By Adam Doud | May 28, 2013 7:00 AM
Apple finds itself in an interesting position these days. Interesting as in unique in its history since entering the smartphone space. It is still selling iPhones by the gaggle and is it’s on all four major carriers in the US – AT&T, Verizon, Sprint, and T-Mobile. But it finds itself losing market share. Like, a lot of market share.
This isn’t completely crazy for the big Fruit. Their slice of the global smartphone pie has remained relatively consistent for the past several years. But recently, analysts have shown that Apple’s global smartphone market share has started to slide and could hit single digits by September.
Well, this is the opportunity many newcomers to the smartphone game have been waiting for, right? Apple’s offerings since the iPhone4 have been pretty lukewarm. A software upgrade here, a spec bump there. Nothing to really get excited about. Perhaps the world has taken notice and is moving on to greener pastures? And if that’s the case, maybe the iron is hot for small players like Windows Phone, Blackberry, Jolla, and a bevy of other offerings to finally gain some ground? Well, yes and no.
As it turns out, Apple is still shipping boat loads of iPhones. As a matter of fact, they’ve sold more smartphones this year than they did last year. Wait, what? How is it that Apple is selling more phones but losing market share? Apple’s iPhone sales grew by 7% from the same time last year, but the global smartphone market grew by 36%! That’s a whole lot of smartphones. But what it means is that Apple hasn’t kept up with the rest of the market. It makes sense – if Apple’s bucket of water stays the same size, while the pool gets bigger, suddenly, Apple’s bucket looks a lot smaller.
So, this begs the question, who is going to fill up the pool now? Microsoft and Blackberry, in their heated battle for 5%? Jolla with Sailfish or FirefoxOS with….whatever? Well, no actually. Unfortunately for those smaller players, Android (read: Samsung) is sucking up new users (anecdotally, I know a couple of iPhone defectors who are now drinking the Samsung punch) at a silly, silly pace. Android’s market share numbers are not only up from this time last year but knocking on the door of…wait for it…75 Holy Crow percent!
Innovate – Adapt or Die
This is coming on the heels of a mountain of innovation from the Android circuit. Ultrapixels, Octacore, BlinkFeed, HyperGlaze. All these factors and more are just bringing people in droves, and the biggest thing Apple has brought to the table is consistently made fun of on the Big Bang Theory.
The new folks have tried to innovate too – take Blackberry’s Peek feature as a prime example. But unfortunately, they have failed to create any noticeable buzz among those who are leaving the iPhone until such time as they start collecting their pensions. But all is not lost. In the same time that Apple’s star has fallen, Microsoft has shown very, VERY slight gains. So perhaps one out of every 1000 people not buying an iPhone is picking between the other offerings. If you do that math, that’s roughly a .2%. So, you know… slight.
What all this means is that Apple needs to figure out how to sell more boat loads of phones than it already sells. Cheap iPhones maybe? The market seems ripe for it, and not just price reductions on yesterday’s hardware. But it also means that newcomers need to keep pounding away at this vulnerability.
Microsoft should continue their marketing blitz, and perhaps even up the ante with a Surface phone. Blackberry needs to get BB10 bugs worked out and decide once and for all – keyboard or not. Spoiler alert – “not” is the correct answer here. Jolla needs to get powerful hardware out the door. Ubuntu needs to get, well, finished. And all this needs to happen before Apple can right the ship.
Because if Apple can figure out this market share puzzle now, then it will be game over for any other contender to make a serious run at this. Up until just recently, Apple has been attacking from the stance that is was the only game in town. Now, they are second fiddle to the big green bot. Android, in the form of Samsung, HTC, Hauwei, and a host of others, has established its market dominance for easily the next three to four years. Apple can make moves to get back in this game, because as the source articles say, Apple’s ecosystem is too vast to fail any time soon. But they can’t stay in the single digits for long without exposing a major crack in its armor.
So, while Apple’s decline has not yet translated into opportunities for other contenders, it does show that there is weakness here. Other operating systems might be wise to try and exploit that weakness to draw away potential iPhone customers to their respective operating systems instead of targeting the big dog in town lest they Scroogle themselves out of a chance.
Image source: Vator.tv