Bianca Bosker of The Huffington Post dives deep into the history of Siri:
“The way that Steve described it, speech recognition — and how to use it to create a speech interface for something like the iPhone — was an area of interest to him and Scott Forstall [then head of Apple’s mobile software] for some time,” recalls Kittlaus. “The story that I’m told is that he thought we’d cracked that paradigm with our simple, conversational interface.”
Verizon thought so, too. In the fall of 2009, several months before Apple approached Siri, Verizon had signed a deal with the startup to make Siri a default app on all Android phones set to launch in the new year. When Apple swooped in to buy Siri, it insisted on making the assistant exclusive to Apple devices, and nixed the Verizon deal. In the process, it narrowly avoided seeing Siri become a selling point for smartphones powered by its biggest rival, Google. (Somewhere in the vaults of the wireless giant, there are unreleased commercials touting Siri as an Android add-on.)
Never knew that.
Steve Kovach for Business Insider:
That means (if we’re being conservative) at least 80% of all smartphones sold through AT&T, the second largest carrier in the U.S., were iPhones. The rest were Android, Windows Phone, BlackBerry, or whatever else is out there.
Now let’s look at Verizon’s earnings last earnings report for the same quarter. Verizon, the largest carrier in the U.S., sold 6.2 million iPhones out of a total of 9.8 million smartphones. That means the iPhone made up 63% of Verizon’s smartphone sales.
This is not some survey of a few thousand people. This is not data extrapolated from ad impressions across a vague number of devices. This is sales data. It does not lie. On the two largest carriers in the U.S., the iPhone dominated last quarter.
You can argue about whether that’s important or not. But clearly, when Apple launches a new iPhone in the U.S., it sells a lot of new iPhones — even more than the plethora of Android options combined. (A trend which has continued for a few years now.) Which suggests one of two things:
1) People buy an insane amount of iPhones in the U.S. because of the subsidy model. Verizon and AT&T (and now Sprint, and it looks like T-Mobile soon as well) allow you to get one for $299, $199, $99, or free. Those price points matter a lot, and they would matter in other countries as well.
2) The U.S. market is just different. For some reason, consumers in the U.S. want iPhones even when those in other countries do not as much.
If the first point is indeed the case, it’s a hell of argument for a lower priced phone without subsidy. It’s suggests that it’s not that people don’t want iPhones, it’s that they want new iPhones at good prices.
The data is also a pretty good argument as to why Apple may want to speed up the release cycle of new iPhones. (Though such a move would undoubtedly dampen the yearly “bulge” in sales.)
Chris Velazco for TechCrunch:
Since the only device that fits the description is the iPhone 5, that breaks down to about 651,000 iPhone 5s sold and activated since the device’s launch in September. That may seem a bit on the low side considering the near-religious fervor that iPhone launches tend to inspire, but it’s worth remembering that Apple’s newest smartphone hit the streets just prior to the fiscal quarter’s close.
Right, we’re already seeing a lot of confusion on this, but it’s really not complicated. While Verizon announced their quarterly earnings today, the actual quarter ended around September 30. In other words, the iPhone 5 was on sale for just nine days before the quarter ended. And it was supply-constrained the whole time.
I have no doubt we’re going to see the same level of confusion when Apple announces their earnings next week. The iPhone numbers will be lower than some are expecting because again, it will only include a couple weeks of supply-constrained iPhone 5 sales. Q1 is the real quarter to look at.
Jeff Benjamin:
I can confirm that the Verizon iPhone 5 is indeed GSM unlocked. Even though I bought an iPhone 5 from Verizon under contract, I was able to cut down my AT&T Micro SIM, and use it in my Verizon iPhone 5 to pick up an AT&T signal. By doing so, I was able to hop onto AT&T’s HPSA+ network, or “4G” as they so ridiculously name it.
Interesting — I assume this is related to the international roaming all iPhone 5s support (few countries use CDMA for 3G, so roaming would be on GSM).
Dieter Bohn last week on Google’s “New Motorola”:
But the simple fact remains: neither Google’s flagship Galaxy Nexus nor the new devices from its subsidiary Motorola are running Google’s latest software on Verizon’s network, and they won’t until Verizon says they can.
There’s nothing “new” about that.
If it weren’t for Verizon, I’d bet that basically no one would have bought any Motorola phones the past few years. And the company would have been even more of a money pit. And Google still probably would have paid over $10 billion for that money pit.
