Analyst reports yesterday confirm a trend that has been long-recognized: Android phones are gaining smartphone market share rapidly. The days of this gain coming at the expense of BlackBerry and other lesser brands are over, since they’re all small potatoes, so it’s coming at the expense of the iPhone.
We know a few things about these market trends: The iPhone still seems to be dominant in wealthier areas, while Android is the new norm among the more common folk, and especially in emerging markets where BlackBerry was once the norm.
There are plenty of high-end, expensive Android phones that cost as much as an iPhone, but in macro sense what sticks out about Android is that you can get dirt-cheap phones running it. And yet, there’s something in the local culture (or maybe the water?) of Manhattan that drives even starving artists to the iPhone.
Based on what I’ve seen so far from iOS 7 and the rumor mill, I don’t see them being able to protect the iPhone in the long term. They’re going to need to come up with something new and different again, like the iPhone and iPad were when they were new. What can they possibly do in the iPhone 6 to grab the attention of people outside of Manhattan and San Francisco? It’s hard to imagine.
All this just confirms some more conventional wisdom: the iPhone is a luxury item, like a Mercedes Benz. Such products can be very successful, even if they’re up against Lexus and other luxury brands, but that doesn’t help them against the vast majority of users who can’t even think about spending that much.
Apple is responding with a lower-cost iPhone, due in the Fall, but this is treading on dangerous ground. Luxury brands run the risk of cheapening their image if anyone can afford them.