If there is one subject I have focused on since I started writing for iSource, it is tech reporting on sales and market share for mobile and connected devices. I have been ranting, raving, begging, jumping on market analysts and even occasionally complimenting a few sites for their efforts while looking for someone out there who would let us know what the entire playing field looks like. What happens when you put all of the smartphones, media players, tablets, and set top devices that run iOS or Android together in one big pile and add them up? Well, last week commScore finally gave us as good a look as anyone has to date, and I have to admit that even I was a little surprised by the results.
According to the report, entitled Apple iOS Platform Outreaches Android by 59 Percent in U.S. When Accounting for Mobile Phones, Tablets and Other Connected Media Devices, Apple’s iOS currently holds substantial 59% advantage over its primary competitor in the United States. In terms of the number of devices, iOS registers 37.9 million according to commScore, as opposed to 23.8 million running Android. Think about that for a second. After months and months of analyst reports talking about the inevitable dominance of Android, and the eventual fade of iOS, we learn that despite all of the huge sales volumes in the smartphone arena, Android still has a long way to go to catch up to Apple. I have been wanting to see this kind of comprehensive report for months, and I always believed that iOS would come out ahead right now, but I honestly didn’t think they would be this far ahead.
So what does this mean? Well, I and others have been trying to get people to understand that the days of using the smartphone as the primary barometer of the battle between iOS and Android is OVER. It’s done, and this report is a pretty strong indication of that fact. It’s time for everyone to wake up to this, and move on. I’m talking to you market analysts. I’m also talking to all of the Apple and Google fanboys out there. My desire to see this kind of reporting isn’t just so I can throw stones at hard-core Android aficionados. I want to see the truth of what’s going on in the mobile and media world, whatever that is. It’s difficult to have an intelligent discussion about something when you don’t really know what is going on.
What I don’t like seeing, is people with some influence or credibility who have a bias toward one side or the other, or who have just made up their minds based on incomplete data, allowed to shape the market and even public opinion. Some media outlets will stick a mic or recorder in front of anybody with a name, and put their uninformed or skewed opinions out there as if they are absolute fact. It’s one thing to have this kind of information out there in the tech press, because many of us know better and take these reports with a truck load of salt.
However, it is quite another thing when that kind of incomplete or misleading reporting is put out there in the public eye. Then it has a way of influencing broader opinion. When a person who isn’t tech savvy hears from a trusted news outlet that someone who’s name they recognize or who works for someone they have heard of, says that Android is taking over the world, that has influence. People who don’t know a lot about a given subject tend to give weight to those who they feel are experts in the field. That is why reporting on the entire market matters. I’ve ranted about this before, so I’ll be brief on this point. It doesn’t matter that much to Apple or Google which device you are using. It’s that you are using THEIR device. That means that you are consuming their ads, and/or their content from their ecosystem. Sure, Apple makes more profit from some devices than they do from others, but they still gain influence from the sum total of them because of the connected ecosystem. Both Apple and Google understand this, and it is why they have taken over the connected device market from companies like Blackberry and Palm, who didn’t wise up and get it until it was too late.
Before we move on, I would like to note that nothing in the commScore report says that Android will never catch iOS, and I’m not saying it, either. With Google’s pace of innovation and rapid proliferation, that is still very possible. What the report does say, however, is that Apple’s ecosystem reaches farther than some thought thanks to the iPod Touch and the iPad, and that has to be taken into account. Google hasn’t overtaken Apple yet, and with Apple products now available from both major cell carriers in the US, and with a big head start in the more open, contract-free worlds of media players and tablets, the playing field is finally level here at home in the US. Over the next year, we will be able to match the big two head-to-head across all segments to see which platform is excelling where.
In other words, reports of Apple’s impending demise are all too premature. If you think I am exaggerating by saying that, think back to Gartner’s recent report stating that iOS would trail Windows Phone 7 in smartphone market share in four years. WINDOWS FREAKIN PHONE 7. This speculation is based purely on the fact that Nokia has signed on to use the OS. The same Nokia that has hemorrhaged market share to Apple and Google worldwide, and has basically become non existent in the US in the last five years. However, since the happy couple haven’t even announced their first piece of hardware yet, to say this report is speculative doesn’t go far enough. It is pure FABRICATION. This is a little sad, seeing how they really seemed to be getting it a few months ago. I wrote an article patting them on the back for understanding the importance of device other than smartphones, and how important the ecosystem. I guess that went out the window in the face of two giants who have such a firm grasp on the mobile world of today. Was it those awesome Windows 7 tablets from Microsoft that swayed Gartner, or Nokia’s clinging to Symbian for about 7 years past its prime? I’ll move on. There’s no sport in shooting fish in a barrel.
