: Apple loses marketshare


iphoneottawa
Sep 15th, 2010, 06:39 PM
http://moconews.net/article/419-apple-continued-to-lose-u.s.-marketshare-despite-spike-from-iphone-4-sa/

fjnmusic
Sep 15th, 2010, 06:51 PM
Interesting, but probably irrelevant. If market share means "the number of devices out there," including the number that are given away in buy-one-get-one-free promotions (or the equivalent of downgrading an item's worth to 50% off), then I can see how Android appears to be doing very well. But seeing how Google makes no money directly from the distribution of Android devices since the OS is given away free, I think "profitability" might be a better term to use.

For example, Apple seldom reduces its prices, unless the new model has just been released, and yet continues to sell very well, even at higher prices than the competitors charge. So from a profitability standpoint, Apple devices would appear to be cleaning Android devices' clock. It all depends on what you are actually measuring. I certainly don't think market share is all that reliable an indicator of value or quality. Just proliferation.

MomentsofSanity
Sep 15th, 2010, 07:31 PM
It's also for the three month period ending in July. That accounts for one month of shortened sales that were also impacted by supply shortages. I'd be more interested in the numbers through October personally.

dona83
Sep 16th, 2010, 04:12 PM
The marketshare for smartphones is still growing as there are still many dumbphone holdouts out there... Apple can lose marketshare and still gain considerable sales at the same time.

wilecoyote
Sep 16th, 2010, 04:39 PM
The marketshare for smartphones is still growing as there are still many dumbphone holdouts out there... Apple can lose marketshare and still gain considerable sales at the same time.

If you you're interested, this article has further insight. Yes, the market share has dropped, but Apple has increased sales due to a larger "pie". Also, he points out the issue of the 3-month average - it was a very bad time to be looking at Apple sales with few iPhone 4s in the mix, and enough leaks to drop demand for iPhone 3s.

Android vs. iPhone: Wait just a minute! - Apple 2.0 - Fortune Tech (http://tech.fortune.cnn.com/2010/09/16/android-vs-iphone-wait-just-a-minute/)

Joker Eh
Sep 16th, 2010, 04:56 PM
Also take into account that Andriod is on many smartphones and flooded the market with so many phones that I lost count and who can keep track of what each phones features are and what version of Andriod it is running and if the carriers will allow you update it and they put their blout software on their vs Apple one. Isn't the one phone approach so much cleaner?

I just don't know how you measure market share like that.

fjnmusic
Sep 16th, 2010, 07:24 PM
Also take into account that Andriod is on many smartphones and flooded the market with so many phones that I lost count and who can keep track of what each phones features are and what version of Andriod it is running and if the carriers will allow you update it and they put their blout software on their vs Apple one. Isn't the one phone approach so much cleaner?

I just don't know how you measure market share like that.

Perhaps you break the Android category into the individual models of all the different manufacturers and get a better sense of real marketshare of each model compared with the iPhone. Unless you're a geek, you don't know the difference between Droid and Android anyway.

groovetube
Sep 16th, 2010, 07:49 PM
blah blah blah blah. If you divide 5 by 4, and you only place htc in one can and hold up the droids and sing a song, apple is still king.

Android is kickin butt. And I say, it's a good thing, that apple is not dominating. I don't think any of should dominate.

MacUnited
Sep 16th, 2010, 10:24 PM
Competition will only serve the consumer, that all I can say. On the other hand, I'm not sure exactly why do we bother if apple loses market share or not, unless you're a share holder, Market share is a "non-issue" to you. ( Bun intended lol)

digitddog
Sep 17th, 2010, 12:55 AM
Android is kickin butt. And I say, it's a good thing, that apple is not dominating. I don't think any of should dominate.

Competition will only serve the consumer, that all I can say.

Agreed. Competition is good. Apple vs Google. iOS vs Android. The consumer has been the real beneficiary. But the more interesting battle is philosophical: Walled garden vs open system. And I think that Google's choices in that battle have left Android vulnerable, despite the robustness that openness is supposed to create.

When Apple forced AT&T to accept concessions that were, back in 2007, unthinkable in the wireless industry, it threatened the whole industry. Until then, each carrier had their own propriety market for music, videos, everything. Apple changed that.

