Apple overtakes Android to pass 50% of US smartphone usage

Apple has overtaken Android devices to account for more than half of smartphones in use in the United States, giving the iPhone maker an edge over its rival as it pushes into sectors such as finance and healthcare.

According to data from Counterpoint Research, the 50% threshold – the highest iPhone share since its launch in 2007 – was crossed for the first time in the quarter ending in June. Some 150 devices running Google’s Android operating system, led by Samsung and Lenovo, made up the rest.

“Operating systems are like religions – never significant changes. But for the past four years, the flow has always been from Android to iOS,” said Counterpoint research director Jeff Fieldhack. This is an important step that we could see replicated in other wealthy countries around the world.”

Figures are based on smartphones in use, known as the “active installed base,” which Apple CFO Luca Maestri dubbed “the engine of our business” during an earnings call in July. .

This is a broader and more meaningful category than new phone shipments, which fluctuate from quarter to quarter and have already demonstrated Apple’s new strength.

The active installed base takes into account the millions of people introduced to Apple’s ecosystem through the used phone market, as well as those using iPhones purchased years ago.

Ben Wood, an analyst at CCS Insight, said: “It’s not that we’re seeing a great year where Apple increases market share by 10% or 15%, but there’s this slow burn where they’re quietly taking over shares every year.”

Android smartphones first hit the market in 2008, a year after the launch of the iPhone, and surpassed the iOS install base in 2010, according to NPD Group. In the previous three years, Apple never had nearly 50% market share, with sales being dominated by Nokia, Motorola, Windows and BlackBerry.

As Apple Chief Executive Tim Cook prepares to unveil the iPhone 14 on Wednesday, this milestone suggests the company has never been in a more competitive position despite persistent criticism that it has lost its edge. innovative.

The group’s fall event in recent years has focused much more on developments of existing gadgets than the famous product launches of company founder Steve Jobs.

Apple is expected to unveil the new iPhones at its first in-person event since the start of Covid-19, in Cupertino, California. Analysts expect better cameras and a smaller “notch” in the display where the sensors are held, as well as a more rugged version of the Apple Watch.

Under Cook, the iPhone, a disruptive product that spawned entire industries, made Apple the largest company in the world, with a market capitalization of $2.5 billion.

“Cook took what Jobs gave him and built an empire out of it,” Wood said. “Because anyone who buys an iPhone — whether used, third-hand, or fourth-hand — will likely donate money to Apple to buy apps, pay for iCloud, use Apple Music, or transact on Apple Pay. And it’s a model that no one else, really, has been able to replicate.

As iPhone penetration reaches saturation, Cook has branched out into film and TV, advertising and payments, fitness and health, leveraging a global installed base of iPhones that has exceeded 1 billion in 2020.

The result is a diverse set of “services” revenues that are consistently growing in double digits and delivering profit margins north of 70%, twice the profitability of its hardware business.

The number of people paying fees for this line of services reached 860 million in the June quarter, about double the number of Netflix and Disney-Plus subscribers combined.

Analysts saw plenty of room for Apple to increase market share as the rest of the world remains dominated by Android, largely due to its variety and low cost. Cook recently said the group had “set a June quarter record for switchers” – consumers switching from Android to iOS.

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