Apple, Samsung Snag 99% of Mobile Phone Profits
May 4, 2012 11:53 AM
comment(s) - last by
Apple commands 73%, Samsung captures 26%
It's no secret that Samsung and Apple are dominating the smartphone market. According to
IDC's figures for Q1 2012
, Samsung had a 29.1 percent share of the worldwide smartphone market while Apple was not far behind with 24.2 percent.
With Samsung and Apple together commanding over 50 percent of the smartphone market, you would expect for them to take home a healthy portion of profits as well. While this is true, according to Asymco, the disparity between the profits reaped by Samsung and Apple compared with the also-rans in this sector is astonishing.
According to Asymco, the pair accounts for 99 percent of worldwide mobile phone operating profit. Samsung is using its nearly 30 percent share of the smartphone market to obtain 26 percent of the profits.
However, the biggest winner is Apple, which is pulling in an estimated 73 percent of the profits from the mobile market. Apple's performance shouldn't come as a surprise to many considering that the
company pulled in $11.6 billion in profits
during the first quarter (fiscal Q2).
HTC barely made a blip with just 1 percent of operating profits. LG,
, and Sony have all posted losses with regards to their respective mobile phone divisions, so they don't even factor into this equation.
Samsung Galaxy S III
"Seen this way, the story isn’t so much that Apple 'took the profits from the incumbents'", stated Horace Dediu of Asymco. "Rather, it’s that Apple created a vast new pool of profits. And one need not look far to find out where they came from: operators. These profits were mostly carrier premiums for the iPhone 4S."
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RE: The harsh realities of business.
5/6/2012 12:07:34 AM
So much bias.
The iPhone is like that simply because Steve Jobs learned the hard way. Have you ever used a Motorola ROKR E1? I have. It's a horrible phone for the following reasons:
- carriers have full control over its firmware, thus its Bluetooth spec only allowed for pairing with headsets but not data transfers;
- as a cellphone it works, however sluggish it is; most phones at the time weren't any better. As an iPod it's slower than the real thing;
- no native 3.5mm headphone/headset port means carrying a 2.5mm-to-3.5mm adapter that is easily misplaced and lost;
- max 1000 songs restriction without a third-party hack.
Moto proudly advertised the E1 as a cellphone with iTunes-like capability. The truth is it sucked. Apple had no control over it, and it ended up going into the smartphone market itself.
Samsung might still be bedfellows with the South Korean government, but everything else is downright untrue.
RE: The harsh realities of business.
5/7/2012 12:25:51 PM
The ROKR E1's song limit was actually 100 songs, not 1000. You were likely to hit that limit too, since it had 512MB of storage, and most MP3s people wanted to load were under 5MB. It really was a disaster in virtually every category.
"This is about the Internet. Everything on the Internet is encrypted. This is not a BlackBerry-only issue. If they can't deal with the Internet, they should shut it off." -- RIM co-CEO Michael Lazaridis
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