Google's Android OS actually helping iPhone sales

A close analysis of the eight largest mobile vendors' average selling prices for their smartphones was just posted by market intelligence firm Asymco, and the study reveals something very interesting that is currently happening. Something that even Apple didn't expect.
In fact, Steve Jobs is probably laughing all the way to the bank right now.
Apple's average iPhone selling prices have actually gone up since Google's Android open source (read: free) operating system was introduced, and although there has been some price erosion among the other top vendors (the orange line in the chart below), it is still surprisingly small. Almost negligible in fact.

o what's happening you may ask? Well according to Asymco, the smartphone market is growing so fast at about 90 percent per year that there is very limited direct competition between smartphones but a lot of competition between smartphones and so-called feature phones.

It's the feature phone makers who are having to cut their prices a lot in order to compete. But not the iPhone, no sir re.
"The only single correlation with the pricing power is whether you build smartphones or dumb phones. The more smartphones you build, the higher the price you can charge. This is regardless of platform," says Asymco.
The research firm has long argued that the mobile phone market should be studied as a whole because the competition is not between platforms but between smart and non-smart devices. Period.

"Android is actually expanding the market without crushing pricing," adds Asymco. "In a way, this is all good news -- even for Apple. A world full of smartphone users is a better addressable market for iPhones than one filled with voice products," reveals the study.
"Apple's iPhone traction was always in markets which had been seeded by some smartphones. The U.S. and Canada with Research in Motion's BlackBerry OS and Europe with Nokia's Symbian OS. Such a smartphone-soaked world will have better mobile broadband infrastructure, users with more demanding tastes and awareness of the value that a smart device can really bring to mobile users," the Asymco report suggests.

Nevertheless, on Nov. 1, NPD published a report that reveals that Google's Android operating system continues to chisel away at the market share of Apple's competing iOS and especially Research In Motion's BlackBerry operating system. The new numbers confirm what many had already suspected for the past two months: Android is clearly gaining market share from the iOS and even more at the BlackBerry, and some are now expecting the trend to accelerate going forward.

An astonishing 44.2 percent of all smartphones purchased in the last quarter were running Android, marking an 11 percent market gain, quarter-over-quarter.
Apple's iOS actually rose one percentage point to 23 percent, while RIM fell from 28 percent to 22 percent of overall market share between the second and third quarters.
"Much of Android's quarterly share gain came at the expense of RIM, rather than Apple," said Ross Rubin, executive director at NPD. "The HTC EVO 4G, Motorola Droid X, and other new high-end Android devices have been gaining momentum at wireless carriers that traditionally have been strong RIM distributors, and the recent introduction of the BlackBerry Torch has done absolutely nothing at all to reverse the exodus."
And overall, the year-over-year numbers are even more profound when you look at them even closer. RIM's operating system market share has declined a staggering 53 percent while Apple's slice has dropped less than 22.3 percent.

Over the MID (mobile Internet device) segment, Apple has a new lead over RIM globally as well as in the United States.
Canalys also reports that global smartphone sales rose a little over 94.9 percent from the year-ago period to almost 81 million units.
But Nokia managed to hold on to its leadership position with about a 33.1 percent global share of the smartphone market while Apple grabbed a 17 percent market share that bested RIM's 15 share share in the third quarter.
According to Canalys in the United States, Apple held a new lead over RIM with a 26 percent share gain.

NPD's next report is expected around Jan. 31, 2011.
Last month, Gartner's latest market research report had predicted that Google's Android operating system would be the market leader in the wireless industry by 2014. The prediction comes as no surprise to many industry observers.

And by 2013 or earlier, both the Symbian OS and Android are expected to comprise almost 60 percent of mobile operating system sales.
Gartner also expects that the two platforms will find themselves in a very heated battle for the top spot.
Thanks to increased vendor support from wireless carriers and mobile handset makers, Android should become the second-largest OS, following Symbian, by the end of 2010, which would be two years earlier than Gartner had predicted just a year ago.
Things are rapidly changing in the mobile segment, no question about that, and brace yourself for even more.
Less than four short years ago, Gartner had predicted that mobile apps developers would mostly work with Microsoft's Windows Mobile platform. Now we all know that that prediction from Gartner couldn't be further from the truth. Then again, making predictions in any technology sector ain't easy, let alone the wireless industry.
“Interest in Windows Mobile 5.0 has grown steadily, however, and it now attracts far more developers than any rival mobile operating system. This should improve the likelihood of IT managers being able to buy line-of-business mobile applications for the Microsoft platform. More than 10,000 developers are currently working on applications for Windows Mobile 5.0. Part of the reason for this developer momentum is Microsoft's programming model," said Nick Jones, vice president of Microsoft's marketing division at the time.
Fast forward to today and Microsoft isn't even listed in Gartner's top four mobile operating systems anymore. Some might want to replace Peggy Lee's original song of 'What a difference a day makes' to 'What a difference just four years make'...

"The global mobile OS market is dominated by just four players now: Symbian, Android, Research In Motion and Apple's iOS," said Roberta Cozza, principal research analyst at Gartner.
"Launches of updated operating systems — such as Apple iOS 4, BlackBerry OS 6, Symbian 3 and Symbian 4, and Windows Phone 7 — will help maintain strong growth in smartphones for both this year and next, and help accelerate R&D and innovation," added Cozza.
"But we sure believe that market share in the OS space will consolidate around a few key OS providers that have the most support from wireless carriers and mobile app developers, combined with a strong brand awareness with consumer & enterprise customers abroad."
Recent numbers revealed that mobile data traffic in the U.S. has more than doubled in the last six months, and the trend appears to be increasing.