The smartphone is touted as the greatest innovation of this generation. With that, a formidable smartphone industry has risen and this business continues to expand both in terms of players with nearly 1,000 companies making these devices as well as in innovation. Even with this growth, few companies actually profit as would be expected. Some like Samsung actually register profits but the growth is beginning to stagnate. Some like Blackberry are clutching at straws, while others like Nokia, sigh.
A report by a Wealth management company Canaccord Genuity says Apple is doing just fine in this business. So much so, that Apple which currently holds 20% of the global smartphone business, saw a rise in profitability to 92% from 65%. The profitability was mostly due to Apple’s higher selling point of its devices, attributed to a shift, where Apple has overtaken Samsung in the high-end segment. Its rivals such as Samsung and HTC make up the volume in the high-end, mid-tier and budget segments.
Apple’s continues to affirm its stronghold of the high-end segment with the average selling price of its devices in 2015 at $659 from $624 in 2014, occasioned by the launch of iPhone 6 and iPhone 6-plus. The average selling point for Android devices over the same period is $185. Samsung, Apple’s main challenger in the high-end segment forecast a decline in its Q2 earnings attributed to supply shortages for the curved screens of the Samsung Galaxy S6 edge. We at Techweez think, the S6 edge should have been the flagship device. HTC on the other hand has witnessed lackluster sales with its HTC One M9 flagship device, which consumers viewed as an update to HTC One M8 offered in 2014.
Source: Wallstreet Journal