Perhaps no other question has been more significant since the dawn of the smartphone era.
While Nokia and Blackberry quietly battle it out for global top spot, it is Apple’s lone warrior iPhone and an army of Android smarties that is writing the next chapter in smartphone history.
It goes without saying the iPhone has been a tremendous, resounding success since its release back in 2007. In its first year alone, it sold six million units. But more importantly, Apple’s messianic handset has singlehandedly revolutionised the way people use smartphones.
It made the touchscreen cool again and established the App Store as a hotbed for the best mobile applications out there. For a while it seemed like nothing could touch Apple’s premier handset.
Then in 2008, a new smartphone operating system called Android was born.
Although it initially struggled to compete against the iPhone, which continued to grab all the headlines and the hearts and minds of consumers worldwide, a certain Motorola Droid (or the Milestone as it’s known in Europe) eventually kicked open the door for a glut of top-notch smartphones. Notably, the Google Nexus One, HTC Desire, Droid Incredible, Motorola Droid X, Samsung Galaxy S and more.
The critical and commercial success of these handsets begun to gradually transform Android’s fortunes and do away with its somewhat off-putting image as being a platform for geeks and tech-heads.
Android sales have risen exponentially as consumer awareness of the platform started to improve.
Statistics published last week by research group Nielsen Media revealed that over the last six months Android smartphones have collectively outsold the iPhone in the US for the first time.
Android smartphones accounted for 27 per cent of the total smartphone subscribers in the US, ahead of the iPhone, which managed 23 per cent.
The findings will no doubt ruffle some feathers in Cupertino, but does it actually suggest a sea change in the dynamics of the market?
What the figures don’t tell us is that Nielsen’s data only includes a week of iPhone 4 sales. Consumers tend to avoid buying a product if a better, newer model is about to hit store shelves.
The timeframe of the data and slowdown in iPhone sales could simply be a case of consumers avoiding long-term iPhone 3GS subscriptions in anticipation of the iPhone 4 instead of an actual decline in interest in Apple’s handset.
In fact, iPhone 4 sales have already crossed the three million mark, as revealed in Apple’s iPhone 4 conference last month. And while its lingering antenna problems have been something of a thorn in its side, only 1.7 per cent of the devices have been returned according to Apple compared to six per cent returned for the 3GS.
Still, Android’s accomplishments cannot be disputed. The platform has made some serious inroads into the market against stiff competition from the iPhone, with a staggering 886 per cent rise in year-on-year sales in Q2 2010, revealed market analysts Canalys.
Google CEO, Eric Schmidt claimed on Wednesday that around 200,000 Android devices are now being sold in the US every day. The NPD group, which collects sales data in the US, confirmed that nearly a third of smartphones sold between April and June were running Android, pushing market leader Blackberry into second place for the first time since 2007.
All these revelations point to the same question: is it inevitable that Android will overtake the iPhone in terms of market share?
It currently holds 13 per cent of the US smartphone market against 28 per commanded by the iPhone.
But it’s on a steady climb and the operating system has been adopted by almost all the major mobile manufacturers except Nokia, RIM and, of course, Apple.
It’s also available on multiple devices on multiple carriers, which means there’s more variety for consumers and higher levels of competition to drive prices down. Manufacturers are also more inclined to develop better handsets when competitors are breathing down their necks.
That said, the onslaught of Android devices has one rather irritating drawback for the platform. And that’s fragmentation, which is becoming something of a deterrent for many buyers from picking up an Android and may even be driving causing existing owners away from the platform.
On the other hand, iPhone owners are some of the most loyal fans out there. Despite all the hoopla surrounding iPhone 4’s antenna issues, 89 per cent of current iPhone owners want to pick up an Apple smartphone as their next handset, according to Nielsen.
What’s more interesting is that 21 per cent of Android owners are also of a mind to pick up an iPhone next, which is in stark contrast to only six per cent of iPhone owners intending to transfer to an Android.
It will take some doing on Google's part to break the stranglehold Apple has on its existing customers while preventing a mass exodus of its own, unless it can put a lid on the fragmentation problem.
Android’s rapid growth could most likely be attributed to declining interest in platforms such as Windows Mobile, Palm OS and even BlackBerry. Whether it is actually eating into Apple’s share of the pie or not will be something only time will tell.
When it comes to loyalty and satisfaction of its customers, Apple is second to none. But choice and affordability for millions of yet undecided customers could yet help Google’s Android triumph over the Cupertino giant’s “one size fits all” solution.