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“The Bernstein analysts think the Android installed base could exceed that of the iPhone in a little over 5 quarters,” Savitz reports. “If that happens, they add, it could ‘undermine Apple’s powerful first mover advantage and network effect that we believe has been instruments in shaping iPhone’s popularity to date.'”
MacDailyNews Take: Current, and possibly future, legal actions are ongoing. To discount and/or ignore them would be imprudent. Of course, Toni hasn’t really proven himself to be so swift on the uptake:
• Apple’s $45.8 billion cash pile is fine right where it is, thanks – August 20, 2010
• Apple analyst smackdown: Bernstein’s Toni Sacconaghi vs. Piper’s Gene Munster – January 20, 2009
• Bernstein Research’s Sacconaghi not sure iPhone SDK will allow Apple to hit 10M in 2008 sales goal – March 17, 2008
• Analyst who couldn’t find ‘missing’ iPhones thinks Apple won’t hit 10m in 2008 goal – February 22, 2008
• Wise investors should ignore the Apple iPhone panic – January 30, 2008
• So-called ‘analyst’ finds his ‘missing’ iPhones – January 28, 2008
• FUD Alert: CNET article based on lone analyst’s view tries to gin up iPhone demand issue – January 25, 2008
At least, he’s not whining about buybacks.
Savitz continues, “A key reason for Android’s momentum, they add, is the fact that the iPhone is still selling through just one carrier in some countries, including the U.S., where AT&T remains the exclusive carrier. And that brings us to a point Sacconaghi has been harping on for months: they need to add versions of the phone for the large carriers that don’t currently sell it, including Verizon Wireless, Vodafone Germany, NTT DoCoMo and China Mobile. Interesting, he notes that Android is only available on 59 carriers, versus 154 for iPhone – the issue is that Apple lacks deals with some of the world’s largest wireless carriers.”
Read more in the full article here.
MacDailyNews Take: The sky is falling! The sky is falling! The sky… oh, wait, no it isn’t. That’s not to say that the general gist is wrong (it isn’t) just that Apple has the time necessary in which to execute their plan. The cheesy knockoff isn’t going to come out on top this time. iCal us.
Apple can’t keep up with demand now. Adding a Verizon iPhone does nothing but make that worse. Apple could sell 6 million units tomorrow on Verizon. When foxconn gets that new plant up and running, we have a whole new ball game.
In the US, there are currently 19 different Android smartphones, from half a dozen manufacturers, on four different carriers (according to my own manual count at http://www.letstalk.com).
The point is not about how many carriers have the iPhone; it is about Apple just not being able to make enough of them. iPhones still sell out as soon as they arrive in stores. And whenever stores don’t have iPhones, store sell non-iPhones, and those non-iPhones are almost always Androids.
The purpose of Android is to co-opt the low cost handset market, a proactive move to disrupt any meaningful potential of a win7mobile space.
When people say this is Mac vs PC all over again, I’m inclined to agree with them, but not in the way most ‘experts’ keep harping about.
No, people will flcok to what they think is the ‘open’ and ‘cheaper’ alternative until one day they wake up and realize they’ve been sold a solution that is half assed and backwards, and they are slave to the ‘user experience’ the telco want to force upon them.
Then they will flock to Apple’s solution in droves, just like we are seeing on the computer side of things.
The only question is, how long will it take for people to realize they’ve bought a piece of junk.
Odd, the iPhone is 31.6% in France where they are not allowed to lock the iPhones. If Apple open it up to ALL the carriers in the U.S. would it not meet or exceed that in unlocked countries like France? I assume the iPhone would be at least 1 out of 3 (33%) in the U.S.A.!
comScore breaks down smartphone OS stats in Europe
http://www.mobile-ent.biz/news/38621/comScore-breaks-down-smartphone-OS-stats-in-Europe
Note:
• 23.8% in U.S. (ON ONE CARRIER!)
