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Is Apple Losing Its Smartphone & Tablet Shine?

If you've been keeping up with recent smartphone and tablet market research, you might be wondering if Apple's charm over consumers has begun to wear off.

Strategy Analytics last week reported that at 76 million units, Samsung shipped more than two times the smartphones than that of Apple's 31.2 million iPhones shipped in the second quarter of 2013. That gave Samsung a 33.1 percent share of the global smartphone market and second-ranking Apple 13.6 percent share, its lowest market share level in three years.

“The flagship [Samsung] Galaxy S4 model experienced solid demand in China and worldwide and helped to lift volumes,” Neil Mawston, executive director at Strategy Analytics, said in a statement. “Samsung's next major flagship launch is likely to be the rumored Note 3 model later this year.”

In all, Samsung grew 56 percent in the second quarter on a year-over-year basis. Meanwhile, Apple grew just 20 percent on the same basis — less than half the overall smartphone industry average of 47 percent growth, which brought about a record 230 million smartphone shipments in the second quarter of 2013.

“The current iPhone portfolio is under-performing and Apple is at risk of being trapped in a pincer movement between rival 3-inch Android models at the low-end and 5-inch Android models at the high-end,” Mawston noted.

Following on its smartphone market report, Strategy Analytics this week reported that Apple iOS continues to lose share in the tablet world as well. While miles ahead of Windows tablet share of 4.3 percent, Apple iOS share of 28 percent at 14.6 million iPads shipped is less than half that of market leader Android's 67 percent with 34.6 million units shipped in the second quarter. Peter King, director of tablets at Strategy Analytics, said in a press statement:

Android is now making steady progress due to hardware partners like Samsung, Amazon, Google, and white-box tablets, which, despite the fact that branded OEMs are lowering price-points and putting pressure on the white-box manufacturers, are still performing well. Apple iOS shipments were 14.6 million iPads in Q2 2013, which declined 14% annually. In the same quarter a year ago the first retina display iPads were launched, which could partly explain the decline as there were no new models in this quarter.  However, to compensate that, iPad Mini, which was not available a year ago [and is] now freely available, was expected to take the figure higher than 14.6 million.

To be true, Apple is hardly in danger of closing its doors. Its late July report on quarter three showed it sold 31.2 million iPhones, a record for the June quarter and up compared to 26 million in the third quarter of 2013. Apple further sold 14.6 million iPads in the third quarter, down compared to 17 million in the year-ago quarter, but certainly respectable sales.

Still, the company is one of the largest chip consumers in the electronics supply chain. In 2012, Apple dominated OEM semiconductor spending, according to IHS iSuppli, necessary in light of its then strong product demand and beneficial relationships with more than 150 suppliers.

Looking at 2013, however, IHS has suggested Samsung might overtake Apple in terms of semiconductor spending. Chip spending comes with influence over electronics design, demand, and supply. When products from an OEM with such a high standing as Apple see even a minor change in sales, the electronics supply chain feels it.

What are your thoughts on Apple? Has it begun to lose its shine in the competitive smartphone and tablet markets? How, if in any way, do you expect Samsung's and Android's gains to impact the electronics supply chain? Share your thoughts below.

53 comments on “Is Apple Losing Its Smartphone & Tablet Shine?

  1. apek
    August 1, 2013

    Suzanne, Nice analysis. I believe Samsung is certainly doing better than Apple presently. Samsung's cell-phone business profits alone beat the profits of Google as a whole company in this quarter. Samsung has benefitted most from Google's andorid OS. I still belive Apple is doign pretty well when it comes to sales of iPADs. Semiconductor spending is certainly going to be more in Asia in coming years unless Apple is able to offer lower priced iPHONEs in China and India which are big markets but with less well off consumers (who prefer cheaper and better of the available two options). 

  2. Eldredge
    August 1, 2013

    It is difficult to stay at the top – competitors always have you in their sights, both as role and/or industry models, and as the competitor to beat.

