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« Ok Smartphone Q2 Results part 1: SonyEricsson and Google | Main | Nokia Q2 Results 2011: 15 Years after Inventing the Smartphone, Finally The King Is Toppled: By Who? Apple's iPhone of course »

July 19, 2011



Regarding Samsung, news just came out that a Senior Product Manager from RIM just joined them. Might push them even further in the future and is another downward sign for RIM.

Earendil Star

Fantastic performance from Apple, a real innovator.
I am really curious to see what Samsung's results will be: I saw it's Galaxy Pad 10.1 and it's really gorgeous. This race is really cool to follow. We'll see!
And of course, I am really curious to see what will happen to Nokia... and if the bloodbath is confirmed, if TH Elop remains at the helm...
In any case, thank you Tomi for your insight!


Wow, quick on the draw tonight Tomi. Can't wait for final results from Sammy & Nokia. It's like the world cup final for phone geeks, only it happens every 3 mnths :-)



Are you beginning to understand Apple yet?

Just last week, you were still projecting Apple was down in sales and share from last quarter, and repeating foolish nonsense about delays due to SIM rejection. I didn't see any point in repeating what I told you long ago, which was Apple projected this growth long ago (due to CDMA, white iPhones, additional carriers, additional distribution at Apple Stores and other points). They foresaw the opportunity to switch to a Sep launch that would allow use of the A5 chip, have more software/capabilities such as iCloud, and be more competitive (newer model) at Christmas. It's obvious that Apple's perfect quarterly streak of annual market share gains continues.

So again, the cellular handset market is changing, and the way one projects it needs refinements. Beyond the basics of carriers and distribution (which of course are still important), Apps, iCloud, media content, and a family of tightly-UI-related devices of different form factors are driving purchases (and multiple purchases).

Tom Ross

Tomi, 19 million is Samsung's official smartphone sales figure for Q2. They released an earnings preview on 07 July 2011. Apple wins Q2.

For the full year the race will be interesting. Apple is 7 million in the lead. They'll probably lose Q3. Q4 might be a tie. I could see both companies approaching 100 million units by the end of the year.


Apple could be 4 times more valuable then ExxonMobil if their ability on innovating on computing where not smaller then their ability on creating competitors.

Apple created the market of personal computers but who dominated it? Microsoft. How? Why?

While Apple created what would be the base of next 30 years of personal computing Steve Job's jealousy with what he creates, his perfectionism and obsessive compulsive controlling behavior made it's software stuck into Apple's hardware limiting the possibilities of personalization and prices high. Knowing this, Microsoft stole Apple's OS and licensed (windows) it for free to giant hardware makers while Apple got stuck into a little niche market.

Now Apple turns the mobile phones market into a market of pocket computing devices (smartphones). But who will dominate it? We don't know but surely won't be Apple.

How? Why?

Steve Job's jealousy with what he creates, his perfectionism and obsessive compulsive controlling behavior made it's software stuck into Apple's hardware limiting the possibilities of personalization and prices high. Knowing this Google copied Apple's OS (Android) and licensed it for free to giant hardware makers while Apple got stuck into a little niche market.

Surely we cannot say that 20% of smartphones it a niche market. But we can bet that Apple won't have the same growth on cheaper devices markets when dumbphones be completely substituted by smartphones. As we all know, Android is having an excellent performance on cheaper smartphones. And there is another reason why Apple is going to create more competition: their tight control over everything creates pressure from the environment for new OSes.

So in the end all we can say is that story repeats itself.


On keeping too high margins while behaving unfriendly with many players Apple is always bringing trouble to themselves and closing themselves on a position that they must innovate or innovate to keep the lead. Which is bringing pressure over a competence that normally doesn't works fine under pressure. If they drop the ball, then they will be in trouble. And that is something that can happen soon or later as Steve Job's health is not very good and as the company still depends too much on him to many decisions.

