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How Android Drives Smartphone Adoption in China

According to the latest market study by Informa Telecoms & Media, almost two-thirds of the mobile phone handsets sold in China this year are powered by the Google Android operating system (OS).

Did you know that China is the largest single market -- a third of all the Android devices sold in 2012 were to mobile network service subscribers in China?

The U.S. is now the second-largest market for Android -- with an 11 percent share of the global market. Informa predicts that at least one in every two mobile phones sold in America in 2013 will be powered by the Android platform.

"Despite the economic downturn, the global smartphone market is enjoying healthy growth and consumers are actually spending more to acquire more technologically-advanced devices," said explains Malik Saadi, principal analyst at Informa Telecoms & Media.

It's estimated that around 786 million smartphone devices were sold in 2012 (including the devices powered by non-certified variants of Android that are proliferating in China), which is 45 percent more than the total number of smartphones sold in 2011.

China is by far the fastest-growing smartphone market with a year-on-year growth of 85 percent in 2012. This growth is being driven by the explosive demand for Android phones.

Sales in China of devices powered by this OS exceeded 50 percent penetration in 1H12, and Informa estimates that two in every three handsets sold in the country over the whole of 2012 are powered by Android.

In contrast, the Apple iPhone and Microsoft Windows Phone hold minority shares of China’s total handset sales, around 5 percent and 1 percent, respectively, in 2012. However, thanks to Nokia’s partnership with China Mobile, Windows Phone is expected to improve its share in 2013 to 2 percent while iPhone is expected to lose market share slightly if Apple does not manage to create a TD-LTE variant for the Chinese market.

Informa expects Android to consolidate its leadership position in the U.S. market -- predicting that one in every two handsets sold in 2013 will be powered by this software platform.

With the continued rise of top-end Android devices, iPhone sales in the U.S. could face significant challenges if Apple does not make radical changes to its aging iOS -- particularly to the user interface (UI). Otherwise, Apple could be forced to compromise the high margin associated with its iPhone in order to maintain volume share.

Although Apple has upgraded the hardware of the iPhone5, only a little has been done to improve the software. This situation could lead to some Apple fans churning to Android, as they become disillusioned with using the same UI framework for more than six years.

Therefore, Informa now anticipates that U.S. sales of the iPhone will decline to 34 million units in 2013 -- that's down from 35.5 million in 2012.

Microsoft is expected to slightly improve its market share in the U.S. in 2013 to 6.5 percent as both Nokia and HTC strengthen their Windows Phone marketing strategies and device portfolios, and tighten their partnerships with operators in the region.

Looking forward, Google Android is expected to continue gaining market share globally and, by 2015, one in every two handsets sold worldwide will be powered by the OS -- further fueling the leading independent mobile software developer ecosystem.

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