  3. Hailey Lynne McKeefry
    August 2, 2013

    Certainly businesses are price sensitive, which in turn impacts consumer decisions. For example, for those who want to connect with a work PC or notebook running Windows, the Apple iPad and iPhone make less sense. Many organizations are unwiling to pay the premium that Apple products demand. THis is nothing new–it's been the reality for most of Apple's lifetime.  As an iUser (I admit to having three regularly used Apple devices) i think that in the long run Apple will be successful.

  4. Hailey Lynne McKeefry
    August 2, 2013

    @Apek, I give Samsung a lot of credit for their marketing efforts which are aimed at makign their technology “cool”. Samsung has also been smart in terms of listening to users. Some of its newest products will be “dual SIM” so taht users can have a personal SIM card and a business SIM card… a huge win for those who don't want to carry two phones but want their personal lives separate from tehir work lives.

  5. FLYINGSCOT
    August 2, 2013

    From my own little world and what I see around me techy sorts are moving en masse to Android with Google Nexus doing quite well.  I recently replaced an Iphone with an S4 and I like the Samsung a lot more.  I reckon Apple will always have a cult following and do well but it will never lead the market again in smart phones.

  6. Susan Fourtané
    August 2, 2013

    Flyingscot, 

     “I recently replaced an Iphone with an S4 and I like the Samsung a lot more.”

    What exactly you like from the S4 that your iPhone didn't have? What iPhone are we talking about? 

    -Susan

  7. Suzanne.Deffree
    August 2, 2013

    I have a Android tablet and an iPad and there are design decisions I like about both of them. As consumer electronics moves ahead, as a whole, and more and more types of devices enter consumers' hands, we'll likely see Apple lead in some segments (maybe phones, maybe tablets, maybe both or neither) and other operating systems and companies take the lead in various other areas.

  8. _hm
    August 2, 2013

    I have recently marked Apple products are on sale and discount is as high as 10%. How much is this true? It looks like Apple is slowly trying to reduce margin and explring new consumers.

     

  9. Hailey Lynne McKeefry
    August 2, 2013

    @_hm, the fact that you say “discounts as low as 10 percent” is telling. Apple is notable for maintaining its prices… I see prices holding firm for hte most part. it's part of the “we're worth it” brand attitude.

  10. Hailey Lynne McKeefry
    August 2, 2013

    @Susan, you took the words right out of my mouth. I'd be interested in knowing how you thought the two cdevices compare.

  11. t.alex
    August 3, 2013

    I believe Samsung did try to learn and improve a lot on the user-friendliness. However, Android Playstore is a mess with lots of bad apps infected with malware.

  12. Wale Bakare
    August 3, 2013

    >>What exactly you like from the S4 that your iPhone didn't have? What iPhone are we talking about?<<

    @Susan, i have also seen many people going for S4 instead of iPhone. I would say a trending thing in smartphone world now – Samsung would enjoy its time in world markets just like Apple has been recently.

  13. Lavender
    August 4, 2013

    Hi, Hailey. Due to the brand effect and the existing technology advantage, I think Apple will still be a leader in smartphone and tablets in near-term. But, the situation facing Apple is very severe: Apple even suffered the first revenue decline in China, the largest phone market.

    It is reported that Apple is adjusting supply chain, however, I really show doubt to its future, and I think the supply chain adjustment may be too late. 

  14. jbond
    August 5, 2013

    From a business standpoint, I don't think apple is doing very well, their apps and programs aren't compatible with others and that is causing problems for them.

    A year ago I had an iphone and an ipad and that lasted 3 months, I couldn't get flashplayer and so many other programs on my ipad and iphone that I need not only for work but personal use also. I know have a samsung galaxy s3 but I plan to upgrade to the s4 soon. I also have the samsung galaxy tablet. I am able to use all the programs that I have on my laptop on my tablet and sync them to my phone. This wasn't possible with the iphone and ipod. With our company we have found that the apple products just don't work as well because of the lack of compatibility.

  15. Tom Murphy
    August 5, 2013

    I agree, jbond. Apple isn't doing very well. It has wowed us all by launching a stream of products like the iPod, iPhone, iPad, and iDon'tknowwhatelse, but it hasn't had another blockbuster product out of the gate since then.  It's time for something else, not just another iteration of the existing products…if Apple is still up to the challenge. Did the company need Steve Jobs to push its designers and developers?  Can it still hit that level of performance now that he's gone? 

