Apple results won’t slow fierce competition

This week Apple announced its third quarter FY11 results. iPhone shipments rose 142% year-on-year to 20.34 million units.

IDC’s Francisco Jeronimo, Research Manager European Mobile Devices, estimated a growth in Apple’s smartphone market share to 18% for the quarter ending in June from 13% in the same period a year ago. The company is expected to consolidate its market position as the second biggest worldwide smartphone player, despite strong results expected this quarter from Samsung’s Android-based devices.

Jeronimo added: “Regardless of the continued success of the iPhone, Apple faces a fierce competition ahead. Indeed the company is already experiencing a slowdown in its market share in some developed countries, where the iPhone penetration is higher. In Western Europe, for instance, Apple became the smartphone market leader in the quarter ending March with 21% unit share, but IDC estimates that, this quarter, its market share slipped to 18% as Android is still gaining popularity and rapidly expanding its presence among European consumers.

“Apple’s new devices that are rumoured to be launched in September will play an important role in its strategy to tackle the mid-tier price bands that are currently dominated by Android, BlackBerry, and Symbian devices. A new product at a lower price will stop Apple’s unit share to decline as it will attract more users to move from feature phones to smartphones by the popularity of the user experience and the affordability of the lower prices. It is important that Apple continues to attract first-time users as this drives loyalty and future replacements for more premium versions of the iPhone,” he noted.

Jeronimo continued: “On the other hand, mobile operators are strongly concerned about Apple’s dominance. Most operators in Europe (unofficially) express a need for an alternative to Apple’s dominance, and support for other operating systems will be key to balance Apple’s strong presence in the market. Therefore, Apple will continue to face competition from Android devices and Microsoft’s operating system from next year as the Windows Phones manufactured by Nokia are expected to strongly benefit from operator’s subsidies.”

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