Apple rides iPad profits for 2014

“Despite the growing number of tablets using Google’s Android operating system due to hit retail in 2014, Apple is poised to dominate where it matters most to investors: usage and profits,” Chris Ciaccia reports for TheStreet.

“Research firm Canalys predicts that in 2014 almost half of all PC shipments will be tablets, a total projected to reach 285 million,” Ciaccia reports. “The total PC market grew 18% year-over-year in the third-quarter, a figure that includes tablets. Tablets accounted for 40% of the volume last quarter, so it’s clear the trend for the market is growing, and fast.”

“While Apple will continue to lose market share due simply to the nature of Android being free combined with original equipment manaufacturers (OEMs) also using the software, Apple will keep the lion’s share of the profits,” Ciaccia reports. “‘Apple’s decline in PC market share is unavoidable when considering its business model. Samsung narrowly took the lead in EMEA this quarter and Apple will lose its position to competitors in more markets in the future,’ said Canalys Senior Analyst Tim Coulling in a press release. ‘However, Apple is one of the few companies making money from the tablet boom. Premium products attract high value consumers; for Apple, remaining highly profitable and driving revenue from its entire ecosystem is of greater importance than market share statistics.'”

Read more in the full article here.

MacDailyNews Take: As we explained exactly one year ago:

Google made a crucial mistake: They gave away Android to “partners” who pushed and continue to push the product into the hands of the exact opposite type of user that Google needs for Android to truly thrive. Hence, Android is a backwater of second-rate, or worse, app versions that are only downloaded when free or ad-supported – but the Android user is notoriously cheap, so the ads don’t sell for much because they don’t work very well. You’d have guessed that Google would have understood this, but you’d have guessed wrong. Google built a platform that depends heavily on advertising support, but sold it to the very type of customer who’s the least likely to patronize ads.

iOS users are the ones who buy apps, so developers focus on iOS users. iOS users buy products, so accessory makers focus on iOS users. iOS users have money and the proven will to spend it, so vehicle makers focus on iOS users. Etcetera.

Android can have the Hee Haw demographic. Apple doesn’t want it or need it; it’s far more trouble than it’s worth.

Not all consumers are created equal. There are valuable customers, and then there is everybody else. Sticker prices are remarkably adroit at separating the wheat from the chaff. Apple collects the valuable consumers and leaves the leftover chaff for their “rivals.”

Related articles:
Android has the most unit share, but Apple dominates profit share, making more money than all Android smartphone makers combined – November 15, 2013
Android users poorer, shorter, unhealthier, less educated, far less charitable than Apple iPhone users – November 13, 2013
IDC data shows two thirds of Android’s 81% smartphone share are cheap junk phones – November 13, 2013
IDC: Android worldwide smartphone market share passes 80% – November 12, 2013
Apple Maps makes killer comeback as Google Maps loses access to world’s most desirable mobile customers – November 12, 2013
Android phones 3 times more likely than Apple iPhones to have been bought at discount store – August 22, 2013
CIRP: Apple iPhone users are younger, richer, and better educated than those who settle for Samsung knockoff phones – August 19, 2013
Twitter heat map shows iPhone use by the affluent, Android by the poor – June 20, 2013
Apple’s iPhone generates more in carrier fees than rival smartphones – January 30, 2013
Unsurprisingly, survey says Apple’s iOS is highest priority among mobile developers – January 23, 2013
People buy more Android phone units and do less with them vs. Apple’s revolutionary iPhone – November 14, 2012
Study: iPad users more likely to buy – and buy more – online than traditional PC users – September 29, 2011
iPhone users smarter, richer than Android phone users – August 16, 2011
Yankee Group: Apple iPhone owners shop more, buy more, remain more loyal vs. other device users – July 20, 2010
iPhone owners more likely to pay for digital content – November 26, 2009
Study: Apple iPhone users richer, younger, more productive than other so-called ‘smartphone’ users – June 12, 2009
Apple iPhone users buy many more apps, surf the Web much more than other ‘smartphone’ users – March 27, 2009


    1. Most MDN readers and forum participants use Apple products, so I suppose that makes us valuable to Apple. We also tend to understand more about the design and technology behind Apple’s products, which makes us better informed advocates when our family, friends, and neighbors have questions. That makes us far more valuable, because we multiply Apple’s message and add a personal touch to it, as well.

