“The Honeymoon Period for Apple in the Mobile World Is Clearly Coming to an End”
With global shipments that rose 43 percent to 60 million units in the second quarter, the cellphone industry has been on a real tear lately. And while it’s not yet a top-five player there, Apple has been reaping the benefits of fast developing interest in high-end 3G touchscreen phones. In the second quarter, the company’s iPhone shipments rose 61 percent, according to research outfit Strategy Analytics.
Apple (AAPL) now has an almost 14 percent share of the smartphone market and an almost three percent share of the overall handset market. The company shipped 8.4 million iPhones during the quarter–a nice increase from the 5.2 million it shipped a year earlier, but down from the 8.8 million of the prior quarter. And to Strategy Analytics, that suggests the iPhone juggernaut may be slowing, if only a bit. “The honeymoon period for Apple in the mobile world is clearly coming to an end,” Strategy Analytics analyst Neil Mawston wrote. “Apple was criticized for its intensive production methods in China, while the iPhone has been heavily criticized for its poorly designed touchable antenna, and may have lost some heartshare in recent weeks because of its perceived mishandling of the antenna problem.”
Because of that, said Mawston, the iPhone is now “more vulnerable to competitive attacks from rivals like Nokia, Android, BlackBerry and Motorola.” More vulnerable, sure. But only to the well-armed attacker, and I’m not sure you could say that about everyone on Mawston’s list. Not yet, anyway.
And seriously, Nokia?
Comments
Have YOU or ANYONE EVER researched or questioned or been “concerned” about the “Intensive production methods” of Nokia, Motorola, Blackberry or Samsung, etc. etc.? Has Strategy Analytics analyst Neil Mawston's “opinions” EVER included quotes like “Some” feel that the Apple company and their products are the best designs and best performing on any on the market”? Just wondering if there is ANY “balance” in the opinion of all the 'analysts” that complain about Apple while writing their complaints and opinions on Windows/Bloomberg machines?
Posted by alatFIOS at July 30th, 2010 at 3:41 pmHahahahahahahaaha
Nice to know that in these difficult times you can include (and headline) comments from a noted humorist…
Posted by stsk at July 30th, 2010 at 4:21 pmSo if the honeymoon is over, then why do all the major phone manufacturers continue to offer iPhone CLONES? How come all the other plethora of mechanical keypad phones are now considered old school?
Posted by pushbuttonchimp at July 30th, 2010 at 4:32 pmEverything is subject to competitive elements. Facts are, Apple controls both ends of the food chain. It's an old marriage.
Posted by stu1976 at July 30th, 2010 at 4:41 pmPure comedy:
iPhone is now “more vulnerable to competitive attacks from rivals like Nokia”
Oh really.
1 figure missed out (apart from shipments up, 14% of smartphone market, 3% of handset market) is that of percentage of total profit off all handset's sold.
To not compare quarter to quarter – when you've got an Apple yearly cycle is disingenuous. If they do'nt think the next quarter is going to be oustanding, humongous – then they should hand in their phoney analyst badges and give up. There's always some slow down prior to a new model. The interesting thing here is just how mainstream iPhone 4 is – tech folk are now seeing their friends, parents, kids, relatives also look at getting one – a big step on from the previous iPhones.
As Gruber notes today – if you're looking at Android vs iOS – to make a better comparison you should rightly include iPod Touch numbers in there too. And also look at biggest handset sales for a specific model typ Android vs iOS.
Nokia's painful mistake was to do as the analysts sound like they did and fixate on handset numbers, to the detriment of actual profit per handset. Apple's been laughing all the way to the bank on that one Nokia.
The recommendation of low cost versions of iPhones is like many variations of this theme – silly, not understanding Apple's pricing scheme, and ignoring that the cheap iPhone/ iDevice, is last year's iDevice! It's the Kansas City Shuffle.
Posted by tomtubbs at July 30th, 2010 at 4:53 pmThe honeymoon is over? Slow news day I guess … that is a pointless title for an article.
Posted by axual at July 30th, 2010 at 4:54 pmIt's a direct quote from the analyst note.
Posted by JohnPaczkowski at July 30th, 2010 at 6:25 pmHas Apple ever dominated a market other than for portable music players (iPods)? they pretty much wiped everyone else out on that one. But hardly see anyone carrying one any more since that functionality is now in so many phones.
You can't argue with success, and Apple has succeeded in making a lot of money, and increasing their share price.
Meanwhile we agonize over “what might have been”. Could they have gotten closer to 50% in the PC space? Could they make inroads to supplying the federal (and lower level) government with computers? Could they been an early winner in cloud computing with iTunes, dot-me and other server based products tied into each and every iMac purchase? And what of servers? What big companies have switched their infrastructure over to Apple servers? Selling a box similar to the Mac Mini I use as a server makes little sense to me and I doubt any organization is running racks of these things. Apple TV, was a what? A “hobby”? I think the whole company is run like a hobby. their success is more attributable to the alternatives being so pathetically poor than to Apple executing particularly well. I know I'll draw some fire here, but I just think the company could have done so much better in some cases. I know people who are on their fourth or fifth laptop (from Dell or similar) since Apple entered that market and they are so frustrated with what they get that I think they could easily be convinced to switch, but if they switch it will be due to my mocking their Windows experience, not because they've seen an ad on TV.
I applaud Apple for doing well, but they don't deserve a standing ovation. Not yet anyway.
Posted by macbeach at July 30th, 2010 at 7:29 pm> And while [Apple is] not yet a top-five player [in mobile]
By units shipped, that is true. But that doesn't tell the whole story. They are #1 in many other metrics, like profitability, market cap, 3rd party app platform, audio video platform, and advanced technologies (thinnest smartphone, best smartphone battery life, highest-res display, best multitouch interface, best 3D graphics, only desktop class OS, only desktop class C API, best ease of use.) They are leading the industry. You can tell from the fact that everyone else is copying them.
