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  • Apple and the Market Share Myth

    April 16th, 2014

    Some believe that Macs were the most popular personal computers on the planet before Microsoft and Windows took over. But that was never true, not even at the beginning. In the old days, "real PCs" used MS-DOS and many were actually made by IBM. Sure, Macs were popular among certain classes of PC users, particularly those involved in content creation, but for many the Mac was just a fancy, overpriced toy that would never do real work.

    When Windows became dominant, Apple's minority market share really shrank. The success of Windows 95 convinced some to give up on Macs completely, since Microsoft and Windows were, to them, just as good, had more apps, and more users.

    Indeed, when Steve Jobs returned to Apple as the result of the decision to buy NeXT, the company he co-founded wasn't in very good shape. Some suggested it came to a point where bankruptcy was close, but Jobs made the right moves to cut expenses and discontinue non-performing products. The rest is history.

    It is true that the iPod became the most popular digital music player on the planet, and even in the twilight of that era, the situation hasn't changed, except that Apple and the competition are chasing a smaller number of sales.

    Besides, isn't the best iPod found in the iPhone?

    The theory has it that the iPhone took over the market, and Apple soon lost share to Android, particularly Android handsets made by Samsung. That was never true. The iPhone never held a majority position worldwide.

    Although the iPhone is a minority product, Apple controls the high end. Most of Samsung's success comes from cheap handsets, where meager profits are being made. No wonder Samsung's profits have been flagging of late, although that singular fact doesn't get near as much attention as Apple's presumed problems, real or otherwise.

    These days, the iPhone is the number one smartphone in some countries, though, particularly in the U.S. where the both the iPhone 5s and that alleged failure, the iPhone 5c, routinely occupy two of the top three spots.

    Things get a little screwy when it comes to tablets. The iPad took off real fast, coming to dominate a market that had gone nowhere before Apple got into the game. These days, surveys that claim to report tablet sales report that the iPad's share is slipping, and the combined total of other tablets covers a growing majority of the market.

    If you can believe them.

    So it was revealed as part of the documents released during the latest Apple versus Samsung patent trial that Samsung's own figures about tablet sales have been faked. An example is an alleged "top secret" document from the company that revealed sales of the Galaxy Tab tablet in 2011 were in the range of one million. This is quite a bit less than the data reported by such analytics firms as Strategy Analytics and even IDC.

    Samsung's gambit was to tout the number of units shipped into the channel, not actual sales, although you'd think the chickens would come home to roost eventually when dealers were left saddled with loads of unsold inventory.

    An even larger number of tablets fit into the "white box" category, no-name gear sold, or at least shipped, mostly in Asia, for extremely low prices. But if you check the tablet offerings at dealers selling consumer electronics gear here in the U.S., you'll find loads of cheap models from unknown manufacturers from which to choose — if you're looking for junk. Just a quick run through of Best Buy's online catalog revealed products from such unknown makers as Digital2 (or D2) or Visual Land beginning at a mere $59.99.

    Does anyone actually buy that garbage? And if they do, what percentage of those tablets are returned because they just don't work very well?

    This explains why some 85% of the tablets recorded online are iPads. Sure, the iPad doesn't command 85% of the market, or even close to it. I'm not about to suggest that all those cheap tablets do not exist, or that people aren't buying them. But they clearly aren't getting much use, for why aren't they showing up in those online surveys?

    Members of the media, however, will continue to pretend there is an honest-to-goodness tablet market, rather than an iPad market with lots of cheap competitors that few buy or, if they buy them, actually use on a regular basis even for email and browsing.

    True, some of those cheap tablets do seem to get favorable customer reviews, although I did catch this comment about the $59.99 D2 (Digital2), "I had called the company no one answer."

    Why am I not surprised?

    To be sure, I am not suggesting that the iPad's real market share is over 50%. But it may well be that a lot of the sales attributed to other brands amount to channel flooding and number fudging. Or maybe people do buy them, turn them on once, and put them away, realizing that you get what you paid for, and what they got was a hunk of junk.



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    One Response to “Apple and the Market Share Myth”

    1. […] “Apple and the market share myth: Some believe that Macs were the most popular personal computers on the planet before Microsoft and Windows took over. But that was never true, not even at the beginning. In the old days, ‘real PCs’ used MS-DOS and many were actually made by IBM.” — Read the article on technightowl.com > […]

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