Thursday, May 17, 2012

Apple Crushes Cell Phone Market Target

Apple continues to amaze in the cellular arena. After having dramatically overshot its original objective of taking 1% of the global handset market, Apple has over the last four quarters doubled its share of the cell phone market to 7.9%.

That's not 7.9% of the global smartphone market, but 7.9% of the whole cellular market – smartphones, feature-phones, dumb cell phones, prepaid phones, etc. Of even greater interest than Microsoft's apparently headlining smartphone partner Nokia dropping from the world's leading vendor by volume (not by profit; it's lost money consistently for a while even despite Microsoft's cash injections) to the #2 slot, is that the #2 ranking is achieved with a product mix that's only 16% smartphones. By contrast, Samsung's product mix is 43.9% smartphones. Apple's is 100% smartphones. The difference in market segments addressed by each company explains how Samsung and Apple seem to be the only handset manufacturers currently making money in mobile phones.

Further reading:
Investing In Smartphone Failures (you can make money on predictable failure)
Apple's 'Share' In Jeopardy? (Share of unit sales isn't share of profits, which is literally where the money is)
Playing Microsoft's Mobile Victory in China (if you believe in a MSFT victory, the play is MSFT and not its commodity hardware vendor partners)

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