Sacramento Business Journal: Apple iPhone share drop may be partly due to shortage, next-gen gear up

“Apple Inc.’s share of the smartphone market in the U.S. dropped to 19.2 percent in the first quarter from 26.7 percent the preceding quarter, analysts reported Thursday, while Palm Inc.’s share rose,” The Sacramento Business Journal reports in an article headlined, “Apple’s iPhone loses market share, Palm gains.”

“IDC said Cupertino-based Apple is still second behind Research In Motion’s BlackBerry, which had a 44.5 percent market share in the first quarter, up from 35.1 percent in the fourth quarter of 2007… Palm’s share of the market was 13.4 percent, up from 7.9 percent,” The Sacramento Business Journal reports.

“Analysts say Apple’s drop may be partly because of an iPhone shortage as the company gears up for Monday’s expected 3G device launch,” The Sacramento Business Journal reports.

Full article here.

“May be partly because?”

Okay, Sacramento Business Journal, please supply at least one other reason (with some proof, please) as to why Apple’s iPhone market share dipped.

While we wait for that, we’ll go with, “Apple’s drop was mainly because of an intentional iPhone shortage as the company gears up for Monday’s expected 3G device launch.”

Ahhh, the truth.

(Yes, we believe that in first quarter, a minute segment of potential buyers decided to wait for the next iteration of the device, but not enough to significantly affect market share.)


  1. An obvious advantage of the intentional shortage is to “clear out the channel”, i.e. get iPhone 1.0 off the shelves because it won’t sell after iPhone 2.0 appears. But another business advantage might be to reduce the need to deal with complaints and product returns from customers who buy iPhone 1.0 just before 2.0 hits the market and then regret their purchase.

  2. MDN. I think you have stepped over a line with your comment on this story.

    ” … intentional iPhone shortage”

    I don’t remember you reporting on this shortage in the 1st three months of the year.

  3. I doubt Apple wanted to have such a significant shortage of iPhones. They essentially ran out about a month early; however, with the size of the launch that appears to be happening, Apple had to get production on the 3G iPhone going.

    What the shortage shows is just how much in demand the iPhone ie, even with people knowing that a new version is coming out. Of course, people also know that 2G iPhones will be able to upgrade software (look – just like a desktop computer!) to run the new apps and thus get the new features, so it wasn’t a problem.

  4. Actually if you look at the world wide numbers for smart phones, NOKIA grew 2.94 million units, RIM grew 2.23 million units year over year and Apple grew 1.73 units (from zero a year ago). The total market place grew 7.31 million units. You should be able to see that all of the remaining manufacturers got very little of the growth.

    On a percentage basis, Nokia only grew 25 % where as RIM grew 107 % and Apple percentage growth is not calculable. On the other hand, RIM’s entire sales a year ago was only 2.08 million units after being on the market for more than a year where as Apple’s 1.73 million units comes after only 9 months on the market with a single sku.

    It would look like to me that the biggest loser in the Smartphone marketplace is Windows Mobile or Linux.

  5. Not so fast. . .
    These are stats for the 1st Quarter (Jan-Mar). The shortages didn’t hit until Apr/May.

    Of course, the rumors flying about iPhone 2.0 and the SDK started early in the year and many may have decided to wait until June.

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