iPhone Market Share: Come Again, Ballmer?
Steve Ballmer, Microsoft CEO, April 30, 2007:
There’s no chance that the iPhone is going to get any significant market share. No chance. It’s a $500 subsidized item. They may make a lot of money. But if you actually take a look at the 1.3 billion phones that get sold, I’d prefer to have our software in 60% or 70% or 80% of them, than I would to have 2% or 3%, which is what Apple might get.
And now? A recent news story about global smartphone market share:
The latest smart-phone numbers from Canalys show that Apple’s gaining share like a bat out of hell.
The company has gone from 2% global share to 14% share in a year.
And Apple is just beginning to make deals in China. In the U.S., the iPhone’s market share has rocketed from 7% to 23%, nearly a quarter of the entire market. Microsoft’s smartphone market share shrank globally from 14% to 9%, most of that being eaten up by Apple. Looks like Ballmer’s not getting the 80% he thought he’d get.
Here in Japan (where everyone is supposed to hate the iPhone), I don’t know what the numbers are, but the iPhone is definitely taking off. You can see them everywhere now–more and more, I keep seeing people tapping away at them. Not so much in school, where students are married to cheap plans which allow for low-cost cross-carrier calls, but among the general population, it’s evidently very popular. The iPhone has consistently been in the top 10 in smartphone sales, and the 32GB 3GS has held on to the #2 spot since September, with its 16GB sister unit bring up the rear between #9 and #5. As much as people claim this is only because SoftBank offers the 8GB 3G for free, both of Apple’s top-selling models are not free–the free unit held the #14 spot for the last two months. In short, the iPhone don’t need no free deal to make it big.
Meanwhile, Microsoft got a hell of a black eye this week when it revealed that it failed to back up data on its Sidekick cloud network. When the servers failed last week, the data went bye-bye. That means that many of the million or so people depending on Microsoft just lost all their contact, calendar, and photo data, permanently. Microsoft has been running the service for about a year now–presumably enough time that they can’t blame someone else for the failure.
For full disclosure: I own Apple stock, and not Microsoft stock, fortunately.
I’m not sure how they get away with it, but the Iphone is just not sold in Korea (perhaps, banned might be more appropriate). I’m not sure where Apple builds their phone (maybe it could be made in Korea), but this seems like nothing other than blatent protectionism for a core export oriented industry.
Fact is, I think the Korean bureaucracy that does industrial policy planning must just hate Apple to pieces. While you can buy some Apple products here, and you occasionally see their laptops in cafe’s, they really are quite rare here. The reason being, I assume, is the licensing. Korea can’t develop an exportable computer industry using Apple’s operating system, because Apple won’t license it out.
Korea’s industrial policy, which I believe they learned or coopted from the Japanese, targets the development of industries that can allow for both import substitution and export promotion simultaneously. Electronics is always preferred sector because the cost of freight for small light weight devices is a small percentage of the value of the product. Also, the more advanced the technology the less likely it is subject to protectionism in foreign markets. Electronics is a field where technology is still advancing in quite rapidly. So Korea wants to participate as much as it can. It does so with cell phones by licensing the technology from Japan and the United States as it does with computers by licensing that technology. The problem with Apple is that this rains on their parade.
I for one am quite happy to see it. Apple is one of the few American electronic technology companies doing well for the United States. They are to to electronic technology what Mercedes and BMW are to automobile industries – the premium brand. I am, thus, quite glad to read all about Apples successes here. There’s only one measly little American cell phone, but it is the gem of the market – and all of Korea’s long term investments and industrial planning and protectionism and subsidized investments, and it still has to take subsidies and protection to protect them from that one measly little American electronics company.
Go Apple, go.
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Editor’s note:
I am keeping “deallusaphave”s comment here (email and link redacted) because it is an amusingly strenuous attempt to appear specific while remaining completely vague, while throwing in praise for the blogger even as it suggests a challenge–all designed to attract bloggers to approve the comment. I am thinking of using this as an example for my students in writing class.