Is Apple about to lose its dominance in the smartphone/tablet market?

[boomhower]

If note losing the cracks in the armor are certainly starting to show. With the iPhone 5, Apple has angered a ton of people including some blindly Apple loyal. Between dinged up phone to the Maps debacle, it has gotten bad. I'll admit, the Galazy S3 Mini has me intrigued. I don't know why all the Android manufactures think every wants a giant screen. People make fun of one handed use saying it's just the Apple sheep, but it's something important to me. Anything larger than 4.0 is getting hard and over 4.3 is a complete non-started for me.

 

[dagamer34]

Apple will stop being this aspirational fairy tale company everyone thinks they are and just start operating like a norma (but still very successful business). The difference is that when the company does something wrong, they'll actually call them out for it.

 

[Zaap]

I don't know why all the Android manufactures think every wants a giant screen. People make fun of one handed use saying it's just the Apple sheep, but it's something important to me. Anything larger than 4.0 is getting hard and over 4.3 is a complete non-started for me.

I don't know why people think they can't get an Android phone with a 4" screen. I'm sure if any of them were selling in numbers as great as the SGS3 or Nexus or Note or whatever then manufacturers would make even more smaller phones.

I also just don't get how small a person's hands have to be that they couldn't use a > 4" phone one handed. I have absolutely no trouble using my SGS3 one handed. If the screen were a whopping .8 inches less, it would make zero difference as far as one-handed use.

 

[Mopetar]

I'm saying that Apple may not do as well as it has in the past, starting with September of 2012, because the iPhone 5 upgrade is a small incremental over that of the 4S and isn't that much better than competitor Androids.

The same thing has been said about pretty much every other iPhone release. I remember this gem of a thread from last year about the 4S: http://forums.anandtech.com/showthread.php?t=2196198.

It's pretty much the same set of arguments, usually made by people who have no interest in buying an iPhone anyway. For whatever reason, people on tech forums seem to convince themselves that not only do they have a good understanding of the industry, but that somehow the average consumer makes purchasing decisions in a fashion similar to their own.

Both of those things, and especially the later, tend not to be true. It's why something like "No wireless. Less space than a Nomad. Lame." is still quoted so often to poke fun at this armchair analysis.

I honestly don't think that anything you've listed will even put a dent in iPhone sales. Furthermore, I don't think we're going to see much beyond small incremental upgrades in phones for the foreseeable future, so I'm not even sure what it is that you're expecting. Go ahead and point out one addition to the iPhone 5 that would have made it more than an incremental upgrade to you, and I'll gladly point out that 95% of consumers wouldn't care about it or that it's not feasible for some reason.

5 million units is well short of the 6.5 million units that was expected by analysts hence the drop in stock price.

Apple's stock price could tank heavily for any number of reasons, but it wouldn't have any impact on the sales of their devices. It could even shoot up several percent for any number of similar reasons (e.g. analysts start undershooting on predictions) that have nothing to do with Apple's actual sales.

Also, I generally don't put a lot of faith in analyst predictions. They're rarely correct, and generally don't contain any description of how the numbers were arrived at, so for all anyone knows they're just a gut feeling from someone who's previous gut feelings haven't been all that accurate. Here's an older CNN article that lists several analyst predictions from Apple's 4Q 2010 results. Here are the actual results that Apple posted. When looking at certain analyst predictions, especially for any one product, they can be off by staggeringly large amounts.

 

[akugami]

Old data that only show sales up to the second quarter of 2012, that doesn't show the iPhone sales after the Galaxy S3 came out into the market, and certainly doesn't have the iPhone 5 sales.

Please come back in a year or 2 with a musical and tell us how much you love iPhone developers as well as Steve Jobs.

Umm...how the hell is data that shows the last five years up to the first half of this year old data? Are you serious?!? You can't be serious.

I'm saying that Apple may not do as well as it has in the past, starting with September of 2012, because the iPhone 5 upgrade is a small incremental over that of the 4S and isn't that much better than competitor Androids.

5 million units is well short of the 6.5 million units that was expected by analysts hence the drop in stock price.

What do you base your conjecture that Apple may not do as well in the coming months/years on? The increasing sales every year?

Basing it off what an analyst says is BS. The iPhone 5 has been selling out as fast as Apple can get it into the hands of the consumers. And yes, if Apple had another 1.5 million units, they would have sold all of them.

I know you're trying hard to invent reasons why Apple is going to fail but at least think logically and give a plausible response. There are definitely valid reasons why Apple may fail in the future. The problem is the reasons you gave makes absolutely no sense if you're trying to argue Apple is about to fail.

