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Android powers 59% of smart mobile devices shipped in Q1, what can Apple and Microsoft do?
Latest figures show that Android was the operating system of choice for over 182 million smart devices that were shipped during the first three months of this year. According to a new report by research company Canalys, 308.7 million smart mobile devices (which includes notebooks as well as tablets and smart phones) were made in Q1 and Android powered 59.5% of them!
What is interesting about these numbers is that Canalys has added notebooks into the equation. This gives Microsoft a better representation and means that this isn’t just another set of Google vs Apple statistics. If you include notebooks and Microsoft Windows then Apple only has a 19.3% share of the market (with iOS and OS X) and Microsoft has an 18.1% share (with Windows 8 Pro, Windows 8 RT, Windows Phone 8).
Tablets continue to be the fastest growing segment with worldwide tablet shipments growing by 106.1% year-on-year to 41.9 million units. Apple’s dominance in this area can’t be denied and iOS has a 46.4% share. However Apple’s market share is shrinking and Q1 was the third consecutive quarter where Apple lost market share to Android.
The bulk of the 308.7 million smart devices shipped in Q1 were smartphones with just over 216.3 million shipped. Android was the dominant OS with 75.6% of smartphones shipped using Google’s open source OS. Samsung continues to dominate increasing its volume by 64.3% year-on-year, while Apple saw only a modest annual growth of 6.7% in its smart phone shipments.
The growth in sales of the iPhone is at its lowest level since the launch of the original iPhone back in 2007 and clearly the Cupertino company faces some strong challenges. To be fair it isn’t the end of the world for Apple (yet) as it did ship over 37 million iPhones but clearly Android phones like the Galaxy S4, the HTC One, the LG Optimus G Pro and Sony’s Xperia Z are more than a match for the iPhone.
What can Apple do?
All the current Android flagship smartphones use much bigger displays than the iPhone (which now even at 4 inches is looking small). They all have quad-core processors, they all have 2 GB RAM and they have HD (1080p) displays and they all offer NFC. None of these things are true for the iPhone 5.
For Apple to maintain its momentum the next iPhone can’t be just a tweaked version of the iPhone 5. Traditionally Apple released a new design (iPhone 3G, iPhone 4 and iPhone 5) every two years and in the in-between years it released a tweaked, faster version (iPhone 3GS, iPhone 4S). If the next iPhone from Apple is the iPhone 5S with just a faster CPU and a few tweaks then the company will be in serious trouble. Product naming aside it needs to release a new design (an iPhone 6) with a HD display, a bigger screen and more CPU power. Apple also needs to embrace NFC.
But that isn’t all. iOS needs to be updated radically. Sir Jonathan Ive is now hands-on with the design of iOS after Scott Forstall left (was pushed) Apple. He needs to radically refresh the current iOS UI which is six years old and is missing lots of “standard” features that Android smartphone users are used to.
What can Microsoft do?
This is a tough question. I will go out on a limb here (bullet proof vest on, helmet secure) and say that Windows Phone 8 isn’t actually that bad. Please don’t shoot! The problem Microsoft has is that it’s business model is broken. Google went open source with Android which means that every manufacturer from Samsung down to some small Chinese outfit can make Android phones. Second, Google went into the hardware business (with partners like LG and Asus) in a way that actually boosts sales of Android. When Microsoft went into the hardware business it just annoyed its OEMs.
Apple is different as it is at the “high end”. The iPhone is seen historically as a premium product. Its marketing is based on a small number of models at the top end (compare how many models of iPhone there are to how many Samsung devices you can buy). Microsoft are stuck in an old business model with only one or two major hardware partners (Nokia and HTC) trying to convince the world that Windows 8 on the desktop is just like Windows 8 on a phone or tablet!
What Microsoft need to do is lure developers and handset manufacturers to Windows Phone 8. There are several ways it can do this, it will never open source Windows Phone 8, but it could open source parts of it and offer developers (and manufacturers) the freedom to tweak the OS. It could also tempt developers with special handsets at reduced prices etc. To get more handset manufacturers it could also relax the procedure for becoming a OS partner, maybe waive some fees etc. Once developers and handset manufacturers are truly keen on Windows Phone 8 and once they have some freedom to tweak and differentiate then the consumers will come.
What do you think, is Android destined to be the dominant mobile device OS? What can Apple and Microsoft do?