Why Android fragmentation in China is good news for Apple

“In the last few parts of this series, we’ve been discussing the success Apple (AAPL) has achieved over the years not only in developed markets but also in emerging markets. There was never any doubt about Apple’s ability to succeed in developed markets, but there were some doubts in emerging markets,” Puneet Sikka writes for Market Realist via Yahoo Finance. “Some analysts were concerned that Apple’s stubbornness in not introducing a cheaper iPhone specifically for emerging markets could be detrimental to the company’s growth. However, those concerns have now been averted, as Apple continues to increase its market share in the premium smartphone segment in China. According to a report from Umeng, China’s largest analytics firm, for 2013, 27% of China’s smartphones sold for over $500, and 80% of those were iPhones.”

“According to the same report from Umeng, China’s brand distribution of active Google Android devices as of Q4 2013 is quite fragmented,” Sikka writes. ” there are hundreds of smartphones based on the Android operating system in China. Samsung has the highest market share, at 24%. However, this means Apple doesn’t have a single most competent opponent that can challenge the company. If we calculate the individual market shares for Apple and Samsung in the overall Chinese smartphone market, assuming the data provided by Umeng is true, they will come out as 21.6% and 18.8%, respectively. This means Apple has already beaten Android’s highest-selling smartphone maker, Samsung, by some margin. This gap could increase even further if we consider the gains that Apple could see from its recent partnership with China Mobile and the impending launch of the iPhone 6 this year.”

Read more in the full article here.

28 Comments

        1. Really?

          What’s wrong with China’s education system is that it does not and cannot reward creativity. That is the consistent effect of ‘communist’ governance. Provide people with NO incentive, and they’ll turn to crime for incentive instead. That essentially makes China’s education system great for rote memorization and imitating things. The end.

            1. Yes, you are right! Every Chinese kid is jumping out the window in EVERY single school. Why can’t they be like kids in the United States and just get a few guns and shoot a whole bunch of kids?

              Is it really that easy for you to ignore your own kettle when calling the pot black? Try being objective instead of being so awfully biased.

            2. 23 per 100,000 people in China commit suicide. That’s one suicide every 2-minutes, or 720 people each day.

              What’s your problem? You think I don’t care about America’s school children, because I chose to focus on China’s education system?

              I was in fact responding to a comment about how good their system was, so either stay on topic or butt out.

            3. After rereading your comment I’ve concluded you’re sick.

              Why would anyone raise the specter of the slaughter of American children with assault rifles in contrast to any other country’s education system?

              Unlike you maybe, I feel compassion for every soul on earth and not just Americans exclusively.

              The fact is, suicide takes the individual’s life. I don’t defend the practice, but I have absolutely no sympathy for anyone who murders another.

              So your feeble and shameless attempt to make me feel guilty for my compassion for the individual who takes their own life is appalling.

              Have you ever owned a passport?

            1. That’s really sick/sickening. Little kids.

              If the Chinese were serious about education as well as creativity, they’d burn their destructive ‘communist’ government down to the ground. It’s a constant self-destructive cycle over there. Run to get ahead while their government is bashing them down.

          1. The whole “Americans are creative and Asians aren’t” meme is tired and lame. And it has nothing to do with the dirty “C” word. That’s such a tired fallback. That and the “S” word.

            Japan and South Korea have the exact same issues as China… in the American perception they don’t reward creativity. In reality, they have a different value system. In Japan, they value incremental changes toward perfection and are willing to pay for quality. They value the work put into something often just as much as the final result. It’s hard to understand unless you spend some time in the country.

            Americans value innovation, but typically don’t have the patience or interest to refine ideas. The Japanese patent system is designed so that you can patent improvements on an existing design. This is why high quality craftsmanship and refined ideas, procedures and products come out of Japan.

            What they DON’T value is the lone maverick. They consider it a negative, abrasive quality that doesn’t promote harmony and teamwork. The instinct is to think of the group over the individual.

            Yes, the education system uses rote a LOT more than the Western education system. Children’s minds are typically more receptive to learning by rote. That’s not to say it’s the most effective, but it suits their culture which values order, harmony and group over self.

            And yes, the university system is somewhat of a joke in most cases.

