More Evidence that Investing in the Experience is Paying off for Apple

Scott Francis
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First, this announcement from Verizon.  The 90million+ customers of Verizon now have access to the best smart phone on the market. Previously, there were a lot of pundits saying that Verizon wouldn’t “cave” to Apple’s terms.  According to Verizon, it wasn’t even hard for them to “cave” on those terms – they knew what they were getting into and the financial numbers make sense so it wasn’t really an issue.  (Well, maybe it was an issue 2 years ago, but I guess it wasn’t now!) Second, there’s this update from IDC on the state of the PC market.  Apple has now captures 8.7% of the market according to IDC, up 15.2% from Q4 last year. It has all the momentum, in an environment where the PC market in the US declined more than 5%. Third, Gartner confirms the general trend in their report: 9.7% market share in Q4 with a 23.7% growth rate year-over-year.  An interesting tidbit in the Apple Insider article is that the iPad is noticeably absent from any of the analysis or figures:
Under its published charts, Gartner notes that its “data includes desk-based PCs, mobile PCs, including mini-notebooks but not media tablet such as the iPad.” Apple sells more iPads than all of its Macintosh computers combined, so including iPad tablets within PC sales would dramatically boost the company’s market share at the expense of generic PC makers, much like the balloon of netbook sales from Acer and Asus skewed the PC market in 2008 and 2009. Neither Gartner nor IDC have explained why they gerrymander their PC sales data to exclude the iPad, even as they count limited functionality netbooks, scramble to invent non-iPad explanations for contracting growth in the PC market outside of Apple’s own sales, and describe Apple’s tablet as part of a distinct “media tablet” market that simply does not exist. Gartner previously invented arbitrary definitions of “smartphone” that excluded devices from some makers (notably Palm) in order to flatter sales of Windows Mobile, formerly included PC servers (but not competing servers using non-Intel chips) in its PC sales reports to flatter Microsoft, and more recently has invented tens of millions of devices it says are probably using Android in order to dramatically skew its modern reports on the smartphone industry and fulfill its own predictions on mobile platforms.
I find the blind spot kind of interesting.  I guess it lets everyone pretend that the iPad *isn’t* eating their lunch for another year or so… but the gig is going to be up soon. Investing in the Experience seems to be the right way to go. UPDATE:  I should have caught this excellent article from Marco Arment (of Instapaper fame).  He makes the point that although Android has a ton of volume, it hasn’t really been in proper competition in the US with iPhone:
Whenever I’ve overheard conversations about smartphones in real life, by “normal people” (not geeks like us), it has always been clear that the true battle happening in the U.S. phone market wasn’t iPhone versus Android, but iPhone versus Verizon. The decision that people were discussing wasn’t “Do I get an iPhone or an Android whatever?” It was always “Do I get an iPhone or do I stay on Verizon?” I get the feeling that very few people except anti-Apple geeks really care about Android itself. The buying decision for most seemed to be, “I’m on Verizon and don’t want to switch, so which of the phones in the Verizon store looks best? They say this one is just as good as an iPhone. I guess I’ll get that.”
I get this same feeling as well.  Looking forward to seeing if I’m right.