back to article Apple rakes in 60% of profits in still-surging smartphone market

The global smartphone market continues to skyrocket, and Apple and its iPhone line continue to slurp up the lion's share of that market's profits despite holding a relatively small marketshare when compared to arch-competitor Samsung. Percentage of operating profit from mobile phones (globally, select vendors) Apple pulls in an …

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Anonymous Coward

Don't care.

If there were only iPhones on the market I'd make my own out of mud and spider webs before I gave Apple any of my money.

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Re: Don't care.

Don't forget to drop in at Aldi on your way to the swamp.

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Re: Don't care.

Yeah, Google's aggressive data collection and hoarding, increasingly closed software and alleged anticompetitive practices (cf: http://www.theverge.com/2013/6/13/4427706/eu-committee-probe-google-over-android-anticompetitive ) is much better than Apple's not-invented-here mentality, explicitly closed software and alleged anticompetitive practices. Also when Google doesn't want something you submit on its store, it permanently suspends the thing — which is obviously a lot more 'open' than when you submit something to Apple's store which it doesn't want, as Apple will decline to approve it.

Apple's position as whipping boy is not without justification but the degree to which some people separate it from other players is absurd.

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Re: Don't care.

Funny, I've never had a problem loading an unapproved app on a android phone.

Haven't had much need to, mind you, but it's pretty trivial to do if I want to. I suppose I only have the one phone as a point of reference, but if it varies from phone to phone, that probably means it's a manufacture or carrier thing.

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Re: Don't care.

I agree about Google being evil. However:

1. It allows competition in hardware.

2. AOSP can be forked.

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Re: Don't care.

As well as an up and down voting button, can we have one to indicate that someone does not understand the comment, how on earth is Aldi related to this?

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Re: Don't care.

Fuck off

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Anonymous Coward

You'd think from all the hype that Samsung were taking over. Yet there's a bigger increase in Apple sales than Samsung.

Hopefully people are seeing through the hype, Samsung have cheated in benchmarks and when there wasn't an Apple product to rip-off (Smartwatches) they've released a right turkey.

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I think the difference is that Samsung has a lot of space to transition sales from ordinary phones to smartphones, so its gains in smartphone numbers are offset by the decline of the non-smart market.

If you compared methods of playing MP3s then Apple's gains wouldn't look so good as the ongoing decline in iPod sales would have a similar effect.

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Devil

Specs are irrelevant until they're not.

Smart watches an Apple product? Linux freaks did that one first a LONG time ago. It's funny how suddenly this is an over hyped idea now that there is some implication that Apple is considering it.

Although it's funny seeing a fanboy drone on a about "specs". I thought that was something that only the the "irrelevant geeky types" cared about? Of course that raises the obvious question of what number crunching you're expecting to do with your phone exactly.

It's the functionality, not the marketing propaganda. If you're not interested in the Walled Garden and ONLY the Walled Garden, then an Apple product probably isn't suitable for you. Doesn't matter how much faster the latest iDevice is.

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Everybody cheats at benchmarks. Everybody. It's a joke at some conferences and trade shows. There will be a seminar or lecture on 'Performance Benchmarks: What They Mean and How to Manipulate Them' or something similar. The group that rented the lecture space will hang out there and take people's pictures as they come in for the presentation. It's kind of a hazing thing, but it's funny as hell when the new kid from Motorola gets his picture taken under the huge banner over the door while he's all decked out in Motorola branded everything for the show. Good stuff.

Beyond that, smartphones are a luxury purchase. If you're expecting people to make reasoned purchase decisions for luxury goods you've lost your damn mind. In fact, there's a strong argument that flying completely in the face of reason and shitting on its pillow before presenting the bill is a desirable attribute in a luxury good.

Attempting to find reason and justification is a futile activity that, at best, is tiring. At worst you end up being one of those loudmouth market analysts that just become too much of a liability to keep on staff. That decision is usually made when their employer starts receiving calls requesting that analyst conduct an analysis of the 43rd St. Prostitution Market with a focus on whores who have been open longer than 12 months.

You don't want to be that guy do you? Just use whatever phone you have purchased and buy a different one if you're dissatisfied. It's really, really not worth bothering about. It is, after all, just a phone.

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Re:Smart watches an Apple product?

No. Not yet. Probably not ever.

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The power of not offering options?