But with Android, the wireless industry is winning it back. People might buy Android for its openness, but that "openness" has been co-opted by the wireless carriers (http://blogs.techrepublic.com.com/hiner/?p=5855). And in many ways, Apple's walled garden looks better and better.

kkritsilas
Sep 17th, 2010, 01:24 AM
Market share is a very artificial way of measuring things. The Mac has what, 5-10% market share in the personal computer business? And Apple seems to be happy with that, in that they aren't trying to increase it. Apple makes a healthy profit at the 5-10% market share, and isn't down in the trenches with every other PC manufacturer trying to cut price to the bone. Apple's pricing has never been as cheap as PCs, and probably never will be. But Apple turns a profit pretty much every quarter, for the last 5+ years. I don't know if any of the major PC vendors have been able to do that (HP. Dell, Acer, Asus, etc.). Its really hard to charge anything more than the absolute minimum for a PC considering that the hardware is all common, and the software is as well. Apple has managed to stay away from selling commodity PCs, and the same is true for the iPhone, iPad, iPod, etc. Apple will be happy to just turn a good profit, and see increased sales quarter after quarter, even though they may only have a 10-20% (exception, iPod) market share. The many Android vendors will eventually end up making Android phones commodity items, and then the only differentiators will be price. The hardware for Android phones will probably converge to a standard, and with the same hardware, the same operating system (Android, albeit with a few different releases floating around constantly), how do you stand out from the rest? The phone makers will try to do with with UI tweaks (Motoblur, etc.), but that will potentially fragment the Android market somewhat, and the general public will just buy the cheapest Android phone, anyway. Android will become the same as the PC market; a race to the lowest possible price. Innovation will fall by the wayside as profits drop, and the makers will not invest the R&D money to bring out new, innovative phones, because there won't be enough profit in it.

I have hopes that Palm's WebOS will still be around. While I am an iPhone 4 user, I thought the Palm Pre that I tried out a year ago was a pretty nice phone, and I did like WebOS.

Kostas

groovetube
Sep 17th, 2010, 07:42 AM
they're not trying to increase their marketshare? They haven't cut their prices???

I seem to recall paying 1600 for a 17" G5 iMac... maybe I was glue I donno. And I remember what I paid for my G4...

When did the whiskey get put on the table?

hayesk
Sep 17th, 2010, 02:08 PM
I think what he meant was Apple is not trying to compete down in the bargain basement level of most PC vendors. In today's prices, Apple is not going to sell sub-$500 Macs the way others are selling sub-$500 PCs.

And no, Apple is not trying to increase market share - at least not at the expense of profit margins. They're trying to keep their current margin levels and sell as many Macs as they can.

groovetube
Sep 17th, 2010, 05:29 PM
At the end of the day, profit, is a good thing, but it is ALL about marketshare. Without that, and if that were to wither, the profit thing will keep you rolling for, a while, but you better get that engine rolling again, or you'll only be able to boast about 'profit' for so long.

groovetube
Sep 17th, 2010, 08:24 PM
The data and the things I saw today, I knew android was doing well, but I didn't realize -how well-.

Their rise from last year is nothing short of explosive. The projections I saw were a bit worrying. I want to see android do well, but perhaps, not that well.

I played with the new samsung galaxy tab today, WOW, they really got that one right.

can.rules
Sep 17th, 2010, 09:30 PM
Marketshare is certainly important for the iPhone, as it will drive app development. However, trying to come up with conclusions based on data right before the iPhone 4 was about to be release is misleading at least. Based on the iPhone 4 stock availability even months after release, iPhone marketshare numbers are bound to rebound.

kkritsilas
Sep 18th, 2010, 05:13 AM
they're not trying to increase their marketshare? They haven't cut their prices???

I seem to recall paying 1600 for a 17" G5 iMac... maybe I was glue I donno. And I remember what I paid for my G4...

When did the whiskey get put on the table?

The cost reductions have come from using high volume CPUs (read Intel) and high volume based chipsets (again, Intel, but re-engineered for Apple), using standard SATA hard drives instead of SCSI, etc. What Apple will not do is chase market share at the expense of reducing profit, or by cutting corners on quality or support. Market share at any cost is not something that Apple has ever chased. I think Apple engineers/designs a product, figures out what the cost is, adds its profit margin, and then determines the selling price. Apple is not under anywhere near the price pressures of the PC manufacturers. In the PC world, the price is determined, and then the system is configured to meet that price point. That's why you sometimes see a PC laptop with a relatively high powered CPU teamed with a low end GPU, or even integrated graphics, and you can pay extra for the GPU upgrade. In the iPhone 4, Apple used the retina display, not because anybody was complaining about the 3GS screen, it was just a better screen. it probably was more expensive than the 3GS screen, and it may have even cut into the profit margin Apple makes on the iP4, but they used it anyway.

