

Samsung Overtakes Apple as World’s Biggest Smartphone Seller - aab1d
http://www.businessweek.com/news/2011-10-28/samsung-overtakes-apple-as-world-s-biggest-smartphone-seller.html

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mtkd
26% of the iPhone 4 was manufactured by Samsung:

<http://www.economist.com/node/21525685>

Samsung have for a long time been a bigger player in the smartphone market
than they look from their device sales alone.

~~~
tjogin
Sure they have, and as long as we count parts and phones, rather than
revenues, or better yet, profits, they will always be "bigger" than Apple, in
that sense.

I have a feeling they'd rather be more _profitable_ though.

~~~
davidw
As a consumer, I think I'd rather buy from the guy that's, yes, profitable, so
they don't disappear, but not the one that's making quite so _huge_ margins on
the stuff they sell me.

~~~
Terretta
Sorry, but that seems dumb.

You'd rather pay $100 for a flash drive to the guy that only makes 10% on them
because of his low volume or bad logistics, than pay $80 for the flash drive
to the guy that makes 50% margin because he's the high volume buyer and has
great logistics?

Me, I'd rather pay less for the best, and if that guy has better margins, so
much the better.

~~~
ramchip
What if the guy that makes 10% on them doesn't earn more because his drives
are made to last longer and he provides better working condition in his
factories? Not saying that Samsung is like that, but there are plenty of
reason beyond volume and logistics to justify different margins.

~~~
davidedicillo
That would be Apple ;) You can probably use the latest iOS longer (as
discussed yesterday) and it also hold a much much better resell value.

------
nextparadigms
I was expecting this. Apple can't possibly match Samsung with all their
smartphone price ranges, and it's only the beginning for Samsung. There are a
lot more "units" to be sold in the under $150 level. That's where the biggest
volume will come from.

I also expect them to surpass Nokia in all phone shipments, too (they already
did in smartphones). But it might take a few more quarters. Nokia will
transition too slowly to Windows Phone and Meltemi, and it's yet to be seen if
they will even see as big success as they did in the past with Symbian. Many
have already moved on from Nokia.

~~~
technoslut
There are other factors that did give Samsung an advantage such as no new
iPhone launched by Apple this quarter. It remains to be seen what the impact
is of new iPhone, Sprint availability and a 3GS that is free with a contract.
Apple is predicting that they will generate $40 billion during the next
quarter.

With a 'free' 3GS Apple is pretty much competing with Samsung and Android now
at every price point.

~~~
nextparadigms
Apple might win the next quarter, because of the launch boost of iPhone 4S,
but it will be their last one. After that it's all Samsung all the way. And
no, Apple isn't competing with the Android manufacturers on every price point.
This is a common American fallacy, thinking that the contract price is all
that matters, and that it's the real price of the phone.

But an iPhone 3GS still costs around $400, while Android manufacturers can
make even $100 phones today. What this means is that the iPhone 3GS will still
be sold on an expensive contract, while the "free" Android phones will be even
on $10 contracts.

------
hugh3
I'm really confused as to why some people seem to have strong feelings about
this.

~~~
kenjackson
I agree. It's interesting info to know, but not something to get worked up
about. MG Siegler seems to take pride in Apple making a lot of money, for
example. I'm really unclear why I should get excited if Apple make $30B this
year or $25B unless I'm a shareholder.

~~~
hugh3
Well heck, I _am_ an Apple shareholder, but still don't particularly care
whether Apple happens to sell more phones than any other individual company,
as long as they're still selling plenty of phones and making plenty of money.

I mean, I'd prefer 'em to be making more money rather than less money, but
it's not a great idea to get too emotionally invested in every piece of news
about every company you happen to have some money in.

------
diminish
Single device strategy vs Devices with multiple sizes, keyboards etc.The first
strategy makes good profit and the second strategy makes more revenuue. but
long term, always the market share rules strategically..

~~~
wmf
It's clear that very small market share is not sustainable, but the market is
so large that I think iOS will be fine even if it levels off at ~30% share.

~~~
MaysonL
And also, given that a much larger share of Android users switch to iOS than
switch the other way, Apple will do fine.

~~~
diminish
that is totally false; I (comscore, nielsen) observe that android came from 1%
to near 50% of all sales globally in 2 years despite the media buzz around ip.
most of my friends are disappointed by over promised, not met expectations of
ip5 and they are moving to large screen android phones. sgs2 and sgn are clear
winners as well as htc.

------
idspispopd
These figures are a red herring, I'd like to know how the iPhone-equivalent
models from Samsung/others are selling. The 3GS is available on upfront $0,
but the plan cost is higher, which means it's not competitive to the much
cheaper, albeit less-featured/powered models from other vendors. In essence
this is apple replicating their 90%+ marketshare in computers over USD$1000.

