Filed under: Company News, Technology, Industry News, Cell Phones, Investing
The smartphone revolution is showing no signs of letting up. Industry tracker Gartner reports that 301 million units were sold during the third quarter, a meaty 20 percent jump over the prior year’s showing.
No one is shocked to see portable computing take off, but the actual strength is a bit of a surprise. Yes, we knew that Apple (AAPL) sold 26 percent more iPhones than it did a year earlier. However, Samsung (SSNLF) — the global leader that sells more smartphones than its three nearest rivals, including Apple, combined — saw a decline in its Android-fueled devices. Overall growth is being fueled by Asian manufacturers populating the globe with attractively priced Android hardware that’s gnawing away at Samsung’s market dominance.
Huawei saw its sales spike 37 percent over the past year as the world’s third-largest smartphone maker. China’s Xiaomi isn’t a household name in the U.S., but it has skyrocketed to become the fourth-largest provider of smartphones with its cheap iPhone-like devices that run on Google’s (GOOG) (GOOGL) Android. It’s on pace to top 60 million handsets this year as it expands outside of its home market.
The Rich Get Richer
Samsung’s slide notwithstanding, it’s a great time to be a smartphone maker as long as you’re championing Android as your mobile operating system of choice — or you just happen to be Apple. Android and Apple’s iOS combined to power a whopping 95.8 percent of the smartphones sold to vendors this past quarter, up from a 94.1 percent dominance a year earlier.
Between Android at 83.1 percent and iOS at 12.7 percent, the two leading platforms are powering 19 of every 20 smartphones sold in the world. That’s probably not too much of a surprise for BlackBerry (BBRY) watchers. The smartphone pioneer has been fading in recent years. However, seeing Android and iOS only get stronger has to be painful for Microsoft (MSFT).
The world’s largest software company has invested heavily in its mobile offerings. It even acquired Nokia’s (NOK) handset business, shelling out $7.2 billion late last year to give its fledgling Windows Phone platform greater visibility. It’s taking baby steps in the right direction, moving 9 million handsets in its latest quarter. However, that’s marginally up from 8.9 million a year earlier. It also means that Windows commands a mere 3 percent of the smartphones sold this past quarter. It’s not growing as quickly as the smartphone market in general, and its market share has fallen from 3.6 percent a year earlier.
That’s not a good place for Microsoft to be in a booming technology where developer support is everything. After all, if your platform can’t play “Angry Birds,” browse leading social media sites, or stream music and video through popular apps, you’re not going to convince iPhone and Android owners to make the switch. Microsoft has the developer support for most of the applications that matter, but it may not always be that way. Developers would prefer to have to program and offer support in just two operating systems, especially since they now account for 95.8 percent of new smartphone purchases. Microsoft can try to make a difference with proprietary features, but these days, in a world where Android and iOS continue to be the only two platforms that matter, the pedestal for the bronze medalist is pretty low.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple and Google (A and C shares). The Motley Fool owns shares of Apple, Google (A and C shares), and Microsoft. Try any of our Foolish newsletter services free for 30 days. Check out our free report on the Apple Watch to learn where the real money is to be made for early investors.
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Source: Investing
