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Android smart phones, like the Samsung Galaxy S II are dominating global sales, shipping over 50 million smart phones a quarter.  (Source: Samsung)

The iPhone is still unmatched in profitability, though, and a solid #1 in global sales by manufacturer.  (Source: Reuters)
Despite legal troubles, the Android juggernaut rolls on

Android's open platform and broad selection of hardware, thanks to liberal licensing, has proved a winning formula for Google Inc. (GOOG) and its hardware partners.  Competitors like Apple, Inc. (AAPL) and Microsoft Corp. (MSFT) have been unable to keep up with the platform's wild growth.

According to [press release] market research firm Canalys, for every 2 iPhones sold, approximately five Android phones are now sold (1:2.5).  This is another milestone for Google, who only recently heard the news that it was outselling Apple two to one globally.

The study looked at 56 countries and found Android to be the top platform in 35 of them.  Its global market share is now at just under 50 percent, thanks to a 379 percent year-to-year growth in shipments.  In Q2 2011 it shipped on an estimate 51.9 million smartphones, globally. 

Google's smartphone operating system continues to soar after a quiet 2005 acquisition by Google and 2008 product launch.  Google didn't pick up much momentum until 2009, when its partners began to release bleeding edge handsets like the "Droid" from Motorola Solutions Inc. (MSI).  Since then it's been unstoppable.  However, threats loom from lawsuits [1][2][3][4][5] from Apple and licensing demands [1][2] from Microsoft. 

Speaking of Apple, it posted impressive growth of its own, passing Finland's Nokia Oyj.(HEL:NOK1V), with 20.3 million units shipped.  Apple is now the clear number one in terms of global sales by a single manufacturer.

Despite falling behind Android in growth, Canalys had kind words for the highly profitable Apple.  Canalys VP and Principal Analyst Chris Jones states, "The iPhone has been a phenomenal success story for Apple and a watershed product for the market. It's an impressive success story, given that Apple has only been in the smart phone market for four years. With the next-generation iPhone anticipated in Q3, it's likely that Apple’s position will grow even stronger in the second half of the year."

Samsung Electronics Comp., Ltd.'s (SEO:005930) flagship Galaxy S II smartphone sold well and the company shipped 17.0 million phones in the quarter, bumping Nokia to third place in manufacturer sales.  

However, Mr. Jones had some harsh words for the company, stating, "Samsung has failed to fully capitalize on Nokia’s weakened state around the world, as the Finnish company rides out a challenging transitional period. It's the best placed vendor to grow at Nokia’s expense, taking advantage of its global scale and channel reach, but it hasn’t yet done enough to capitalize on this, particularly in emerging markets."

Fellow Android phone maker HTC Corp. (SEO:066570), however, earned praise for rising out of relative obscurity to gain a 21 percent share in the lucrative North American market.

Microsoft, unsurprisingly, didn't do very well.  It only moved 1.5 million smartphones -- about 1 percent of the market.  Mr. Jones commented, "A fresh crop of products is certainly needed," alluding to the crucial upcoming Mango update and lineup refresh, which airs in September.

Research In Motion Ltd. (TSE:RIM) struggled, gaining 11 percent in global market share, but slipping 12 percent in North American.  Mr. Jones comments that RIM needs to "continue to innovative and recapture lost momentum."  He says that the upcoming BlackBerry OS 7 product family will be a critical turning point -- for better or worse -- for the company.

In perhaps the worst insult of all, 
Hewlett-Packard, Comp.'s (HPQ) webOS, with only a fraction a percent market share, wasn't even mentioned in the report.





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Android, a Winning Formula?
By rabidcb on 8/2/2011 1:59:09 PM , Rating: 2
Android's... has proved a winning formula for Google Inc. (GOOG) and its hardware partners."

False. Most Android hardware makers are making next to nothing or are losing money. Take a look at Moto's and Sony's latest earnings. The only companies doing well are Samsung and HTC. Samsung makes more than just smartphones and did not report a breakdown of their sales, so its hard to determine how profitable their Android business is. HTC sells standard mobile handsets as well as smartphones.

When a company, Apple, controls 75% of all profits, leaving 25% of the profits to be split up amongst the rest, then you know there is a problem in Android land. Realize the numbers only count iPhones, not iPad or iPod Touch, which also run iOS.

Google is the only company winning the Android share race. They are an advertisement company and rely on user and user data. Moto, HTC, Samsung could give two cents about market share, they are only concerned with profits, which they aren't making.




RE: Android, a Winning Formula?
By Dorkyman on 8/2/2011 2:05:32 PM , Rating: 2
Very true--for the present.

Apple's huge liability is the cult status surrounding its very ill founder. In two years, how will the numbers stack up?

To each his own, but I would NOT want to be buying Apple stock at its present valuation.


RE: Android, a Winning Formula?
By vbscript2 on 8/3/2011 3:07:37 AM , Rating: 2
Marketshare of the platform translates directly into future potential profits. Saying Sammy, Moto, LG, and HTC don't care about the popularity of the Android platform makes about as much sense as saying Dell, HP, and Lenovo don't care about the popularity of the Windows platform.

Sammy and HTC are making profits on Android. Moto will be if they can get their act together, but if they keep delaying products for 5 months after their originally-announced release *cough* Bionic, *cough* they'll keep having trouble. Samsung Galaxy S II is owning iPhone in the markets where it's already released. 5 million devices in 85 days without even releasing in the massive U.S. market. It's a bad time to be buying Apple stock. This year has already seen many Android phones leave Apple's hardware in the dust, a trend that is likely to continue over the coming years as iOS's marketshare continues to plunge (with brief bumps annually when they actually release new hardware that's only a few months behind the current Android devices.)


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