The Mac is also minimized by people saying it only has 8% market share in PC's, but it has much broader influence than that because it has 90% market share in high-end PC's, and it leads in all the technologies, so the other 92% of PC's are all cheap Mac copies. Apple leads in PC's also, and everyone else follows them.
Posted by JohnDoey at July 30th, 2010 at 7:54 pmYes, but don't you understand that iPhone has “lost heartshare”?
Posted by JohnDoey at July 30th, 2010 at 8:08 pmThere was never any honeymoon. An iPhone Killer was supposed to arrive in 2007, remember? Apple mocked this when they introduced their 2008 phone with an ad that said “it's finally here, the phone you've been waiting for, the phone that can beat iPhone … iPhone 3G.”
What has happened in 2010 with iPhone is the same as what happened with iPod in 2004:
- the product is now 3 years old
- by now, every competitor has shipped an iPod Killer or iPhone Killer that failed to kill
- the consumer expectation of how a music player or smartphone looks and functions is now defined by iPod or iPhone
- in previous years, demand doubled each year, but the demand for this year's product (iPod nano or iPhone 4) is 10 times last year
- Apple share of the profits in the market segment passes 50%
- the corresponding online store (iTunes Store or App Store) is now 2 years old, has passed $1 billion in revenue, and no competitor has even really gotten off the ground
- everyone else in the market, who are now all dividing up a minority share of the profits, has become an anti-Apple cabal, they may not agree on anything else, but they all want to hurt Apple
Spinning this all as being bad for Apple is really hard. So you have to say a phone they can't build enough of and which has generated almost no returns and almost no support calls is a lemon that should be recalled and since Apple is up by every real metric you have to say they have “lost heartshare.”
The mobile makers who have problems are the ones that are losing money selling obsolete phones. Exactly opposite to Apple.
Posted by JohnDoey at July 30th, 2010 at 8:38 pmCan you explain what you mean by 'best audio video platform' here? No support for Flash in iOS, no support for Ogg Theora (the only truly open source codec for HTML5 until WebM is adopted), odd aspect ratio in iPhone that always ensures letter or pillarboxing, no support for Main or High Profile h264, poor encoder platform in QT, etc. Curious to know what you're referring to here.
As for your other points, not sure if all of your “metrics” really hold up. Am fairly sure that HTC has a thinner phone on the market, for example, & I really haven't noticed much of a difference in the multitouch interface of my iPhone and iPhone vs. my HTC Incredible. Also what exactly is a “desktop class OS”? A smartphone running Windows386? In my world, I'd expect a desktop OS to support multitasking…
Posted by ericjharvey at July 31st, 2010 at 12:09 amM$ are three times as profitable as Apple – and hey, the make a phone OS too… What you might think of Win Mobile 7 is immaterial.
Posted by Stroganoff at July 31st, 2010 at 12:10 amPretty sure JD was talking about mobile only. 99.9999% sure that MS wishes they were 1/10th as profitable in this space as Apple…
Posted by ericjharvey at July 31st, 2010 at 12:37 amThe antenna issue is an AT&T one..do you hear the same complaint from the rest of the world. And tech blogger like Seth have a field day bad mouthing Apple and the iPhone/
As for PA Consulting test I believe they should test the network in addition to the iPhone 4.
What about CONsumer Reports they should do likewise.
Posted by wired-4058 at July 31st, 2010 at 12:52 amMS profit last quarter was 50% greater an Apple's, not three times greater. And just “making” a phone OS isn't good enough it has to sell, and so far their phone OS hasn't even hit the market. When it does it will be nearly four years behind the iPhone.
Posted by Chris at July 31st, 2010 at 5:15 pmThe analyst says: “Apple was criticized for its intensive production methods in China…..and may have lost some heartshare in recent weeks because of its perceived mishandling of the antenna problem.”
This same manufacture is one of Nokia's largest phone producers, but does anyone care or write about Nokia's production issues? But these issues have little to do with the success of the iPhone. It appears this analyst knows little of what he says. And what is “heartshare”? Apple certainly has not lost mind share – or market share.
Posted by phil28 at August 1st, 2010 at 4:16 amDo these analysts use their brains before they talk or they just shoot words of wisdom from their ass!? Have they seen the flood of people gathering everywhere around the world to buy the new 4G iPhone. It seems to me that apple is expanding on an international scale very quickly, which leads me to “analyze” much bigger sales and revenues, regardless whether profit margins will go down. And what about the iPad, it looks like every high-tech company on earth now is rushing to launch its copy cat of it! Do these observation suggest to “analysts” that apple is slowing down?! Do your editors even spend time reviewing such articles before they publish or was everyone responsible for this article high at that time?! morons…
Posted by us citizen at August 1st, 2010 at 8:37 pmMy friend,
Posted by us citizen at August 1st, 2010 at 8:44 pmapple is an innovator, they launched the iPod first and everyone else followed to copy it, then they launched the iPhone first and everyone else followed to copy it, and now they launched the iPad and everyone else etc…..
for these achievements alone, they deserve every respect.
You are mistaken, Nokia is one of the few consumer electronics companies that has its own factories. Nevertheless, Foxconn is producing for many other companies besides Apple.
And, more importantly, the criticism of Foxconn was rooted more in western clichés about sweatshops that in reality. Foxconn is a big factory, but it’s not a sweatshop. It’s clean, it’s well managed, it gives the best pay to unskilled labourers in the whole country, and it pays overtime.
Posted by Tom Ross at August 3rd, 2010 at 9:37 am