[holymadness]

Originally Posted by Graham

OK, I'll bite.
As long as the makers aren't losing money on every phone sold then capturing market share while the market is still expanding so rapidly makes good business sense. You phrase this as though the big players didn't have high end expensive phones in their portfolio as well, which is nonsense of course.

It never ceases to amaze me how Apple's massive profit margins are held up to be a good thing for their customers.

Apple's profit margins are good for Apple, which was the crux of the thread.

I don't believe Android OEMs can continue to operate successfully on such razor-thin margins. Their lack of profitability will prevent them from investing in the R&D needed to innovate and the pricing expectations they create in the minds of customers will not only impede them from raising prices later, but also devalue their brand as cheap, shoddy, budget, etc. Weak demand creates a lack of leverage in negotiations with carriers, who burden their phones with unremovable crapware and try to block rookits, hurting customers.

Do you really believe that is true?

Samsung have been rightly pulled up because some aspects of their phones and their Touchwiz interface have borrowed significantly from the iPhone. That does not make them copies. There are a huge number of elements that make up a phone. Even the original Galaxy S is not an iPhone 3G 'clone'.

In the US and Germany Samsung were adjudged to have crossed the line. In the UK, Japan and the Netherlands they were adjudged to be OK. The South Koreans penalised both sides, but in the penalties awarded sent a message that the infringements were minor in the grand scheme of things.

Yes, there is really no question in my mind.

Really, the fragmentation argument? The vast majority of Android apps are backwards compatible to Android 2.1, so will run on 99% of Android devices.

Your link even espouses the benefits of what detractors like to call 'fragmentation':

I don't deny choice is a benefit. The point I was making largely concerns developers, and thus has a trickle-down effect on consumers.

And you're claiming that the wide selection of free apps is somehow bad for Android customers?

The free app to try out followed by paid app for something you like that does what you want is working well, and the Android paid market is growing all the time. What you're saying may well have been relevant a year or two ago, but now with Android having nearly three times the market share, your one third of users paying for apps is presumably a good match for the number of purchasers on iOS.

Personally, I prefer to have the option to pay for an app rather than be forced to use a spammy, ad-supported version.

We'll see if developer attitude shifts over time or not. So far, I have yet to see signs that Android has become or is becoming a platform of choice.

This would be the popularity based on a much smaller market share and a much higher profit margin? That's great for Apple and their shareholders.

Customers seem to love it. The iPhone 4S is the most popular phone in the world. The second most popular is the iPhone 4. Those will be displaced next week by... another Apple product. Apple phones now account for a vast majority of all handsets sold by AT&T and Verizon (obviously, US-only).

Then there's tablets, something like 90% of which are iPads. Its main competitor, the Kindle Fire, is using a version of Android so forked that it doesn't even merit the name. There are no legitimate Android alternatives.

Then there's JD Power & Associates user satisfaction rankings, which Apple has topped every year for the last half decade.

I would say their popularity among users is incontestable.

Oh, I think he does you know. I can see a lot of law suits going on, and the relative stagnation or decline of his market share in most countries outside the US must be ringing alarm bells.

Which is good, because hopefully it will prompt Apple to do what they do best: apply a huge helping of style to a niche product, identify the essentials and trim the concept down to its intuitive core, make us all want one with fanfares and slick marketing, and open up another product range for us all to enjoy.

Graham

In a sense, you are surely right. Cook wants market share, which he made clear enough during the iPhone 4S reveal. That's why he's moving to release the iPad mini later this year. Perhaps he'll eventually drop the price of the iPhone in emerging markets.

On the other hand, it's not the only metric that counts. BMW wants market share, too, but it doesn't try to compete with Toyota or KIA in volume. That's not its business model.