Android is accelerating smartphone adoption

According to Morgan Keegan analyst Tavis McCourt Chinese consumers purchased 8 to 10 million smartphones last quarter–implying 400% growth from the 2 to 3 million last year.

How quickly things change. According to McCourt, Android now represents nearly 50 percent of smartphone volume in the country, up from zero last year. And Apple’s iOS, while a niche player with less than 500,000 iPhones sold last quarter, is ramping up quickly, thanks to the successful launch of the iPhone 4 in the country last month.

via 50 Percent of Smartphones Sold in China Last Quarter Run Android | John Paczkowski | Digital Daily | AllThingsD.

The growth of Android is far beyond what a single company can engineer. It represents the effect of uncoordinated and uncontrolled distribution. Google does not have to market, license or write contracts for Android. It also does not necessarily benefit from this work. It enables excess device manufacturing and distribution capacity to embrace browser-enabled devices.

Android is clearly accelerating smartphone adoption and is competing very effectively with non-consumption. Without Android I doubt many of the Chinese manufacturers who are building more smartphones today would be doing it.

One question that remains with is whether Google will do anything to police the platform or leave it to run and splinter.

Another question is what will current Android users aspire to purchase for their next phone.

  • Sameer

    50% android sounds awesome.. But i have a feeling that a large part of that 50% would include the oPhone fork of Android..

  • Angel lamuno

    Great questions! We’ll probably have answers in 2-3 years.

  • MattF

    The 'next phone purchase' question is important, and most analysts seem to ignore it– in fact, most analysts seem to assume that their bold multi-year predictions won't be remembered 90 days later. But the replacement cycle on mobile phones– between one and two years– will become important at some point, perhaps when the market begins to saturate…

  • Alan

    So if you segment the smartphone market into 3 segments (US, China, and EMEA), how do the numbers break out vis-a-vis iPhone vs. Android?

    Here is what I can glom together based on Q32010:

    US – iPhone ~5M, Android ~9M
    China – iPhone ~0.5M, Android ~4M
    EMEA – iPhone ~8.5M, Android ~6M (based on totals of 14M and 19M respectively).

    So the lead Android has in the US is largely due to the distribution differences.
    I suspect that the same is true in China. If both of these change in the coming year you could see a the momentum of the two platforms equal out.

    • I do not not see Verizon's iPhone to change the trend in US.

      Coming to the US market soon are $100 (w/o contract) Android phones. Couple this with even more Android distribution (burner "pay as you go" smartphones) and Android acceleration continues in US and EMEA.

      Actually, such low cost Android handsets from "good enough quality vendors" ZTE, Hauwei, others are the reason China consumers have strongly adopted Android platform.

      • Alan

        Well in the US at least most purchases are with contract so the carrier distribution is one of the most important factors. Cost of the handset in that context isn't that big of a deal to the buyers as it might seem. No contract phones are popular because the service usually costs the same either way. Where I live many people choose the carrier first (and generally choose Verizon if possible) and the handset second. This model gives the carrier tremendous market power – they can heavily influence the winners and losers. Nokia smart phones were shut out of the US market by the carriers for years. So I believe Verizon phone will affect the trend in the US.

        China may be a different beast – but I do know that iPhone is only on a minority carrier and that the carriers have influence there as well. Perhaps not to the same extent as the US but certainly some.

      • Alan

        That should read "Contract phones are popular…"

      • asymco

        The key point here is that Android's gain is not Apple's loss. If Android expands the market for smartphones, the big losers are the dumbphones. That may not be a bad thing for Apple at all because Android educates the market to what you can do with a smartphone. RIM did the same thing and many RIM users will migrate to a touchscreen device. Nokia did the same thing with Symbian in Europe. It created the market and many users switched to the more aspirational alternative as soon as it was available. Another way of thinking about it is that a leap from a $10 voice only phone to an iPhone is a big leap for many. Android is a nice stepping stone.

        Finally, consider that Apple cannot meet current demand. It really is unlikely that they could meet the demand for 1 billion iPhones next year. Apple needs to grow at a sustainable rate. Android is unbounded in its growth rate since it's just an FTP download away from the market.

      • There's no market for cheap smartphones in the USA. Just look at Nokia.

        The carriers charge the same for a contract dataplan for a cheap smartphone as an expensive one and subsidise the expensive models more than the cheap models so the upfront handset price is the same anyway.

  • dchu220

    Apple will do fine in China. The price of the cheap phones are irrelevant unless they lock user into the platform. Adoption is the true battle.

  • David Pugsley

    Perhaps the win for Google from any and all smart phone sales is the browser access that comes with it. What this growth represents for Google is more search and therefore more advertising revenue. The threat for Google is Microsoft Bing phones and any phone that does not have a Google search as standard.

    • Arp

      As iPhone uses Google search by default, it appears Google did not have much to gain in Android in terms of search, except as a way to gain power. In the way Microsoft pays for profits, Google gives away software to hurt competitors, even if a link to profits is not clear.

      Google seems less motivated by growth, than a will to preserve their own power/influence/relevance. I think open source alternatives are essential, but Android smells of Microsoft: if you can't BE successful, copy great products and sell them as your own.

      There is no such thing as a free lunch, and Android is no exception. I think rogue companies overseas will use the open code to create new frankensteins. And Google will end up costing US companies billions.

  • I NEVER see the comments anymore. Clicking on the list that appears to the right of the main text body merely recycles the same page!

    How do I get to see them?


    • Narayanan

      I had the same problem from my iPad till last week when I upgraded to iOS4.2

    • asymco

      What OS/device are you using?

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