Under the radar of yesterday's wild Apple [AAPL] speculation that iPhone sales are reeling
comes an attributed story based on evidence which points out that while
Samsung's Galaxy sales are booming, iPhone remains the stronger brand
with one-in-two shoppers still planning to get one.
iPhone remains consumer favorite
Changewave's news
here is that this level of interest in an Apple smartphone reflects
historical patterns quite accurately -- interest in any new device
usually wanes after the initial interest on its release, as you can see
in the graph above.
"One-in-two North American respondents (50%) planning to buy a smart
phone in the next 90 days say they’ll get an Apple iPhone. While that’s
down from 71% in last quarter’s survey – conducted just as the iPhone 5
was being released – historically speaking it’s a solid showing for
Apple," the researchers say in a press release provided to me.
Samsung's doing well, with its
Galaxy S III retaining a consistent slice of the consumer markets and
increasing interest in the larger Galaxy Note II.
There's some concern for Apple in the survey, as it shows that the
number of shoppers planning to purchase a Samsung smartphone across the
next 90-days has soared from 13 percent to 21 percent. While most of
these consumers plan to buy an S III, around a quarter (23 percent) have
their eyes on a Note, aka, "Phablet".
From Changewave:
"The impressive demand for the Galaxy Note II suggests the era of
large-screen smart phones is upon us. Importantly, when all planned
buyers were asked their screen size preference, more than one-in-four
(27%) said they’re most interested in a 5-inch or larger screen."
Change the game
Should Apple be worried at yet another form factor its adroit Android
foe has put up against it in the market? Not according to Changewave's
Paul Carton, who notes:
"With this level of consumer interest, Apple is perfectly capable of
producing a large-screen smart phone that’s virtually a tiny tablet –
they could call it an 'iTab' – and have it on the shelves for the next
Holiday season.”
Will Apple do this? I consider it unlikely, as I believe it is more
likely to introduce a new device designed to expand the whole category
of these mobile devices. Looking at the deep competition it faces, I
remain convinced the company will seek to change the underlying metaphor
of what a smartphone should be in an attempt to change the rules of the
game -- anyone can ship a phone with a different display size; few can
reinvent the category.
Not everyone agrees, of course: ex-Apple CEO, John Sculley, shows why
Steve Jobs was a good recruit for the top job when he advises his former
company to follow industry trends. Apple watchers, of course, will recognize that where Sculley follows, Jobs led: Apple is at its best when it sets trends.
Microsoft is coming up
What the latest Changewave data does reveal, however, is that the
smartphone industry has indeed become a two horse race between Apple and
Samsung.
71 percent of US consumers in the market for a smartphone within the
next 90 days will purchase a device from one of these two companies (two
thirds of these will opt for Apple, one third for Samsung).
This leaves precious little for competitors in the current
cash-strapped consumer economy. An industry, which perhaps should have
been booming, is instead consolidating around a small number of
household brand names.
There's potential for a third runner, Changewave observes: while iOS
remains the OS which most satisfies consumers (71 percent of iOS users
say they are Very Satisfied with the OS), it's Windows Phone (53
percent), not Android (48 percent, that takes second place.
This is likely to mean that consumers using a Windows Phone in
preference to Apple or Android will be likely to say good things about Microsoft's
new OS, and while Windows 8 sales aren't great, this does suggest
Redmond has a route to avoid the company meltdown some industry watchers
predict.
This is also good news for Nokia, and while you most likely won't see to many mentions of this elsewhere, it could be bad news for Samsung:
"Nokia is the biggest beneficiary of the higher Windows Phone satisfaction levels to date. The Finnish manufacturer's Very Satisfied
rating jumped to 56 percent this quarter putting it in a dead heat with
Samsung (55 percent) for second place – though both remain well behind
Apple (70 percent), the industry leader," Changewave explains.
In other words, from a fairly shaky start, Nokia and Microsoft are
beginning to make some headway persuading customers that their devices
are at least as good as those from Samsung, which currently dominates
the smartphone market.
Given none of these firms offer the kind of customer satisfaction Apple
provides, this strongly suggests that should Microsoft begin to exceed Samsung's heavy marketing spending then there's a chance it can unseat its Korean pretender and once again reclaim its seat as Apple's number one rival.
Apple's ascendancy is on hold
The take away here has to be that while Wall Street analysts are
chiming the division bell on the fate of Apple stock, the company itself
continues to benefit from its strong customer relationships and ability
to deliver products which please consumers. (Though Maps clearly
damaged this, it didn't topple the company's lead).
Not every analyst is a herd animal, some maintain their own original perspective, such as Brian White at Topeka Capital who continues to maintain a $1,111 price target on Apple stock.
White warns that the supply chain changes that dominate the Apple news
agenda this week are not surprising, given the firm cut certain
component orders in December and this was already known.
He also predicts (as I have) a deal with China Mobile and sees a huge future company opportunity on launch of the Apple television, which he says will be a "new TV experience". Though he thinks it could be a couple of years away.
The bottom line?
Apple continues to be the consumer's favorite smartphone, and while
Samsung is the biggest challenger, Microsoft and Nokia are in prime
position for a flank attack. Apple meanwhile already has plans to expand
iPhone sales while also opening up new market sectors with an eye to a bigger prize.
