Sunday, October 30, 2011

100 articles on Economic- (4): Will Apple swim after Blackberry crash?

The edited article was published on Felix, Imperial College Student newsletter.

It seems that i have a lot to improve in term of wording and structuring.


An Analyst of Apple Iphone’s Stand in Current Market
- By Shiang Jin, Chin

Just before the Black Berry service collapse at 10 october, the analyst firm Enterprise Management Associates (EMA) have conducted an extensive research regarding the trend in enterprise mobile device management. The research concluded that more than 30% of blackberry users in large enterprises are expected to move to different platform within a year , due to the lack of user satisfaction. Despite the growing popularity of the device in UK teenager market (due to BlackBerry Messenger which allow users to save a lot for instant messaging), the recent blackberry “black out” will only accelerated the declining of RIM’s market share at enterprise level. The question is whether Apple Iphone and IOS platform, after the death of his founder Steve Jobs, will take over BlackBerry place, or following the Blackberry footsteps in its own key market.

Recent stats from Kantar Worldpanel ComTech’s smartphone OS market share news showed that while Nokia Symbian’s platform and RIM’s market share in major country are being fade out, Apple IOS failed to take the opportunity. Apple IOS only have significant gained in US market share, while their market share in UK, Japan, Germany and France drops drastically. On the contrary, Android operating system outperformed Apple IOS in every market, with Samsung, HTC, Nokia and Motorola as key players competing with Iphone for smartphone market.

On the other hand, apple still maintained its dominance in global mobile application store market, generating $1.8 billion in revenue, which is 82.7% of the total market. A recent user satisfaction survey by J.D. Power and Associates showed that Apple topped the other smartphone manufacturer with 838 point, topping every key area like performance, ease of operation, features and physical design. As the Kantar report suggested, Apple and Android’s user are quite loyal when choosing upgrade, due to the amount they already invest in mobile application. Hence, Apple might be losing ground in attracting new customers, especially when their latest product is just an upgraded version of Iphone 4s instead of a much anticipated Iphone 5. However, Apple’s hold on their original customers is quite firmed, which guarantee a constant stream of revenue for near future.


As more companies coming out with smartphone devices with similar and matching functionality to Apple’s Iphone, what is differentiating Iphone from the rest will be the operating system (OS) that it used. In that case, Apple’s weakness is actually what contributes to their strength. They have a highly rigid combination of operating system (IOS) and devices (Iphone), complement by the app store which required approval from Apple to sell the application. Hence, while new customers might be pushing away for lack of variability of product, little integration with the Window’s operating PC, and expensive application compare to android , Apple still managed to rake a high profit margin from their products. According to Horace Dediu from asymco , apple shipped only 5.6% of the mobile phone unit in second quarter 2011, but their share on Global Mobile market profit was about two third (66.3%).


While Android OS is more popular than IOS, the application developers are more satisfied with Apple market’s ecosystem. A recent survey from US Yankee group and Skyhook shows that developers were dissatisfied with the lack of regulation in Android application market, as piracy is eating away their profit. Another survey from research firm IDC and mobile software company Appcelertor showed that developers are shying away from Android as they viewed the platform still too fragmented, and they can gain more profit in Apple market place . Statistic from Furry confirmed the view, in which out of 10200 application project developed in second quarter, 2011, 72% were for Apple IOS while only 28% were for Android, this means more good apps will stay and developed in IOS platform.

Hence, the ultimate fate of Iphone and IOS might depends on the outcome of the tug of war between the developers and the consumers, whether the consumers will be attracted by the good application make by developers, or the developers forced to follow the consumer choice. The news so far isn’t good for Apples, as latest estimates from Ovum, an telecom analyst group projected that Android Applications will outsell Apple Apps this year . As history always showed, bad money drives out good money, Android OS with its openness and vast popularity will eventually dominated Apple IOS in every aspect, the only question is when. It took 6 years for Window-Intel Pc to overthrow Apple’s Macintosh machine. As current customers and developers satisfaction still high, it will take years for Android-HTC/Samsung/LG/Motorola/Nokia to defeat Apple in amount of profit make.


Reference:

http://mobileenterprise.edgl.com/news/Analyst--RIM-Losing-Market-Share-Faster-Than-Expected76379
http://www.emausa.com/research/asset.php/2101/Enterprise-Mobile-Device-Management:-How-Smartphones-and-Tablets-are-Changing-Workforce-IT-Requirements
http://www.mobileindustryreview.com/2011/07/apple-iphone-uk-market-share-halves-to-18-3.html
http://www.directv666.com/?p=395
http://mashable.com/2011/09/09/apple-customer-satisfaction-survey/
http://tech.fortune.cnn.com/2011/07/11/apple-users-buying-61-more-apps-paying-14-more-per-app/
http://www.mobilemarketingwatch.com/fiksu-android-users-2x-more-likely-than-ios-users-to-open-an-app-ten-times-or-more-19052/
http://www.asymco.com/2011/07/29/apple-captured-two-thirds-of-available-mobile-phone-profits-in-q2/
http://www.marketwatch.com/story/app-piracy-is-hurting-android-developers-bottom-lines-2011-09-08
http://www.businessinsider.com/developer-interest-in-android-and-apple-2011-4#ixzz1bpAgkPYy
http://www.androidauthority.com/android-apps-outselling-apple-apps-24227/

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