Does Apple want more market share? Yes. Are they willing to cut features, lower quality, or send tech support offshore (see Dell sending tech support to India)? I don't think so. That's why I said Apple isn't "chasing" market share. Even though they haven't been "chasing" market share, it is growing in the personal computer market, and has been for a number of quarters. They are going to stay with 15-25% market share in smart phones long term. Sufficient to give developers a viable marketplace for their software, and for the developers to make money, be it from sales directly, or through embedded ads. Right now, there are probably 50-70 Million iOS devices out there, and that total will still go up, to somewhere over 100 Million by next year. That, to me at least, sounds like a marketplace that is big enough to be viable, whether is is 10% of the smart phone market, or 40% of the smart phone market.

If market share were the determinant of developers desire to generate applications, then Blackberry should have far more applications that Apple or Android, as they have had the dominant position in smart phones for many years. That isn't true, is it? Same can be said of Nokia in the rest of the world.

As for this market share study, it was really badly (or well?, depending on your outlook on things, I guess) timed for the transition between the 3GS and the iP4. Demand for the 3GS had fallen off a cliff, relatively speaking due to the Gizmodo leak, and the low initial volumes of the iP4 most likely contributed to the statistics in the article.

Kostas

groovetube
Sep 18th, 2010, 07:53 AM
I don't care what resulted in cost reductions. ALl I know is, a 17" imac hat cost nearly 3 grand is now, ONE grand. There are some, who have been using macs for years, who will argue that the quality has, indeed suffered somewhat. But that's an arguement that'll go nowhere here.

As for marketshare, anyone who thinks apple doesn't care about it, is simply nuts.

fjnmusic
Sep 18th, 2010, 01:26 PM
I don't care what resulted in cost reductions. ALl I know is, a 17" imac hat cost nearly 3 grand is now, ONE grand. There are some, who have been using macs for years, who will argue that the quality has, indeed suffered somewhat. But that's an arguement that'll go nowhere here.

As for marketshare, anyone who thinks apple doesn't care about it, is simply nuts.

Consider me nuts then. Apple cares more about profitability than market share. They are not in a race to the bottom for prices. They also know know, as His Great Steveness stated years ago, that this is not a zero sum game. MicroSoft does not have to lose for Apple to win. The same can be said of Android today, or Samsung, or Amazon, or any other competitors in the same market space. iPad market percentage penetration, for example, will of course drop as more companies come out with their iPad wanna-be's, but of course that's bound to happen, since no competitors actually exist yet. I am at a loss to understand how Google profits exactly no matter how large its Android installed base becomes since it charges nothing for its OS. It's like it can be rich or famous but not both, so it has chosen famous. Maybe that explains why it's stock price is only worth 3/4 of what it was when it peaked.

groovetube
Sep 18th, 2010, 02:47 PM
without marketshare, there isn't going to be great profits.

period.

kkritsilas
Sep 18th, 2010, 08:03 PM
Compaq had great market share 10-15 years back. It is now the cut rate brand of HP. Gateway was a major PC brand with significant market share; they are now a sub brand of Acer..

Microsoft has 85-95% of laptop/desktop PC market OS, and a dominant position in office productivity software. The anounced layoffs this year, and stock price has languished for the last few years. They were one of the dominant players in the smart phone market, prior to the arrival of the iPhone, having a market share of 30-40% in North America. Not only did they lose anywhere from hundreds of millions (some say as much as a billion+), but they need to scramble real hard to fin market acceptance for Windows 7 Mobile/Windows Mobile 7.

Apple, with a 5-10% share of personal computer market, is showing increased market share in personal computers
quarter after quarter. The iPhone, with it's paltry 25% or so of the smart phone market has 250,000 apps available, yet Blackberry, the smartphone with the largest market share has only a few thousand, and many of those are corporation specific. Android, which will/will soon/already has surpassed the iPhone has only 50,000 apps at this point.

Market share, bought at the expense of profitabiliry, is a sure fire way to ensure that you won't be around for too long.
Good market share, with good profit margins, will keep you in business, and provide the funding for future products and innovation.

Kostas

bsenka
Sep 18th, 2010, 09:18 PM
The iPhone, with it's paltry 25% or so of the smart phone market...

Apple's share of the global Smart Phone market is a lot less than 25%.

