, App Store etc. But the rest of the world will eventually catch up, and if they stay a closed box, they can never hang on to the lead.

This is no problem though in their current position, which is very comfortable. They can keep making lots of money, and try not to get behind, ride the name for a long time, and make the most of their closed platform, while Android phones become ever lower-margin, PC-like creatures that give a great bang for a small buck, allow you to do everything, and have to run anti-virus software.

I hope they'll stay around for a long time, though, because what they do keeps making sense, even if they leave a void that's happily filled by many, many others. Just keep being the best thing for a rich and healthy market, and you can last a long, long time.

 

[silent_guy]

What surprised me most in those numbers is the market share of Window in some of these countries. 17% in Italy? I see more Ferraris than Wjndows Phones in my day to day life!

 

[Ailuros]

What surprised me most in those numbers is the market share of Window in some of these countries. 17% in Italy? I see more Ferraris than Wjndows Phones in my day to day life!

Exactly what I was thinking; maybe they're hip at bunga bunga parties

 

[Alexko]

I don't think that's exactly off topic Sinistar. I think that as long as Apple will continue to break its own sales records, they'll do fine. Especially if they manage to do so while only catering to the high end of the market. If they do that, it won't hurt them that bad that they're slipping in market share. There will still be plenty of developer interest in their iOS platform.

But can they manage to do that? And if so, for how long? They've already had to release a somewhat mainstream-ish model (iPhone 5C) and only got modest growth out of it (compared to Samsung, LG, Huawei, Lenovo, etc.)

I don't expect Apple to be in serious trouble any time soon, but their net income is already dropping, and I'd expect this to continue. It wouldn't surprise me to see decreasing revenues within 2~3 years either. In particular, if the subsidies scam were to be disturbed in the US (which doesn't seem all that likely in the short term) it could hurt them pretty bad.

 

[Helmore]

I agree with you there Alexko. It will be very hard for them to keep up the trend they currently have. I actually kind of expect what you're describing, where they'll start to see decreasing revenue in a year or 3. Nothing too dramatic probably, but still. That said, maybe they'll surprise us, you never know.

 

[Ailuros]

But can they manage to do that? And if so, for how long? They've already had to release a somewhat mainstream-ish model (iPhone 5C) and only got modest growth out of it (compared to Samsung, LG, Huawei, Lenovo, etc.)

I don't expect Apple to be in serious trouble any time soon, but their net income is already dropping, and I'd expect this to continue. It wouldn't surprise me to see decreasing revenues within 2~3 years either. In particular, if the subsidies scam were to be disturbed in the US (which doesn't seem all that likely in the short term) it could hurt them pretty bad.

If they wanted the 5C to be a serious sales success, they should have priced a lot more attractive.

Decreasing revenues is relative as to whether they'll more actively chase alternative markets and if they'll be successful there or not. The NET income is dropping because they spend more than before in R&D or less? (honest question).

 

[patsu]

What surprised me most in those numbers is the market share of Window in some of these countries. 17% in Italy? I see more Ferraris than Wjndows Phones in my day to day life!

If they are comparing global sales, then it's likely to be shipment/sell-in numbers.

For sell-in figures, the more SKUs and manufacturers you have, generally speaking, the more channel inventory out there (to be worthwhile). Cook mentioned in the conference call that their sell-through numbers are actually very strong.

But there are many low end Android phones in India and China. Windows Phones are also low end devices since the growth is in the low end. In India, since Apple discontinued iPhone 4, they lost even more shares to other brands. These low end phone users are unlikely to use the extra services though.

Edit: Cook also mentioned that their new China Mobile sales is based on 16 locations only. They have 284 more locations to cover in China.

Apple likely won't lower price until their global channel have been fleshed out. Most people think they are big, but they are actually pretty lean. Their Mac channel is tiny. So they have to spend years building out their global distribution. They were kinda fighting using a smaller channel all along. They were never #1 in shipment, even for phones.

Companies like Sony and Samsung have more widespread channel than Apple. The latter is also very picky about channel partners. So if you compare sell-in data, they are at a disadvantage. But their sell-through is impressive.