Thomas Gryta:
Verizon Wireless is including use of Apple Inc.’s FaceTime video-calling feature over its cellular network on all of its data plans, as opposed to rival AT&T Inc.
I’m shocked — SHOCKED — that AT&T once again has egg on its face.
Well, it may not exactly be the Kindle Phone some were hoping for, but this Verizon/Amazon partnership could end up being a big deal.
Verizon:
Recognizing this trend, Verizon and Amazon will offer a suite of Amazon-owned shopping apps directly to customers on certain Verizon Wireless Android smartphones. Amazon’s Shopping, MP3, Zappos, Kindle, and Audible apps, will be preloaded to offer quick access to the online stores, one-click ordering and access to Amazon Prime free two-day shipping.
That’s a round-about way of saying they’re going to start pre-loading all those Amazon apps on some of their Android phones.
And while Verizon don’t specifically mention the Amazon Appstore, The Verge says that will be a part of the suite as well. That’s huge news because it’s still way too much of a pain in the ass for a regular consumer to install it right now — which is a big reason why Amazon would want to build their own phone.
AT&T has updated their international travel data plans (following Verizon doing the same thing). On the surface, it’s a good move, the new packages are certainly a better bang-for-the-buck. But let’s be real: they’re still a colossal rip-off.
120MB of data from $30 a month? 800MB for $120 a month? They’re basically begging anyone who travels internationally to unlock their phones.
Like SMS, this insanely profitable dream is eventually going to collapse on the carriers. They could be less greedy and offer international data plans at a still-healthy markup (call it a convenience fee) and everyone would be happy. Instead, they’re fleecing customers.
When comScore released their latest U.S. smartphone market share numbers earlier today, I was a bit confused. According to comScore, Google (Android) usage surpassed 51% last quarter. Apple (iPhone) meanwhile, was at 30.7%. Those numbers alone aren’t necessarily surprising, comScore measures overall market usage, not just new sales and Android devices (as a whole) had been outselling iPhones for much of the last couple years.
But something happened last quarter. On the nation’s two largest carriers, Verizon and AT&T, the iPhone actually outsold all Android devices — combined. The nation’s third-largest carrier, Sprint, did not give a number for total smartphones sold last quarter. But they did disclose that they sold 1.5 million iPhones, which was higher than expected. Given the numbers, it sure seems like the iPhone is the majority of their smartphone sales as well — maybe by a lot — but it’s hard to know for sure. Yet, according to comScore’s numbers, Android market share rose 3.7% versus 1.1% for the iPhone.
This leaves two distinct possibilities.
First, that T-Mobile and regional carriers (which don’t offer the iPhone) more than made of the difference between Android and iPhone sales at the big guys. Eric Slivka of MacRumors notes there are around 70 million wireless subscribers in the U.S. without access to the iPhone, so it may be possible. That assumes that basically all of those people chose Android devices, but that’s also possible given the shrinking market share of Microsoft and RIM.
Second, that comScore’s method of measuring smartphone market share is flawed.
It certainly could be the case that the first scenario is correct, but it just doesn’t feel right. I’ll concede that the people without access to the iPhone could have offset the iPhone dominating Verizon, AT&T, and Sprint, but enough for Android to see nearly 4x the growth rate of the iPhone? That seems suspect.
Then consider the numbers from NPD. As a rival to comScore, NPD has their own methods for gathering smartphone market share. In their most recent report, they had Android controlling 48% of the U.S. smartphone market versus 43% for iPhone in Q4 of last year. In the same span, comScore had Android at 47.3% and the iPhone at 29.6%.
Forget the actual numbers, focus on the differences in the numbers. It’s pretty clear that the methods these firms are using to measure smartphone usage aren’t an exact science.
Digging deeper, you’ll find that the way comScore gets its numbers is through a service they call MobiLens. How is MobiLens calculated?
MobiLens data is derived from an intelligent online survey of a nationally representative sample of mobile subscribers age 13 and older. Data on mobile phone usage refers to a respondent’s primary mobile phone and does not include data related to a respondent’s secondary device.
A survey.
So on one hand, we have actual, verified and legally reported public data from the three largest U.S. carriers. On the other hand, we have a survey.
I’m not denying that Android still has the larger overall market share in the U.S. I’m just disputing comScore’s stats that it’s still growing faster then the iPhone.