 

[Fire&Blood]

In terms of ecosystem milking no even comes close to Apple. They targeted the networks with the wealthiest subscribers first and still avoid the cheapest carrier (T-Mobile) to this day. They dictate terms to carriers that are far more lucrative than deals with Android OEM's.


They aren't trying for mass adoption with Accords or Camrys, iproducts are more like a 5 series BMW with last year's models doing fairly well too.

 

[iGas]

It seems as if bigger is better. And, it look like Apple is staying flat during Android early stage to Aug 2011. IMHO, newer Android is a major game changer and perhaps it start in Aug 2012.

May 2012

 

[jpeyton]

Yeah. Apple is doomed I tell you. Their market share keeps dwindling every single year.

The worldwide smartphone market is around 450 million units per year and growing. It makes perfect sense that Apple's unit sales and profits will rise even as their market share drops.

Apple can't maintain iOS as the "premiere" mobile ecosystem without developers, and developers aren't going to code for iOS exclusively if it accounts for 10% of the worldwide market.

Between the iPhone, iPad and iPod Touch, iOS is still very relevant right now. But the writing is on the wall; extrapolate Android's growth in the smartphone and tablet market out 2-3 years from now and iOS will be a much smaller blip on the radar.

 

[Suspicious-Teach8788]

The worldwide smartphone market is around 450 million units per year and growing. It makes perfect sense that Apple's unit sales and profits will rise even as their market share drops.

Apple can't maintain iOS as the "premiere" mobile ecosystem without developers, and developers aren't going to code for iOS exclusively if it accounts for 10% of the worldwide market.

Between the iPhone, iPad and iPod Touch, iOS is still very relevant right now. But the writing is on the wall; extrapolate Android's growth in the smartphone and tablet market out 2-3 years from now and iOS will be a much smaller blip on the radar.

They won't code for iOS exclusively, but even with far less marketshare, you can tell iOS apps take a front seat to Android apps. Select developers do try to even the two in terms of development priority (Foursquare), but it's clear others like Facebook, Twitter, Flipboard, put iOS first.

You don't need to be #1 marketshare to have the developers clamor over. It'd be interesting to see the average # minutes the FB app is used on an iOS device and an Android device per day. Or perhaps compare the activity on the FB app via Android vs. iOS. I somehow think iOS users are more active in the world of apps in general, especially communication and social networking apps.

 

[kyrax12]

Do you guys think that in a couple of years, iOS will start to lose out on popularity?

 

[kyrax12]

They won't code for iOS exclusively, but even with far less marketshare, you can tell iOS apps take a front seat to Android apps. Select developers do try to even the two in terms of development priority (Foursquare), but it's clear others like Facebook, Twitter, Flipboard, put iOS first.

You don't need to be #1 marketshare to have the developers clamor over. It'd be interesting to see the average # minutes the FB app is used on an iOS device and an Android device per day. Or perhaps compare the activity on the FB app via Android vs. iOS. I somehow think iOS users are more active in the world of apps in general, especially communication and social networking apps.

Why you think that?

 

[jpeyton]

They won't code for iOS exclusively, but even with far less marketshare, you can tell iOS apps take a front seat to Android apps. Select developers do try to even the two in terms of development priority (Foursquare), but it's clear others like Facebook, Twitter, Flipboard, put iOS first.

That "app" advantage will erode quickly. At some point, the numbers become overwhelming enough that you're only doing your own company a disservice by putting Android second.

Apple's profit advantage is also eroding. Samsung is getting ready to announce a $7.3 billion Q3 profit, doubling what they made year-over-year.

 

[Suspicious-Teach8788]

That "app" advantage will erode quickly. At some point, the numbers become overwhelming enough that you're only doing your own company a disservice by putting Android second.

Apple's profit advantage is also eroding. Samsung is getting ready to announce a $7.3 billion Q3 profit, doubling what they made year-over-year.

At what point? When iOS marketshare hits 20%? 15%? 10%? I think my basic point is that if an average iOS user uses apps more than an average Android user, then the marketshare of Android needs to at minimum have that much of an advantage over iOS to make up for its users barely touching apps. That's at a minimum. But moreover, as an App developer, I think I'd rather have 10 million loyal fans using my app 1 hour a day than 60 million using it 10 minutes a day. It's clear who is using my app in a deeper manner, and I would work on adding new features to cater to those who actually utilize my apps features.

If you look at Twitter, how many people are tweeting from iOS versus Android?

If you look at Foursquare, how many people are checking in via iPhone vs Android?

