Re: Mobile phones & tablets thread
Quote:
Originally Posted by BleAivano
So if cheap phones will hurt your image and thus result in fewer sales, then why is Samsung doing so well?
They have both simpler and cheaper models as well as their flagship the S4, still they have the largest market share.
Samsung have efficiencies of scale and also have the advantage of being able to manufacture the entire phone in-house slashing costs because of their background as a component maker, something no other manufacturer can do. Elop recently talked about why Nokia never went for Android, it was because they could see from very early on, around the time the S2 came out that Samsung would utterly dominate the Android world. At the time Samsung were also the only smartphone maker with a huge cash surplus available for R/D and marketing other than Apple, the rest like HTC and Sony were and remain small fry.
Re: Mobile phones & tablets thread
Quote:
Originally Posted by Jag_Warrior
In seeking to recapture marketshare in China and other developing markets, if they go the route of offering phones that are perceived as "down market", Apple has to finely balance the benefits of increased sales with the risk of margin shrink and damage to the brand.
True, but in China and also in India they are under-represented if at all. In China they also have the opportunity to make profit in a market where Google isn't allowed to compete in terms of the revenue generating part of the business, ie apps and content downloading. I would have thought the opportunity cost of messing things up with China mobile are really quite significant.
I think Apple are probably happy where they are when it comes to Western markets, they make a much higher profit per handset than Google taking into account apps/content sales and that side of the business is fine. Tablets look like they're hitting a race for the bottom, something they are not interested in so declining iPad sales are probably not as big a problem as people make it out to be.
Quote:
Originally Posted by Jag_Warrior
I think the China Mobile deal will happen sooner than later. They do need that. From what I've read, China Mobile has already began work on an advertising campaign.
Lets hope so. Perhaps Apple will learn from Google's mistakes in China which have effectively lead to them being locked out of the market too.
Re: Mobile phones & tablets thread
Quote:
Originally Posted by BleAivano
So if cheap phones will hurt your image and thus result in fewer sales, then why is Samsung doing so well?
They have both simpler and cheaper models as well as their flagship the S4, still they have the largest market share.
Samsung have always made cheap mobile phones and have been doing so longer than they have made devices at the premium end of the market. They are able to develop in-house and have considerably cheaper manufacturing costs than Apple. Why is having the biggest market share so important? Why does this keep getting repeated like it is the key to success? Apple have recorded bigger profits in the mobile sector than Samsung in the last 12 months which shows they have a very different business model. Apple are investing in their brand and maximising profitability and Samsung are going for a wider reach.
Quote:
Originally Posted by BleAivano
Regarding Apple and Iphone they're aren't really that "exclusive" as they think it is, expensive yes but overpriced when there's S4's and HTC One's that are both better and cheaper.
I agree the iPhone isn't an exclusive product any more. I know more people with iPhones than any other phone so it kind of takes away the exclusivity somewhat. Your opinion though, that you can get an S4 or HTC One which is 'cheaper and better', I am afraid is a subjective opinion held by yourself. There is no correct formula to say why a phone is better than anything else in its range. I wouldn't stand here and say the iPhone is the best phone on the planet because it is obvious it has plenty of competition and different people have different tastes. The S4 or HTC One are not the best phones for 'me' or I would have had either. There are many reasons why different people choose a variety of top end mobile phones. Some people like a big screen and a spec list that puts some computers to shame. Some like reliability in an operating system. Some like a phone with a solid build and an aesthetically pleasing exterior to back up all its other attributes. An easy to use straight out of the box approach is appealing also. Some are brand loyal.... You cannot pin down as fact why any of the top phones are the outright best and I think it is best to leave that type of arrogance out of discussions like this because it gets us nowhere. Its horses for courses with all flag ship phones and my choice may not suit yours and vice versa.
Re: Mobile phones & tablets thread
Samsung is a proof that making and selling cheaper models of phones does not affect the sales of the flagship model.
The S4 is one of the best selling phones ever despite that Samsung also have cheaper models.
Imo Its better to sell a cheap phone then not sell a phone at all.