So now, since we’ve talked about the difference between good information and incomplete or skewed information, let’s talk about yesterday’s Wall Street Journal interview with Michael Dell, founder of Dell Computers. Now, this isn’t necessarily an example of the poor reporting that I was talking about earlier, because it is clearly framed as an interview with a notable figure in the tech world. As such, it isn’t as important to have a second opinion or rebuttal of Mr Dell’s statements, because this article isn’t being presented as fact. However, Michael Dell’s statements could stand some commentary from the rest of the mobile world. When you start off your interview with this exchange, you certainly call your credibility as an expert in the field into question:
WSJ: You’ve been back as CEO for four years now. What has surprised you the most about the evolution of the tech industry in that time?
Mr. Dell: I’d say [the] rapid rise of the tablet. I didn’t completely see that coming.
In Michael Dell’s defense, I guess no one else but Apple did, either, but that’s isn’t exactly a ringing endorsement of statements to come. It is also important to note Dell’s market response to the changing mobile landscape. Rather than bring out a compelling Android smartphone to compete with the iPhone, or bring out a compelling Android tablet to compete with the iPad, they instead pushed out the Dell Streak, which failed with a giant thud. The Streak was a 5″ Smartphone that really tried to also be a tablet, but ended up with more identity crisis than innovation. The fact that Dell released it running the older Android 1.6 and didn’t upgrade it until the hype had quickly moved on doomed it to failure.
As if Dell’s market response wasn’t enough to make its CEO’s opinions on the state of mobile today look shaky, his statements after the previous quote certainly should:
Tablets aren’t really new, in the sense that the tablet PC idea’s been around for a while. Obviously, more recent products have been much more successful.
What’s interesting [is that] business users are not going to give up smartphones. Won’t give up PCs. So now you have a PC, you have a smartphone and you have a tablet. Sounds pretty good. Industry growth.
What’s also interesting is Apple’s great success with the iPhone. Android comes along, even greater success. I think you’ll see the same thing on tablets, with enormous numbers of Android tablets with Dell certainly playing a role in that as well.
WSJ: Do you think Android tablets will outpace iPads moving forward?
Mr. Dell: Not tomorrow. Not the next day. But again, if you look at 18 months ago, Android phones were like, “What is that?” And now there are more Android phones than iPhones. I don’t see any reason why the same won’t occur with Android tablets.
I love the way Michael Dell first glosses over the amazing success of Apple’s iPad in an off-hand sentence (highlighted in bold above). Giving a little credit to the opposition when it is due is a sign of of someone, I don’t know, in touch with reality. Of course, this is the same guy who claimed that Apple was dead many years ago and said that they should give stockholders their money back. How do those stock prices stack up now, Mr Dell? Ah, how the tables can turn.
As far as Michael Dell’s opinions on Android vs iOS, first off, he certainly has an agenda there considering that his company uses Android in their mobile devices. What else would he say? However, there is plenty of wiggle room here to try and have an informed opinion, rather than spout the same old tired arguments. Let’s see, since a + b = c, x = y has to = z, right? Being a different ends of the alphabet shouldn’t change that. Of course, the blanket statement that Android has even greater success than iOS is pretty misleading, as well. Name a single Android smartphone that approaches the sales of the iPhone head-to-head. Hmmm. How about corporate profitability? Which Android manufacturer rivals Apple in terms of profits derived from smartphones? Which platform do think developers would claim is more successful at this point? I’m sure all this sounds a little smug and fanboyish, but my point is that, you can’t just make blanket statements like that and expect to be taken seriously. I really hope for Dell Computer’s sake that this is just CEO-speak, and not a true reflection of his thoughts on the market.
