ABI: Apple iPhone tops smartphone market as Android suffers its first decline in share

The 4th quarter totaled 150 million smartphones shipped, representing a record high penetration of 36% of the 409 million total handsets shipped worldwide. Apple was the star this quarter with 37 million iPhones shipped for a sequential growth rate of 117% (128% QoQ). Apple’s results made it the number one smartphone OEM in the quarter and for the year.

For the first time since Android was introduced, its market share declined from its 3Q high of 52.5% to 47.0% in Q4. Despite Samsung’s estimated 33 million shipments as the head Android OEM, Apple’s iPhone 4S cut Samsung off at the knees and outpaced Samsung’s highly coveted 280% YoY smartphone growth. At the low-end of the Android spectrum, Chinese handset OEMs Huawei and ZTE showed strong growth with 6.6 and 4.5 million units shipped respectively. Leveraging their inherent cost structure advantages, Chinese-based handset OEMs are rapidly consuming the market for low-cost Android devices which pressures the rest of the Android ecosystem to innovate or die. As Android approaches its fifth year as a platform, often considered middle-age in the mobile world, its midsection is sagging as Motorola, LG and Sony Ericsson struggle with profitability.

The overall handset market increased 5.4% sequentially and 11.4% for the year reaching 1.54 billion shipments. The smartphone market delivered 28.6% sequential growth, 48.6% QoQ and 57.4% YoY with the 2011 total reaching 473 million shipments. “It is important to note that if smartphones are taken out of the equation, the remainder of the handset market showed a YoY shipment decline of 1.6%, signifying that market growth is entirely dependent on smartphones,” said Senior Analyst Michael Morgan in the press release.

Nokia and Samsung retained the top positions in Q4 and 2011 for total handsets shipped. Which bumped LG to 4th in Q4 and 2011? Despite RIM’s recent troubles in the smartphone market, weakness in the feature phone sector pushed RIM from 9th, to 7th largest handset vendor overall in Q4. “The mid-tier Android OEMs showed weakness in Q4 and Samsung was not able to maintain Android’s growth on the one hand and fight Apple with the other” said Kevin Burden, VP Mobile Devices, in the release.

ABI Research’s “Mobile Device Market Share Tracker” provides quarterly and annual historical vendor market share, vendor average selling prices (ASPs) and technology ASP trends. More info here.

Related articles:
Apple overtakes Samsung to take world’s largest smartphone vendor crown – January 27, 2012
These charts will make the Fandroids want to puke – January 26, 2012
AT&T sold 7.6 million iPhones and fewer than 1.8 million Android phones in Q411 – January 26, 2012
Apple’s iOS passes Google’s Android to take U.S. smartphone market share crown – January 25, 2012
Analyst: Verizon’s record iPhone sales signal waning demand for Google Android phones – January 24, 2012

18 Comments

  1. I don’t put too much emphasis on what the actual figures are, they are often misleading ( actual sales vs estimated sales ).

    The important thing is which companies are making money out of them, because ultimately, only those that can consistently make a profit from the phone business will be able to continue to keep making them.

    It’s pretty certain that Apple and Samsung will be making phones for some time to come, but some of the more established manufacturers are looking rather insecure these days.

  2. PLEASE PLEASE PLEASE!!!
    How $tupid you have to be in order to keep comparing apples to nuts????
    iPHONE is a SMARTPHONE!!!!
    Android is a OS!!!
    the iPHONE has always been in the top spot if you compare SMARTPHONE MODEL from Apple to SMARTPHONE models with any other company.
    And even all that, Apple is always at top in profits from phone only business, so where the hell is android beating iphone at any time??

      1. “Android” wasn’t outSELLING anything, as such — since it’s free.

        And can anyone explain to me how the sum of all the massively fragmented, incompatible collection of Android offshoots is relevant in any business sense that matters?

        1. It’s all in perception. All Android smartphone vendors are basically fighting against one another. There’s no true collective at all. Dozens of companies merely trying to jockey for position to pick up Apple’s scraps from the floor. This is so easy to see because quarterly earnings shows it plain and simple. Why this topic is constanly bandied about, I’ll never know. Apple is the wealthiest tech company traded publicly. Why the media is constantly trying to cloud the facts makes no sense at all.

          Android is only relevant in some theoretical, abstract way of adding up lots of individual units. The reality is totally different when it comes to earning revenue and profits.

          You’ve seen how fast they lumped in Amazon tablets as being Android vs iPad. The Kindle Fire is so much of an offshoot of Android, it shouldn’t even be included since it’s hooked to Amazon and not Google. Still, it’s being said that Android tablets are gaining on the iPad, yet in fact they should just say the Kindle Fire is gaining market share and leave the Android part out of it. Any Android tablet that doesn’t connect to Google Market should not be considered a valid Android device or be counted as such. It’s no longer an open OS as Android is purported to be.

          More FUD to stir up a hornet’s nest.

      2. The question is, how DO you compare one to the other?

        If you compare phones to phones, than it is improper to do iPhone vs. all other makers running Android.

        If you compare OS to OS, then it is difficult to justify excluding iPod touch from the equation. The point of OS comparison is to figure out addressable market for app developers. Normally, we would include tablets in that equation, since they run the same OS, in which case iOS wins by a very wide margin. Even if we exclude tablets (arguing that apps need to be optimised for tablet performance, segmenting the addressable market somewhat), iOS, with iPhones and iPod touch still has greater numbers, by a very comfortable margin.

