iPhone may be poised to bump its market share

iPhone may be poised to bump its market share
Smartphone sales dropped across the board in the US for the first time in Q3 of this year. The Apple iPhone saw a dramatic drop in sales, likely because of the newly released iPhone 4S, but surprisingly all non-Apple smartphones also saw an overall drop in sales, which has analysts predicting big things for Apple, and some possibly very bad signs for Android.

The numbers from Morgan Keegan analyst Tavis McCourt show that smartphone sales from AT&T and Verizon declined in Q3 2011 both compared to Q2 and compared year-over-year to 2010. Android in particular also saw a decline in sales compared to Q2, but did report a small growth year-over-year. McCourt says that these numbers point indicate that many smatphone users may be stalling on upgrades in order to get the iPhone 4S, and claims that this could be an "ominous sign for Android vendors."

The idea that smartphone users were stalling to get the iPhone 4S seems to be a solid one, especially given Apple's strong opening sales. However, we're having trouble accepting that this is an "ominous sign for Android", because while there were some new handsets released for Android in Q3, the major releases that people have been waiting for are the Samsung Galaxy S II, Samsung Galaxy Nexus and DROID Bionic.

Q3 ended September 30th, and the Galaxy S II wasn't released on AT&T until October 2nd, and its Verizon cousin the Galaxy Nexus isn't due out until November, so there is a possibility that Android users held off on upgrading for those devices and not the iPhone 4S. Just as the iPhone 4S sales numbers can back up part of McCourt's idea, the global success of the Galaxy S II can be used to back up our idea that this may not be as terrible a sign for Android as McCourt believes. The data could certainly point to Apple taking back some market share from Android as well as other smartphone makers, but we're not sure that "ominous" is the right adjective.

source: BGR

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74 Comments

74. jcoberg10

Posts: 112; Member since: Oct 30, 2009

i know at least 5 people waiting for new androids dual core 4g.

65. Cyd07

Posts: 83; Member since: Oct 03, 2011

I like analysts...if Apple sales drop, that's because everybody waited for the next Iphone. But if Androdi sales drop, that's because evrybody wait for...the next Iphone ! It's not as the Nexus Prime was awaited for october-novembre, nor the Mororola Spyder/Razr, nor the HTC Vigor/Rezound. Android owners always wait the next Iphone... The idea that people wanted to see iOS versus Android as their best before buying a phone for two years has fallen far far away from these analysts...

68. remixfa

Posts: 14605; Member since: Dec 19, 2008

lol, analysts are stupid and they pull figures out of their butt. it makes for good thread fanboy drama, thats about it.

53. jacko unregistered

http://www.youtube.com/watch?v=pPLsr7vKFdw from 3:27 mark i couldn't said it better myself

57. Whateverman

Posts: 3295; Member since: May 17, 2009

Holy sh*t, now that was funny! And true when you think about it for a minute. All those things did exist before Apple/Steve Jobs did it.

63. Sniggly

Posts: 7305; Member since: Dec 05, 2009

Dude, Azrienoch is amazing. I actually started following him over unrelated drama when another jerk on Youtube started attacking him for dissing Watchmen.

51. MorePhonesThanNeeded

Posts: 645; Member since: Oct 23, 2011

One thing I am not sure is how come they are talking about all this increase in iPhone sales because of the 4S, but how many of those are actually new customers? How many are just people switching out from iPhone 4 to the 4S? The dip could also be people waiting for the iPhone 5 and with the titanic let down that it wasn't coming. Blackberry is steadily losing it's once vaunted market share, windows 7 seems to not move either up nor down, only Android and iOS seems to make any movement at all.

44. Sniggly

Posts: 7305; Member since: Dec 05, 2009

Android will take a small hit, but I don't think it'll be drastic. Even when people hate the phone they have, they're willing to try a different brand or model before they'll jump ship to a new OS.

49. networkdood

Posts: 6330; Member since: Mar 31, 2010

With the SGS2 coming to AT&T and with the high end phones coming to Verizon, I do not see ANDROID taking a big hit. Plus, with new Androids coming to the other carrier, and new prepaid options coming for Android, things look very good for ANDROID and Iphone. What it means is Blackberry losing more share and Win7 gaining very little share. Although, with WIN7/8, it may do better than expected.

