The iPhone Report: 10 Million Versus 20 Million
September 27th, 2011So there’s a report this week that the Samsung Galaxy S II, a smartphone powered by the Android OS, has sold some 10 million copies within the span of five months. This is being heralded as a great success, though you never know whether Samsung is reporting shipments or sales.
To put this in perspective, since the start of the April quarter, up until the end of June, Apple sold 20.34 million iPhones. There’s no indication how well it fared during the current quarter, what with all that publicity about a new version arriving real soon now. But if sales kept up at a good clip, I wouldn’t be surprised to hear Apple report another 15 to 20 million units sold when the results are in.
Even at the low end of that figure, with 35 million iPhones sold in roughly the same period that Samsung moved 10 million of their most popular mobile gadget, Apple is certainly doing quite well. Sure, there are more Android devices out there if you count all the models and manufacturers, but Apple is selling just one current model, and a version of the previous model with reduced storage. That same lineup has been around since the summer of 2010, whereas Android phones are updated every few months.
Indeed, I wonder how many of you can pinpoint the actual changes between the original Samsung Galaxy S and the Samsung Galaxy S II. But the main differences appear to be a speedier processor, and an increase of the camera’s resolution from five megapixels to eight megapixels. In passing, these seem to be the sort of changes that are expected in the next iPhone.
But the real problem in Android land is that so many companies have so many similar models that you will likely find it difficult to tell one from the other. I suppose you can see which product gets the best reviews on the day you’re placing your order, and go with that, hoping that its replacement won’t arrive a few days later without much warning. Well, that could happen unless you pay really close attention to the technology blogs that focus on Android products.
At the same, the biggest problem facing Android handset makers is customer retention. It’s not just moving from one Android smartphone from one maker to an Android smartphone from another maker when your contract is up. It’s all about whether the customer will dump the platform and go for an iPhone. As reported recently, Apple can manage an 89% retention rate according to a customer survey. Most rival smartphone makers are lucky to get a third of that, and a healthy number of customers are looking to just leave Android-land. The only hope is that they’ll sign up so many new customers, that losing loads of existing customers won’t be such a big deal.
Now when Apple releases the next iPhone — and reports indicate that the upgrade will be announced at a media event next week — it is quite likely that the existing iPhone 4 will be reduced to 8GB storage capacity and sold for a pittance with a two-year contact. Some suggest an alternate low-cost model, the iPhone 4s. The reason is that Apple has made it clear that it’s not just going after as many wireless carriers as possible, but it wants to get into the prepaid market. That’s where people buy the phone upfront, and pay for their month’s service in advance. There are no carrier commitments, and they can just as well jump to a competing carrier that offers a compatible network if that’s what they want. Or just disconnect the thing for a few months to save some hard-earned cash.
Of course, when it comes to Apple, nothing is certain until the official announcement. We can speculate all we want, and even quote rumors that purportedly describe actual iPhone 5 cases, production schedules and even the quantities ordered. But only a portion of those reports are ever confirmed, and you don’t know whether that confirmation comes from a lucky but informed guess, or actual inside information from an Apple partner. But you have to wonder what how Apple would regard one of those suppliers if they broke the company’s iron-clad confidentiality agreement. That is, unless those leaks are carefully timed to gin up demand for the new product.
In the meantime, Apple and Samsung continue to trade lawsuits, and the action has spread to various parts of the world. Apple has already obtained a few victories that are slowing the release of a new Samsung Galaxy tablet, but until final verdicts are granted in Apple’s favor, it may just be a delaying action and nothing more. But even a delay can hurt the chances of the iPad rival, considering that the chances for success are extremely low to begin with.
Yes, I’m glad to hear that Samsung has built a successful smartphone, and I hope that customers who are stuck with two-year contracts are going to be satisfied with them. But it would be interesting to see if any surveys are conducted to indicate just how many people will actually break their contracts that include Android OS handsets after the next iPhone arrives.
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The Android world is murky. It is difficult to see the true customer landscape, with so many different hardware vendors, versions and user interfaces.