Has Android Peaked? - InformationWeek

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11/4/2014
12:08 PM
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Has Android Peaked?

Having hit 84% of the smartphone market in Q3, Android likely has nowhere to go but down.

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Android 5.0 Lollipop is here, and though it will drive adoption of Google's mobile platform, it won't help increase Google's share of the smartphone market. Some suggest Android has reached its peak and simply can't grow anymore. For Google, the top is not a bad place to be.

Of the approximate 270 million smartphones that shipped during the third quarter, 84% -- or 229 million -- ran Android. That number actually decreased one percentage point from the second quarter, according to Strategy Analytics. Apple's iOS platform accounted for 12% of smartphone shipments; that figure was also down about one percentage point. Microsoft's Windows Phone platform followed, with 3% (also down a bit), and BlackBerry trailed at 1%.

Strategy Analytics' Neil Mawston doesn't believe Android can go any higher than it already has. "Android's global smartphone market share is peaking," he told The Wall Street Journal. "Unless there is an unlikely collapse in rival Apple iPhone volumes in the future, Android is probably never going to go much above the 85% global market share ceiling."

[Motorola's latest device boasts a powerhouse battery and high-end specs. Read Motorola Droid Turbo Challenges Apple, Samsung, LG.]

Though he called Android's position in the market "unbeatable," Mawston said new challenges are beginning to emerge. For example, Android is dominated by hundreds of hardware makers. These device manufacturers have flooded the market with devices -- and few of them are making any money. Android still has plenty of room to grow in terms of volume, however, as more emerging markets are adopting Android than any other platform. This is possible thanks to the surge in low-cost smartphones available in India, China, and the markets in between.

Microsoft is making a play for those same markets with low-cost Windows Phones. Microsoft gives Windows Phone away to phone makers for free, so it is now better able to compete in the low-cost space. But Microsoft's presence in the market has weakened over the past several months, and the company's new vision for its hardware business has yet to really emerge.

Apple's share of the market has more or less stabilized for the time being. The iPhone 6 and iPhone 6 Plus helped boost the platform's volume a bit at the end of the third quarter, and Apple will likely see strong shipments through the fourth, as well. Even so, Apple and its iOS platform won't be able to put much of a dent in Android's position. Mawston attributes this to Apple's absence from the low end of the market. iPhones cost a pretty penny and don't sell much in emerging markets, where pricing is critical.

At the moment, Android appears to have reached its peak. With 84% of the market, there's little room for it to go up -- and plenty for it to go down.

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Eric is a freelance writer for InformationWeek specializing in mobile technologies. View Full Bio

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danielcawrey
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danielcawrey,
User Rank: Ninja
11/5/2014 | 12:12:13 AM
Re: Android phone makers
Microsoft usually doesn't have a propensity for giving things away, so the fact they are doing this with Windows Phone suggests desperation. 

I remember having a Windows smartphone a few years back and it was awful. Apple and Google have dominated this space because they make something better than Windows, it is that simple. 
nomii
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nomii,
User Rank: Ninja
11/5/2014 | 12:07:12 AM
Re: In the long run, security will count
@Charlie good analysis. I am of the opinion that the android market is expanding as most of the firms are trying to earn their share from the already peaked market and they do not care about the security aspect. The low prices of android system made most of the customers take security as secondary. I believe that sooner or later apple will eventually win the race by sticking to its basic and providing the best security that customer needs.
nomii
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nomii,
User Rank: Ninja
11/5/2014 | 12:03:24 AM
Re: Android phone makers
@Jastroff I believe that finances is a big factor. Apple is a symbol of status and only status concious people will buy Apple so its market will remain stable and will grow only marginally. How ever the android is quite cheap and affordable to all level of commuinity. So if any one to really challenge the status of android, financial aspect is to be seen foremost.
Charlie Babcock
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Charlie Babcock,
User Rank: Author
11/4/2014 | 8:42:02 PM
In the long run, security will count
I worry that Android's success makes it harder to eliminate Android problems in the areas of security and reliability. Much as I hate to say it, Apple could gain market share, despite the price differential, by the advantage its control over the system gives it. That includes its seeming abiltiy to keep malware out.
jastroff
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jastroff,
User Rank: Ninja
11/4/2014 | 6:22:40 PM
Re: Android phone makers
>> Android can be cheaper and afffordable in developing countries

 

Good point. So, market share can grow as the user base grows. 
zaious
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zaious,
User Rank: Ninja
11/4/2014 | 5:42:27 PM
Re: Android phone makers
Since, there are another OS's (iOS moslty) in the market, it will not grow beyond 85-88%
Android can be cheaper and afffordable in developing countries. So, there might be expansion for them. iOS can retain most of its current customers and can gain new users (kids that are buying their first ever phones).
Thomas Claburn
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Thomas Claburn,
User Rank: Author
11/4/2014 | 3:55:35 PM
Re: Android phone makers
Android could improve in terms of revenue.
Shane M. O'Neill
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Shane M. O'Neill,
User Rank: Author
11/4/2014 | 2:34:11 PM
Android phone makers
I'd be curious how the Android hardware maker profits break down. Does Samsung leave everyone else in the dust?
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