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iOS Loses Market Share as Windows Phone Gains

iOS Loses Market Share as Windows Phone Gains

Apple's iOS had a record volume of shipments in Q1, based on iPhones. That, however, wasn't enough to beat back the rising tide of Android devices coming from a wide variety of vendors. The lack of any new iPhone news also didn't help, so Apple actually lost market share, while Windows Phone surprised everyone by wresting third place away from BlackBerry.

By Richard Adhikari E-Commerce Times ECT News Network
05/16/13 3:23 PM PT

Android continues to rule the global smartphone marketplace with the OS accounting for 75 percent of shipments worldwide in Q1, according to the latest IDC report.

Apple's once-dominant iOS had only 17.3 percent of the market.

Windows Phone unexpectedly took third place from BlackBerry, which was relegated to fourth.

Android's dominance over iOS "is similar to what happened when Microsoft adopted the graphical user interface that Apple introduced and offered it up to many different vendors," Andrew Eisner, director of community and content at Retrevo, told the E-Commerce Times. "It's natural that, when you have lots of different suppliers offering competitively priced products, the market will move in that direction."

Meanwhile, Google has continued to improve Android to the point where it rivals iOS in some areas and outdoes it in others.

The Sorrows of iOS

Apple's situation is being hurt by the company's failure to have come up with innovative products apart from the iPhone 5, which was launched in September.

That could be why iOS chalked up its largest ever Q1 shipment volume, based on iPhone shipments. However, year-over-year market share declined and its shipment growth fell behind that of the overall market.

Apple shipped about 35 million smartphones in Q1 2012, and over 37 million in Q1 this year. Apple's iOS had 23 percent of the market in Q1 2012, but just over 17 percent this year.

"Folks upgraded their phones aggressively, but new customers fell off in favor of other brands," said Rob Enderle, principal analyst at the Enderle Group.

Further, because Apple is now available at multiple outlets, including Wal-Mart, it has "lost its exclusivity advantage and isn't really the cool phone any more," Enderle said. "They are increasingly living off customer loyalty, and their ability to grow their base has all but evaporated."

Figures from IDC

Android smartphone shipments in Q1 2013 totaled 162 million, almost 80 percent more than the 90.3 million shipped in Q1 2012. Android's Q1 market share was 75 percent, compared to 59 percent during the same period last year.

Windows Phone shipments grew more than 133 percent year over year. In Q1 2012, Windows Phone had 2 percent of the market, with 3 million smartphones shipped. This year, 7 million Windows Phone smartphones shipped in the first quarter, giving the OS 3.2 percent of the market.

The BlackBerry OS, which had 6.4 percent of the market in Q1 last year with nearly 10 million devices shipped, had only 2.9 percent of the market this past quarter, with 6.3 million units shipped.

Implications of IDC's Findings

"Samsung continues to out-execute Apple, suggesting they will sustain and grow their market share advantage," Enderle told The E-Commerce Times.

It's a critical time for Apple, and Samsung is well ahead in terms of innovation, Eisner stated. "There are rumors that Samsung, which showed some beautiful flexible displays at CES, will bring out a device with one of them soon."

Although Windows Phone has pushed out BlackBerry from third place to fourth, "it's a question of who sucks less," Eisner said. "If you don't have the apps, you don't sell the smartphones, and iOS and Android have far more apps, which compounds the fact that PCs are on the decline so Microsoft doesn't even have that advantage in creating an ecosystem now."

Google made a slew of announcements for developers at Google I/O in San Francisco this week, but "I doubt they will have much real impact other than better quality in Android apps, which could have a lagging positive impact on the platform," Enderle said.

BlackBerry wrapped up BlackBerry World in Orlando, Florida this week. Because it has changed over to the new BB10 operating system, it is "likely to bleed share at a slowing rate until BB10 reaches critical mass in the installed base," he said.

IDC did not respond to our request for more details.


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