  16. jbond
    August 5, 2013

    I think part of the problem is the fact that apple doesn't want to make their products compatible with other products. Until they realize that they need to be compatible they are going to continue to lose customers.

  17. Wale Bakare
    August 6, 2013

    I also have the samsung galaxy tablet. I am able to use all the programs that I have on my laptop on my tablet and sync them to my phone. This wasn't possible with the iphone and ipod.


    Apple needs to relax its overly shrewdness on its design strategy and focus more on the aspect of usable devices not only for the already established fanbase in developed nations. It's also a known issue in developing markets that iPhone users face difficulties of different forms – apps, iOS upgrading, networking and many more. All these impact negatively on Apple and resulting in majority dumping Apple's devices for Samsung's.

  18. kilamna
    August 6, 2013

    Of course.

    I think Apple is riding the momentum of recent years, just like GM Chrysler Ford did for many years.  Having said that it seems to me that they are giving up the edge as Apple's innovation (mostly in design) slows down and others catch up.

    I just got the iPhone5 a couple of months ago. My main point is that for many of the apps the screen is a bit small … other than that I am quite happy.  Since so much of what one can do on a smartphone is location based, and that often uses lots of data, I would like an easier way to turn location services on-off.

  19. afellios
    August 6, 2013

    In my opinion, Apple made a big mistake releasing the iPhone 5. They should have waited another year, worked on designing a much bigger screen and bigger battery than the 4s, and then unveiled an iPhone 5 that could compete with the Galaxy 4 and all the other bigger Android phones. The small screen is the #1 complaint of all iPhone users. The iPhone 5 only increased the screen by 0.5 inches. There are a lot, and I mean A LOT of iPhone 4/4s users like myself that did not upgrade to the 5. The 0.5 inch bigger screen and a little faster processor simply are not worth it. The 5 is a great phone for first time iPhone users, but for Apple loyalists, the upgrade was marginal at best. I myself am giving Apple one more chance. I do believe that they will come out with something in the 5 inch screen range sometime next year for the iPhone 6. This isn't an option for them, they have to do it or else the Apple die hards will begin opting for the 5 inch + screens and bigger batteries that Android phones offer. I have demoed the iPhone 5 and Galaxy 4 side by side and there is just no comparison. The Galaxy blows it away in screen size, speed, capabilities, and customization. This coming from a die hard iPhone user since the very first iPhone was released in 2007. Apple needs to make some big changes and step up their standards to the way it was when Steve Jobs was still alive.

  20. prabhakar_deosthali
    August 7, 2013

    For years Apple is known to bring something revolutionary.

    Now that the smartphones and tablets have become a commodity with so many players in the fray, I think there is no charm left for company like Apple to add something innovative to this product line .

    So a company like Apple has to now move to something different , something totally new where no one is even thinking to go.

    If Apple is successful in that then the soul of Steve Jobs will be really happy.

     

  21. Ariella
    August 7, 2013

    @prabhakar_deosthali  It's true that Apple faces a lot more competition in the field now, but I'm not certain that it has to move into something totally different. What kind of things did you have in mind?

  22. Ariella
    August 7, 2013

    @AzmatMalik About the small screens, I recently saw something about larger cell phones making a comeback to offer more screen space. With so many people relying on their phones for so much, the tiny screen is not so user friendly. 

    As for the location data, that has become a serious issue with many complex legal questions. NJ recently ruled that a warrant is needed to collect cell phone data location. But on a national level, the rule is the opposite.

  23. Wale Bakare
    August 7, 2013

    >>So a company like Apple has to now move to something different , something totally new where no one is even thinking to go<<

    That would be very difficult to achieve. If that looks promising, is Apple really very active in research field? May be it should just stick to its iPhone and perhaps iWatch.

  24. Wale Bakare
    August 7, 2013

    >>So a company like Apple has to now move to something different , something totally new where no one is even thinking to go<<

    That would be very difficult to achieve. If that looks promising, is Apple really very active in research field? May be it should just stick to its iPhone and perhaps iWatch.

