In U.S. Market, Samsung is Top Device, Android Top OS

Samsung was the top handset manufacturer in the U.S. market in the fourth quarter of 2011, with 25.4 percent market share. Google Android continued to grow its share in the smart phone operating system market, accounting for 48.6 percent of user devices.

Apple undoubtedly will be found to have made the most profit, though. That has been true for some time.

Between them, Apple and Samsung earned fully 81 percent of all profits in the mobile handset business, on a global basis.

The number of U.S. smart phone subscribers surpassed the 100-million mark in January 2012, up 13 percent since October to 101.3 million subscribers, according to comScore. 

Google Android ranked as the top smart phone platform with 48.6 percent market share (up 2.3 percentage points) followed by Apple with 29.5 percent market share (up 1.4 percentage points). RIM ranked third with 15.2 percent share, followed by Microsoft (4.4 percent) and Symbian (1.5 percent).

But profitability, more than anything else, now is shaping the global smart phone business, one might argue after considering the latest estimate by Strategy Analytics of market share in the global handset business.

Globally, Apple and Samsung have, over the last 12 months, surged to the top of the charts in terms of smart phone sales volume. In the past, the “smart phone” category has not been significant, as all devices were feature phones or basic phones.

As the market begins to shift to a smart phone buyer pattern, differences in firm strategy and execution have lead to a rapid change in market leadership.

In the past, Nokia has been the global share leader, but Nokia has not been able to translate that prior success into smart phone success, where Apple has changed the game and Samsung apparently has been able to keep pace.

Apple overtook Samsung to become the world’s largest smart phone vendor by volume with 24 percent market share. Apple’s global smart phone shipments surged 128 percent annually to 37.0 million units, as distribution of the iPhone family expanded across numerous countries, dozens of operators and multiple price points.”

Apple took the top spot for share on a quarterly basis, but Samsung became the market leader in annual terms for the first time with 20 percent global share during 2011. With global smartphone shipments nearing half a billion units in 2011, Samsung is now well positioned alongside Apple in a two-horse race at the forefront of one of the world’s largest and most valuable consumer electronics markets, Strategy Analytics says.

In contrast, Nokia’s smart phone market share was cut in half from 2011 to 2011, dropping from 33 percent in 2010 to 16 percent in 2011.

That is one reason there has been so much focus on the Nokia partnership with Microsoft, as many would argue the Windows Mobile operating system represents the best shot Nokia will have to avoid collapse.

The other observation of note would be that profitability might now be emerging as the key differentiator, even though design and consumer demand clearly are driving the market overall.

Samsung’s most-recent quarterly earnings also set records. Samsung Electronics Co declared $4.7 billion in quarterly operating profit. jumping 76 percent year over year.

Top Mobile OEMs 3 Month Avg. Ending Jan. 2012 vs. 3 Month Avg. Ending Oct. 2011 Total U.S. Mobile Subscribers (Smartphone & Non-Smartphone) Ages 13+ Source: comScore MobiLens
	Share (%) of Mobile Subscribers
	Oct-11	Jan-12	Point Change
Total Mobile Subscribers	100.0%	100.0%	N/A
Samsung	25.5%	25.4%	-0.1
LG	20.6%	19.7%	-0.9
Motorola	13.6%	13.2%	-0.4
Apple	10.8%	12.8%	2.0
RIM	6.6%	6.6%	0.0

Top Smartphone Platforms 3 Month Avg. Ending Jan. 2012 vs. 3 Month Avg. Ending Oct. 2011 Total U.S. Smartphone Subscribers Ages 13+ Source: comScore MobiLens
	Share (%) of Smartphone Subscribers
	Oct-11	Jan-12	Point Change
Total Smartphone Subscribers	100.0%	100.0%	N/A
Google	46.3%	48.6%	2.3
Apple	28.1%	29.5%	1.4
RIM	17.2%	15.2%	-2.0
Microsoft	5.4%	4.4%	-1.0
Symbian	1.6%	1.5%	-0.1

Google Play Replaces Android Market

Google has launched Google Play, an integrated destination for apps, books, movies, and music, accessible to users on Android devices and to anyone on the Web, that also replaces the Android Market.

Google Play illustrates, as well as anything might, the growing role commerce is playing in the mobile device and applications ecosystems. The new branding obviously focuses attention on "Google" rather than "Android," as well.

