Android Hits 500 Million Activations as Apple's iPhone 5 Prepares to Launch

 
 
By Todd R. Weiss  |  Posted 2012-09-12
 
 
 

In a gleeful Google+ post, Hugo Barra, director of product management for Google's Android project, lauded the still-growing success of Android around the world.

"Today is a big day for Android ... 500 million devices activated globally, and over 1.3 million added every single day," wrote Barra in a brief but pointed post Sept. 11 on his Google+ page.

What he didn't note-and what he didn't have to note-is that the milestone was being announced on the eve of Apple's iPhone 5 launch Sept. 12.

That subtle dig at major rival Apple seems to be part of the very competitive landscape in the mobile device marketplace wars nowadays.

"Apple has been a great success," said analyst Maribel Lopez of Lopez Research. "Android, with all the [patent-infringement] lawsuits that have been going on between them, wants to demonstrate that they have great momentum and that their product is very strong and sells well globally."

At the same time, she said, the market is still very young and undeveloped, which means that more shifts and changes are likely to occur. "The interesting thing is that we're still in such early days of the market. Most people are still getting their first smartphones, or people are upgrading to new ones. So this is by no means over."

That's great for the market and for consumers, Lopez said.

"It's good to have a healthy competition between the two," she said. "It keeps innovation moving forward in the market."

Wally Swain, an analyst with Yankee Group, said that the market wars between Apple and Android actually are different, depending on where you are in the world.

"The numbers, the buzz is all toward iPhone now [due to the Sept. 12 iPhone 5 launch], and it is tremendously important for what future smartphones are going to be," Swain said. "But the bulk of the market globally is Android. The raw numbers are for Android, especially outside of the United States," in places like Asia and other regions where there is a huge Android bias.

Apple is certainly trying to counter the growth of Android with innovations and new devices such as the iPhone 5, but that could be tougher to do now since competitors are also bringing interesting new ideas into their devices and capturing the attention of consumers, according to analyst firm Ovum.

"Apple needs to do much more than the widely expected hardware revamp of the iPhone to lead in the smartphone market," Adam Leach, leader of Ovum's Devices and Platforms practice, said in a statement. "[Ovum] expects that the new iPhone will be Apple's most successful smartphone to-date. However, without a redesign of the iOS user experience and underlying software platform in the next two years, Apple will find itself in a position similar to Nokia and RIM, which found themselves with outdated smartphone platforms that needed replacing."

Apple can't rely solely on customer brand loyalty to keep its smartphones as popular as they have been since the iPhones debuted in 2007, according to Leach. "Whilst the company is still reaping the rewards of the brand equity of the iPhone, consumers are notoriously fickle when it comes to buying handsets. Without the continued innovation which we are accustomed to with Apple, the company risks losing consumer appeal."

Whether the new iPhone 5 can help Apple continue its past success will soon be seen, he wrote. "The iPhone re-defined the smartphone category in 2007, but it can't rely on past success to guarantee its future or rely on litigation to keep its competitors at bay."

The U.S. market for feature-rich smartphones is still expanding at a rapid clip, with two-thirds of new mobile phone buyers opting for devices that can do far more than their old-style flip phones, according to a study from Nielsen released in July. Google's Android operating system is the beneficiary of this surge, although the iPhone still holds sway.

"Android continues to lead the smartphone market in the U.S., with a majority of smartphone owners (51.8 percent) using an Android OS handset," according to the Nielsen data. "Over a third (34.3 percent) of smartphone owners use an Apple iPhone, and BlackBerry owners represented another 8.1 percent of the smartphone market."

Apple handsets have the highest manufacturer share of the U.S. smartphone market overall, Nielsen reported, but in June, about 54 percent of handset buyers chose an Android handset, compared with 36 percent who bought iPhones.

In May, an Ovum report projected that Android will dominate the smartphone market through 2017.

Ovum said it expects Android to hold 48 percent of the smartphone market by 2017, while growing at a slower pace than it has recently. In 2011, Android's share jumped to 44 percent, up from 2010's 17 percent. Apple is expected to control a 27 percent share in 2017, up from 2011's 23 percent share, with remaining smartphone players following at a good distance.

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