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Schiller: switcher momentum is with iPhone, not Android

updated 10:02 pm EDT, Wed March 13, 2013

Cites higher satisfaction figures, questions 'shipments' mentality

In a rare interview, Apple Senior VP of Worldwide Marketing Phil Schiller revealed research from Apple that showed that customers switch to the iPhone from Android at about four times the rate they go the other way. He also pointed out the problem that platform fragmentation in Android -- where the vast majority of users are running very outdated and insecure versions of the OS, and cannot upgrade without buying a new device -- and the overall poorer user experience, on the eve of Samsung's introduction of the Galaxy S4 smartphone.

The Samsung Galaxy phones have been widely acknowledged to be a legitimate competitor to Apple's iPhone 5, and has been duly rewarded for that by becoming the most popular non-iOS brand of smartphone. However, Samsung's sales in North America -- the largest market for smartphones outside China -- have recently suffered as buyers withdraw, waiting for the forthcoming new flagship, the S4.

Schiller pointed out -- in a move seen as "defensive" by the recently-down-on-Apple Wall Street Journal -- that real-world usage shows the iOS platform to be very healthy, questioning the reliance of publications and the industry to rely on "shipments" rather than end-user sales to determine "marketshare." He added that although Android units in total do indeed outsell the iPhone line, "Android is often given [out as] a free replacement for a feature phone," a factor that would also help explain the enormous disparity between "shipment" numbers and "usage" numbers, that often paint Android users as not engaging with any of the smartphone services their units offer -- including things like surfing the web, watching videos or online shopping.

Schiller promoted the iPhone as a better experience for users due to its hardware and software integration, pointing out that "when you take an Android device out of the box, you have to sign up [for] nine accounts with different vendors to get the experience iOS comes with," saying flatly that "the experience isn't as good as an iPhone" and that the disconnect between hardware manufacturers, carrier software (often forced on users, along with customized themes and limitations) and service providers "don't work seamlessly together."

He also assailed the importance of market-share figures generally. As someone with rare access to exact sales figures from carriers and his own company, Schiller said he wasn't sure that the "estimates and the modeling" of sales divined from shipment data -- since no other company apart from Apple actually gives out end-user sales figures -- "gives an accurate picture of it all." Apple's ability to dominate revenues in the global smartphone industry -- it currently gets about 70 percent of all income from smartphone sales -- would seem to support Schiller's view.

Apple's stock has declined precipitously over recent months over concerns about increased competition, speculator-planted stories that turned out to be untrue, and genuine impatience among investors who await the company's next market-changing innovative new product like a child at Christmas. Both the iPhone 5 and the fourth-generation iPad, while well-received, were seen as relatively minor updates rather than complete overhauls or reinventions. It will be interesting to see if the Samsung Galaxy S4 -- which appears to be a minor "spec bump" and refinement of the Galaxy S III -- will be met with the same indifference.

Apple's notorious secrecy about new products and release timeframes may also be hurting the company in Wall Street's view. The arrival window of the Galaxy S4 was widely known by February, giving investors time to work out strategy for capitalizing on the company's fortunes. Its debut next week will likely put increased pressure on Apple to bring out a newer model of iPhone before the first-year anniversary of the iPhone 5, which debuted last October.

Finally, Schiller commented on the trend among other phone makers to keep increasing the size of the display to sometimes-impractical levels. Despite conventional wisdom that the rise of large-screen "phablets" was to appeal to customers who could not afford both a genuine smartphone and a tablet, Schiller said he felt the bigger screens were a reaction to the iPhone 5's light weight and better battery life. "The reason that people are making their devices bigger is to get up to the battery life the iPhone 5 offers," he said.



By Electronista Staff
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Comments

  1. Bobfozz

    Fresh-Faced Recruit

    Joined: 07-28-08

    Wall Street's guesses

    your comment

  1. yticolev

    Forum Regular

    Joined: 05-22-02

    70% income?