To be sure, Android Market was a "commerce" vehicle before. In the future, Google Play will be more of a "shopping" venue as well.

Apple iPad Still Leads Tablet Market Share, but Kindle Fire is Pressing

To the extent that the Android operating system lies underneath the Amazon Kindle Fire, Android remains the operating system that is chasing Apple iOS for market share. In fact, one might argue that Android has passed iOS> 

No "Wallet War?" Really?

According to Michael Abbott, Isis CEO, “there is no mobile wallet war out there. ” The statement will strike some as a bit of bluster, good manners or delusion. But there always is a time, early in the development of a market, when it is helpful for lots of firms to enter the business.


The existence of multiple competitors helps to legitimize the market. That is probably the sense in which Abbott says there is no wallet war. It obviously is not based on a lack of substantial would-be competitors. 


Also, at the moment, there are niches within the broad mobile commerce space, including "payments" systems, wallet or credentials systems, point of sale systems and money transfer systems, for example. 


Those somewhat distinct niches will blur, over time, once the market begins to take more definite form. It won't be so easy to distinguish between payment, wallet, money transfer or terminal roles, for example. 


Nor will it be so easy to distinguish between firms that engage in online commerce, or brick and mortar retail. 


At the same time, many contestants will gain one footfhold in the market, and then use those positions to add other market roles, as Square is doing, for example. 

Try Explaining "Cloud Computing" Without Words

Apple does a fairly decent job of showing, in a consumer context, the advantage of iCloud. For users, "what" it is, or "how it works," doesn't really matter. The only thing that matters is the value. Remember the old concept of "write once, read many?" 


That's really the advantage of the cloud, and cloud storage of content. Store it once, use it anywhere, on any device. 

An Important Lesson about "Over the Top" Danger

Contestants in competitive communications markets tend to recognize the value of having the leading incumbents set a high price umbrella, the simple reason being that a common attacker strategy is to offer "same service, less price." 


The higher the price umbrella, the better the value proposition an attacker can offer, and still generate more revenue than under a low price umbrella. 


That seems to be the case for over the top applications in the messaging space, in European markets that feature high tariffs. 


European operators rely on high tariffs for international calls and texts. Whatever else one might say about that situation, the high tariffs allow lots of room for attackers to offer the same features at much lower cost.


Over the top application providers provide salient examples.


By way of contrast, U.S. service providers, operating with a continental-sized domestic market,  offer unlimited or huge buckets of calls and texts for a flat rate that offer much less room for attackers to exploit.


The exception is international calling, where apps such as Skype get serious amounts of use. But for domestic calling, tariffs are so reasonable that there is little incentive to modify domestic calling or texting behavior because the marginal cost of a domestic text or call is zero. The "Panic" About OTT Apps


The point is that the pricing umbrella has significant implications for competitive dynamics. Over the top will be a bigger danger where the pricing umbrella is high, and much less a compelling alternative for users where the pricing umbrella is low. 

What Role for End User Choice in Mobile Data Plans?

Many consumers probably would jump at the chance to buy virtually any TV show, series or channel, including current episodes, a la carte, much as they buy single songs, rather than the bundled collections we call "albums" or "compact discs."

One reason is the somewhat logical expectation that such buyers will get precisely what they want, while saving money.

The issue is whether many consumers will have something of the same reaction to mobile Internet plans that, for example, offer lower data plans in exchange for a curated experience big on Facebook, YouTube or Twitter.

Orange apparently wants to find out. For less than $14 a month, customers get unlimited use of Facebook and Twitter. Web browsing on other sites costs about 70 cents for every 20 minutes of use, the Wall Street Journal reports. All Mobile Traffic Isn't Equal

The issue isn't whether this is the best way to match end user preferences on mobile devices with retail packaging. The issue is that it is an interesting way to customize and personalize use of the web apps people really value, while offering savings at the same time.

To the extent that users already have indicated preference for buying songs, not albums, or might prefer buying shows rather than channels, they might also prefer a focused approach to web apps on their mobiles.

Some won't like the idea, but they can buy the standard plans, and pay more money. Some policy advocates will worry about the implications for app competition or any number of other issues.

But if choice provides end user value in music, video, or stories, it isn't so clear why such choice does not provide equivalent value when mobile users buy and use their favorite mobile apps.