• 31.6% in France (no locked phones here)
• 29.6% in UK
• 21.2% in Germany
• 9.8% in Italy
• 8.6% in Spain
Also note that if the iPhone could be sold with Verizon and Sprint than they would sell fewer Droid knockoffs!
Apple doesn’t make iPhones. And there’s no doubt that they can order more from Hon Hai, who does make them. In fact, they’re opening up another factory for that purpose, and are thinking about opening up at least one factory here in the US.
Correction; the number of various Android devices on the US market today is 21. They are made by:
Motorola
Samsung
LG
HTC
Garmin
Sony-Ericsson
plus the T-Mobile branded (actually, HTC, if I’m not mistaken)
Motorola has 7 (count them) models; each is exclusive to its own carrier (Droid, Droid X, Droid 2 on Verizon; i1 on Sprint; Cliq XT on T-Mobile; Backflip on AT&T). Samsung has 5 (Captivate – AT&T; Fascinate – Verizon; Intercept and Epic – Sprint; Vibrant – T-Mobile), and so on.
We all know this is an alphabet soup of models, specifications, features, OS versions and carriers. In the end, though, an ignorant customer walks into a Best Buy mobile store and asks for an iPhone. They don’t have one, so they sell him one of 21 different Android devices, most of them cheaper than the iPhone, and the customer walks out happy (for a while, at least…).
I don’t see iPhone coming to all four major US carriers (and other major carriers of the world). Short of that, it will be rather difficult to dominate Android, until that lawsuit begins gaining some traction…
So, “… they contend that Android and Apple combined could be as much as 52% of the overall smart phone market by the end of 2011”. Maybe it is 50% iPhones and 2% Droids. If you can get the iPhone with the same monthly contract, why would you get a Droid? People are not a stupid as these talking heads.
I couldn’t agree more with the author. Every android phone sold is an iphone opportunity missed, same with every Android two for one. Apple offers its two models of phone and its one carrier here in the U.S. These products are outstanding but there is more to the world than two colors.
Ongoing litigation is interesting but the only time I’ve ever seen it shut down competition is way waay back when Polaroid managed to kill off Kodak’s instant photo business through litigation. It didn’t help either company with the digital camera business though…
If Apple really wants to stop Android from overtaking it in the mobile phone marketplace, it has to at least offer the phone to more carriers. You can’t really complain about people buying from someone else’s cart if you aren’t there selling next to them.
More “analysts” spouting off about what Apple needs to do. These are the same folks who constantly nagged that Apple needed to sell low-cost “netbooks” (yeah, that would have been a great move). And how Apple needs to license this and that…
There are advantages to only being on one carrier in certain markets, especially when that “other” carrier requires a significantly different phone design and you can’t keep up with demand on the existing design. When the time is right, Apple will no doubt add alternate carriers.
And that will only happen when Apple is finally able to meet the current demand for the iPhone on the lone US carrier.
If Joe walks into a Verizon store looking for a smartphone, and he can get either a Droid or iPhone for the same price, the iPhone will almost always win. The problem is Joe doesn’t have that option now.
All I can say is ATT must’ve negotiated a helluva contract with Apple that makes breaking the exclusivity clause a financial disaster. Either that or none of the carriers are willing to give Apple what they want. There’s no other possible reason for not moving onto the other carriers. Especially with your #1 product getting lambasted on tech blogs, late night talk shows and Consumer Reports. (They’re still around?) We all know it’s because of the massive data that the iPhone users consume, but the average person just hears that the iPhone is a piece of shit for phone calls.
Ya, I know about CDMA blah blah – but the iPhones proven that it will make money a million fold for every dollar it takes in R&D.
Apple doesn’t need to sell the most phones. It sells the best phones, and has great margins. Just like with Mac sales.
Apple is smart enough to know that quality beats quantity.
I disagree, Apple needs to have the iPhone on every carrier EXCEPT Verizon.
Verizon is never going to agree to the Apple running the APP store, they want to own the customer experience, as shoddy as they may make it.