Perhaps, the apogee on this quarter is the turning point for its decline.


I knew it and I can't wait to get the new iPhone this year^^
Soon or later they have enough power to push operators.

Yes, they paid one time fee and on-going royalties to Nokia but it's peace of cake compared to what they currently have. They can buy Nokia easily if they really want to.

It's better to keep fighting on Samsung cases because at the end if they win, Apple could probably get an exclusive deal agreement i.e. for latest (and cheaper) hardware components. And could sell two or three different iPhone types for different price-segments.

Jimmy Joe

One rumour I've heard is that the low-cost iPhone will the 3Gs which will receive a price cut whene the new phone is announces. It makes sense to me: it's a proven product and zero additional R&D.

Rocking Robin

Why isn't Apple releasing numbers for individual phone sales? iPhone 3GS is now going for equivalent of $20-$40 in some countries and even in America, it's $49 I think. Developing countries are snapping up this model. So to say these sales are just all iPhone 4 is lame. Let's get the real scoop on iPhone 4 sales..... anybody can sell or give away cheap iphones 3GS or androids at $20 a pop!!!

Tomi T Ahonen

Hi Joe, Earendil, Sonicnights, kevin, Baron95 and LeeBase

Joe - thanks. Yeah RIM is bleeding

Earendil - yeah me too! Sammy results have me almost awake at nights now as I am eagerly waiting for July 29..

Sonicnights - haha, good comparison, totally agree yes. We are witnessing tech history being made.

kevin - that was below the belt, kevin and you know it. I was not the only analyst who projected iPhone decline - in fact EVERY other Apple analyst that I saw, projected a decline, most of them a bigger decline than I did (And I said it was conceivable Apple would grow sales, due to Nokia collapse).

The reason for the iPhone growth was not CDMA phones, AT&T still outsells VZ by 2 to 1. The reason is not iPhone White. The reason is clearly Nokia collapse. Go to Apple's second best market after USA: China. Before February, Nokia market share was 72%. It is now 22%. Thats your bonus 1.7 million iPhone growth right there.

But I totally agree with you that the market is evolving and the tools to project it also need to evolve. I try my best and I dare claim I am still the most accurate forecaster of our industry - and we forecasters also all say, no forecaster can be 100% right and no forecast can be 100% on the money unless by accident. That is simply not the nature of forecasting haha. But honestly, kevin - which other source told you in mid-February that Apple would be taking market share from Nokia due to the Microsoft announcement? Can you show me one other source that said so by say Feb 18? Do you really mean to say, this blog is not mostly in the right ballpark?

Baron95 - yes, you are totally right and it is a significant point I should have mentioned. Apple's profitability is spectacular, driven by their huge desirability globally. But you also know I have an allergy against discussions about levels of profit (it is important to be profitable else you are not viable in the long run, but the AMOUNT of profit is more of interest to the investors than those who study the platforms). I do not want this blog polluted with pointless debates of today's evaluation of a given stock based on the latest gossip about some profits etc... But yes, in this case I could have mentioned it, you are right.

LeeBase - and so, if Apple releases an iPhone Nano, it is by your opinion automatically the appropriate time to do so, and perfect timing, because it is Apple. But for a professional analyst of this industry with far longer history with smartphones than Apple, cannot suggest that the timing for the Nano is perhaps earlier than when Apple releases it? A bit unfair I'd say :-)

Also you should remember, you read the blog - back last spring, when I explained why it was the right time to do the Nano, was that the format was like the 3GS but with some critical differences to create a new actual handset that is visually distinguishable. The business logic was valid back then, that the Nano could be done with roughly half price of what was the iPhone 4, and with roughly the same profit margin.

Then you make several statements that are simply not true. That there was no Nokia gift to Apple? See my comments in the above about China. Same is true of most European major markets. The evidence is clear that Apple's gain came out of Nokia's losses in those markets (and from RIM's loss in the USA).

