Do you still believe there's room for a third major player in the smartphone market?


Today, there are more smartphone manufacturers than ever before. Whether we're talking about established, decades-old companies like LG, HTC, Samsung, Apple, and Sony, or upstarts from China and India or elsewhere, it's fair to say that we have an unprecedented freedom of choice. There's almost certainly a manufacturer that caters to just what you need.

And yet, pretty much without exception, all of these makers make little to no money from their operations. A recent report by Fortune, based on data by Canaccord Genuity, shows that Apple grabbed an incredible 91% of profits within the smartphone industry, with Samsung a distant second with 14%. Combined, that's 105% of the profits split between just two of hundred companies (105% because the rest had losses). That's a pretty disconcerting fact, and one that we've been well aware of for years now. Essentially, nobody but Samsung makes any real cash in Android land, and even Samsung makes almost nothing compared to Apple.

As can be seen from the chart at the top, everyone else is either barely breaking even, or losing money from its smartphone division. Inevitably, if nothing changes, it's likely that, at some point in the future, these companies may decide that exiting the market is the sensible choice—specifically since most of these companies are publicly-traded. At some point, they might have to appease shareholders by ditching the arm.

With that in mind, the question we've been pondering internally is whether there's really enough room for a third major player at this point? Looking at the hard data, it seems to us that any one of these can only catapult itself into profitability land with a breakthrough product, or at least a smartphone that is objectively better than competing products from the same cycle. But without a healthy balance sheet, that sounds unlikely. What do you think?

Do you still believe there's room for a third major player in the smartphone market?

Yes
56.11%
Unlikely, but not impossible
34.68%
No
9.21%

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52 Comments

54. HtPsycho

Posts: 27; Member since: Aug 14, 2015

Just Remember The Era When Nokia Were The King

51. jroc74

Posts: 6023; Member since: Dec 30, 2010

And as far as comparing profits with Apple..... Apple makes sooo much that 2nd, 3rd place could make 1/10 of what Apple makes and still make a decent profit.

49. jroc74

Posts: 6023; Member since: Dec 30, 2010

As far as hardware manufactures, yes. Its room for more than 2. Ppl tend to forget that in Android land HTC and Moto were the top dogs and Samsung was barely hanging on. They struck gold with the Galaxy series in 2010, and having that brand on all major carriers. They also kept doing low end, mid range phones. Now imagine if Samsung thought there wasnt room for more than 2 back then....no Galaxy phones...

46. ibend

Posts: 6747; Member since: Sep 30, 2014

and I bet they'll make another poll again about who'll be on that 3rd spot.. -_-

41. darkkjedii

Posts: 31812; Member since: Feb 05, 2011

Sure why not.

38. BullDozer

Posts: 160; Member since: Dec 18, 2015

There is already a third major player. Huawei has took clear third position worldwide with over 100million shipped units. It's also growing faster than Apple or Samsung.

42. AlikMalix unregistered

Platform and android manufacturer are two different things - we're talking android, iOS and .....

50. jroc74

Posts: 6023; Member since: Dec 30, 2010

I thought the article was hardware manufacture. If its hardware and OS.....thats a lil tricky. For mobile OS's....I think there is only room for 2. For manufactures there is always room for more than 2 when you have OS's like Win Mo, Android.

45. TerryTerius unregistered

And no one knows how much money they're actually making doing so.

34. joevsyou

Posts: 1093; Member since: Feb 28, 2015

how much as you wish, NOPE. the market has been claimed unless google or apple does something freaking stupid.

48. remtothemax

Posts: 260; Member since: May 02, 2012

well, or unless something pops up and changes the market. it is conceivably possible that there could be something that apple and google do not capitalize on that totally disrupts the market in such a way that it "breaks" apple's walled garden or google's advertising group and leaves them scrambling to fit a radically new model into their system. sort of how like blackberry essentially had all the necessary pieces, but were ultimately broken by the rise of the phenomenon of app stores. they tried to rest on their established system of a business environment and when they realized what was going on, they were never able to recover. i agree with you that it is unlikely, but it is possible. before the iphone, i don't think anyone would have predicted microsoft, blackberry, and nokia being brought to their knees in the phone market. ...or that microsoft would suck so bad at making phones that they would tank both themselves and nokia at the same time.