Maybe Mr Dell, as well as a lot of other writers and tech CEOs, should go read the commScore report I referenced above. Just because Android smartphones have sold like hotcakes over the last two years, doesn’t mean that Google dominance in the tablet space is assured. As I stated earlier in this article, the true playing field for iOS and Android has only recently been set here in the US. Android now has wider availability on AT&T, and there is finally an iPhone on Verizon. When you consider the findings of the March MobileMix report from Millennial Media that I wrote about a few weeks ago, this smartphone battle that most consider to be already won may not be a done deal yet, as the Verizon iPhone has started to make inroads, and has helped iOS recapture lost market share from Android. Who knows if this trend will continue, but it bears watching. Failing to keep a good eye on trends is what puts a tech company in a financial hole and behind the times, so maybe a little perspective is in order.
Let’s move away from the smartphone argument completely for a moment. As far as the tablet space goes, the market dynamics there are COMPLETELY different than what you see in smartphones. Sure, you can get 3G models of pretty much any major tablet device, but you don’t HAVE to. And even if you do, you can get them without the two year locked in contract and simply go month-to-month as you need Internet service. This is a huge distinction, as consumers aren’t nearly as locked into a device once they buy. However, buyers are more likely to lock themselves into a device or platform based on the ecosystem, and Apple has a big lead there right now. It’s common sense that, the more time users spend in a given ecosystem, the more the apps they will buy. The bigger their investment, the less likely they are to flush that down the toilet to move to another platform.
The commScore report bears this out, showing the significance of the iPod Touch. There has never been a true answer for this device from the Android world. In my opinion, the main reasons why are found in the ecosystems. iOS got into the 3rd party app business first, and gave developers cheap, solid and easy to use tools to work with. As such, there has been a huge proliferation of apps for iOS. Apple’s advantage in both numbers and profits in the App Store has held, despite greater numbers of smartphones on the Google side of the equation.
One of the app segments that has seen incredible growth is Games. It has grown so much, in fact, that iOS devices have begun to take market share away from dedicated gaming devices from Sony and Nintendo. Ask yourself- who is buying and using iPod Touches, and what are they using them for? Between my family, and others we know from church and school, I know about 25 kids that have some version of Touch, or a hand-me-down iPhone that they use as one. Several of these kids have had more than one, and many of them, like my son, gave up a DS or PSP to get one. All of them buy apps, especially games, and all of them listen to music. These are two strongholds that Apple has maintained over Google, and they help fuel non-phone devices. Google is working to bridge this gap, but is just now making more inroads in gaming, and is struggling to get its music service off the ground. Apple will more than likely maintain a sizeable lead here for the near future. While tablets are a somewhat different animal, they share more in common with the Touch than the iPhone. When it comes to tablets, the ecosystem also matters.
So, at the end of the day, who is going to win this epic connected device battle? Who knows? I don’t, and I don’t think anyone really does yet, either. That’s sort of my very long and drawn out point. Forget analysts like Gartner sticking a finger in the air and looking in outdated crystal balls. Forget industry talking heads who are mired in what they think they know, or flat out have an agenda in mind. We need more good reporting, with combined data for the smartphone, tablet, media player, and set top markets like we have in last week’s commScore report. We need these facts, broken down by OS, manufacturer, and carrier, like we got in recent reports from Millennial Media and Nielsen. That’s the only way to really know what’s happening in this ever-changing landscape.
Most of all, we need all of the developers, manufacturers, and providers to also look at this data, and give us the products and services that we want and need. I’m not interested in what Michael Dell is saying because he isn’t giving us any kind of informed opinion. I want tech CEOs to wake up, get informed, and give their employees the ability to innovate. That’s how Apple and Google turned these industries on their ears. They looked beyond what everyone else was doing and gave consumers something better. And we responded. Whether you use iOS, Android, or something else, we all need that innovation from all sides to keep the market moving forward, and to keep all of the players on their toes. You don’t get that looking at last year’s sales figures or staring into crystal balls. The three reports I have mentioned are a good start. Let’s hope they keep it up, and others get their heads out of the sand and get on board in the near future.
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TAGS: Android vs. iOS, connected devices, Gartner, iOS analyst reports, iOS vs. Android, Millennial Media, MobileMix, Wall Street Journal
