The latest sales channel analysis by ABI Research shows tough times ahead for smartphone vendors, as the balance of power remains with Samsung/Android and Apple.
According to ABI, Samsung is dominating the sales channel at nearly every price point, with only Apple challenging Samsung at the high end of the market. The ABI analysis shows Samsung at the forefront of the sales channel, with more than double the number devices on offer than any other vendor across the 13 markets and multiple online retailers studied.
Nick Spencer, senior practice director at ABI Research, says this leaves little room for the other vendors to compete, especially the other Android vendors and those using uncompetitive operating system ecosystems. "Despite some carriers' efforts to create a more balanced smartphone device vendor industry with their use of subsidy, ultimately they are obliged to fulfil consumer demand and at the moment that means Samsung/Android and Apple," says Spencer.
Ovum analyst Richard Hurst concurs with ABI that Samsung is positioned at the forefront in the smartphone battle. "When all is said and done, Samsung has the higher ground, especially in our region," says Hurst.
"They [Samsung] might have lost market share in the developed market, but I think in the emerging markets, particularly Africa and the Middle East, they will continue to have the higher ground."
Chinese factor
Hurst points out that Chinese vendors could be a threat to all the players in the smartphone environment. A recent analysis by Canalys shows just over 238 million smartphones were shipped globally in Q2, amounting to a 50% year-on-year increase.
While Samsung and Apple grew their shipments by 55% and 20%, respectively, to maintain first and second place, both lost share to Chinese vendors. Collectively, the five Chinese vendors shipping the most devices worldwide - Lenovo, Yulong, Huawei, ZTE and Xiaomi - made up 20% of the total market, up from less than 15% a year ago.
"If we look at the Chinese vendors, I think they're going to come into the market, and particularly the Sub-Saharan region, and they are going to play on price," says Hurst. "I think Samsung might not be able to completely play so much on price as they are able to do in developed markets."
He notes the key for the Chinese vendors will be to deliver low-cost devices that are still able to offer a positive end-user experience. "Because if it turns out to be a shoddy user experience, they will be shooting themselves in the foot," he says. "Other interesting issues are also at hand, such as what flavour of Android they will ship on their devices."
The Canalys analysis shows platform-wise Android grew the fastest during Q2, by 79% year-on-year. It powered 190 million, or 80%, of the smartphones shipped in the quarter. According to the analyst firm, Apple's iOS share fell to 13%, while Microsoft's Windows Phone shipments grew by 54% annually. This was driven by Nokia, with 31% sequential growth in Windows Phone shipments, enabling Microsoft to retain a 3% share. BlackBerry's shipments grew successively by 15%, also helping it to retain a 3% share of the market.
Share