Why it is important to have a large market share? It kind of speaks for itself doesn't it?
The bigger market share Samsung have, the smaller share the competitors have.
Re: Mobile phones & tablets thread
Yet nothing creates as much enthusiasm and buzz than an Apple launch. They get more coverage than any other product. The article I quoted earlier explains very well the reason why market share is not important to Apple, so that speaks for itself. If samsung are occupying more market share but recording less profit, it makes little difference how much market they have. It's not like Apple are struggling for sales or product interest. They could take the easy route and start churning out crap phones for under a hundred quid, but they don't need to.
Re: Mobile phones & tablets thread
Quote:
Originally Posted by BleAivano
Samsung is a proof that making and selling cheaper models of phones does not affect the sales of the flagship model.
The S4 is one of the best selling phones ever despite that Samsung also have cheaper models.
Imo Its better to sell a cheap phone then not sell a phone at all.
Why it is important to have a large market share? It kind of speaks for itself doesn't it?
The bigger market share Samsung have, the smaller share the competitors have.
Despite the luxury of making many of its own components and having a large global marketshare in smartphones and handsets (33%), Samsung saw its mobile communications operating profit margin (Q2 2013) fall from 19.8% to 17.7%. Apple's operating profit margin for that period stood at approximately 34%. Without the impressive profit gains in the components business (up 71%), Samsung would have seen its Q2 profit growth fall rather flat. But things could always be worse. I read that Nokia's operating profit margin off the Windows Phone business was around 3%. :erm:
I'm not really disagreeing with your point about picking up incremental sales. But clearly, it is a balancing act. A company has to be very careful about allowing cheaper, lower margin products to cannibalize sales of more expensive, higher margin products. Oddly enough, in business sometimes it really is better to pass on an incremental sale, if that incremental sale is going to harm margins too much. Finding that balance is what Apple, Samsung and all the rest must do.
Re: Mobile phones & tablets thread
Of course the issue Samsung has is that they are running Android, which is freely available and not controlled by them. So if they didn't make the cheap end phones, someone else would, thus taking the sales away from Samsung, so they make them themselves and keep the profit - because they have to.
Whereas with Apple, they own iOS, and nobody else can use it on a phone so there's no risk of a competitor making a 'cheap' iPhone thus enabling them to have only high end models.
Re: Mobile phones & tablets thread
Quote:
Originally Posted by airshifter
This coming from the person that started the thread thinking the iPad would tank.
Thing is though, it's market share is tanking now that halfway decent Android tablets are available for well under £100, and really good ones for under £200. This xmas the shops will be full of sub-£100 tablets, some awful, some actually very capable machines. There's almost no compelling reason to spend two or three times as much on an iPad, unless you're already committed to their ecosystem.
iPads will most likely end up the same way as Macs: selling in reasonable numbers and making a decent amount of profit, but commanding a ~10% market share. That's not "tanking", I grant you, but given that Apple essentially made the form factor work after a few dismal efforts from others, MS included, that's got to be disappointing for them.
Re: Mobile phones & tablets thread
I can fully understand why people would buy £100 tablets as iPads are an extravagant purchase and quite an investment. Given the choice and if I had cash to burn I would have to still choose the iPad. I've used many tablets and we've tested many for work, however the iPad is by far the most refined experience I have used. The closest I have found is the galaxy tab, but even that falls significantly short IMO. It's what suits the individual though really and whatever takes their tastes and finances.
Re: Mobile phones & tablets thread
The HTC One is a decent enough phone. Does what I need it to do. Could not really care what it isn't good at, since I've coped do far in life without whatever it is it isn't that good at.
It's cheap. Which allows me to spend money on the things I value.
A phone is just a phone to me
I suspect that Apple disciples believe an iphone bestows upon them a degree of status which they feel is worth something it is not .
To me, they are simply image-obsessed tits.
Who gives a crap how profitable a company is, unless you have shares or work for it? It means nothing to anybody else.
Judging a product by the company's profit margin alone is a bizarre way to judge a product.
