Are Apple and Samsung the smartphone profit bullies?
Published: Monday, February 18, 2013 at 6:01 a.m.
Last Modified: Friday, February 15, 2013 at 6:16 p.m.
Let's face it, being the third wheel is no fun.
Who wants to sit back and watch others indulge in all the spoils? Just ask smartphone makers HTC, Motorola, LG, Sony, Nokia and Blackberry. How depressing must it be to see that Apple and Samsung raked in 103 percent of the handset profit in 2012.
It's like the bully punched you in the face and stole your gold chain.
How is such an absurd number even possible? According to research released by analyst Canaccord Genuity, former heavyweights Nokia, Sony Ericsson and Motorola accumulated 3 percent in losses while HTC coughed up a 1 percent gain. The others remained mostly flat, which essentially means they ran away from the bullies. Want the black eye? This is an industry that has been growing faster than a 9-year-old with a new pair of sneakers.
Is the war over supremacy really between Apple and Google's Android?
Well, all of those aforementioned punching bags make phones that run on Android. Samsung also makes devices that run on Android but are highly customized with their own TouchWiz interface. Samsung is more of an Android cousin than a direct descendant.
So what about the Apple vs. Samsung prizefight? Apple put a TKO uppercut on Samsung with a profit smackdown of 69 percent to 34 percent, respectively. Somebody tell that to the bellyachers on Wall Street who continue to declare that Apple is down for the count.
What does any of this mean to you or me? Actually, a great deal. We should root for the underdogs. Competition is a good thing because it means lower prices and more features. Haven't you noticed that manufacturers have not exactly been hitting techno-homeruns lately? In this arena, you want a little juice in your bats if you know what I mean.
So, who is going to step up to the plate and be that third wheel? It's not an envious position but being the doormat is certainly not any better. Will it be Microsoft who is teaming up with various manufacturers to run its new Windows 8 software? So far, it has had as much traction as a bald tire in a blizzard. There's plenty of cash to keep throwing fastballs but when it comes down to it, nobody seems to be swinging.
How about HTC? With its paltry 1 percent profit, it's essentially already in third place. Truth be told, my first smartphone was the original HTC Droid Incredible. It was a great phone and served me well. They make gorgeous devices and, in some cases, I like them more than my beloved Apple iPhone 5. HTC runs a highly-customized version of Android called Sense, which is a joy to use. Still, it is going to take better devices than the competition to get on base.
Google bought Motorola a year ago and you would expect that would have given it the leg up. Not so much. When it came time to produce the annual Nexus smartphone, which is inspired and infused directly with Google goodies, the contract went to LG. Say what? I am no expert, but I know Motorola does not pass the showroom test. Walk into any tech store and compare Motorola's devices with any of the others, and you will see what I mean. They just look weird. Sorry, but I don't want R2-D2 in my pocket.
Blackberry is back on the scene with its new BB10 operating system and a pair of hot new phones. Is there anything left in the tank? On paper, they look good and the early response has been positive. They are definitely the dark horse in this race.
Until then, if I were the competition, I would keep that gold chain tucked really securely under my shirt.
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