I’ve been using the best available on Verizon for years now. I started with two generations of Palm smartphones, then two generations of Windoze Mobile unsmart phones, and currently with an Android. All were bought cheaply on eBay so I could stay contract-free just in case Apple jumps to Sprint instead of Verizon (or in the unlikely event AT&T improves their network).
I must say each step I have taken had been a vast improvement. Although the Palm phones, the wm5/6 phones, and the Android were all POS phones, the are not as bad as they used to be. When I do finally get an iPhone, I will have reached the top and will have known the bottom all too well.
BTW, my current Android is really not that bad, especially compared to my Windows phones. Patent infringement can pay off.
But is still is a lagging POS.
I first discovered the direction in which US mobile phones were moving, on a visit in 1986. Phones were the size of briefcases and a carrier controlled only a small territory. Move into a different territory and suddenly you were roaming. Amazing.
I don’t know about the current US scene but all of the countries I’ve lived in (New Zealand, Australia, Germany, Russia) or visited (another 30 or so) are all operating carrier-agnostic arrangements. Buy a phone, sign up with a carrier. The two transactions are totally unrelated. Also, each carrier operates country-wide. Why did America have to be different?
I would kill for an iPhone but I will never buy one until I can choose my own carrier and swap SIM cards when I visit other countries.
Apple is having trouble landing the major mobile carriers, (Verizon, China Mobile, etc) simply because they don’t want Apple to control the customer’s app store and other money making activities.
They are playing nice with Android today, hoping to beat back Apple, and if they do, or are effectively able to put Apple in a 25% market niche, look out consumers, then they will use their power to curtail and control the android experience on each of their independent networks.
That’s how they think they add growth, by providing services / phones / capabilities other mobiles don’t. Going to the iPhone model, they become dumb pipes, and compete on price alone. iPhone works the same on every network.
Trust me, the big mobile companies want no part of that.
Apple could meet demand if they wanted to. They choose not to over manufacture iPhones. It’s not because demand is so high. It’s because Apple carefully meets or under supplies demand.
I wonder… At 200,000 per day, it takes a little under 5 years for every man, woman, and child in the US to have an Android phone. Make it 6 years and include all the ‘illegals,’ too.
A bit of skepticism of their analysis is in order.
First, we still need data from a full quarter of the iPhone 4. That hasn’t happened yet.
Second, they really shouldn’t discount the iPod touch. It really is a stealth iPhone without the telcos.
Third, the fragmentation, upgrade and virus issues are going to be much bigger in the next year with Android
Fourth, remember that Goggle really wants everyone to go to Chrome in the not-too-distant future. That’ll be fun.
Fifth, Apple is building an entire iDevice universe with the iPhone, iPod touch and the iPad, AND is making money off of every atom in that universe. Google still hasn’t gone beyond search.
Sixth, the iPad is taking over. I’m floored at the long-time Apple-haters in my circles who own iPads and love them. Same with the iPod touch. They are the gateway drugs for the under-20/anti-Apple crowd.
@ grh
It’s merely that, in the US, lobbying dollars are more productive than infrastructure investment. Look at who ran our congress for the previous decade and gave us such wonderful things as the “K-Street Project”…
theloniusMac,
I disagree. Apple is selling, activating and supporting as many cellphones as all six Android manufacturers combined. That is a MASSIVE number of cellphones to support. All by one SINGLE manufacturer, to whom cellphone business is just ONE of four (five?) more-or-less equally demanding business lines. Let us not forget; iPhone growth has been unprecedented. None of these Android manufacturers are individually experienced growth anywhere near as rapid as iPhones. Each sold iPhone requires a new iTunes account, registration, activation and subsequent support. Apple is likely bursting at seams from such fast pace, not to mention the inability to physically make any more iPhones with current facilities.
Apple’s ‘pedal’ is pressed to the metal today. Neither Verizon, nor T-Mobile, nor Sprint would change anything.
Why would Apple want to put the iPhone on verizon? Verizon is trying to make android go through the Vcast store to buy apps instead of googles own market further fragmenting android. There is no way the iPhone will go to Verizon.