Only Apple, Nokia and Google have reached critical mass in the smartphone wars

“Google and Apple win and will continue to win the smartphone wars in coming years because they’ve delivered quality services and products that have created an impassioned customer base and an even more important broad fanbase,” Cody Willard writes for MarketWatch.

MacDailyNews Take: Hopefully, Cody hasn’t failed to factor in what an iPhone on Verizon would do to Google. Alas, from reading ahead, it sounds like he has. Look at markets where Apple has gone from a single exclusive carrier to multiple carriers, Cody. It ain’t pretty for Google’s Android. In fact, it’s a bloodbath.

Willard continues, “Those passionate fan base are creating the self-sustaining virtuous cycle called the ‘network effect’ which means that as more people spend more time on a network (in this case, an iPhone or an Android), the more developers will focus on that network and create more and better products for that network which drives more people to that network.”

MacDailyNews Take: Android’s big toe hold is in the U.S. on Verizon. Why is that? Because Verizon doesn’t yet have Apple’s iPhone. When iPhone goes to multiple carriers in the U.S., Google’s Android will feel the pain.

Willard continues, “In this case we’re talking about a platform instead of an outright network, but the concept remains the same — you gotta get to critical mass and only Nokia, Apple and Google have reached critical mass in the smartphone wars. Stick with Google and Apple as they take marketshare from everybody else and are the de facto standards already in the next phase of networking.”

Full article here.

MacDailyNews Take: Be careful not to ascribe Google Android’s “success” to much more than the absence of Apple’s iPhone. Apple can (and likely will), in one fell swoop, cut Android off at the knees. Google possesses no such capability. People covet iPhones. They only settle for Android phones when no iPhone is available.

Please see:
Bloomberg: Verizon Wireless to get Apple iPhone in January 2011 – June 29, 2010
Survey shows significant number of Verizon customers covet Apple iPhones – May 24, 2010
• Survey: Verizon customers suffer from iPhone jealousy – May 10, 2010
• ChangeWave: Majority of Verizon customers want iPhones – May 05, 2010
• Verizon CEO asks Steve Jobs for right to carry Apple’s revolutionary iPhone – April 06, 2010
Verizon CEO: We’re interested in iPhone, ball entirely in Apple’s court – October 26, 2009

20 Comments

  1. Google makes great user experiences. Apple makes even better user experiences and hardware to boot. Problem being, anyone who has not spent a day or two with an iPhone or iPad will not instantly know the difference between the two. Apple is in trouble.

  2. Google’s success is not due to a lack of iPhones on Verizon.

    Google’s success is dut to the lack of Windows 7 phone in the Marketplace. The only choice is Google or bankruptcy. Every manufacturer is choosing Android out of desperation.

  3. OK, lets ignore the US for a while. Androids growth has accelerated in markets where the iPhone is available on multiple carriers, like here in the UK where you can get it on O2, Vodafone and Orange (as well as Tesco Mobile I believe) yet Android sales continue to grow. Where’s the clever explanation of this one? And it’s not like there is a shortage of iPhone 4’s here.

  4. @@MDN
    There are two reasons for Android gaining growth over iPhone in the UK:

    1. People were waiting for iPhone 4 when the polls have been made. A true iPhone v. Android analysis must wait until the iPhone 4 has a full quarter in the sun.

    2. Android phones are cheaper than the iPhone, they are really not in the same league in overall quality
    in my opinion, it’s like comparing low/middle-end phones (Android) to high-end phones (iPhone), so naturally the potential number of purchasing customers is greater for Android phones (that’s why Nokia has over 40% market share of all mobile phones cause they sell so many candy bar phones)

  5. As much as I’d like to think the lack of iPhone is contributing to Android success, the fact is that Android has filled the void left by WinPhone and Palm and BB and Symbian and Apple. Those mfrs that used to use WinMo or were also-rans have flocked to Android as their only hope. If Apple were to opensource iOS, then it would be game over for Android and the others, but right now, the only viable alternative for OEMs without their own OS is Android.

  6. Market share is ok for those that depend on market share. I know it is all a matter of economics but do you seriously think the iPhone would be in trouble if it sold far less?

    Why don’t we see Macs at discount retailers like we see PCs?

    Apple doesn’t need market saturation to survive. Apple is successful at whatever market share they are in.

  7. How can you compare Apple that makes money from the hardware to Google that does not? Seems like an irrelevant comparison.

    Ex. “Look, the guy who gives out dollar bills gets rid of more of them that the guy who sells them…” Duh!

  8. Mac user since ’94, I still raise a smile when I see Apple’s logo at checkouts like Tesco, Sainsburys and ASDA.

    Yup, those iTunes vouchers are a silent advert. Every time you got to the supermarket in the UK, you see the Apple logo…

  9. I still don’t understand how (or even IF) Google makes a profit on Android. It seems like the only way was by selling the Nexus One. It was made by HTC, so Google was really the middle-man, but at least it was something to sell to make a profit. And that was cancelled.

    At least Microsoft sells the license to put Windows Whatever on the device. So I understand Microsoft’s motivation.

    Apple obviously sells the integrated hardware/software combination directly to the customer. It’s very clear how Apple makes a profit, and what’s good for the customer (great user experience) is directly aligned with Apple’s motivation.

    So for now, it seems to be that the more popular Android becomes, the more money Google will LOSE to support the user base. What exactly is Google’s “end game”? Whatever it is, I think that what’s good for the customer will NOT be directly aligned with Google making a profit from Android. Since Android users do not pay Google directly, who are Google’s actual “customers” in their Android business?

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