      3. Wrong, again, if you can’t ready English, may be I should put it in Spanish…
        “Andoid no es telefono, iPhone si es telefono”
        Besides that, the iPhone model alone (3GS vs any other, 4 vs. any other and 4S vs. any other) is totally outselling any other single model.
        So when you people say “Android vs. iPhoe, you are really saying:
        Samsung (and its 46 Smartphone models), HTX (and its 12 models), Motorola (and its 21 modes), Acer, Dell, Vizio and every other crappy company with all their more than 10 models VERSUS 1 SINGLE COMPANY (Apple) with 1 SINGLE MODEL (the iPHONE), or if you prefer, VS Apple and its 5 models since its born. Explain that comparison.

        1. An app developer does NOT care whether the devices he develops for are made by one, five or fifty companies. For him, there are (practically) two choices: iOS and Android.

          So, a developer looks at a number of Android-based phones out there, then looks at a number of iOS-based phones out there. If his functionality does NOT require a phone feature, then he includes in this list non-phone devices (some obscure Arcos MP3 players running Android, as well as the quite non-obscure iPod touches out there). So, a developer compares total addressable market on Android platform and on iOS platform, and takes that as one of the most important criteria when deciding for which platform to develop first.

          So yes, we very legitimately compare the two.

    1. This is the way Wall Street sees it. Apple’s iPhone vs combined Android smartphone vendors. It’s never Apple losing to any particular Android smartphone vendor. It’s always the iPhone losing out to Android. It’s Wall Street that is betting against the iPhone because it is supposed to be commoditized by every and all Android smartphones. I know it doesn’t make any sense, but that’s how Apple’s P/E multiple and future growth rate is being determined.

      Apple isn’t being projected to be losing to any specific company, just Android as a whole. I’ve seen this being said many times before and it’s a very unfair way to (de)value a company.

  3. Profit per unit. iPhone is a product, with three current models (not counting configs). Every unit sells with exceptionally high profit margin, even the “free” 3GS.

    Android is a platform, fragmented into many mostly indistinguishable products from many producers. Low end (low profit) models dominate the Android share of the market. Even the higher end models are often sold at a discount to clear out inventory.

    Result. Apple makes most of the available profit. Long term result. Apple widens the gap between iPhone and “the rest of the market.”

    1. Not necessarily. We should not dismiss (even underestimate) the importance of market share. What attracts consumers to iPhone (even though it is at least three times as expensive as an average Android — starting at $650, vs. around $200 or so, without contract and subsidy) is the eco-system and half-million available apps. Android has rapidly come close (difference between 250k and 500k has little meaning with such large number). However, it is well documented that even for apps that are on both platforms, the iOS versions are always better polished, more complete and feature-rich. The main reason for this developer attention is the size of the market (i.e. IOS market share), as well as its value (the fact that iOS users pay for apps, while Android users want them for free).

      1. In other words, iOS will continue to have developers’ attention even if its market share sinks well below Androids. And there is still a strong chance that it will happen; Android is put on phones that start at $70 (without contract/subsidy), and a median price is now close to just $200, compared to the iPhone, which starts at $450 for a three-year old model, and $650 and up for the current on (and this is US prices; elsewhere in the world, it is significantly more). A large segment of world’s population simply cannot afford $500 (a price of a very good Windows desktop) or more for a smartphone, if they can have one for under $100. Obviously, these aren’t quite the same, but the point is that they will eat away at the market share. As long as that $100 phone can run Android apps, for developers it will be a part of the addressable market. At some point, there’s a chance of the market becoming Windows-Mac scenario of 90’s: superior, reliable, robust platform with a small share (and decreasing number of developers), vs. spaghetti-code vaguely and broadly defined lowest-common-denominator platform with an increasing developer interest, due to sheer numbers.

        We’re still very far from that scenario and too many factors play against it today, but the possibility does exist. Hopefully, Cook, Ive, Forstall and the gang are sharp enough to take the necessary moves to prevent such a scenario.

        1. Android is necessary, because Apple cannot (and does not even want to) make 100% of smartphones. And it helps Apple that Android is now the “other” platform, because “Android” (as a platform made up of many players) is predictable and easy to out-maneauver.

          I think Apple stayed off of Verizon (and Sprint) for as long as it did, to help Android do the dirty work of killing off Palm and marginalizing RIM and Nokia. Now, it’s mostly Apple versus competition that does NOT control both hardware and software. just like in the PC world. Apple wanted it to be iPhone versus Android, because in that world (regardless of market share), Apple makes most of the profit.

          The key consideration is profit per unit, not pure unit sales or platform versus platform market share. It’s the ongoing profit that allows Apple to innovate at a faster pace and take well-calculated risks. iPad was one such risk, and it was paid for and mitigated by the profit from iPhone.

          Developers will keep developing for the platform that makes them money, regardless of market share. There are no worries there. Look at Mac OS X; it still only has a fraction of the overall PC platform market share, but there are plenty of developers actively engaged in the Mac platform (because there is money there).

  4. Just because market share drops doesn’t mean things are doomed for them. iPhone market share still has a long way to go. Look at the data. Don’t get a swelled head. The same goes for Microsoft (MSFT) market share. MSFT is huge in market share, whether it’s 90%, 80%, 70% or 55%. It will be a long time before Apple poses any threat to MSFT. Get real folks.

Reader Feedback

This site uses Akismet to reduce spam. Learn how your comment data is processed.