31. squishypanda8

Posts: 47; Member since: Aug 28, 2015

I hope Nextbit does well.

30. yoosufmuneer

Posts: 1518; Member since: Feb 14, 2015

Windows Phone. Only if they took it seriously and make good phones. Bugs should be fixed and th

36. joevsyou

Posts: 1093; Member since: Feb 28, 2015

they can make the best phone on the market, hardly anyone is going to buy it because why would you? The app store is terrible

53. jontaylor07

Posts: 169; Member since: Oct 12, 2015

The reason more people don't buy better Android phones is due to experience and app store. Obviously this is the major barrier. The question is, will MS ever overcome it to a degree that WP becomes profitable? I think they will.

26. Astonvan

Posts: 237; Member since: Aug 14, 2015

Motorola had good future but google churned everything out of it and threw it to some lame a** company whom already made phone which is actually a total peice of crap.

24. Tanii

Posts: 132; Member since: Apr 30, 2015

If you're willing to open any smartphone manufacturing company, just design budget handsets with awesome specifications & great features & good looking as well, you'll rock. My answer is YES. Personally I've never gone with samsung, lg, apple etc, I've always obtained better handsets from other companies because of their specifications & suitable price.

23. meanestgenius

Posts: 23126; Member since: May 28, 2014

It's currently an Android/iOS world, but for the sake of CHOICE, continued INNOVATION, and COMPETITION...YES, there MUST be a third player in the smartphone market space. And I do believe there is room for one.

28. mrochester

Posts: 1050; Member since: Aug 17, 2014

Sadly, with Google's predatory anti-competitive pricing of Android, there's little chance of that.

29. meanestgenius

Posts: 23126; Member since: May 28, 2014

So you're trying to say that Apple doesn't partake in "predatory, anti-competitive" practices? Or are you just showing your hate for Google?

37. tedkord

Posts: 17536; Member since: Jun 17, 2009

Yes, that sure is predatory, letting anyone take the Android source and do anything they want with it. Tard.

22. Coconut00

Posts: 485; Member since: Jan 13, 2015

Third OS, no, but third manufacturer yes.

40. justrt

Posts: 446; Member since: Jul 10, 2014

I think we'll get third OS sooner than a third manufacturer. After all, we don't even have a second onehttp://www.phonearena.com/news/Apple-accounted-for-91-of-smartphone-profits-last-year_id78318

21. samgsam15

Posts: 51; Member since: May 09, 2014

soon people will get bored of Apple and Samsung phones and will switch to another premium phone make and if till then Nokia starts making good phones then it can be Nokia sharing the third spot. Just waiting for that time when people will buy Nokia phones rather than a Lumia.

20. RuneMaster

Posts: 75; Member since: May 31, 2015

Nothing lasts forever, Even cold november rain. You just wait and see for next 5 years.

16. tedkord

Posts: 17536; Member since: Jun 17, 2009

Not only is it possible, it's desperately needed. We need third options in hardware and software. Fourth and fifth options would be welcome, too.

27. mrochester

Posts: 1050; Member since: Aug 17, 2014

We desperately need more Apple's in the market. Android has essentially destroyed the market.

32. tedkord

Posts: 17536; Member since: Jun 17, 2009

Android has built the market, and pushed Apple to try and keep up. The last thing we need is more Apple's, companies that steal ideas and stifle competition.

13. talon95

Posts: 1013; Member since: Jul 31, 2012

I only see the mobile industry moving forward when apps become OS independent. When they are like HTML and run anywhere. I know that has been unsuccessful so far, but I don't really see it working any other way. Like wireless charging, Bluray, HDMI, USB, VP9, Self driving cars, etc etc, we need to have standards, and ideally open standards, in order to progress. Some of these are private license and cost money which has always meant that they eventually fail, and while they are used industry wide they seem to prevent rapid progress. That's my opinion. I perceive Android as a success because Cyanogen and Amazon can build on it and make something that works in parallel, growing the overall user base while offering custom experiences. I doubt Apple will ever be dominant until they open source.

12. Bernoulli

Posts: 4364; Member since: Sep 01, 2012

Microsoft has the potential but they're going to have to invest heavily.

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