The position now held by Apple and Samsung in smartphones is unprecedented even in an industry known for consolidating profits.
Do you love your smartphone? Of course you do. It's transformed your life in the past five years (except you hate having to fish it from your pocket every time you just want to check the time).
Apple and Samsung love them too. The two consumer-electronics giants now account for a whopping 81 percent of gross profits in handset business.
IHS iSuppli analyst Lee Ratliff reports that in 2007, the year the iPhone was introduced, gross profits for the smartphone industry were $13.4 billion. Last year, they rose to $75.3 billion, or the equivalent of $116 in gross profit per smartphone. Click to read the rest of this article on EBN.
The difference between Coke and Pepsi and Apple and Samsung is that a technology misstep can have a pretty major impact pretty fast. Motorola (twice, I think) had the top spot in mobile phones. Nokia has, as stated, fallen far. In the CPU world, AMD has dropped a lot lately and may end up being nosed out by Arm.
Either Apple of Samsung or both could easily stumble and end up way down in the pack.
You're either with apple, or you're with the terrorists. There is no room in a CIVILIZED society for binary thinking. Only the weak of mind would limit themselves to two choices without considering the wealth of other possibilities.
Thankfully, products evolve and marketplaces shift to allow real competition to flourish. As mentioned in the article, ARM is the prime example of a third option disrupting the status quo. A duopoly worries too much about market share and less about what the customer really needs. Once this happens it paves the way for third parties to swoop in and make the old ones obsolete ... on that note, I guess I just predicted the impending downfall of apple and samsung.
I'd call it a dynamic marketplace. First, there was just one smart phone provider: Blackberry (and Palm Pilot if you needed a smart personal digital assistant and could get by without a telephone). Now both of them are swept to the side and we have a head to heat competition of smart phone providers. Is the "Innovator's Dilemma" playing out as we move from one provider to the next?
No reason to fret, Brian. All industries go through this consolidation as they mature, but the much dreaded dupopolies have a way of being themselves at high risk.
Look at the auto industry, as an obvious and recent example. In the US, the duopoly became GM and Ford. And yet GM at least, and Ford could have been there but squeaked by, just about went bankrupt. Seemed practically impossible.
The smartphone industry is a fashion industry. Fashion is fickle. Things can easily change from one year to the next.
January 2016 Cartoon Caption ContestBob's punishment for missing his deadline was to be tied to his chair tantalizingly close to a disconnected cable, with one hand superglued to his desk and another to his chin, while the pages from his wall calendar were slowly torn away.122 comments