 

[patsu]

Im not surprised. whilst the hardwares good (ignore the small screen) I was using IOS7.1 recently, compared to the latest android versions its a giant leap backwards
I would like to see how many iphone5c sold, i would be shocked if its greater than 10% of the iphone5s

5c was #2 or #3 in US depending on carrier ("competing" with S4). 5s is top.

Given the $100 difference, many people will opt for 5s. You get a MUCH better and versatile camera, fingerprint recognition, metal casing, and the latest CPU. ^_^

iOS7 is a major revamp. There are rough edges and forward thinking features in the system. I think they need the apps to be updated to stablelize the environment. iOS 7.1 beta 4 is actually quicker than iOS6 on my iPad 2. When it's released, I expect it to be almost as good as iOS6 in terms of smoothness. But in terms of enterprise security, it is miles ahead.

 

[Alexko]

I agree with you there Alexko. It will be very hard for them to keep up the trend they currently have. I actually kind of expect what you're describing, where they'll start to see decreasing revenue in a year or 3. Nothing too dramatic probably, but still. That said, maybe they'll surprise us, you never know.

If they wanted the 5C to be a serious sales success, they should have priced a lot more attractive.

Decreasing revenues is relative as to whether they'll more actively chase alternative markets and if they'll be successful there or not. The NET income is dropping because they spend more than before in R&D or less? (honest question).

Ah but they can't price the 5C lower, because they're Apple and they want to remain Apple, that is they want to maintain very high volumes and obscene margins. Their R&D budget has been steadily and rapidly increasing for years, up to almost $4.5 billion in 2013, from $1.8 billion in 2010.

They have a possible way out of their falling profits problem, however. When the iPod started losing steam, they came out with the iPhone, and were even more successful. Then they diversified with the iPad, but now both iPhone and iPad volumes are starting to stabilize, while ASPs are stable or falling (because of the iPad mini). So they need something new, perhaps glasses, watches, or something else.

The question is whether they can do it. Can glasses and watches themselves have as much of an impact as smartphones and tablets did before? Can Apple be as successful in those markets as they were before given that the competition has a headstart (Galaxy Gear 1 and soon 2, Qualcomm Toq, Google Glass, etc.)? Is it all even possible without Jobs and his RDF?

I have serious doubts, but we'll see. And maybe Apple will come out with something big and entirely unexpected.

 

[Ailuros]

Ah but they can't price the 5C lower, because they're Apple and they want to remain Apple, that is they want to maintain very high volumes and obscene margins. Their R&D budget has been steadily and rapidly increasing for years, up to almost $4.5 billion in 2013, from $1.8 billion in 2010.

They have a possible way out of their falling profits problem, however. When the iPod started losing steam, they came out with the iPhone, and were even more successful. Then they diversified with the iPad, but now both iPhone and iPad volumes are starting to stabilize, while ASPs are stable or falling (because of the iPad mini). So they need something new, perhaps glasses, watches, or something else.

The question is whether they can do it. Can glasses and watches themselves have as much of an impact as smartphones and tablets did before? Can Apple be as successful in those markets as they were before given that the competition has a headstart (Galaxy Gear 1 and soon 2, Qualcomm Toq, Google Glass, etc.)? Is it all even possible without Jobs and his RDF?

I have serious doubts, but we'll see. And maybe Apple will come out with something big and entirely unexpected.

If their R&D expenses are growing rapidly while they're using one and the same SoC for the 3 different devices it sounds like they are researching/investing in alternative markets; for which I wasn't exactly thinking of watches or other boring wearable stuff but home entertainment like a set top box or smart TV. Especially with the latter and assuming they manage they get the right contracts to ensure worthwhile content, it could turn into another huge margin money milking cow.

And what's a headstart anyway? There used to be smartphones too before the iPhone. Want to bet that if they ever really release a smartTV platform it will turn out to be revolutionary for quite many despite the typical Apple restrictions it might have?

But since that may take some time still, let's see if and by how much iPads will grow this year.