Thursday, February 28, 2013

Competition for Apple and Google Mobile Ecosystems

At Mobile World Congress this week, new attempts to create competing mobile device software ecosystems were announced. What are they up against? Google Android and Apple iOS, the number one and number two ranked smartphone operating systems (OS) worldwide, combined account for 91.1 percent of all smartphone shipments during the fourth quarter of 2012 (4Q12).

According to the latest market study by International Data Corporation (IDC), Android smartphone vendors and Apple shipped a total of 207.6 million units worldwide during 4Q12 -- that's up by 70.2 percent from the 122.0 million units shipped during 4Q11.

For calendar year 2012, Android and iOS combined for 87.6 percent of the 722.4 million smartphones shipped worldwide -- that's up from 68.1 percent of the 494.5 million units shipped during calendar year 2011.

"The dominance of Android and Apple reached a new watermark in the fourth quarter," said Ramon Llamas, research manager with IDC.

Android boasted a broad selection of smartphones, and an equally deep list of smartphone vendor partners. Finding an Android smartphone for nearly any budget, design preference or screen size was easy during 2012. As a result, Android was rewarded with market-beating growth.


Likewise, demand for iPhone 5 kept iOS in the hands of many Apple smartphone fans. At the same time, lower prices on the iPhone 4 and the iPhone 4S brought iOS within reach of more users and sustained volume success of older models.

The competition between Android and iOS has collectively accounted for more than 50 percent share of the smartphone OS market over the past two years. At the same time, both BlackBerry and Microsoft have been working on competing platforms.

Microsoft launched Windows Phone 8 in 4Q12, and BlackBerry more recently released BB10 in January, marking the first time two new platforms have been introduced to the smartphone space in the past several years.

"With the recent introductions of two new smartphone platforms we expect some ground to be made by the new entrants over the coming years," said Ryan Reith, program manager with IDC. "There is no question the road ahead is uphill for both Microsoft and BlackBerry, but history shows us consumers are open to change. Platform diversity is something not only the consumers have asked for, but also the operators."

Leading Smartphone Operating System Highlights

Google Android continued its overall upward trajectory, reaching triple-digit growth for the year. Samsung was the biggest contributor to Android's success, amassing 42 percent of all Android smartphone shipments during the year.

Following Samsung was a long list of vendors with single digit market share, and an even longer list of vendors with market share less than one percent. The intra-Android competition has not stifled companies from keeping Android as the cornerstone of their respective smartphone strategies, but has upped the ante to innovate proprietary experiences.

Apple iOS posted yet another quarter and year of double-digit growth with strong demand for the iPhone. But what also stands out is how iOS's year-over-year growth has slowed compared to the overall market. The smaller volumes during 2Q12 and to a smaller extent 3Q12 underscore the possibility for a mid-year iPhone release in order to maintain market-beating growth.

Speculation about the release of possible larger-screen and inexpensive models during the middle of 2013 continues to follow Apple, which would help sustain growth. But until any model is formally announced, speculation remains simply that.

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