Momentous Changes

We often hear that the mobile phone market is going through momentous changes, with iOS and Android getting lots of attention. But is this really playing-out on the ground with mobile operators? I thought it would be worth providing some informal ‘anecdotal’ evidence that I’m hearing and some thoughts on where things are heading.

The ‘iPhone effect’ is still increasing. I hear from numerous sources that iPhone sales in Europe are still rising, with up to 30-40% of some networks current sales being iPhone. So given a typical 18-24 months handset replacement cycle, within 2 years a significant proportion of some Operators handsets will be iPhone. This varies across Europe, but it is a pattern that is starting in the more developed markets, and is sure to spread.

Android is slightly behind, but it too is heading towards 30-40% of sales in some markets. Many Operators are actively encouraging this as a counterweight to Apples dominance (and hence bargaining power). And of course this is across many more handsets – whereas there are 2-4 iPhone SKU’s typically, there may be 15-20 Android SKU’s.

If Operators typically range 40-50 handsets in Europe, that leaves a very long-tail of small volume devices for Nokia, Samsung, SonyEricsson, LG and Motorola to fight-over. That’s a very different position for some of these manufacturers than they are used to.

It interesting that the share of media attention iOS and Android are getting is actually in-line withe their near-future market share. And if anyone tells you iOS and Android are all hype, then that’s either someone outside Europe talking, or someone in denial.

As for outside Europe, in the US we’re still waiting for the impact of iPhone on Verizon to begin, but some analysts and bloggers are predicting major sales of iPhone of Verizon. SOme of these will be AT&T switchers, but many will be new iPhone users.

And in Japan, iPhone is extremely popular. I was looking at an Android handsets produced by Sharp recently, with 1-seg TV built-in and a 3D display (yes, 3D, and no glasses required). So i think Android, whilst still small in Japan, is positioned for major growth there.