As an app developer I'm more interested in how this top end pans out. I want
the consumers who are willing to buy apps, and I want there to be lots of them
on one kind of platform so I don't have to do the heavy lifting in making the
game consistent across all handsets. I'm not making angry-birds clones that
could run on minecraft redstone, so a basic level of GPU+CPU capability is
needed.

Samsung's business model promotes the further fragmentation of Android, and I
think this will be a bad thing for consumers(read: developers). We'll be back
to the days of nokia making a different phone for every conceivable type of
person there is, with only nokia or huge studios with the capability to make
the umpteen variations required to make the game feel at least comparable
across each handset.

If there are 80% of the market using android devices that are underpowered the
only winner will be flashlight apps.

------
The_Sponge
That's because Samsung has a wider view of "smartphone". They release a LOT of
Bada phones which they consider to be "smart", but often only mention their
Android partnership when they release their numbers.

------
YooLi
Can anyone find Samsung's actual sales numbers? Not analysts estimates or
vague percentages more. I would think if Samsung is selling as much as is
claimed, they would have at least a concrete number.

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Mordor
... and so the pressure builds on Apple to diversify, which is what killed it
last time. Really Apple needs to invent and come up with something special,
but as SJ would tell you - which idea do you pick?

~~~
Tyrannosaurs
Does it? It may not ship the units that Samsung ships but it makes far more
money off the smaller number of units it does sell.

The reality is that Apple were the largest smartphone manufacturer in the
world for one quarter. It would be more accurate to view the fact that they
were (briefly) number one as a blip rather than see it as a major title they
lost and something they need to react to.

~~~
hpaavola
How much money does Apple and Samsung make from smartphones?

~~~
davidrhunt
From Q2 2011

[http://www.bgr.com/2011/07/29/apples-iphone-accounted-
for-66...](http://www.bgr.com/2011/07/29/apples-iphone-accounted-
for-66-of-q2-smartphone-profit-among-top-vendors/)

~~~
hpaavola
That seems to show total profit of Apple from Q2 of 2011. See
[http://www.apple.com/pr/library/2011/04/20Apple-Reports-
Seco...](http://www.apple.com/pr/library/2011/04/20Apple-Reports-Second-
Quarter-Results.html) "The Company posted record second quarter revenue of
$24.67 billion and record second quarter net profit of $5.99 billion" and
compare that number to the latter graph on the page you posted.

Or am I reading this wrong? I know nothing about finances, so it very well
might be that case that I just don't understand what I read.

So, again, how much does Apple and Samsung make money from mobile phones?

------
moomin
Apple never set out to make the most smartphones, it just kind of happened.

They set out to make the most money. Samsung are a fair distance from
achieving that.

~~~
ZeroGravitas
_"They set out to make the most money."_

It really worries me that there's a new breed of Apple fan that actually
believes this.

In reality they set out to build the best device (for affluent, white, middle-
aged, American males with a taste for minimalism) and semi-accidentally became
fashionable status symbols.

The crowing about making the most money was just fanboy bragging because every
other stat they bragged about was slowly being eclipsed by Android. Fanboy
rule number one is to make far too big a deal about anything unique about you
or your enemy. Some people seem to have latched onto profit margins and run
wild with it. This has gotten to the point where I'm half expecting, even here
on HN, someone to come along and claim that Samsung _"isn't making any money"_
from selling these phones.

~~~
Tichy
"for affluent, white, middle-aged, American males with a taste for minimalism"

So what do you reckon, what would a perfect smartphone for black, middle-aged
American males look like?

~~~
bane
For the last few years, if you add "part of the hip hop culture", it's been a
Blackberry.

Recently, I've seen a lot more high end Android devices, but a few of my
friends have gone back to flip phones surprisingly.

------
brisance
Once again the media is derelict in its reporting duties by equating "shipped"
as "sold". They are not the same thing.

~~~
ZeroGravitas
Samsung _smartphones_ are selling briskly, there is no material difference in
the numbers.

The month on month rise in sales, for the last year or so, has been
spectacular. You can't just keep shipping phones at that pace without selling
them, it's simply not realistic to channel stuff on that scale.

~~~
brisance
The article didn't mention anything about the difference in "shipped" vs
"sold" numbers. Apple's numbers are those that have sold through to customers.
So there is not enough information to tell if it's "a material difference".

The rest of the article is equally shoddy. For example: _Chinese phone maker
ZTE Corp.’s cheaper handsets helped it take 4.7 percent and overtake Apple for
fourth place. Global market shipments climbed 14 percent to 390 million units,
according to the researcher._

Apple does not even produce feature phones, so the inclusion of Apple in that
paragraph can only be construed as mischievous. It's like saying "Porsche fell
to last place in the under-US$20K category".

------
boscomutunga
The secret of samsung is that they cater for multiple price ranges, also the
use of android is proving to be a good advantage over the now dying
nokia.Despite the launch of the lumia, nokia and microsoft aren't likely to
win in this race.

------
coob
What percentage of the profits do they take?

Exactly.

