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Um, no. He pointed out that as the smartphone market grows (at the expense of feature phones, probably), HTC and Samsung are riding that wave much better. It's

Um, no. He pointed out that as the smartphone market grows (at the expense of feature phones, probably), HTC and Samsung are riding that wave much better. It's not horribly surprising, since Apple's product is not likely to be immediately affordable to many of those switching from feature phones, but as the smartphone (and eventually tablet) market becomes commoditized it is not a given that Apple will be able to successfully uphold their profit margin by charging relatively high premiums for their value proposition. Of course they might do just that, but that is not something we can take for granted.

MrScruff 15y ago
From the article, HTC's market share growth in the given interval was 4%, compared to Apple's 3%. Considering they achieved that growth on significantly lower margins than Apple (and consequently much less revenue growth), I don't think it's reasonable to claim HTC are riding the smartphone market growth much better than Apple. Samsungs 10% growth is more impressive, but again was achieved with much lower margins. Apple could afford to cut their margin significantly if competitive pressure forces their hand, and unlike RIM they have a product which is high demand.
- anghyflawn 15y ago
  Percent is not the same as percentage points, you know. Growing from 6% to 10% is actually a growth of 66% percent, which sounds much more impressive. Fair point about the margins, but the fact is that Apple's entire business model is built on ensuring their margin stays high by charging large premiums for products that are clearly better than the competition. This is not guaranteed to last forever. The other companies on the other hand are used to living in commoditized markets with razor thin margins. I'm not saying Apple are doomed, but they clearly cannot just write the whole competition off, and they obviously aren't.
  - MrScruff 15y ago
    Sure, but by a similar logic going from 0.1 to 0.2% represents 100% growth. But yes, I agree that Apple are very aware of the competition and the pitfalls of potentially losing marketshare. It would be silly for them to be otherwise. I just don't thing they're running scared yet in the way the original article infers they are.

MrScruff 15y ago

From the article, HTC's market share growth in the given interval was 4%, compared to Apple's 3%. Considering they achieved that growth on significantly lower margins than Apple (and consequently much less revenue growth), I don't think it's reasonable to claim HTC are riding the smartphone market growth much better than Apple. Samsungs 10% growth is more impressive, but again was achieved with much lower margins. Apple could afford to cut their margin significantly if competitive pressure forces their hand, and unlike RIM they have a product which is high demand.

anghyflawn 15y ago
Percent is not the same as percentage points, you know. Growing from 6% to 10% is actually a growth of 66% percent, which sounds much more impressive. Fair point about the margins, but the fact is that Apple's entire business model is built on ensuring their margin stays high by charging large premiums for products that are clearly better than the competition. This is not guaranteed to last forever. The other companies on the other hand are used to living in commoditized markets with razor thin margins. I'm not saying Apple are doomed, but they clearly cannot just write the whole competition off, and they obviously aren't.
- MrScruff 15y ago
  Sure, but by a similar logic going from 0.1 to 0.2% represents 100% growth. But yes, I agree that Apple are very aware of the competition and the pitfalls of potentially losing marketshare. It would be silly for them to be otherwise. I just don't thing they're running scared yet in the way the original article infers they are.