    2. Well, I use an iPhone, iPad Air, Mac mini, and a MacBook Pro. I like quality in everything I buy and use. When it comes to my digital needs, Apple is my only choice. It just works, very rarely if ever crashes, and gets the job done with ease and elegance. Worth every penny. If time is money, a very small amount of time is required maintaining it.

    3. Let me see if I can list all I have owned so I qualify as die hard!

      512K Fat Mac, Mac SE, Mac IICI, Performa 6400 CD with A/V, Mac IIVX, 20th Anniversary Mac, PowerMac 6100, Newton Message Pad 110, Apple TV 3 of them, iPad 2, iPhone 1, 3, 4, 5S, iPods 30, 60 gb, Apple Adjustable Keyboard, Stylus II, Macintosh Portable, Powerbook 1400cs, Powerbook lombard, Powerbook Wallstreet, Titanium 800 mhz, iBook Firewire Blue, iBook 14″ 900 mhz, Titanium 1gz, Macbook Pro 15 core 2 duo, Macbook Pro late 2008, Macbook Pro Retina 13…I think I have a few more somewhere in the garage.. Thats just hardware. LOL

  1. You never know. Apple, some day, may advertise that their A7 iOS devices are much much faster tablets. If you are just reading e-books, buy what ever you want. If you need power and speed, get an A7 iOS device!

    1. If you want a terrible e-book experience then buy what you want.

      If you want A pleasant e-book experience, go iOS, it is worth every penny and has resale value beyond being a coaster

    2. To most consumers, any mid-range Android tablet will do. It’s like buying a Kia. It’ll get you where you want to go on the cheap. Most people don’t drive Porsches because they honestly have no need for one. When I buy products, I start upscale and work my way down according to how much I can afford. I’m not even happy with low-cost toilet paper or facial tissues. There is definitely a difference among those products concerning cost vs. value. Most consumers start looking at the low-end products and just stay there. They’re in it for the bargains. I still hear people saying the Nexus 7 is just as good as the Retina iPad Mini because it’s much cheaper. Low-cost products have a lot of pull with consumers.

  2. What a crock. Android “tablets” are anything running Android that doesn’t identify itself as a phone!

    So, dear analyst, if Apple will continue to lose market share by being the only profitable tablet maker, who, at the end of the day, will have the most market share? The usual prediction for a market when many players exist but are losing money is “consolidation.” Funny you’re not talking about that. Could that omission shed light on your real agenda, the agenda that pays your bills?

    1. I honestly would not be surprised if wi-fi equipped Samsung refrigerators, running Android on an 8 inch LCD, check in as tablets.

      I know some analysts count cash registers and other dedicated devices as Windows computers, but that hardly seems as reprehensible as this latest blatant conspiracy to rig Android’s perceived market share.

  3. We might as well face it. Google has paid a lot of money out to people to back Android and defame iOS. They have a lot of backers trying to make Apple appear as a dying company and it’s somewhat difficult to separate fact from fiction. Although Apple’s share price hasn’t moved much this year in comparison with the rest of the stock market, I see Apple’s market cap slowly but definitely moving towards the $500 billion mark. It’s definitely pulling away from Exxon so apparently Apple hasn’t quite hit the skids just yet.

    Yeah, those damn Android activations are getting boosted by practically every low-cost Android device under the sun. Chromecasts and tens of millions of HDMI Android sticks. The flow never stops and it makes iOS look pathetic in comparison. Maybe Apple should start selling simple $50 watches running iOS to boost market share. Why does market share matter so darn much to Wall Street. It’s never been a sure-fire indicator of success or failure of a company. I’m just so frustrated over this whole market share statistics race in regards to shareholder value.

    1. I think it’s clear now that the share argument is just an easy proxy to defame Apple. Wall Street is down on Apple because (1) they don’t believe Apple will keep putting out new popular products to permit the company to grow, (2) Apple doesn’t make it easy for them to get their hands on its cash hoard by loading up on debt they finance, and (3) they don’t believe Apple has a sustainable cash flow based on products they do have.

      Wall Street loves Amazon and Google because they believe their models are sustainable indefinitely, much as they love Microsoft’s Windows/Office model.

  4. Guys not to worry. The world is finite and so is the population. And keep in mind that once NEEDs are met, people always look to fulfilling desires and APPLE leads in the ASPIRATIONS Department.

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