If you look at Facebook, how many people are posting photos via iPhone vs Android?

In all 3 categories, what I can see is it's iOS.

At work when I see people checking their phones during meetings more than half of those are iPhone users. Amongst the whole manufacturing engineering group at our office, with ages 20-early 30s, ALL had iPhones. This is a target audience that uses phones and apps actively. I can bet you these guys use their phones far more in terms of apps than 50 year olds.

Honestly, looking at those statistics if I wanted to target an audience that will use my app more, I think I would do iOS first. Even if my app is free. You want to be popular? Get an iOS version out. Even my friends who develop for Android, they desperately find an iOS developer ASAP to help them out and launch as soon as they can. Meanwhile I see iOS developer friends take their sweet time. Wait 6 months even before actually starting to port over. It's just not a big priority.

 

[iGas]

At what point? If you look at Twitter, how many people are tweeting from iOS versus Android?

If you look at Foursquare, how many people are checking in via iPhone vs Android?

If you look at Facebook, how many people are posting photos via iPhone vs Android?

In all 3 categories, what I can see is it's iOS.

At work when I see people checking their phones during meetings more than half of those are iPhone users. Amongst the whole manufacturing engineering group at our office, with ages 20-early 30s, ALL had iPhones. This is a target audience that uses phones and apps actively. I can bet you these guys use their phones far more in terms of apps than 50 year olds.

Honestly, looking at those statistics if I wanted to target an audience that will use my app more, I think I would do iOS first. Even if my app is free. You want to be popular? Get an iOS version out. Even my friends who develop for Android, they desperately find an iOS developer ASAP to help them out and launch as soon as they can. Meanwhile I see iOS developer friends take their sweet time. Wait 6 months even before actually starting to port over. It's just not a big priority.

So far 2 of my co-workers upgraded their iPhones to iPhone 5. 4 iPhone users upgraded to the Galaxy S3, and 2 Android users upgraded to Galaxy S3. I upgraded from Black Berry to Galaxy S3, and 1 more will upgrade from iPhone 3 to the Note II once it is out in a few weeks. 2 others are thinking of getting Android. And the majority of the users are in there late 20s to early 30s.

From what I have seen people are getting Android phones instead of iPhone, and people are defecting from iOS to Android.

 

[Mopetar]

It seems as if bigger is better. And, it look like Apple is staying flat during Android early stage to Aug 2011. IMHO, newer Android is a major game changer and perhaps it start in Aug 2012.

Market share doesn't matter all that much when a large portion of the market is still untapped. As another poster pointed out earlier on, Android is going to be able to target segments of the market that Apple either can't or isn't interested in.

Basically what this means is that Apple continues to sell more phones year-over-year. Once the market becomes saturated, the only way for Apple to grow is at the expense of other smartphone owners. At that point, the inability to grow their market share will hurt Apple's stock price, but if they're still hauling in the majority of the profit, I doubt that they'll care if they're stuck at ~25% of the market.

Unless that changes, and there's no good indication that we'll see a significant change in the next few years, there's no good evidence to suggest that Apple is doomed.

 

[boomhower]

Have there been any recent studies done on how much users are spending? I remember a year or two ago reading some that showed iOS users spent a lot more than Android users. Android users by in large went for free apps alone.

I don't know why people think they can't get an Android phone with a 4" screen. I'm sure if any of them were selling in numbers as great as the SGS3 or Nexus or Note or whatever then manufacturers would make even more smaller phones.

I also just don't get how small a person's hands have to be that they couldn't use a > 4" phone one handed. I have absolutely no trouble using my SGS3 one handed. If the screen were a whopping .8 inches less, it would make zero difference as far as one-handed use.

Yes there are 4" phones but they are middle of the road phones. I want a flagship phone, not the $49-$99 model. I want the high end CPU, high quality screen, camera, etc. I just want it in a smaller package.

Screen size is just personal preference but I know I'm not alone. Can a large phone be used one handed? Sure. But I don't want to have to roll it around, readjusting, etc. A smaller screen is just easier to use one handed. I don't have small hands, I wear a medium glove so average size. I just don't have any desire to have a screen on my phone pushing 5".

 

[MrX8503]

I'm saying that Apple may not do as well as it has in the past, starting with September of 2012, because the iPhone 5 upgrade is a small incremental over that of the 4S and isn't that much better than competitor Androids.

5 million units is well short of the 6.5 million units that was expected by analysts hence the drop in stock price.

Small and incremental? Lol where do people come up with this?

Wait for the sales reports, it's going to smash sales records. Nokia and Samsung knows it too, considering their recent desperate ads. Oh and there's gonna be a GS3 mini. Hmmmm.