  25. Ariella
    August 7, 2013

    @Wale and as Google already came out with the glass, perhaps it needs the iContactLens

  26. kilamna
    August 7, 2013

    I am not so referring to the government tracking (in this comment) as to the gobs of data (from the limited monthly allocation) that many location services gobble up.  I just want an easier way to turn off-on the location services.

  27. Wale Bakare
    August 7, 2013

    @Ariella, i personally dont rank Apple in class of Google because Google is strategically postioned well in technology business world.

  28. Nemos
    August 7, 2013

    Apple is in trouble because the iPhone 5 is lacking in performance compared to competitive products that are in the Market. Apple trapped in their strategy having “closed” products , from the other hand Samsung choose to have the same high valued price for their products as Apple did (and still does) maybe it is a wise move…. maybe not 

  29. prabhakar_deosthali
    August 8, 2013

    We must remember that Apple has a history of creating niche products with a wow effect. So even thorugh Steve Jobs may not be there but his underground team may be still intact and may spring some surprise new product something that may even surprise likes of Google!

    I do not want to imagine what Apple will bring  out next but I am sure that definitely will.

     

  30. Ariella
    August 8, 2013

    I admire you optismitic spirit, prabhakar_deosthali 

  31. jbond
    August 8, 2013

    I agree apple needs to come out with something new but they also need to relax and make their devices compatible with other devices and not just apple products. These two things would make a world of difference for apple.

     

  32. Hailey Lynne McKeefry
    August 8, 2013

    @prabhakar, very true. I heard a podcast recently that talked about the iPod–and that it took the existing media players and reinvented it. The iPad took the idea of a tablet computer and broadened its usefulness beyond the wildest imagining.

    On the other hand, it hasn't been a success only journey. I remember during my first stint with EBN in the early 1990s going to a press conference that introduct the Apple Newton, which was trying to create a market defining personal digital assistant. For a variety of reasons it never took off.

  33. Hailey Lynne McKeefry
    August 8, 2013

    @jbond, i agree that it would be good if Apple would play nice in terms of compataiblty but that particular approach seems entrenched in their DNA. Let's take a vote: Yes or no, do you predict apple will ever embrace operability? Readers, pleas weigh in!

  34. prabhakar_deosthali
    August 9, 2013

    My opinion is NO.

    Apple has kept its IOS closed and that is why the Apple products are almost immune to virus attacks. Even the App store is strictly controlled by Apple.

    As long as Apple has the large following it won't go for interoperability- It is not just in its genes!

  35. Wale Bakare
    August 9, 2013


    The reason why i would like Apple to relax security for inter-operability sake and  continual control of its market share.

     

    The Android smartphone operating system now claims nearly 80 percent of market share, according to the latest Worldwide Quarterly Mobile Phone Tracker report from International Data Corp. Samsung's figure for the second quarter of 2013 (79.3 percent) represents a 10-percent increase year-over-year.

    Apple's iOS, meanwhile, claimed 13.2 percent of market share, down from 16.6 percent during 2Q 2012. Windows Phone came in at 3.7 percent, up from 3.1 percent in the same period, while the Blackberry OS fell from 4.9 percent market share a year ago to 2.9 percent in the same period for 2013.

    Full piece can be perused here.

     

     

  36. Wale Bakare
    August 9, 2013

    According to IDC the table shows current smartphone market shares

    Source: IDC Worldwide Mobile Phone Tracker, August 7, 2013

     

  37. Ariella
    August 9, 2013

    @Wale thanks for the link and graph. We almost take Apple's dominance for granted. Certainly, this should make app developers think more about serving Android users and not always making the Android version come out later than the Apple version. 

  38. Hailey Lynne McKeefry
    August 9, 2013

    @Prabhakar, your point about corporate DNA is well taken. Change is difficult and needs real planning and though. When i first started really following Apple, they had cornerd the education market (a smart thing in that young people came out wanting to use the company's products) and graphics artists. The move to broad business platform,though, puts more pressure on the comany to play nice with others. it'll be interesting to see what they do to resist.