            Finally, anyone who thinks China is a pure communist state is mistaken. It’s somewhat totalitarian, but it’s also got elements of unbridled capitalism with few checks and balances. The end.

            1. The whole “Americans are creative and Asians aren’t” meme is tired and lame.

              It is not! The results shout for themselves. What lunatic brain delusion are you on?

              I see no reason to address your ignorance. Sorry.

            2. Have you actually been to the Orient, or is yours and iCry’s rhetoric gleaned from the headlines.

              It is painfully obvious your myopic perspective is tech-centric and isn’t based in reality. Your specious generalizations about Asians’ lack of technical innovations is a weak attempt to condem an entire race of people.

              Where tech is concerned, the Asians have been making just about all of our products by hand for the last sixty-years, which speaks volumes about the American work force and the faith of greedy American capitalists in our poorly educated labor pool.

              East Indians have stepped in to fill the vacuum and are rising to the top of the American workforce because they’re prepared AND possess a world view that seems to elude so many Americans.

            3. I study behavior. I study history. I study facts. I also have been keeping a close eye on China since 2007 when the revelation of the ‘Red Hacker Alliance’ was finally acknowledged by #MyStupidGovernment.

              I am quite correct in my assertions. Stick to what I wrote please in your analysis. I ONLY spoke about ‘communist’ China.

              The generality: All communist states fail to provide incentive to their citizens. This directly results in the citizenry turning to crime to provide their own incentive. You won’t find any exceptions to this behavior within communist states. And like it or not, China remains staunchly communist. The ‘capitalist experiment’ has changed nothing in China’s government.

              Please folks: Do your research. I do mine!

            4. So you haven’t been to Asia? Have you been outside the US, at all? Besides Canada and Mexico?

              You’re learned from books? That’s right. You do it your way, I get out of the house and the country for my research.

            5. Who brought race into this? Derek’s points are all focused on government. You could take the people of communist China, plop them into a capitalist society, give them a generation or so to become acclimatized, and they’d innovate like Americans (many of whom, obviously, are Asian). Likewise, you could plunge Americans into communism, and get the expected result – lack of individual desire to invent or accomplish. Yes, the Chinese build most of our stuff. That’s rote, just like what they did in school. It’s not innovation. The drive to innovate is not solely based in capitalist greed. It’s also about being remembered, recognized, and appreciated. It’s not the Chinese people, or even their historical culture, that holds them back, obviously, but the top down discouragement from the government against individual accomplishment.

            6. @uncleotto

              That’s rote, just like what they did in school.

              THEY?

              We all learned the multiplication tables using rote. The American education system was transformed into a rote system. We memorize select things and regurgitate them back out in the form of a test.

              It wasn’t always that way in America. I seriously doubt whether any of us could pass a test from the 1940s. Essays and worded math problems were simple tests to determine the caliber of children’s minds. Today, American school children are taught the test.

              We learn poems using rote. It takes imagination to write a poem.

            7. The American education system was transformed into a rote system.

              I agree! The stupefaction of the USA has been, in large measure, due to the inability of people in charge to comprehend exactly what education actually IS. They have no personal sense of self-learning. They think it’s all about following some formula for living. Oops. It’s not.

              If we never learn HOW to learn all on our very lonesome, we have NOT been educated. It comes down to engendering self-motivation to learn throughout life. It’s never about passing ANY test. Life is not a test. Life is a process. We must learn how to make our individualized way through that vast, incomprehensibly complex process. That’s education.

              I have no idea why you’re off on a jag at me G4Dualie. We typically are allies in the process of helping others. Oh well.

            8. Tell me, what Asian countries innovated anything or contributed to human’s achievement?. from TV, Air Condition, Cars, refrigerators, electricity, etc. I have seen none from Asian, just merely memorized and intimated from the West.

  1. I understand that before they got into China Mobile the iPhone was already in China via some other carriers.. Wouldn’t a bettter indicator of how much market share iPhone would be able to take at China Mobile be how much iPhone has of the other carriers? Also bear in mind that some of the iPhone users that are on the other carriers could be there BECAUSE it was not available on China Mobile till now and may simply switch over reducing some of the increase in share they may receive from China Mobile subscribers.

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