~~~
ZeroGravitas
Do you have figures to share? You seem confident, yet I'm equally confident
that their profits from smartphones are large and growing quickly.

It's seems unlikely that they would be doing so differently from HTC and ZTE,
much smaller players who are doing very well.

I don't know of any comprehensive numbers on the market that I'd trust, but as
a snapshot Apple reported $7.3 Billion profit in July (for phones, ipods,
ipads + compters etc.) up 80% from last year, while Samsung just announced
$2.3 Billion just from smartphones, a yearly increase of over 100%. (This
doesn't seem to include money from selling components to other smartphone
makers, such as Apple).

~~~
coob
Asymco smartphone profit league table updated for Q3:

<http://pic.twitter.com/rIO0siLf>

Edit: See also: <http://www.asymco.com/hire-me/vendor-bubbles/>

~~~
ZeroGravitas
Your graph appears to show Samsung overtaking RIM and Nokia in profits and
moving into second place as its smartphone marketshare grows to be the largest
(it overtook them both in marketshare during the last year).

Do you think that supports your point or mine? As a reminder my point was that
_"I'm equally confident that their profits from smartphones are large and
growing quickly"_.

(The bubbles' seem to paint the same picture in a more dynamic way, with
Apple, Samsung and HTC rising strongly over the last year though it ends at
June.)

I'm a bit confused about Apple's profit being "6" according to the bubble
thing in June and it being $7.5 Billion for their entire product line the next
quarter. I guess that's not just smartphones then (edit: yep, confirmed it's
all products combined).

~~~
coob
The article is about Samsung overtaking Apple in shipments (vs sales).

I was pointing out they they have not overtaken in profits. The two points are
not mutually exclusive.

------
jhuni
Well overtaking Apple is a good start, we shouldn't stop until Apple tyranny
is totally wiped off the face of the Earth.

~~~
dereg
Samsung is indisputably more "tyrannical" than Apple. The corporation has
unsurpassed political influence in South Korea. For instance, scumbag Chairman
(former CEO) Lee Kun-Hee is a nepotist and admitted guilt to political bribery
in 2008. Guess what? He paid his way out of jail time and was even pardoned by
LMB in 2009.

Samsung also has tremendous media influence in the nation. The company
influences the media by giving or withdrawing advertising, giving scholarships
to journalists, or suing the critical media. As a result, their corporate
misdeeds get swept under the rug. The company uses the press as a means to
control the press rather than sell their products. Samsung accounts for almost
one-fifth of the entire nation's GDP. It's no surprise they are the nation's
largest advertiser.

Corporate influence in the USA is nothing compared to the influence of the
chaebol in Korea.

~~~
jhuni
As anti-capitalist, I oppose all corporations, including Samsung. On the other
hand, as a free software activist, Apple has made itself my number one enemy
in the past year or so with the considerable spread of the DRM-ridden iOS.

~~~
falling
I can never remember if Apple is a monopolist or Android is taking over.

~~~
recoiledsnake
I similarly can't understand how Microsoft is dying in the post-PC world that
we are supposed to be living in, but somehow trying to kill Linux by requiring
secure boot on it's PCs(which no one is supposed to be buying anymore).

~~~
falling
Well, in that case you would say that Microsoft is trying to survive by
eliminating competition on scarce resources. But then, I don't think Microsoft
is dying.

------
jnfr
My problem is that all of these articles are missing a key piece of
information: the number of devices each manufacturer has out on the market.
Jumping over to Samsung's website, I count 14 Galaxy Smartphone devices
currently on sale. What about Apple? They have on sale the iPhone 3GS, iPhone
4 and iPhone 4S. How about instead of comparing absolute values of shipments,
we talk about number of shipments per device?

But is it really a numbers game? Is it quantity over quality? It's no secret
that Apple has one of the most loyal fanbases out of any other tech company.
Who is clamoring over wanting every new Galaxy smartphone? Who's lining up
every time they release a new product?

For those who want to play the numbers game, make sure to play it properly.
The iPhone 4s sold 4M shipments during its first weekend. Meanwhile, it took
Samsung 55 days to sell 3 million Galaxy S IIs, arguably, their most
successful Smartphone yet. Now if Samsung continuously releases new versions
of these Galaxy smartphones, which they are, then obviously they will be
shipping more.