  39. Hailey Lynne McKeefry
    August 9, 2013

    @prabhakar_deosthali , oh and one more thought on security. I think the ineherent security advantage has less to do with the closed platform than it has to do with the relatively smaller number of users. Increasingly, malware makers are starting to create exploits aimed at iOS. Worse, there's a new breed of malware that is downloaded, senses the type of OS that is being used, and then loads the code accordingly. This shift means that it is more affordable and practical for hackers to target Apple products. I think the comfort of Apple users in their perceived security may be short lived.

  40. Hailey Lynne McKeefry
    August 9, 2013

    @Wale, thanks for taking time to share the charts….I picture really is worth a thousand words sometimes!

  41. Adeniji Kayode
    August 12, 2013

    @jbond

    You made good points there.

    There might be security in isolation but I don,t think it can be for long.

    Apple might have enjoyed this for long but I don,t think it can ever take them further beyond this level that they are.

    I agree if Apple will be compatible with other smart devices, It will enjoy more sales that its having now.

  42. Adeniji Kayode
    August 12, 2013

    @Hailey,

    Amazed at that but as at today, which OS would you regard as the safest?

  43. Wale Bakare
    August 12, 2013

    You could have a reliability on the safety of Linux/Unix OS over Windows for desktop PCs to a higher degree, even Firefox do have a Linux – Ubuntu OS powering a smartphone device in markets. While Apple's iOS seems very unique and less vulnerable to attacks. As for Android, an open OS to mass markets and large community of developers. Having such a huge geeks makes the system risky to attacks.

    Nevertheless, how do you see users' habits and behaviour to security generally?

     

  44. jbond
    August 13, 2013

    Unfortunately I have to say no but maybe in 10 years they will change their minds. I just hope it isn't too late.

  45. Hailey Lynne McKeefry
    August 13, 2013

    @Adeniji, Apple clearly still has the lead in the security world. I make my points, though, as a reminder that no one can rest on their laurels when it comes to cybercrime and malware.

  46. Mr. Roques
    August 15, 2013

    Apple has never been a leader in the market, they have a “niche” which is growing but they've never competed directly against the normal consumer electronics. (you can count MP3s as an exception).

    With the iPhone, they tried a different approach and soon, they were leaders in sales. With competition, they started to lose ground. In the tablets, something similar happened. 

    I don't think they can keep up with the demanding needs of such a huge base. They will reduce their market share to a more solid Apple fanbase. 

  47. Hailey Lynne McKeefry
    August 22, 2013

    @t.alex, to your point, i've seen stats that more than 95 percent of android apps have security holes that make them susceptible to malware. There are a lot of apps that deliberately install malware and adware as well, or download contacts and information from the device, of course. Then there's the exploitability of the rest. It would keep me up at night if i used an Android phone.

  48. Hailey Lynne McKeefry
    August 22, 2013

    @adenjiji Kayode, without a doubt i would put Apple iOS at the top of the list (actually iPhone, iPad and  macs across the board) However, safest and safe are two different things–and going forward i think this safest platform will be targetted. We are already seeing indications of that.

  49. t.alex
    August 23, 2013

    Hailey, with iPhone, it is still relatively safe so far 🙂

  50. itguyphil
    August 26, 2013

    That's not necessarily a bad thing. I think they've started to lose their luster because they wanted everyone as a customer. Not what they did when they were extremely successful, even without huge market share to back them up.

  51. Tom Murphy
    August 29, 2013

    Now that Google's Hugo Barra (VP for Droid) is going to China's Xiaomi, I wonder what you all think that means to China's ambitions in the global handset market?  Should Samsung be worried?  Apple?  Does this guarantee the global importance of Droid in the mobile market for the foreseeable future?

  52. speedo1456
    July 21, 2014

    We from Mafillia.com see them increase of Windows phone users. The main reason that people choose Windows operated phones can be viewed at this website. One of the reasons are the many bugs like “insufficient storage available” in the android phones. As we take a look at the new Nokia Lumia Windows phone we can see and know that the possibilities are endless because of  the compatibility and download possibilities of this system.

  53. itguyphil
    July 22, 2014

    The biggest reason I know of people abandoning Android devices is the terrible battery life. I know people that have had 3 difference Android handsets with the same exact battery performance issue after just a few months. It's extremely annoying at best.

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