    Revenue? Probably not. They must be referring to Apple's gross profits on cell phone sales. Income is a term without meaning here.

  1. Mr. Strat

    Forum Regular

    Joined: 01-23-02

    Had enough of Android

    I had Android from its beginning (G1). It was a nice ride. Then went to the G2X (possibly the crappiest cell phone ever made). It went downhill from there.

    But regardless of my personal problems with a crappy phone, the manufacturers and carriers are to blame for putting goofy skins on the OS and loading the phones down with crapware you can't uninstall. Android looks like it was made in somebody's garage. The interface and the apps are nowhere near as polished and well integrated as iOS.

  1. mattyb

    Addicted to MacNN

    Joined: 02-22-08

    The success of Android is good, especially for us consumers. It'll keep Apple on it toes. Personally, I know quite a few people who have gone from Apple to Android. I don't know any who have gone from Android to Apple.

    Where I live I could have had 16G iPhone 5 for 640€ (thats approx $830) or a Nexus 4 for 350€ (thats approx $450). Not a very difficult choice. The call charges per month would have been the same for either.

  1. wrenchy

    Forum Regular

    Joined: 11-03-09

    Originally Posted by mattybView Post

    Personally, I know quite a few people who have gone from Apple to Android. I don't know any who have gone from Android to Apple.



    My observations exactly. As soon as an iPhone user see's the Android Platform, they realize what they're missing and usually can't wait for their contract to expire in order to try out the superior mobile platform. That guy has his head in the sand. Schiller can Shill somewhere else.

  1. mytdave

    Fresh-Faced Recruit

    Joined: 08-16-00

    wishful thinking

    Schiller isn't wrong about integration, fragmentation, carrier forced apps, user experience, blah blah blah. However it doesn't seem to be helping Apple at all. My experience is seeing people migrate to Android, and unfortunately to Samesung.

    Is the iPhone crap? No. Is the iPhone inferior? No. Then what is Apple doing wrong? How about:

    1. Arrogance - watch out Apple, you're treading the line on becoming the new Microsoft. You're good at coming up with new products that people don't even know they want until they see it, but once it's out, you're really bad at adding features that people ask for.

    2. Screen size - people really do want something larger than 3.5". Anything larger than 4.5" is honestly ridiculous though. If it's more than 4.5" it's a tablet.

    3. Customization - and this goes back to arrogance - with the iPhone, it's Apple's way or the highway. With Android, you're far more free to customize your UI.

    4. Usability - we're in the 21st century now, there are plenty of people who can handle the concept of a file system. Give us access to the filesystem already. Make it an *optional* setting, so the default keeps the stupid people out, but otherwise, open it up damn-it.

    5. Printing - Apple screwed up with AirPrint big time. All Apple needs is Postscript in AirPrint and one simple generic PPD and suddenly iPhones could print to the vast majority of networkable printers. It is apparent that the market is not going to adopt the proprietary AirPrint, so give it up.

    6. iTunes - the god-awful interface. The most idiotic 'feature' ever is connecting one's iPhone to a computer with the intent to *add* (not transfer) content to the device only to be told that said iPhone was "synced with another computer" and will be "erased if you choose to sync with this computer". What kind of moronic system is that?

    Apple, don't stick your head in the sand. The tide is flowing toward Android. If you want to stem the tide, here's what you need:

    iPhone 6, up to 128GB storage, 4.5" screen, customizable UI (allow apps like 'HiddenApps', 3rd party browsers, etc.), setting to allow access to filesystem, fix AirPrint, extend AirPlay, and add other features people have been asking for, and restart your marketing (I haven't seen a decent iPhone commercial in ages).

    And "One more thing..."

  1. Sebastien

    Registered User

    Joined: 04-29-00

    I just love

    How MacNN/Electronista/WhateverNameTheyWantToUse puts in a 'Android Flawed' quote when it doesn't even exist in the article. Classy

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