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Day: January 7, 2011

Half of US population to use smartphones by end of 2011: Update

Half of US population to use smartphones by end of 2011 | asymco.

A month ago ComScore reported that in October 2010 25% of Americans above the age of 13 used smartphones. The latest report shows that share to have risen to 26.3%.

That means there are 24 percentage points of penetration to go until the majority of Americans are smartphone users. In absolute numbers this implies about 56 million additional users (and hence units sold).

The rate of penetration growth was 1.3 percentage points per month. Assuming no acceleration in this figure and assuming we rely on ComScore (vs. Nielsen which reports higher figures) then majority share is 18 months away, or mid-2012.

However, assuming some acceleration and a different sampling method, I still believe that we could see this figure by end of this year.

In either case the tipping point is near.

Resetting Motorola

Motorola—like HTC—is thus a bellwether for makers of Android phones, whose sales have now caught up with those of the iPhone—about 300,000 a day worldwide. Some industry analysts doubt that it will be able to create a big market for its devices and make enough profits before cheaper providers move in. If they are right, the smartphone market may eventually become like that for personal computers: a handful of huge competitors with tiny margins. The difference will be that these firms will hail from around the world rather than being mainly American.

via Motorola: Breaking up | The Economist.

When I argued that the meek shall inherit Android, the profitability data was the core evidence. That argument, made in August, was:

So here we have the real challenge to Android:  partnership with defeated incumbents whose ability to build profitable and differentiated products is hamstrung by the licensing model and whose incentives to move up the steep trajectory of necessary improvements are limited.

In other words, Android’s licensees won’t have the profits or the motivation to spend on R&D so as to make exceptionally competitive products at a time when being competitive is what matters most.

The surge in emerging market Android entrants has been the latest setback for branded Android vendors. What should be the long term strategy for companies like Motorola and Samsung? Continue reading “Resetting Motorola”