January 5, 2011, 12:13 PM

Smartphone race tighter than ever

The iPhone, BlackBerry and Android are neck and neck. Can iPhone retain the lead?

Bill Siwicki

Managing Editor, Mobile Commerce

Lead Photo

28.6% of smartphones in use are iPhones, making the Apple device No. 1 among smartphones.

The race for smartphone supremacy is as close as it’s ever been, according to newly released data from The Nielsen Co., and merchants in mobile commerce or preparing to make the leap face decisions on where to focus their efforts. Of U.S. smartphones in use by adults in November, 28.6% ran Apple Inc.’s iPhone operating system, 26.1% used Research in Motion’s BlackBerry operating system and 25.8% ran Google Inc.’s Android operating system.

The iPhone is increasing market share slightly, BlackBerry is dropping and Android is growing strong. From June 2010 to November 2010, the iPhone grew from 27.9% to 28.6%, BlackBerry fell from 33.9% to 26.1% and Android rose from 15.0% to 25.8%.

One unknown may have an impact on the race this year: Apple is reportedly going to begin offering the iPhone through Verizon; to date it has only offered it through AT&T. This has the potential to boost the iPhone’s market share, and perhaps keep the mega-popular smartphone ahead of the numerous Android smartphones combined.

Retailers, consumer brand manufacturers, travel companies and ticket sellers in mobile commerce continue to focus their mobile efforts first on the iPhone, largely because of the device’s prominence not just in the mobile hardware market but in web traffic logs. But research like that from Nielsen increasingly shows that Android phone adoption puts that platform nearly on a par with the iPhone, and as traffic from Android devices increases, so, too, must the attention merchants pay to the popular operating system, m-commerce experts say.

“Apple’s seniority and the rapid rise of Android give retailers the opportunity to use platforms with advanced functionality and an increasingly broader base of mobile shoppers,” says Tom Nawara, vice president of digital strategy and design at e-commerce and m-commerce research and consulting firm Acquity Group LLC. “It’s a great opportunity for retailers right now to do more than just basic m-commerce—smartphones can help bridge the gap between the online and in-store worlds. The rapid rise of these two types of smartphones and of smartphones overall will enable the primary vehicle for retailers to address their audiences in 2011.”

Some experts, however, believe that the type of smartphone that reigns supreme is irrelevant.

“Retailers need to try to ignore the ‘hardware wars’ and think critically about who their audiences are and how they can provide the best customer experience through mobile. Hardware-specific branded apps, while great for keeping loyal customers engaged, have generally underperformed for attracting and retaining new customers,” says Rich LaPerch, CEO of mobile app and site builder Aegis Mobile. “Regardless of platform, accessing the Internet is still one of the top user activities on smartphones. That’s customers researching products and comparing prices while shopping. That means that companies offering a mobile experience should not simply migrate their PC experience but design it for the mobile user. Integration to back-end systems and business processes is where companies need to focus to ensure the best possible customer experience.”

Comments | 3 Responses

  • My question to you is: what are smartphone *operating system* marketshare figures useful for? If your answer is “so developers and consumers can see which is the largest platform for their software”, then why are you not including all iOS devices in your analysis? If you do that, then Apple’s installed base suddenly doubles and leaves both Android and Blackberry in the dust. If you answer that OS marketshare figures are important for advertisers, then again, why not include all iOS devices that share the same mobile browser and app platform? If you answer “so 3rd party hardware peripheral manufacturers know which platform to target” then you should be considering the far larger number of iOS devices that all share a common dock connector and standard form factor compared to the completely fragmented form factor and dock connector standards of the myriads of much smaller competitors. Of course consumers also want to know which phone has the most dock-equipped audio systems, car steering wheel interfaces, clock radios, etc and of course the answer is the iPhone which is virtually unchallenged in this regard. The fact is that Nielsen includes tablets like the Dell Streak and Samsung Galaxy Tab in their figures because Google requires all tablets include cell phone hardware in order to get access to the Android Marketplace. However, Nielsen does not count the iPod touch and the iPad. With the iPod touch and iPad completely obliterating the opposition in mini tablets and tablets respectively, Apple still has by far the largest mobile OS platform installed base with over 130 million iOS devices sold. In terms of new sales, back in October Apple was selling 270,000 iOS devices a day (peaking at 300,000 on some days) when Google was activating 200,000 Android devices. Recently Google announced they had hit 300,000 activations a day, and while we haven’t yet heard what Apple’s latest figures are it is highly likely they will be higher than Android thanks to the usual pre-Christmas sales surge of all iOS devices. If you are only interested in smartphones, then why aren’t you comparing Samsung, Motorola, HTC, etc all individually against Apple and RIM? Why can’t analysts make comparisons that are actually useful? -Mart

  • Yes, it would not be apples-to-apples if Nielsen included Android tablets but not other Apple Devices in smartphone OS market share. In fact, it wouldn't even really be "smartphone" share. However, the mobile team at The Nielsen Co. has this to say: "We only include mobile phones when reporting on smartphone OS market share."

  • Yes, what they are nit saying is that the Dell Streak and Samsung Galaxy tab and any other Android tablet that matters all have mobile phone hardware guilt-in so are classed as mobile phones despite being 7" tablets. They have to do this for Google to allow them access to the Android Marketplace -Mart

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