Regardless, one thing is very clear: when the iPhone is available on a carrier, it dominates. This is backed up by cold hard sales numbers, not surveys. If Android is still “winning” in some segments of the market in the U.S., it’s only because Apple is allowing it to.
Update: comScore has written to clarify things a bit. It turns out their numbers do show iPhone subscriber growth outpacing Android on the “Big 3” carriers (13% vs. 11% from December to March). But the overall growth Android saw came mainly from other carriers (T-Mobile and regionals) where Android is dominating.
Fair enough. This reinforces the last point: that Android is dominating the areas where the iPhone isn’t competing. Yet.
Citing the fact that the iPhone now accounts for just about 60% of smartphone sales at the top three U.S. carriers, easily besting all of the Android phones out there combined, Jay Yarow writes:
This very well could be the beginning of the end for Google’s mobile operating system.
In September 2010, I wrote “Is Android Surging Only Because Apple Is Letting It?” I followed this up in June 2011 with “The Verizon iPhone Halted Android’s Surge. The iPhone 5 Could Reverse It.”
Both posts were extremely controversial when they were published. But looking back, they sure seem to be pretty spot-on (well, except for the iPhone 5 part, just sub the iPhone 4S in there). Android was “winning” in the U.S. market because the iPhone was only on one carrier, and not even the largest carrier.
This should not be controversial now. It should be viewed as fact, as the numbers indicate.
But in what may be a shock to some of you, I’m not nearly as bearish on Android right now as Yarow (and by extension, Raymond James analyst Tavis McCourt). I think Android will be fine because Apple will never fill every market need.
Apple is smartly focused on China right now, which has a quickly maturing middle class. But I can’t see them competing with all those ultra-cheap phones that Android can enable — why would they?
In the U.S., I think the iPhone will continue to dominate as the single most popular device for the foreseeable future, but Android as a whole will hang around as a popular alternative.
Probably around late summer every year going forward, iPhone sales will dip ahead of the expected new device and some Android manufacturer will find a way to capitalize, rising the entire ecosystem’s share as a result. But it will always be short-lived. The new iPhone will come along and crush it.
Remember too that the iPhone isn’t even on all four major U.S. carriers yet, something which T-Mobile clearly isn’t too happy about. Hard to see how that doesn’t change this year.
Verizon sold 6.3 million smartphones last quarter. The quick breakdown using my math skills:
3.2 million iPhones.
3.1 million non-iPhones.
Android is still winning by some metric, I’m sure. Ridiculous phones sold with styluses, perhaps? Wait, no, that’s AT&T.
Also note that 3.2 million iPhones is a drop from the 4.3 million iPhones Verizon sold last quarter — which isn’t a surprise given that last quarter was the holiday quarter and the first quarter the iPhone 4S was on sale. These numbers seems in line my iPhone sales prediction.
But, as Eric Slivka notes, the iPhone 4S also went on sale in China and on China Telecom for the first time last quarter. This may offset the holiday drop-off in the U.S. We’ll find out next week.
Apple’s stock took a dip today back below $600 a share. Some are citing concern that carriers will cut the subsidies they pay Apple for the iPhone as the reason for the drop.
There hasn’t been much in terms of tangible evidence that this is even a possibility, but the writing does seem to be slowly appearing on the wall. The carriers are all still extremely profitable and they do very well selling the iPhone, but they do better on a per-device basis selling other phones because of the subsidy they must pay Apple.
Because the iPhone is the most popular single device across the carriers, they’re all seeing certain numbers slip as a result. The question becomes do the three U.S. carriers with the iPhone (Verizon, AT&T, and Sprint) have enough leverage to push back and make Apple take a lower cut?
I don’t know, but I do know the leverage they will try to use: Android.
But the fact that Apple has a fourth carrier, T-Mobile, chomping at the bit to pay them the same subsidy, doesn’t speak well for this strategy. Collectively, they all still need the iPhone more than Apple needs any one of them. So unless they team up (collusion?) to put Apple in a position with no carriers willing to pay them what they want, I just don’t see things changing.
Sadly, I still think the carriers will keep on screwing with customers (rate hike here, rate change there) before they screw with Apple.
Two things:
1) The LTE data rates are in-line with the 3G rates. This is a very pleasant surprise. Still commitment-free. No contract required.
2) Of course Verizon is including the hotspot functionality with their plans while AT&T isn’t. AT&T seems to be doing everything in their power to ensure you don’t buy service from them. That’s one way to fix a crap network: drive people away.