Suppose I'm an average consumer and I want a smartphone. I probably decide to purchase an Android because it ticks all my mental boxes: touchscreen, web browser, apps. Having decided to do that, I see the S4 or the HTC One is the king of the market but I also see the Moto G and the Nexus 4 offering a lot more value and I probably have the choice of something else free on my contract. It's quite likely that I don't buy the most expensive option.

Supposing I decide I want an iPhone, because I am already in the Apple ecosystem from iPod times, because I was an early smartphone adopter and don't fancy learning something new, or for whatever other reason, the first thing I can consider is quite an expensive handset. So Apple has protected its profit from me by not offering a mass-market option.

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Trollface

"Apple Ireland rakes in profits, Cupertino hits 0% tax rate"...

Fixed your headline for you.

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Alert

Is this news?

Over priced expensive portable gear is more profitable than that with smaller margins?

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Strange and Wrong

The guy is certainly correct that Apple's sustained performance is an oddity. But, if you get down to it, about 98% of the world is an oddity. Nobody promised logic, reason or sanity. I do think it's going to be hilarious when 'business analysts and business educators' spend the next 40 years trying to identify all the reasons for Apples performance and fail, miserably each time.

Anybody who has has any success in business will tell you that no individual element was the driver of that success. The way all the elements come together is what drives success and there is a massive amount of luck involved that simply can't be replicated. Each company must be judged on its own merits and unique experiences. You can't draw many parallels between any two companies, even in the same markets with the same/similar products.

You also can't draw parallels between a monopoly and a protected market. The are no more alike than a stoat and turtle. In a protected market everything functions the same as in an open market, but the impacts of any competitor or disruptive force are mitigated. Basically you've got a great deal on marketing and a predefined customer base, but things like revenue, margins, growth and innovation are still required to prevent business failure.

In a monopoly there is never growth and revenue and margins are in free fall after a very, very short period of stable operations. There isn't a CEO or Board on Earth that wants a monopoly. You can't justify innovation if there are no other competitors and, barring a large scale die off of Humans in a given market, no innovation means the company is quickly overrun by nothing more than the regular growth of the population in that market. Research that was stopped is orders of magnitude more expensive to restart so that isn't a viable option, and the only thing left is cutting staff or degrading product quality.

That's basic economics. It drives me nuts when quasi-knowledgable people pop off about things they obviously don't understand but keep hammering on it like an authority.

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Re: Strange and Wrong

Apple are doing best out of the smartphone market because they're making the best products and are resisting commoditisation. As long as they do that, they SHOULD win.

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iPhone 5C is not a failure

If people who didn't like the 5C were going to Samsung instead of the 5S, then it would be a failure, but there's no evidence that's happening. The extra 5S sales from people who would have bought a 5C if they liked it are more profitable for Apple than the 5C sales they displaced.

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Happy

And now for something completely different

We interrupt your Apple-Android flame war to bring you this exclusive message:

Thanks for expanding my vocabulary Reg; I plan to accuse at least one colleague of being "unable to do anything but cavil" at least once this week.

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Massive profit margin.

The graphs show that Apple has a small percentage of the market, but a huge precentage of the profit. That's a typical pattern for prestige brands. When price is jacked up on prestige brands, the sales volumes dip slightly, but the profit margin grows hugely. It's the position every company wants to be in.

This also means that Apple sells on image, not products, and will need to be careful not to tarnish their image. Above all Apple should avoid producing low-cost phones, or, if they do, at least not sell them under the Apple brand.

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Re: Massive profit margin.

Non sequitur.

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The plural of anecdote is data. ;)

I have a close friend, very bright person. They had a new job and wanted to buy a smartphone to celebrate their first paycheck with some wanton materialism. I started to sp... "iPhone".

"Have you se..."

"iPhone!"

"Why do y..."

"iPhone! I want a pink iPhone!"

"You can get magenta N..."

"iPhone! iPhone! iPhone!"

I'm not kidding. That's pretty much our conversation. Okay, it was funny, but it was also curious. She knows very little about different phones or different phone OSs, but she was adamant that she was going to get an iPhone.

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Re: The plural of anecdote is data. ;)

>iPhone! iPhone! iPhone!

It's why the wags call them Sheeple.

Even a technical person asked me what the small disc was on my table at work.

"It's for the wireless charging"

"What's that?"

"It charges the phone without me having to plug in a cable"

"Oh, how?"

"Induction"

and so on.

The end result is invariably a strange face possibly indicating "How come I have to plug mine in? How come I have to do it so often? Why doesn't my phone - which is the best, I know it is, do that?"

