

Android's Market Share is Literally a Joke - thoughtsimple
http://techpinions.com/androids-market-share-is-literally-a-joke/16709

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dragonwriter
This article is a joke. First, it misapplies the joke that it says "literally"
applies to Android marketshare -- the "bigger truck" joke only applies when
profit is _negative_ so that the net is a loss, and a bigger truck is a bigger
loss.

But even worse, its just throwing stuff out that doesn't stick together. I
mean, it makes at one point the claim that Android manufacturers are
sacrificing margin for marketshare (which is no doubt true; its a common
strategy, one which Amazon's Jeff Bezos has highlighted with the comment that
"Your competitor's margin is your opportunity"), suggesting that while the
trend is against Apple in marketshare, Apple could easily reverse it by
cutting its own margins.

But then the article goes on to say Apple shouldn't cut the prices on its
offerings because not enough is known about price elasticity in this market
(well, specifically, they say not enough is known about price elasticity of
the iPhone).

And then they make the claim that the goal is not to maximize marketshare
(okay), or even to maximize profits (!), but to _maximize the ratio of profits
to marketshare_. By that logic, in a two-player market where one player has
99.9% of the marketshare and a mere 99% of the profits, and the other player
has 0.1% of the marketshare but a whopping 1% of the profits, the _latter_
would be _winning_.

~~~
dragontamer
You're right. But beyond that... the analysis of this article is so shallow,
it manages to say nothing while taking up pages and pages of information.

Who is "winning" the smartphone wars? How can an article like this rant on for
pages and pages, without mentioning that say... Samsung creates over 25% of
the iPhone?

[http://www.economist.com/blogs/dailychart/2011/08/apple-
and-...](http://www.economist.com/blogs/dailychart/2011/08/apple-and-samsungs-
symbiotic-relationship)

What about that little fact, that the majority of revenue Google makes is from
iPhones?

[http://bgr.com/2012/03/29/google-generates-four-times-
more-r...](http://bgr.com/2012/03/29/google-generates-four-times-more-revenue-
from-iphone-than-android/)

Fanboys can sit around and play silly word games and armchair debates about
who is "winning" or "losing". The fact of the matter is... these companies are
well diversified and will do well regardless of marketshare.

A long rant without mentioning the most basic facts of this marketplace is not
very worth reading.

~~~
gizmo686
Also, the smart phone market isn't a monopoly. And the copy-left nature of
Android goes a long way to assuring that it never will be.

This protects Google (and many other companies) from Apple leveraging their
market dominance into other markets.

------
ocean12
This is absolutely a true statement:

"(T)he primary problem with using market share as a measure of business health
is it provides no insight into the profitability of the product being sold."

But other than that, the answer to "who is winning" is first defined by what
goals the competitors are competing to reach.

If Androids goal is market share, and Apples goal is profit, _both_ could be
winning...and at the same time.

------
rayiner
There is insight here which people are missing. Look at the PC graph.
Honestly, would you rather be Apple making Macs with 8% market share and 45%
profit share, or Dell, Asus, etc?

Unlike with social software, there are diminishing returns to market share in
physical devices. Chasing market share and hoping profits will follow is the
wrong game to play. It's taking the wrong card out of Microsoft's playbook:
Windows might have huge market share, but it was always a very high margin
product for Microsoft!

~~~
gizmo686
In a lot of ways, smartphones behave like social software. Their value is
largely defined by how many third parties are writing apps for them, which is
largely defined by how big the market share is.

~~~
rayiner
Social is different. A computing platform with 50% market share (or even 15%
market share, as evidenced by the Mac) will still have tons of apps. A social
network with 50% market share is something where half of everyone's friends
will be on the competing network.

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neogodless
Oh right, but there is a company that profits from Android market share!

[http://www.zdnet.com/microsofts-most-profitable-mobile-
opera...](http://www.zdnet.com/microsofts-most-profitable-mobile-operating-
system-android-7000015094/)

(Not sure what this chart is showing share of, since it doesn't correspond to
the 74% Android and 3.2% Windows Phone chart that has been circulated lately.)

------
Zigurd
tl;dr: Some competitors have higher margins.

However, high margins are less safe than they look. The article omits the fact
that a high-margin competitor in mobile devices can retreat from market share
only so far before it becomes impossible to maintain a viable ecosystem behind
their product.

