“Apple vacuums up more than 90 percent of the profits in the business, and Samsung takes most of what’s left,” Ashlee Vance reports for Bloomberg. “That leaves crumbs for the half-dozen other big smartphone manufacturers, plus a sea of upstarts.”
“Following years of bumbling, Hewlett-Packard, Nokia, and other onetime powers have given up on them. Microsoft, which bought Nokia’s phone unit for $9.5 billion last year, wrote off $7.5 billion of it in July,” Vance reports. “For stubborn smartphone brands like LG, Sony, HTC, and Lenovo, things keep looking tougher. They’re like Sisyphus pushing his boulder up the hill, only the boulder grows a little bigger with each passing day.”
“‘Samsung is not really making money in smartphones,’ says Roger Kay, head of consultant Endpoint Technologies Associates. ‘The good news for them is that they’re big enough and diverse enough to make some mistakes and still be able to play,'” Vance reports. “Other large companies, including China’s Lenovo, have a tougher time rationalizing their phone businesses.”
“For most smartphone makers, there’s little reason for optimism, says Kirt McMaster, chief executive officer and co-founder of Cyanogen, a software company that sells a souped-up version of Android. If the smartphone market has its share of thrown elbows now, pretty soon it’ll get a lot rougher, according to McMaster,” Vance reports. “‘Handsets are commoditized,’ he says. ‘They’ve gone from being technological devices to fast-moving consumer products. It’s like Coke and Pepsi now. That’s the war these companies are fighting. It’s not a sexy business anymore.'”
MacDailyNews Take: Unless you’re Apple.
Read more in the full article here.
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