Smart Phone sales

[Lennart Sorensen]

On Mon, Feb 07, 2011 at 03:07:36PM -0500, William Muriithi wrote:
> This is an interesting article.  What I found interesting is the
> profit graph at the bottom.  Seem like Apple is getting half of the
> smart phones profit share. That is despite selling only half of the
> android volume.  Since a non subsidized iphone cost $700 and most of
> the android phones cost $550 to $700, -Not a big price difference, it
> imply Apple manufacturing process may be far more efficient.  Its kind
> of odd, how they pull that out as all manufacture their phones from
> China.
>
> http://www.bbc.co.uk/blogs/thereporters/rorycellanjones/2011/02/android_topples_symb.html

If apple sells 1 million units of one model, that distributes the
development costs of the circuit board, custom connectors, case molds,
etc, as well as getting nice volume discounts on the screen and such.

If 2 million android phones are sold, but is spread of 20 models,
each one only has 100000 units to distribute those same costs over.
That's not nearly as profitable in the end.  The android phones may well
turn smartphones into a commodity.  Commodities are not where you make
huge profits however.

> The android market size also has another implication.  Its now highly
> likely that WebM may actually get entrenched at the expense of H.264

But apple and Microsoft have H.264 patent royalties to worry about
(customer interest doesn't matter nearly as much of course).

> Anyway, just thought it may be of interest to you

-- 
Len Sorensen
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