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I was listening to the Economist today and they pointed out an interesting fact ... Apple has 51% of the profits in the smartphone market even though it only h

I was listening to the Economist today and they pointed out an interesting fact ... Apple has 51% of the profits in the smartphone market even though it only has 4% of the market share (remarkable because Nokia once had that same profit percentage but at 40% market share) ... that to me is a far more interesting statistic than these sales numbers which the media seems to be fixated on. We've seen this script before ... it was the Windows OS vs Apple products ... the Android OS will eventually outstrip Apple ... of that I have no doubt ... what is interesting to me is how much profits that continue to accrue to smartphone phone makers because of their decision to use Android. So far it doesn't seem to be helping as much as I thought it would PS: Link to the stat I talked about http://tech.fortune.cnn.com/2010/10/30/iphone-4-of-market-50-of-profit/ http://tech.fortune.cnn.com/2010/10/30/iphone-4-of-market-50...

ZeroGravitas 16y ago
It's 4% (and 50%) of the phone market (and profit). The low end phone market isn't really were the action is and the stat is pretty misleading. The iPhone is 17% of the smartphone market and about 40% of smartphone profit. I'd guess it is Nokia that's throwing that statistic out rather than RIM or Android but it seems hard to find that comparison because Nokia and Samsung straddle both markets.
theBobMcCormick 16y ago
It's unlikely any of the Android phone OEM's will make the kind of profit margins Apple is making, but they're clearly making a lot more profits selling Android smartphones than they were before Android. The feature phone market is drying up. All the growth (and the profit margins) is in smartphones. So what is a company like HTC, Motorola, Samsung, etc. to do? Symbian has been on lifesupport for ever. IOS and BlackBerry OS aren't available to them. They could try to build their own smartphone OS... but what are the odds that'll be successful? Basically they need Android or WP7 to survive. The profits in making Android or WP7 phones may be less than what Apple makes, but it's much better than any other alternatives open to basically every phone maker but Apple and RIM. Which incidentally, like you noted is a lot like the situation has always been between Apple and everyone else in the PC market.

ZeroGravitas 16y ago

It's 4% (and 50%) of the phone market (and profit). The low end phone market isn't really were the action is and the stat is pretty misleading. The iPhone is 17% of the smartphone market and about 40% of smartphone profit. I'd guess it is Nokia that's throwing that statistic out rather than RIM or Android but it seems hard to find that comparison because Nokia and Samsung straddle both markets.

theBobMcCormick 16y ago

It's unlikely any of the Android phone OEM's will make the kind of profit margins Apple is making, but they're clearly making a lot more profits selling Android smartphones than they were before Android. The feature phone market is drying up. All the growth (and the profit margins) is in smartphones. So what is a company like HTC, Motorola, Samsung, etc. to do? Symbian has been on lifesupport for ever. IOS and BlackBerry OS aren't available to them. They could try to build their own smartphone OS... but what are the odds that'll be successful? Basically they need Android or WP7 to survive. The profits in making Android or WP7 phones may be less than what Apple makes, but it's much better than any other alternatives open to basically every phone maker but Apple and RIM. Which incidentally, like you noted is a lot like the situation has always been between Apple and everyone else in the PC market.