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Motorola Backflip

Motorla Droid
Apple has a wakeup call as Android-based smartphones grab market share in Q1

DailyTech has been reporting on Google's meteoric rise in smartphone market share for quite some time now, but we didn't expect to hear the numbers that are coming from the NPD Group today with regards to Android's place in the hot sector. NPD says that unit sales for Android-based devices bolted past Apple iPhone devices for the first quarter in the U.S.

According to NPD, Android-based devices accounted for 28 percent of the smartphone market while smartphones running Apple's iPhone OS garnered just 21 percent of the market. Both, however, were well behind RIM which still commands 36 percent of the market.

"As in the past, carrier distribution and promotion have played a crucial role in determining smartphone market share," said NPD's Ross Rubin. "In order to compete with the iPhone, Verizon Wireless has expanded its buy-one-get-one offer beyond RIM devices to now include all of their smartphones."

It should be noted that there are numerous Android-based smartphones on the U.S. market compared to relatively few iPhone models. When it comes to the Android sector, there are many choices including the Droid, Droid Eris, Nexus One, Backflip, and the Droid Incredible (which wouldn't be accounted for in NPD's numbers) among others.

The iPhone, however, is only currently available as the 8GB iPhone 3G (the last generation model) along with the 16GB and 32GB iPhone 3GS.

In addition to the wealth of differing smartphone designs on the Android side of things, users who pick Android-based phones have a number of wireless carriers to choose as well including Verizon, T-Mobile, and AT&T in the U.S. Apple's iPhone, however, is artificially limited to AT&T's network fresh from the factory -- you can, however, unlock the iPhone using a software hack and use it on T-Mobile's network albeit without 3G connectivity.

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Market Share Means No Profit
By jbelkin on 5/10/2010 12:30:37 PM , Rating: -1
Looking at market share here means very little. Android phones are incompatible to each other (6 OS versions) and they each have their own store. Plus, 99% of each Android phone sold is Buy One, Get One ... this is also reflected in app availabilty and apps sold.

More importantly, Google makes ZERO on each phone sold and probably actually costs them money so far.

Apple has one phone OS (free upgrade) and one store plus Apple makes @$700 per phone sold (including subsidies) and not including itunes purchases ...

Bottom line - one is a business, one is a hobby so Apple does not care if Android wants to give away phones and Google makes no profit on any of its market share - what is the point of that "business."

RE: Market Share Means No Profit
By jabberwolf on 5/10/2010 1:03:45 PM , Rating: 2
Hmmm I remember a small company that gave away DOS for free... called Microsoft. I wonder what ever happened with them?!?!

RE: Market Share Means No Profit
By Mogounus on 5/10/2010 1:16:29 PM , Rating: 2
Sounds like you are another deluded iFan. First off Google is definately set out to make money on Android just not with the same revenue model. They are looking for ad revenue. Secondly, you must be absolutely out of your mind if you think Apple does not care. The lawsuit against HTC is already proof enought that they are very concerned. Apple may not care if Google makes a profit or not but they very do much care if the Android platform is seriously competing with theirs and is impacting the number of $700 phones they can sell.

RE: Market Share Means No Profit
By mcnabney on 5/10/2010 8:12:59 PM , Rating: 2
Google's involvement with Android has already become a profit center. That was quick.

RE: Market Share Means No Profit
By tech4tac on 5/10/2010 1:20:10 PM , Rating: 3
More importantly, Google makes ZERO on each phone sold and probably actually costs them money so far.

Not directly off the equipment sales, but Google makes an obscene amount of money from every phone loaded with Android. Every time you use the nifty search bar on the home screen, Google gets paid through advertisers (if I can have just 1% of the advertising revenue generated by all the Android phones, I'd be set for life). Even after paying Apple millions to be the default search engine on iPhones & iPods, all the searches generated makes it a very lucrative deal for Google (so much in fact that Apple is considering make their own search engine just for their iProducts). Every time you buy something off Android Market Place, Google gets a cut. The entire bases of Google success has been to give away something useful for free (or next to nothing) and make money indirectly.

Bottom line - they are 2 very successful business with different business models.

RE: Market Share Means No Profit
By Alexstarfire on 5/10/10, Rating: 0
RE: Market Share Means No Profit
By afkrotch on 5/11/2010 1:44:11 AM , Rating: 2
I think O² sells unlocked iPhones for $800 (after you convert from Euro). Course, in the US, the price has never been that high.

By Alexstarfire on 5/11/2010 2:19:04 PM , Rating: 2
Unlocked phones can't count since Apple doesn't sell them. That'd be like saying Microsoft or Nintendo made $1000 per console when then first launched. Everyone wanted one and not everyone could get them. On eBay they went for upwards of $1000, probably more.

RE: Market Share Means No Profit
By Bateluer on 5/11/2010 9:38:47 PM , Rating: 1
You information is highly inaccurate. There are currently only 3 versions of Android floating around, 1.5, 1.6, and 2.1. There are no 1.0 devices out there any more that haven't been upgraded, the sole 2.0.1 device was upgraded to 2.1, and the remaining 2.0 devices all have 2.1 upgrades in the pipeline.

They all share the same Android Market store and the majority of apps will work on all three revisions, with a few exceptions due to newer features and capabilities of the newer revisions.

Google doesn't make money on the handset sold, that is true. However, each Android device sold generates ad revenue for Google, very effectively generating them profit.

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