Apple and Samsung Split Smartphone Market Profits
Despite all the recent reports that Samsung is the biggest smartphone vendor in terms of shipments and market share, Apple still continues to command the lion’s share in profitability in the global smartphone market. In a report released this week, Strategy Analytics posted data that demonstrate the stranglehold of these two titans on the global smartphone market. Also, in what may come as surprise to many Android observers, the reports also pointed out the near complete dominance of Samsung on the Android platform.
First, let me share how the chips are stacked for players in the global smartphone market. As I mentioned in the article heading itself, the total industry profit is split between Apple and Samsung – though Apple manages to stay more profitable than Samsung despite lower market share and shipments. This table will help you to understand the fact better – and starkly, if I may add.
As you can see, the industry profits of US $ 12.5 billion in Q1 2013 is distributed between Apple at US $ 7.1 billion (57%) and Samsung at US $ 5.1 billion (40.7%), leaving the rest of the industry scraping the bottom of the barrel at a measly US $300 million! And mind you, this kitty of US $300 million is further shared by the likes of HTC, LG, Nokia, Huawei, ZTE and BlackBerry. Now, looking at these figures, I feel one cannot even begin to mention any other smartphone vendor than Apple and Samsung as giants – so complete is their dominance.
Also, as suggested in the first paragraph, there was some surprising news for Android observers in this report. While it is a common knowledge by now that Samsung has become the tail that is wagging the Android dog, yet few could fathom the extent to which the Samsung-Android relationship is skewed. In what would surely cause a lot of heartburn to Google, Samsung has a 41% share of the Android smartphone market, yet takes away a humongous 95% share in overall Android smartphone profits!
Whether this further sours the equation between Android and Samsung, pushing both the companies to take steps for redressing the balance would be an interesting development to watch out for.