APPLE SQUEEZED AS SMARTPHONE MARKET EXPANDS / iPHONE, TABLETS WITH BIGGER SCREENS
WASHINGTON, JULY 29, 2013 (INQUIRER) Agence France-Presse - The global smartphone market showed healthy growth in the second quarter, but Apple’s iPhone was squeezed by competition from Samsung and other Asian manufacturers, surveys showed Friday.
Apple’s share of the global smartphone market fell to 13.1 percent in the April-June period, according to research firm IDC. A separate report by Strategy Analytics gave Apple 13.6 percent, but noted that it was the US firm’s lowest share since 2010.
Samsung extended its dominance, capturing nearly one-third of all smartphones sold worldwide, according to the surveys, while South Korea’s LG and China’s Lenovo and ZTE showed accelerating growth.
Neil Mawston, executive director at Strategy Analytics, said Apple is being squeezed on both the high and low ends of the smartphone market, by manufacturers using the free Google Android operating system.
“Apple is at risk of being trapped in a pincer movement between rival three-inch Android models at the low-end and five-inch Android models at the high-end,” he said.
Mawston noted Samsung sales grew 56 percent from a year ago to 76 million smartphones, while Apple’s growth was just 20 percent, less than half the industry pace of 47 percent.
Strategy Analytics said Apple was not only beaten on sales, but overtaken by Samsung as the world’s most profitable smartphone maker. The research group said Samsung’s operating profit for its handset division was 5.2 billion in the second quarter of 2013 to $4.6 billion for Apple.
“Apple’s reign as the world’s most profitable handset vendor lasted almost four years,” Mawston said.
“Apple’s profit margin for its handset division has been fading recently due to lackluster iPhone 5 volumes and tougher competition from rivals. Samsung is performing well in the US market, while Huawei, ZTE and other local brands are growing vigorously in China.
“Apple is now under intense pressure to launch more iPhone models at cheaper price-points or with larger screens to fend off the surging competition.”
Ramon Llamas at IDC said Apple’s sales appeared to have been hurt by people waiting for new iPhone models in the second half of the year.
“Market opportunities exist at all levels, including the high end,” Llamas said. “While Samsung and Apple accounted for significant share of the overall market, they were not the only vendors active in the high end of the market,” he said.
“And recent device introductions and upcoming launches signal more vendors targeting this space. Comparisons will certainly be made to the flagship Galaxy and iPhone models, but clearly the competition refuses to be shut out altogether.”
IDC’s figures showed 52 percent growth in smartphones with shipments totalling 237.9 million. It showed Samsung on top with 30.4 percent to 13.1 percent for Apple, with LG third at 5.1 percent, followed by Lenovo (4.7 percent) and ZTE (4.2 percent).
Strategy Analytics said growth was 47 percent annually to 230 million units. Its survey gave Samsung 33.1 percent to 13.6 percent for Apple, with LG at 5.3 percent, ZTE and 5.0 percent and Chinese maker Huawei in fifth place at 4.8 percent.
Apple developing iPhones and tablets with bigger screens—report Agence France-Presse 5:02 pm | Tuesday, July 23rd, 2013
TAIPEI — Apple could roll out smartphones and tablets with bigger screens in a move analysts say is an attempt to catch up with a trend set by its major rival Samsung.
The Californian tech giant and its Asian suppliers are testing smartphone screens larger than four inches and tablet screens slightly less than 13 inches, the Wall Street Journal reported, without naming the suppliers.
Samsung, which has released a series of handsets and tablets with increasingly larger screens, has seen its global market share rise as consumers flock to their products putting Apple under pressure to follow suit.
The paper said it was not clear if such designs would ever make their way onto the market, but analysts said smartphones with bigger displays are increasingly popular because they meet the needs of users.
“Such designs are understandable as people tend to use their smartphones more for apps than for making calls,” Kuo Ming-chi, at the Taipei-based KGI Securities Investment Advisory Co, told AFP.
Currently, the iPhone 5 has a four-inch screen, compared with Samsung’s S4, an improved version of the South Korean company’s popular predecessor the S3 and which boasts a five-inch screen.
Such handsets are often referred to as “phablets” because their size sits in between a phone and a tablet.
By offering multiple screen size options and handset prices, Samsung has seen its market share rise to 33.1 percent in the three months to March, while Apple was lagging with 17.9 percent, according to research by Strategy Analytics.
During the same three-month period, Samsung also witnessed its global tablet market share rise to 17.9 percent, up from 11.3 percent a year ago, while Apple’s market share dived to 39.6 percent, a sharp decline from 58.1 percent the previous year, according to IDC.
While admitting Apple may still defend its argument that smartphones should be designed for one-hand use, Kuo said the continued improvement of battery and processor technologies could lead to re-thinking that policy.
“Bigger displays mean greater consumption of power. But that thinking may change with bigger batteries and improvement of chip manufacturing technologies which have made energy consumption more efficient,” he said.
Kuo added Apple might also try bigger screens for its tablet products to meet the demand of users who hope to work on their devices.
“But then again, tablets with bigger screens may be too heavy to carry for some users. That is something Apple may need to find a compromise on,” he said.
The current iPad has a 9.7-inch screen while iPad Mini is armed with a 7.9-inch screen.
The Journal cited officials at suppliers as saying that they had started mass producing components for the new iPhone in June, and its assembler Hon Hai Precision Industry Co., to ship the new iPhones in late August.
Hon Hai declined to comment on the report, as did Apple.
But a person familiar with matter told AFP that the shipment of new iPhones may be slightly later than the reported schedule.
Chief News Editor: Sol Jose Vanzi
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