 

[Oyeve]

Do you guys think that in a couple of years, iOS will start to lose out on popularity?

If it stays the same yes, IOS is starting to get long in the tooth. But the same can be said of any mobile OS. It just starts to get boring sooner or later.

 

[BenSkywalker]

If you look at Twitter, how many people are tweeting from iOS versus Android?

If you look at Foursquare, how many people are checking in via iPhone vs Android?

If you look at Facebook, how many people are posting photos via iPhone vs Android?

I'd bet if you listed a Cosmopolitan app you would find the same too. I could take it out to a further extreme and point out with nigh 100% certainty that a tree hugging tofu eating app would dominate on iOS the same way a raw steak eating gun shooting app would dominate on Android.

If the apps you use most on your phone are social media apps, you should not only buy an iPhone, you should also get an iPad and a Mac to go along with it, your Prius should have plenty of room

Small and incremental? Lol where do people come up with this?

Very far removed from the RDF, it's a place called 'reality'

Wait for the sales reports, it's going to smash sales records.

Maybe it will, the 4S was a very small upgrade over the 4 and it managed to do so. Doesn't change reality.

 

[runawayprisoner]

That "app" advantage will erode quickly. At some point, the numbers become overwhelming enough that you're only doing your own company a disservice by putting Android second.

Apple's profit advantage is also eroding. Samsung is getting ready to announce a $7.3 billion Q3 profit, doubling what they made year-over-year.

I understand the sentiment regarding the backseat that Android app development has taken for the past couple of years... but... I don't think marketshare factors in the decision that much.

Here is my perspective as someone who is having ongoing projects on both Android and iOS... specifically... both the HTC One X and Galaxy S3:

I MUCH prefer working on iOS, not because there is a huge user base willing to buy my apps, or because there is only one device that I have to write for, but because... the hardware on iOS side is of a much higher quality than Android. And by "much higher", I mean... the camera is of more consistent quality, the microphone is of more consistent quality, and sensors (gyroscope, GPS) are of much more consistent quality. HTC One X? Horrible... borderline bad camera. Galaxy S3? Super spotty GPS. If I want to implement any idea that involves either of those devices, then I'd have to make severe compromises on the Android side simply because the hardware isn't up to par.

And yes, that means specs sheets (CPU, RAM, etc...) don't tell the whole story. There are other things in a device that are more important.

But on the topic of hardware... Android's memory and performance behavior is wildly different depending on the phone. Heck, on the Galaxy S3 and One X, the behavior is wildly different for different ROMs. I still can't see how I can make an overly complicated app that will perform consistent. It's always either too slow, laggy, or it's running fast but the background behavior is spotty and unreliable. And by overly complicated, I mean something more than simply scanning a barcode and sending the result to a database.

And last but not least, we can go back to marketshare: while the iPhone is having diminishing marketshare, I don't see diminishing sales for my apps. In fact, even for free apps, I'm earning more on iOS side than on Android side. I think it's not just because iOS users are more willing to pay (I have many free apps), but it might in fact be that iOS users are more willing to use apps. Also if I'm pitching an iOS project to a prospective business looking for a third-party developer, I'd always recommend an iPod Touch rather than an iPhone. Or at most an iPad if they want a bigger screen. And I don't think any marketshare analysis done thus far has included the iPod Touch... but yet it's still a very valid app platform for developers. Until someone can challenge that market, in which I'm sure the iPod Touch captures a perfect 100% and is actually higher than iPhone in raw number, I don't think iOS as a whole ecosystem (iTunes, iPhone, iPod, iPad and soon to come iPad mini) would die for many years to come.

And I actually hope that it doesn't... because I'm enjoying a lot of good revenue on iOS as a developer as opposed to Android. If anything, Android development has become more of an afterthought lately, and I don't think I'm the only developer who is thinking this way.

Also just as an aside for those who are saying the iPhone 5 is an incremental upgrade over the 4S... well, in terms of performance, it's not. It's a very different beast compared to the 4S. It's much faster than the 4S and the iPad 3. It's the most powerful iOS device to date... and that's only because I'm avoiding having to state something along the line of "it's the fastest smartphone on the planet" because I don't want to start another pissing war... But that's just reality. As a developer, I can see many things that I can do on the iPhone 5 that I can't do on any other device. And that's solely due to the faster CPU, not due to anything else.

 

[dagamer34]

Marketshare isn't a key number to worry about until you've tapped out everyone interested in that class of product. Until you hit that point, you can grow by acquiring new customers without having to steal them from a competitor.

