
Android Rises to 90% of Smartphone Market in China - Reltair
http://www.techinasia.com/android-market-share-china-2012/
======
cs702
Bill Gurley of Benchmark Capital foresaw Android's rise, and wrote an
excellent essay about it in early 2011, "The Freight Train That Is
Android."[1] His main point: Google is not trying to make a profit on Android;
they're trying only to control the key layers between themselves and the
consumer, by making these layers free or even _less than free_ , which is a
HUGE problem for Android's competitors, who must make a profit.

As he put it, "I don’t know if a large organized industry has ever faced this
fierce a form of competition – someone who is not trying to 'win' in the
classic sense. They want market share, but they don’t need economics. Imagine
if Ford were faced with GM paying people to take Chevrolets? How many would
they be able to sell? What if you received $0.10 for every free Pepsi you
consumed? Would you still pay $1.50 for a Coke?"

I highly recommend you read (or re-read) Bill's prescient essay.

\--

[1] [http://abovethecrowd.com/2011/03/24/freight-train-that-is-
an...](http://abovethecrowd.com/2011/03/24/freight-train-that-is-android/)

~~~
stcredzero
Google could also be said to be "commoditizing the complement."

<http://www.joelonsoftware.com/articles/StrategyLetterV.html>

IBM did this with Java development and Sun. (Eclipse - note what the name does
to the Sun.)

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scottchin
Does anyone have insight into any of the following questions?

1\. Which Chinese Android App marketplaces are the most popular? In other
words, if I wanted to target Chinese Android users, which app stores should I
focus on submitting my app to?

2\. Are there any barriers to submitting to such app stores for north american
developers? Specifically related to getting paid.

3\. Which Android mobile ad networks are best (cpm/cpc) for China?

Would love to hear any personal experiences working with China's Android
Market!

~~~
kevin_p
#1. For us, the top 3 are GoAPK (anzhi.com), GFan (apk.gfan.com) and Tencent
App Center (<http://android.myapp.com>). Between them, they're >90% of Chinese
3rd-party app store downloads.

#2. The biggest hurdle is that everything is in Chinese. I'm not sure how hard
it would be to get paid if you're not in China, but as athgeo says, Chinese
users _really_ don't like to buy paid apps - even in the iOS app store our
free-to-paid ratio for China is literally 10 times worse than the US, and
Android is even worse because the users are less likely to have money. So it's
probably best to concentrate on ad-supported apps.

#3. If anyone has good advice on this, I'd like to hear it.

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mtgx
I think it's the people saying that Android is _not_ the Windows of
smartphones that will be considered crazy at this point (unlike before when it
was the one saying it who who were considered that).

~~~
MaysonL
Of course, Microsoft made a lot of money selling Windows...

~~~
adventured
And Samsung is making a huge amount of money selling Android with their
phones, and those numbers continue to skyrocket.

Google doesn't sell Android of course - they ride it. It's a completely
different business model that can't be compared to the business model of
selling packaged retail software.

~~~
rbanffy
Samsung sells phones. This is like saying Dell makes money selling Windows
with their PCs.

What Android does, by spreading development costs across the whole market (and
beyond - since Android is Linux it leverages resources spent on refining it
for uses other than mobile devices), is allowing device manufacturers to build
good phones in shorter cycles for prices lower than they would otherwise be
possible.

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linpythio
The android phones chinese bought are very cheap(500yuan to 2,000yuan),and
they like free app.They can't afford iphones-5,000yuan(it will be stolen).

~~~
lvturner
This is complete rubbish. In Beijing every second person you walk past is
casually using an iPhone.

~~~
vidarh
Sure about that? You can buy feature-phones for ~$20 from China via
Aliexpress.com that mimic iPhone 4's look very closely (including directly
copying the UI), as well as a bunch of low end Android phones that also look
like iPhone's at slightly higher price.

It also doesn't mesh with income levels, unless you're only walking around in
very affluent areas, which is why anecdotes are pretty useless to establish
popularity.