Don't try to understand it, just accept that some people just buy "The best one", and it isn't based on what is even best for them really. It is often about not having to 'defend' your phone or answering questions like "Why didn't you get the best one? You have the money".

Often amusing to compare pictures though - if you have a Lumia 1020 it can be hysterical!

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Re: The plural of anecdote is data. ;)

Did you have to plug the disc in?

Do you have an extra lump on your phone?

Is the inductive charger much more expensive and much less ubiquitous than an iPhone charging lead?

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Re: The plural of anecdote is data. ;)

>Did you have to plug the disc in?

yes, once.

>Do you have an extra lump on your phone?

What is an extra lump? A 1020 has a bump for sure. Helps me to keep hold of the phone - besides, a small lump is worth it for good pics. A 925 is lump-less should one desire great pics and no lump.

>Is the inductive charger much more expensive and much less ubiquitous than an iPhone charging lead?

First inductive charger was free, got another for work for £15 pounds. Ridiculously worth it. Don't care if it is ubiquitous - I have one. I can also plug the phone like regular folk using the much-more-ubiquitous micro-usb should the need arise - which it rarely does.

Given the number of people that break their charging socket by knocking/dropping the phone while charging, the wireless charging system also adds a protection against it.

But, of course, you never broke yours so that use case is not needed, just like your house's fire insurance.

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Re: The plural of anecdote is data. ;)

>>Did you have to plug the disc in?

Yes, obviously. But as you're trying to make an equivalence argument between having to plug the phone in and having to plug the disc in, let's just point out that the phone is meant to be mobile and the disc stays on the desk where you typically charge the phone from and leave those with two brain cells to work out the rest of where that's going.

>>Do you have an extra lump on your phone?

No, the wireless charging with the Lumias is just a different case you clip on in place of the standard one. It doesn't have a "lump".

>>Is the inductive charger much more expensive and much less ubiquitous than an iPhone charging lead?

Is the iPhone much more expensive than {insert other phone}? That really comes down to a cost advantage over time which is going to vary from person to person. Obviously this person thinks its worth a premium to be able to just plonk their phone down on a charging pad, just as you think it's worth a premium to buy your phone over another cheaper one. For your information, the charging case is around £16 on Amazon right now:

http://www.amazon.co.uk/Nokia-CC-3041-Lumia-Wireless-Charging/dp/B009SBROCY

A charging pad is around the same price:

http://www.amazon.co.uk/Wireless-Charger-Google-Samsung-BC252L/dp/B00FEAGZ6E/ref=sr_1_1?s=electronics&ie=UTF8&qid=1395247880&sr=1-1

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Re: The plural of anecdote is data. ;)

I don't see a practical difference between placing a phone on a mat and plugging it in. Zero benefit. I wasn't aware that people broke their sockets, never seen that. Never seen an inductive charge pad in the wild, either. I'm sure the option of inductive charging will help Nokia unsink their Titanic.

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Why shit on Apple all the time?

Why oh why does everybody seem to want to have a pop at Apple? I have a theory - most of the people who are constantly berating Apple either can't, or don't want to, afford their products! There is a very good saying: "you pays your money and you takes your choice". Everybody knows Apple products are expensive but if you don't want to, say, shell out £1500 on an iMac then go buy something cheaper but, for God's sake, stop whining about it! Nobody is twisting your arm, or forcing you, to buy Apple! Of course they're not perfect, nobody is, but you either accept what you're buying, with all its' shortcomings, or just buy something else!

I used to use PC's with Windows until 5 years ago when I switched to an iMac and it was probably the best thing I ever did - for a whole variety of reasons which I won't bore you with. I, for one, love Apple products and why; two reasons: (1) They are beautifully designed and very tactile, more so than most other products and they just work the way I want them to work. (2) I can afford them!

Let's face it, to be blunt about it I'm a lot closer to death than I am to birth so why shouldn't I spend my money the way I want to and if I want to buy Apple stuff then why not? There are no pockets in shrouds!! As it is I now have an iMac, iPod, iPad, MacBook Air and an iPhone and am I happy with them - you bet!!

It's also interesting, is it not, that I don't see any of these detractors giving some stick to Rolls Royce; Bentley; Ferrari; Lamborghini; Rolex; Omega; Louis Vuitton et al - all of whom produce highly expensive top end of the market products and make a very nice profit in the process - just like Apple, so what's the difference??!!

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