As such, when making predictions, it's not about what you see today but what will be happening a year or two from now. Does anyone actually expect BlackBerry survive even though its still 12% of the market? Does anyone think that Windows Phone will flop so horribly that Microsoft will just quit? Does anyone think that Android can continue its rise in marketshare forever without reigning in control?

 

[Capt Caveman]

I understand the sentiment regarding the backseat that Android app development has taken for the past couple of years... but... I don't think marketshare factors in the decision that much.

Here is my perspective as someone who is having ongoing projects on both Android and iOS... specifically... both the HTC One X and Galaxy S3:

I MUCH prefer working on iOS, not because there is a huge user base willing to buy my apps, or because there is only one device that I have to write for, but because... the hardware on iOS side is of a much higher quality than Android. And by "much higher", I mean... the camera is of more consistent quality, the microphone is of more consistent quality, and sensors (gyroscope, GPS) are of much more consistent quality. HTC One X? Horrible... borderline bad camera. Galaxy S3? Super spotty GPS. If I want to implement any idea that involves either of those devices, then I'd have to make severe compromises on the Android side simply because the hardware isn't up to par.

And yes, that means specs sheets (CPU, RAM, etc...) don't tell the whole story. There are other things in a device that are more important.

But on the topic of hardware... Android's memory and performance behavior is wildly different depending on the phone. Heck, on the Galaxy S3 and One X, the behavior is wildly different for different ROMs. I still can't see how I can make an overly complicated app that will perform consistent. It's always either too slow, laggy, or it's running fast but the background behavior is spotty and unreliable. And by overly complicated, I mean something more than simply scanning a barcode and sending the result to a database.

And last but not least, we can go back to marketshare: while the iPhone is having diminishing marketshare, I don't see diminishing sales for my apps. In fact, even for free apps, I'm earning more on iOS side than on Android side. I think it's not just because iOS users are more willing to pay (I have many free apps), but it might in fact be that iOS users are more willing to use apps. Also if I'm pitching an iOS project to a prospective business looking for a third-party developer, I'd always recommend an iPod Touch rather than an iPhone. Or at most an iPad if they want a bigger screen. And I don't think any marketshare analysis done thus far has included the iPod Touch... but yet it's still a very valid app platform for developers. Until someone can challenge that market, in which I'm sure the iPod Touch captures a perfect 100% and is actually higher than iPhone in raw number, I don't think iOS as a whole ecosystem (iTunes, iPhone, iPod, iPad and soon to come iPad mini) would die for many years to come.

And I actually hope that it doesn't... because I'm enjoying a lot of good revenue on iOS as a developer as opposed to Android. If anything, Android development has become more of an afterthought lately, and I don't think I'm the only developer who is thinking this way.

Also just as an aside for those who are saying the iPhone 5 is an incremental upgrade over the 4S... well, in terms of performance, it's not. It's a very different beast compared to the 4S. It's much faster than the 4S and the iPad 3. It's the most powerful iOS device to date... and that's only because I'm avoiding having to state something along the line of "it's the fastest smartphone on the planet" because I don't want to start another pissing war... But that's just reality. As a developer, I can see many things that I can do on the iPhone 5 that I can't do on any other device. And that's solely due to the faster CPU, not due to anything else.

Thanks for the post. The ignorance and hate in this forum is beyond pathetic.

 

[BenSkywalker]

Also just as an aside for those who are saying the iPhone 5 is an incremental upgrade over the 4S..

Unless you are a lunatic level fanatic, the iPhone5 isn't going against the 4S, it's going against the GS3, LG G, OneX etc. Even when speaking on a generational basis, it is going against the GS2-GS3; LG 4x-LG G; HTC Evo DRPMLFG- OneX upgrades as a baseline. Don't get me wrong, 4 to 4S was such a kick in the face to those devout in their iOS praise that by comparison the 5 must seem like a massive upgrade, but the world keeps moving, and for several years now it has been moving faster then Apple(sadly, it is hardware now that they are closest on).

 

[Tom]

As a relative newcomer to Android devices I think there are too many variants of Android operating systems, JB, ICS, etc., too many market places that aren't all available, ie, Amazon, BN, Google Play, etc., too many apps that don't work, not enough compelling apps.

There are great devices and great apps, but the overall is too much the Wild West for it to be appealing to regular consumers.

Compared to Apple in particular. Apple can screw itself up though, this maps fiasco is a good example of arrogance leading them into a mess that was completely unnecessary.

 

[poofyhairguy]

When the app market matures like the Windows ecosystem has, marketshare will matter more.