~~~
seanmcdirmid
We can tell the shanzhai phones from the real ones. I concur with parent,
iPhones are ubiquitous in Beijing. Keep in mind that most people there are
middle class/rich. You have to travel outside the core...maybe 5th ring road
before you get to poorer sections. But ya, the migrant worker on the street
probably has a xiaomi, if that.

~~~
vidarh
> I concur with parent, iPhones are ubiquitous in Beijing

Or you just notice them more because the people who can afford them like to
show off their wealth.

> Keep in mind that most people there are middle class/rich.

According to People's Daily, average salary in Beijing last year was ca. 66000
yuan in non-private companies. It does not give clear numbers for employees of
incorporated companies, other than saying it is about 1.2 times the national
average. Lets be generous and round it up to 80000 yuan. That's still less
than $13,000. And the distribution is extremely uneven - e.g. a lot of
restaurant workers and other low level labour in Beijing still live in
employer provided dormitories with salaries that wouldn't cover other
accommodation.

The Beijing average is certainly well above the average for China, but I still
take issue with the original claim that "In Beijing every second person you
walk past is casually using an iPhone".

That there's a lot of them, I can buy. But seeing a lot of them in a densely
populated city does not mean they actually make up a high percentage.

> But ya, the migrant worker on the street probably has a xiaomi, if that.

Given that Xiaomi phones start at around 3-4 times the low end of the Android
market, I'd go for the "if that" for most of them... Amusingly just today
Aliexpress has been showing off Xiami Phone 2 ($425-$525 for a quad core dual
booting Android and MIUI phone) vs. Samsung Galaxy SIII

(To those not aware of the iPhone-lookalike feature phones I mentioned, here's
an example: [http://www.aliexpress.com/item/Dual-SIM-F8-TV-or-F8-NO-
TV-i6...](http://www.aliexpress.com/item/Dual-SIM-F8-TV-or-F8-NO-
TV-i68-I9-4G-QuadBand-Dual-SIM-Dual-Cameras/503717522.html) \- there's also
Android iPhone lookalike phones under brands like Star)

~~~
seanmcdirmid
Are you based in Beijing?

People's Daily doesn't include black/gray income, and for public-owned
companies, this is huge where almost everyone is getting income/benefits under
the table. They don't need to buy their own iPhone, someone will just "gift"
it to them for guanxi reasons.

Finally, any middle class kid working for a private company making more than
6K RMB/month (72K/year) is going to have a iPhone most of the time. And this
is why they are so pervasive here.

------
alpb
Interesting that almost none of these devices are shipped with Google Account
integration. What does Google get out of this huge market share?

~~~
zalew
> Interesting that almost none of these devices are shipped with Google
> Account integration.

More interesting (for Google) is that 90% of Chinese people don't buy Windows
and iOS phones.

Opensource at its finest and opensource as a defence weapon at the same time.

~~~
pretoriusB
> _More interesting (for Google) is that 90% of Chinese people don't buy
> Windows and iOS phones._

70% of people in the west doesn't buy Windows (nobody buys Windows phones,
period), or iOS phones anyway.

So, it's not much surprise that Android does well in a much poorer market. It
always catered mostly to the lower end of the market in the west too.

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meaty
I wonder what the total marketshare that corresponds to is? From what I've
read, smartphones are still in a niche in china and they primarily use
dumbphones and featurephones.

~~~
sien
There are 40+ million smartphone sales per quarter in China.

[http://bgr.com/2012/08/26/china-smartphone-
sales-q2-2012-len...](http://bgr.com/2012/08/26/china-smartphone-
sales-q2-2012-lenovo-apple/)

So There are 140+ million Android sales per year in China.

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aphexairlines
Where does Analysys International get those stats? Are those the same numbers
that Alibaba, Taobao, Google, Amazon, etc are seeing in China?

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tmister
Google is at same position as Microsoft, both of them are not earning any
money from this large market share. Not to mention about rampant piracy of
applications there.

~~~
InclinedPlane
Let's have some perspective here. Google earns about $40 bil a year, mostly
from ads. Microsoft's Windows division still earns $18 billion a year. That
part of their business may be in extreme danger at the moment but the only
place where $18 billion is a rounding error is the government.

