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AAPL, PALM, and RIMM smart phones
Smart Phones are advanced phones with computer-like functionality such as the ability to browse the internet. While 80% of US adults have a cell phone, only about 4% of those phones are smart phones, although the number of smart phones has grown rapidly since 2005.[1]

Smart phone adoption in the U.S. has lagged that of other developed areas, such as Japan or Europe, where consumer demand for cutting edge technology and better telecommunications infrastructure have spurred adoption.[2] However, as corporate America has seen the advantage of supplying workers with 24/7 office email, and consumers have gravitated towards the rich media offered by Apple (AAPL) iPhones, the North American smart phone market is picking up. Analysts predict growth in the double-digits for unit sales in 2008.[3]

I wrote in the past that I think they will launch Iphone Nano later.They have suprirsed me with Ipad I still think they will launch an iphone nano in the next 24 months with a lower price point and profits per unit but still with a very nice margin

Domestic Hardware Market Share

IDC Market Survey Data, Smartphone 2008
IDC Market Survey Data, Smartphone 2008[4]
Change Wave IT survey
Change Wave IT survey[5]

There are two critical markets when it comes to considering Market Share for Smart phone devices. These include the "general" smart phone population, which includes home-use, and the Corporate market, which has long favored Research in Motion (RIMM) due to BlackBerry enterprise service for corporate email.[6]

U.S. Smartphone Market Share[7] % Share
data from IDC, 2008

According to the data service IDC, which tabulates sales by units, the domestic Smart phone market is 44.5% in BlackBerry hands, with competition from the IPhone. Motorola, and HTC are all second-tier players in this field. Palm has share at 13.4%, largely due to many Centro sales during FY 2008.[8]

Corporate IT spending[9] % Share (ChangeWave)

In the corporate arena, due to access requirements and security demands, as well as a general corporate aversion to Apple (AAPL) due to closed standards, BlackBerry and Palm are the primary competitors. Even as such, BlackBerry leads Palm 76% to 18%, according to ChangeWave, which conducted a survey among corporate IT groups. The number tabulates % of adoption among 2,000 different enterprises.[10] The release of the 3G iPhone, which is more corporate email friendly, will likely have an impact on these shares going into H2CY2008.[11]

International Hardware Market Share

Nokia has the largest share in the international smart phone market.
Nokia has the largest share in the international smart phone market.[12]
Market Share Q4 2007 Units[13]

According to estimates by Canalys, Nokia had slightly more than 50% world market share for smart phone units sold in Q4 of 2007 and almost 19MM units sold.[14] In second place was competitor Research in Motion (RIMM), with 4MM units.[15] No other single competitor commanded more than 10% share in that quarter. This documents why the Symbian O.S. does so well internationally.


The many forces at play in this market are magnified due to the fact that the dust has not yet settled; the market is young and growing at double-digit rates, and therefore market leadership and associated consumer preferences have not yet been cemented.[16]

The carrier/hardware provider relationship will determine future winners

Telecoms such as AT&T (T), Sprint Nextel (S), and Verizon Communications (VZ) set the conditions in which the Hardware vendors (such as BlackBerry, Samsung, and now AAPL) have their handsets sold. The telecoms have traditionally subsidized handsets that they supported, pushing down the price and creating demand from the consumers. In exchange, the consumer signs a service contract for a year or two. As a result of this, customers have come to expect cheaper phones than what the handset companies actually received in revenues. For example, in the iPhone 3G launch, priced at $199/$299 with contract, 1MM phones were sold over the first weekend, compared with 74 days for the 1G iPhone priced at $499/$599.[17] This suggests that consumers were truly price sensitive to the more expensive machines, but are eager to jump on at lower price levels.

Each one of these contracts is worth a lot to the Hardware Vendors. When Palm announced that it had landed a contract for the Centro on Verizon Communications (VZ) network (June 12, 2008), the company's stock jumped 13%.[18] As such, the cooperation and partnership is important to earn both unit sales for the hardware vendors, as well as subscription plans for the carriers.

I could read a book about this without finding such real-world aprpoahces!

Hi Anna! It was so nice hearing your voice with the Skirted Girls! I enjoy your blog. It has such iaoiirntpsn. Good luck to you in your new ventures with the store. I am sure you will do great! Have a great weekend!

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