Thursday, July 29, 2010

Android sales soar, iPhone shrinks

Apple may have further reason to feel more than a little uncomfortable after new figures show a surge in the take-up of Google's Android-based phones. Apple's new iPhone 4 faced a barage of criticism shortly after it was released with a particular on reception problems. And while Apple claims sales have not been dented, its main rival now seems to be closing the gap.

Sales of phones running on Android, an open-source Linux-based system, have soared and now account for a 13% share of the UK market according to figures published by German-based GfK Retail and Technology. The uptake of the Android devices comes as many customers reach the end of their old mobile contracts and are able to upgrade.

GfK analyst Megan Baldock said that many people were specifically demanding Android devices. "The figures suggest an increasing number of consumers are now asking for Android handsets by name," Baldock says, "Operating Systems are no longer simply a by-product but a key selling point in their own right." [Daily Mail / ZDNetitproportal / broadbandgenie]

Slow growth of the smartphone

The smartphone market has has a somewhat chequered history. A few years ago devices that could access the Internet were foisted on the public using WAP [Wireless Application Protocol]. But many of these early devices were slow and information was limited. As technology developed and the demand for mobile Internet increased several manufacturers began to develop new software. Symbian based devices began launching and still retains a large market. Worldwide it is estimated that mobile devices based on the Symbian OS account for 46.9%. Microsoft moved into the mobile market with its Windows Mobile operating system, 

In the number of "smart mobile device" shipments, Symbian devices are the market leaders. Statistics published in February 2010 showed that the Symbian devices comprised a 47.2% share of the smart mobile devices shipped in in 2009, with RIM having 20.8%, Apple having 15.1% (through iPhone OS), Microsoft having 8.8% (through Windows CE and Windows Mobile) and Android having 4.7%. Other competitors include webOS, Qualcomm's BREW, SavaJe, Linux and MontaVista Software.

Although the share of the global smartphone market dropped from 52.4% in 2008 to 47.2% in 2009, the shipment volume of Symbian devices grew 4.8%, from 74.9 million units to 78.5 million units. But it does not look good for Nokia which introduced Symbian [The Inquirer].

While Microsoft had managed to dominate the PC market, it has failed to gain ground on mobile devices. Windows Mobile's share of the smartphone market has fallen year-on-year, decreasing 20% in Q3 2009. It is the 5th most popular smartphone operating system, with only a 2% share of the worldwide smartphone market.

The figures are somewhat weighted towards Symbian due to the slow move by Android and the iPhone OS into some markets. In China for example most devices available use Symbian or Windows Mobile. Apple has begun to target the huge mobile market in China and Android has yet to make any impression.

Two main contenders

In other countries it is clear that there are only two serious contenders in the smartphone market. Despite the criticism surrounding Apple's iPhone 4, it is undoubtedly a well designed piece of technology. But some have questioned the walled off garden approach of Apple in that all apps must be approved by the company. Android, by comparison is open source and although the number of applications is far less than that offered for the iPhone, many are free.

Cost of the device is also a major factor. There is only one iPhone, though the 3GS is still available it is likely to be phased out as Apple pushes its new device. In comparison there are several Android devices being offered. At the last count there were more than a dozen Android phones manufactured by ZTE, Dell, LG, Samsung, HTC, Sony Ericsson, Motorola and Acer. 

The only major phone makers not to sell any Android phones are Nokia, Apple and RIM, mostly because they have their own mobile platforms to protect. While Apple may maintain a significant market share, the recent sales figures may not bode well for others. GfK Retail and Technology's latest figures reveal that between Q1 and Q2 of this year contract market sales of the iPhone grew by less than 1%, but sales of Android phones increased by a staggering 350%.

The price factor

The types of contract available are also affecting market share. More consumers are choosing SIM only contracts or PAYG [Pay As You Go] because of economic circumstances and not wishing to be tied into long term contracts. 

A top of the range Android device like the Nexus One costs around $529 [£339] SIM free, the ZTE Racer costs only $155 [£100] and is the cheapest Android handset on the market. However it still shares some features found on more expensive phones like a 3.2-megapixel camera, Wi-Fi, Google Mobile Apps and Satnav capabilities. An iPhone 4 can cost $935 [£600] SIM free. This clearly favours Android because it is the only platform that offers the breadth of features of a true smartphone like the iPhone combined with the ability to cover the whole of the market from entry level to top end.

While a 13% market share isn't enormous, especially when compared with Apple, the growth is remarkable. RIM also increased its market share in the first half of this year, from two to seven percent, while Apple saw its slice of the UK smartphone market fall to 64% from 75% during the first two quarters. Unsurprisingly, the same research showed that smartphones now represent the lion's share of the mobile phone market, at 73.5%.

Android brings profits

Android uptake is not only good for Google but also the dozen or so manufacturers which are incorporating the software into its devices. HTC, the Taiwanese smartphone maker, has recorded massive profits [LA Times].

And as the popularity of Android grows, developers are said to be moving to be shifting emphasis to the Google software. The iPhone still has the largest number of applications, some 225,000, more than three times that of the Android's 72,000. However the Android Market has grown substantially in a short period of time. With developers now migrating to Google's OS there may be a slowdown in Apple apps and a large increase in Android apps. This will put both devices on a level playing field and may even give Google the edge [Techeye].

Android goes to war

Even the US military has moved to Android. RATS (Raytheon Android Tactical System) is now being rolled out for use my military personnel. a modification of the Android software used on millions of smart phones it will enable devices to handle encryption and military type communication [Strategypage]. Some might see the use of Android by the US military as somewhat at odds with Google's 'do no evil' motto, though Google probably have little say in the matter.

While Android may go to war in the form of RATS, it is the mobile war that the tech industry is focused upon. The iPhone has yet to be killed off by the Android, but it now faces a formidable enemy. Some are even contending Android will overtake the iPhone altogether [Trusted Reviews]

tvnewswatch, London, UK

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