Google’s Android operating system powered half of all smartphones bought in the U.S. in the past six months, twice that of Apple. Yet a majority of developers, citing fragmentation and the high price of competing tablets, would rather create products for Apple’s iOS. Analysts say Apple’s exclusive platform and supply chain domination could ensure that iOS builds an insurmountable lead over Android in available apps.
More consumers choosing Android smartphones
Android is running on 50 percent of the smartphones sold in the U.S. in the last two quarters, according to a Nielsen survey taken in March. Devices running Android doubled the 25 percent market share of Apple’s iPhone. Research In Motion’s Blackberry followed with 15 percent of smartphone sales. In addition to U.S. sales, Android is expected to capture half of the worldwide smartphone market in 2012 as handset makers flood emerging markets with cheap Android alternatives to the iPhone. The Nielsen survey also found other signs that Android’s market share will continue to grow. Thirty one percent of consumers planning to buy a new smartphone said they would choose Android, up from 26 percent in a 2010 survey. The iPhone accounted for 30 percent of planned purchases, down from 33 percent in 2010. Blackberry’s share of planned purchased dropped to from 13 percent last year to 11 percent.
Android fragmentation and inferior tablets
While consumers are flocking to cheap Android smartphones, developer interest in Google’s mobile operating system is declining. A survey by a company marketing cross-platform development software found that developers are growing frustrated with Android and remain enthused about iOS. According to Appcelerator, developer interest in Android dropped from 87 percent to 85 percent. Interest in iOS dropped one point, but still registered 91 percent. Android device fragmentation was the greatest source of developer frustration at 63 percent. Appcelerator noted that iOS-only developers don’t have to deal with multiple handsets and tablets, multiple OS editions and multiple app stores. Thirty percent of developers also said they were frustrated with inferior, expensive Android tablets.
Apple’s edge: supply chain dominance
Developers were disappointed when Android tablets not only didn’t measure up against the iPad, they weren’t cheaper like other Android devices. Android tablets face an uphill climb against Apple’s supply-chain dominance. Apple’s position is that that allows it to beat competitors to the market, make its products more affordable and further delay competing products from coming to market. Android tablets have had a year to catch up with the iPad and none have been able to match Apple’s $499 entry point. Apple has grown to become one of the world’s biggest component purchasers. The company uses its size and $60 billion in cash to get the deals it wants with suppliers, who will always sell to their biggest customers first. Plus, Apple’s small lineup of products share many common components, which has allowed it to fine-tune one of the most precise supply chains in the world.
Bloomberg Businessweek: http://www.businessweek.com/news/2011-04-26/google-s-android-runs-50-of-new-smartphones-nielsen-says.html
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