Digital Stats: Worldwide Smartphone sales Q2 2010 by operating system (http://digital-stats.blogspot.com/2010/08/worldwide-smartphone-sales-q2-2010-by.html)

Abby
Sep 18th, 2010, 10:49 PM
hmm, yeah, very interesting, this morning just read the news that "Best Buy CEO: iPad Cannibalizing Up To 50 Percent Of Laptop Sales" on huffingtonpost.com, seems the iPad didnot do some big contribution for Apple's marketshare?
But I'm sure the iPad will become more capable over time and will be suitable for many people who don't need a "work" computer for their personal use. Having something thin, light, and portable will be more appealing to many people.

bsenka
Sep 18th, 2010, 11:20 PM
hmm, yeah, very interesting, this morning just read the news that "Best Buy CEO: iPad Cannibalizing Up To 50 Percent Of Laptop Sales".

Statement: Reports of notebook, netbook sales declines grossly exaggerated – BBY.com (http://www.bby.com/2010/09/17/statement-reports-of-notebook-netbook-sales-declines-grossly-exaggerated-2/)

"The reports of the demise of these devices are grossly exaggerated," Dunn said. "While they were fueled in part by a comment in the Wall Street Journal that was attributed to me, they are not an accurate depiction of what we're currently seeing.

fjnmusic
Sep 19th, 2010, 05:53 AM
without marketshare, there isn't going to be great profits.

period.

Looked at the stock market much? Compare AAPL shares with those of other tech companies, compare market caps, compare cash available, compare numbers of laid off workers, and then explain to me how Apple manages to be so profitable with minimal market share. There's something important here you're missing.

groovetube
Sep 19th, 2010, 09:54 AM
Looked at the stock market much? Compare AAPL shares with those of other tech companies, compare market caps, compare cash available, compare numbers of laid off workers, and then explain to me how Apple manages to be so profitable with minimal market share. There's something important here you're missing.

I guess you haven't heard of the ipod or the major money makers beyond the desktop/laptop biz.

I hear the markeshare on the ipod was pretty substantial. Don't quote me on it though.

You know, the part that made apple a boatload of cash.

screature
Sep 19th, 2010, 10:12 AM
I think what he meant was Apple is not trying to compete down in the bargain basement level of most PC vendors. In today's prices, Apple is not going to sell sub-$500 Macs the way others are selling sub-$500 PCs.

And no, Apple is not trying to increase market share - at least not at the expense of profit margins. They're trying to keep their current margin levels and sell as many Macs as they can.

At the end of the day, profit, is a good thing, but it is ALL about marketshare. Without that, and if that were to wither, the profit thing will keep you rolling for, a while, but you better get that engine rolling again, or you'll only be able to boast about 'profit' for so long.

Consider me nuts then. Apple cares more about profitability than market share. They are not in a race to the bottom for prices.

without marketshare, there isn't going to be great profits.

period.

You guys are all correct...

Apple of course cares about market share, but in specific market segments. Right now they are pretty much exactly where they want to be with their computer sales... 91% of the market segment of computers costing $1000+. They sell premium products, not everyone can afford them so they aren't interested in overall market share but in dominating the premium market segments.

There are exceptions of course, iTunes sales, iPod, now Apple TV (which is only a "hobby" product anyway) where they do compete on price as well as features and being a premium product. But the over riding philosophy of Apple/Jobs is not to compete on price but to "own" the premium market segments through innovation and bling.

groovetube
Sep 19th, 2010, 10:35 AM
true. We seem to be going around in circles. We already know, that apple doesn't compete on the real crap bargain basement POS hardware.

But that doesn't mean they don't care, about marketshare.

fjnmusic
Sep 19th, 2010, 03:00 PM
true. We seem to be going around in circles. We already know, that apple doesn't compete on the real crap bargain basement POS hardware.

But that doesn't mean they don't care, about marketshare.

Agreed. If you control the top of the class premium price point market, why worry about the lowest common denominator crowd? That's what makes them profitable. When I first contemplated getting the 2G iPod Nano, it was considerably more expensive than the Rio 800 I had been using, but the difference in quality and reliability was obvious right away. I think when most (not all) people buy that first Apple product, they have much the same reaction--why didn't I do this earlier? I also think Apple converts tend to stay loyal longer, but I could be wrong.

Perhaps another way to look at it would be multiple-market marketshare, especially for premium products. No other company has it all covered: desktop, laptop, pro, consumer, digital music player, smartphone, and now tablet, both the hardware and the software. As an individual brand, Apple seems to have it covered. Worldwide, too.