This Is How Apple Will Grow Share in a Mature Smartphone Market
Apr 27th 2013 10:00PM
Updated Apr 28th 2013 11:30AM
Apple investors have been fretting lately over where future iPhone growth will come from, as data continues to pile up that the high-end segment of subsidized, developed markets approaches maturity. Before even including the very distinct possibility of an affordable iPhone, Apple still has a powerful weapon in grabbing share from Google Android: customer loyalty.
That's the conclusion of a Yankee Group report, which expects Apple to top Android in the U.S. by 2015. The researcher surveyed 16,000 consumers over the past year, asking questions about smartphone ownership and purchasing plans. Current trends support the current duopoly structure of the market, with 84% of respondents planning on buying either an iPhone or Android in the next six months.
However, where the two dominant mobile platforms differ is loyalty.
That's a big difference in platform loyalty, and the effects in the long term will be a gradual shift toward iOS. There will always be defectors, but in this case the number of turncoats is extremely asymmetrical. Only 6% of iPhone users are looking to move to the other side, while 18% of Android users are eyeing iPhones.
Rival platforms from Microsoft and BlackBerry are hardly in the picture, with only 3% of iPhone users and 6% of Android users interested in abandoning the top two platforms.
By the time 2015 rolls around, Yankee Group is projecting iOS to surpass Android in U.S. market share. By 2017, Apple could be enjoying 42% of the domestic smartphone market, while Android sits idly by with a 34% slice. Yankee Group exec Carl Howe compares the platforms to leaking buckets of water, except that Google's leaks a lot more than Apple's.
Even as unit growth in the U.S. slows, Apple can still gain share through Android defectors.
Even though Apple boasts the highest loyalty rates, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple and what opportunities are left for the company (and your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.
The article This Is How Apple Will Grow Share in a Mature Smartphone Market originally appeared on Fool.com.Fool contributor Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple and Google and owns shares of Apple, Google, and Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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