Playing with a new chart format. This shows quarterly handset unit revenue at the 8 'branded' handset OEMs, over the past three years. It includes all phones, not just smart.
The polarisation of the industry is pretty clear. Not shown: the 'other category - Chinese OEMs making up increasingly large volumes for which this sort of data simply isn't available.
I presented these slides at the 'Mobile on the Go' event at Google earlier this week: they give the key numbers for what's going on in mobile right now. These are the slides I was speaking to in this video.
Sometimes the simplest observations are the most compelling.
According to the ITU, there are now around 650m fixed broadband lines in the world.
In the 24 months to December 2012, around 915m iPhones, Android phones and tablets will have been sold. At the current rate of growth, which shows no signs of slowing, there will be twice as many of these smart mobile devices as there are broadband lines within a year.
Of course, real life is messier than that makes it look - you need to think about multiple users per PC and multiple PCs per connection, etc, etc. But none the less, the shift in the balance of consumption over the next few years will be profound.
Sometimes the simplest images are the most compelling.
This chart shows quarterly revenue for the handset units of Samsung, Apple, Nokia and the rest of the industry since July 2011. It includes some estimates for small points of detail it it is mostly just the data the companies report.
Apple (with cyclical swings) and Samsung are taking almost all of the growth - one taking the high end and the other taking all the rest.
A Google Trends chart of use of 'the year of mobile' since 2005
This is a summary presentation based on a longer and much more detailed report I’ve produced for clients of Enders Analysis. I’ve presented these slides at a few conferences, so I’m making it public here as well. As should be obvious, it is the basis for a talk rather than a stand-alone document, but most of the charts should be self-explanatory.
As reported by the US operators, supplemented by some reasonable solid estimates on my part. The iPhone had around 47% share in Q2, roughly level with Android (RIM is now very small in the USA).
2 years ago the iPhone was only offered by AT&T, which had 30% of the market. Today it is offered by operators with 80%. I strongly suspect that the iPhone ‘5’ will be ranged by T-Mobile (whose spectrum has been reconfigured, making this more practical): all things being equal that would take it slightly over 50% market share.
This is especially relevant in the light of this internal Apple survey, disclosed today as part of the Apple/Samsung patent lawsuit: people choose operator first and phone second, especially in the US, given the highly variable coverage that operators provide.
Sometimes the simple charts are the best. This shows quarterly revenue for handset manufacturers (using the handset business unit for companies that do other things as well), for Q2 2012 versus Q2 2011.
In the last 12 months Apple and Samsung grew, as did Sony (from a very small base). All the other ‘traditional’ branded manufacturers shrank. In total, Samsung and Apple’s revenue grew by $10.9bn year-on-year: the other branded OEMs combined shrank by $6.3bn.
(The Apple number is slightly misleading because it catches the company in a cyclical dip in iPhone sales - run-rate growth is higher)
Not shown: Huawei and ZTE plus (literally) thousands of other smaller manufacturers in China and now India, which is increasingly difficult to estimate with a straight face: many of these are effectively Mediatek vendors. In effect, the market is polarising between ultra-low-cost manufacturers at the low end and high-volume high-efficiency manufacturers at the high end.
Another (slightly flippant) way of putting it: the market is polarising between quad-core phones and quad-SIM phones.
Google’s Andy Rubin on Android
Nokia reminds me a lot of Apple in the pre-Job days.
It doesn’t have the loss-making, inept manufacturing, but everything else is there. The OS strategy is in chaos, the product lineup is bloated and confusing and the internal politics are out of control. Hardware teams and software teams do whatever they want with no reference to each other and no-one has any idea what OS will be on what device, what OS will come next, what device to buy or what internal fiefdom they should be dealing with.
Meanwhile both companies struggled to get past a sense of ‘but we invented that!’. Apple invented (sort of) the GUI, while Nokia invented the idea of a consumer-friendly, easy to use mobile phone, yet both watched helplessly as newer upstarts zoomed past them. Both the Apple OS and the Nokia OS (more Series 40 than Series 60, admittedly) began as industry-leading products with great UX, both had far too much bolted onto them and both eventually collapsed under their own weight. Both went through a long painful period of confusion as first one then another future path was picked up and then dropped, and both went through and extended period of denial as they pretended to themselves that the success of Microsoft/Apple was due to something other than the fact that they had BETTER PRODUCTS.
Of course, Apple achieved salvation by buying NeXT, which both reset the OS strategy and brought back Steve Jobs, the only man to create a billion-dollar company three times (Apple v1, Pixar and Apple v2). A lot of the comment around the new Nokia CEO centres on the fact that he clearly isn’t the same kind of product visionary. Does it matter?
Well, Nokia has lots of problems that don’t feature on Techcrunch. It has a massive business selling phones for $10 in emerging markets that is now under attack from cheap Chinese manufacturers using MediaTek chipsets. It has a solid mid-range business in phones running Series 40 that is about to get kicked in the teeth by Android (and the iPhone Nano?). And it has a high-end business in ruins.
But running across all that is a deeply dysfunctional company that is incapable of executing - even if you agree with Nokia’s strategies and actually like the handsets they announce, the company doesn’t deliver them. The N97, released 2 years ago as ‘the answer’ to the iPhone, didn’t have a reasonably bug-free firmware for more than a year after launch. The N900, this year’s iPhone killer, didn’t support paid downloads on the Ovi Store for months after launch, and still doesn’t have many of Nokia’s flagship features. Any given Nokia handset has dozens of different firmware variants floating around, all with slightly different capabilities and all needing individual testing by developers.
This shows up in little things too: the high-profile flagship retail presence was supposed to sell the Nokia content experience, but the handsets on display had no preloaded content, no SIM cards and no working Wifi, so there was no experience to see. Who approved that? Who stood in a store painted black and lit in purple neon and said ‘yes, this is the way to sell to women’?
So Nokia needs someone who can solve a corporate culture that looks at broken products and says ‘who cares, ship it’. It needs to reset the OS (Android? Windows Phone? Who knows). It also needs to fire dozens of failed senior managers. So far, so obvious. But I think there’s another, less obvious problem.
Apple’s greatest strategic advantage in mobile is that it only sells one phone. This means it can go to mobile operators with a ‘take it or leave’ it proposition - Apple can ignore operator demands for customisation. This protects Apple’s user experience and makes life far easier for developers. If you’re happy with 5% of the market, and aim for 10%, one handset is fine. But Nokia sells 400m phones a year, at every price from $10 to $600. It has to have lots of phones on the market - not 50 (apparently the target for 2011) but several dozen. This is exactly the same problem Android is starting to have. If there are a dozen inter-changable handsets on the market then operators can demand that you remove that free GPS and pre-load their paid GPS instead - or preload Bing.
In other words, the very fact that Nokia (and by extension Android) is putting more than one device on the market makes it impossible to hold the line against mobile operators in the way that Apple can and does. That makes it much harder to match the Apple experience, no matter how good your strategy, OS and execution are.