61. snowgator

Posts: 3630; Member since: Jan 19, 2011

I tend to agree that stateside, WP is very little threat right now to Android or iOS. If RIM continues to lose customers, than WP will grab a small portion of those. Most will go to Android or Apple, simply due to availability. If stateside WP grows, it will be due to pricing their better handsets low enough they can grab some of the feature phone consumers moving to Smartphones. There is a slim chance of grabbing a few Android users who used a budget Android and had a bad experience, but somehow I kinda doubt it will add to much. Nokia's influence worldwide is WP best hope for growth, and that is where I think Microsoft gains. Now that I am done being a WP Homer, this analyst most likely is correct. Let's not forget that the hope that there was going to be an iPhone 5 existed right up until the announcement of the iPhone4S. Of course people were saving their upgrades for an iPhone 5. The questions now: 1) Outside of those who were due an upgrade from the iPhone 3Gs, do they get excited for the 4S or get swayed by another device? 2) After the initial rush to get the new iPhone is over, will the numbers continue to be as strong as they were for the iPhone 4 or will current iPhone users just ride it out until summer to see if something better is coming? That is why I am fairly amazed by the mobile industry. This stuff is fun. I believe the 4S will not sell as well as the 4 did overall, but who really wants to bet the house against Apple? Isn't that how some people end up sleeping in the street?

72. hepresearch unregistered

I don't see Android taking a "major hit" until at least 18-24 months after feature phone sales have been cut to half of their current figures. Minor hits are possible every year when Apple is waiting to release a new iPhone, and many people hold off on buying anything until they can see what is being offered in the new devices at that time. However, where android seems to excel is in first-time smartphone buyers who are stepping up from a feature phone, webOS orphans who are ready to upgrade, and upgradable Nokia/Symbian enthusiasts who are not willing to try WP7.x (yet). The release of Nokia WP devices will probably signal a trimming-back of the Symbian-to-Android tide, and when webOS device share drops into the abyss the same could be said of the webOS-to-Android conversion rate. Thus, IF nothing changes from the current business model, it will be the feature phone market decline that will drive the first "big hit" in Android sales... lagging by approximately one upgrade period, of course. Google can remedy this situation by finding ways to improve customer loyalty of existing Android users, as this metric, along with the iOS loyalty figure, is the long-term determining factor of the Android vs. iOS battleground.

43. droidcandy13678

Posts: 9; Member since: Oct 24, 2011

i think MICHAELHELLER has a crush on TACO. The amount of attention he is giving her is not something normal. Well i may be wrong .....just had a feeling.....eww...combination sounds horrible n dreary too

48. networkdood

Posts: 6330; Member since: Mar 31, 2010

Yeah, if you saying something remotely bad about APPLE, that taco girl is all over you, accusing you of being a fandroid. Actually, M.H. has come on hear to set taco straight because at times she gets way out of hand.

50. networkdood

Posts: 6330; Member since: Mar 31, 2010

...if you are....

71. hepresearch unregistered

A word of advice... don't go down the slippery slope of assuming someone's gender here just because someone else defined it in their comment. Last time I did that, the repercussions were so embarrassing that it was the LAST time I ever did that...

28. ardent1

Posts: 2000; Member since: Apr 16, 2011

Android is becoming commoditized as the second tier android OEMs eat the first tier's lunch. It's going to become an ugly price war between the android OEMs that want to sell smartphones in the US. When you start seeing android smartphones at prices under $100 in the prepaid market, you start thinking about the big carriers like ATT or Verizon losing customers. For example, the ATT Thrive Go Phone goes for $179.99 on ATT's website ($149.99 on Amazon) and you can get the LG Optimus V from Virgin Mobile for $129.99 on VM's website (or $99.99 at Target). You can find other examples as well. Here is the bottomline, practically all the large prepaid cell phones carriers are offering decent to basic android phones with 3.0" to 3.5" touchscreens for $150 or less. Motorola's Triumph with 4.1" still goes for $300 while ZTE's Warp with 4.3" screen is coming in at $250. With better and better android devices entering the prepaid market at say less than $300, it's going to continue to steal customers from ATT or Verizon et al. I understand the 4G argument for the premium phones, but 3G is still pretty good for someone who is getting a smartphone for the first time. Boost with shrinkage and the ZTE Warp is a pretty deal for the price conscience smartphone buyer.

32. The-Omega-Man

Posts: 12; Member since: Jun 25, 2011

This is what free market and healthy competition is all about. In the end it is a win for the various consumer demographics.

40. hepresearch unregistered

I'm counting on that. As new technology arrives at the top-tier price points, last-generation technology will filter down to the lower price points. I, for one, do not need or want 4G. I don't even care all that much about 3G, as long as I have a solid 3G device before GSM/CDMA get phased out in the US (probably some time in the 2020's?). When today's smartphones become tomorrow's bottom-of-the-barrel bargain feature phones, I'll be a happy camper.

41. Sniggly

Posts: 7305; Member since: Dec 05, 2009

The problem is though that you don't want too many customers going to prepaid, because those postpaid carriers are the only reason the prepaid are able to exist.

45. hepresearch unregistered

They will likely balance out. As prepaid sales increase, and demand for such services and products rise, the prices of prepaid products will also necessarily rise and postpaid equivalents will hold their prices or lower slightly to compete. Likewise, when postpaid services are well within the margin of more customers wallets, then postpaid services will rise in price during times of healthy demand, lowering the prices of prepaid offerings by default. In a system where more people can afford postpaid, the prepaid market is easier to support and prices lower so that more people who cannot afford postpaid can now afford prepaid... however, this is a three-edged sword; in a system where less people are able to afford postpaid, then prepaid will close the disparity with postpaid pricing, and less people will be able to afford either.

55. remixfa

Posts: 14605; Member since: Dec 19, 2008

thats not completely true sniggs. prepaid customers dont start in a deficit like post paid do. they pay those phones out right, buy them elsewhere, or with a very small starting discount. It is pure money to carriers. Carriers love postpaid because it is garunteed money within a few% of attrition so it makes doing the books a lot easier. Prepaid however is very attractive because there is no 12-20 month deficit on the price of the device per contract (depending on the device of course).

62. Sniggly

Posts: 7305; Member since: Dec 05, 2009

I'm referring to the pure prepaid carriers like Virgin, Net10, Boost, and Cricket. Since they don't build their own towers, they rely on the towers built by the contract carriers and the billions they invested in their networks.

67. remixfa

Posts: 14605; Member since: Dec 19, 2008

oh.. well yes, in that case, those prepaid carriers completely exist because of big post paid carriers. :)

70. hepresearch unregistered

I know Cricket recently inked a roaming agreement with Sprint in my area, but they do have an area they refer to as "home network coverage" or whatever similar name they give it... it is very small, and I was under the impression that they do have a few of their own towers in those areas (all of them either 1700 or 1900 MHz CDMA). In the event that my perception is wrong, I am curious as to which carrier owns the towers that Cricket considers to be it's "home network"? MetroPCS, by chance?

22. DigitalBath

Posts: 8; Member since: Oct 20, 2011

What seems more likely than android users waiting for the iphone 4S is that the android users have been waiting for the Prime, Vigor, and Razor. None have been released yet, thus, they are stillng hanging onto thier upgrades.

30. The-Omega-Man

Posts: 12; Member since: Jun 25, 2011

Count me in that list. :)

31. maxican16

Posts: 364; Member since: Sep 29, 2011

Exactly. Analysts, schmanalysts.

16. bossmt_2

Posts: 459; Member since: Oct 13, 2009

There are also a lot of people like myself who would have bought a Bionic or another smartphone but instead are waiting for the Nexus, RAZR, etc

18. taco50

Posts: 5506; Member since: Oct 08, 2009

I don't think so. Not too many people have ever even heard of those phones.

21. MichaelHeller

Posts: 2734; Member since: May 26, 2011

Read: not too many iPhone users have heard of those phones. The buzz for those phones with non-iPhone users is solid enough.

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