And then your line that its apps not SMS that drives the iPhone success. Again, the evidence is overwhelming, many consumer surveys clearly say, even for USA based smartphone users - the primary use of the smartphone is SMS. And when selecting a smartphone, apps don't factor in the top 3 reasons in any markets. Sorry simply not true.

Thank you all for writing, please keep the comments coming, and tomorrow we do Nokia..

Tomi Ahonen :-)

Alex Kerr

The only thing Nokia seem to be doing right (other than making the N9, which Nokia have now sidelined despite receiving rave reviews across the tech industry including from traditional Nokia haters) is with their plans for S40.

S40 is imminently going to be turning into a smartphone platform when they stick Qt on it ("core to the next billion" as Nokia state, all on S40 handsets). The industry REALLY is not going to like this, and is going to have to be dragged kicking and screaming into accepting it has become a smartphone platform (I say that in a future tense, it's currently almost a de facto smartphone platform but I'll play conservative and say it's not there yet).

If anyone disagrees with the notion of S40 being a fully fledged smartphone platform - when it gets Qt - then I'd like to know why not exactly? I can't think of a way of escaping that designation. S40 has touch, an app store, hardware specs easily in the smartphone range, will have a smartphone level SDK and app platform (Qt), Nokia Maps on S40, everything really. It is not yet announced that it will have multitasking. If it does not then that places it on a par with every iPhone to date (which still does not have multitasking by any non-Apple-marketing-BS definition of multitasking). And is the iPhone considered a smartphone?

So...S40 will become a smartphone. And sell some vast number per year. Hundreds of millions, leaving Apple, Android et al way behind in it's dust. So what will that do then to the figures and statistics. I expect lots of "yeah, but...", "no, but...", and desperate, desperate attempts from people to attempt to avoid classifying that future S40-with-Qt as a smartphone platform, but as long as they do it will be the elephant in the smartphone-room, and will sit there staring down the industry until people admit the truth :)

So, Nokia will own the low end low-end-smartphone space, big time. In numbers it will win. At the high end? Who knows? Surprises happen and maybe their WP phones will sell in big numbers? Personally I doubt it, but stranger things have happened. So the fight we're really talking about in this article, looking forward, is the high end smartphone space.


Didn't mean to hit below the belt, but I questioned your comments about Apple in your earlier blog posts these past three months but you didn't respond, and then repeated them at least twice more. I take that as you thinking you're right when you weren't.

Apple had gains in China but those started last year (on a smaller scale). But is Nokia going to be the source of everyone's gains? That's ridiculous; RIM and SE surely haven't taken advantage. Most thought (even you) RIM would be the main beneficiary as it offers similar QWERTY-phones to Nokia, whereas the iPhone is different than Nokia's best selling phones. Companies still need to execute, and Apple did by offering the white iPhone (which even you admit is wildly popular in Asia).

Though I'm not an analyst, in comments on earlier posts, I said that Apple would grow, not shrink this quarter. Many non-pro analysts estimated growth (though no one went over 20m). One could easily say that all the pros are now flummoxed by Apple's strategies and execution.


Tomi - you missed an earlier comment citing a press release from Samsung saying they sold 19M smartphones in Q2.

Also - worth reading Asymco for Horace's take on iPhone sales ramp. Essentially - he says that Apple may have been inadvertently limiting possible iPhone sales with their rigid 12 month update schedule. By delaying an update they were able to keep ramping production higher this year and thus sell more compared to earlier years.

My questions to you:

1. Thoughts?
2. Does Nokia introduce a new flagship model every 12 months? My thought is that they are slower than this - maybe every 18-24 months.


@Bill: That linked article quotes an analyst's estimate of Samsung sales, not an actual Samsung executive or spokesperson.


@Tomi: Altho SMS is something that buyers say they want and use, it's not a big differentiator between smartphone handsets, except for those that want a physical QWERTY-keyboard, as all smartphones pretty much provide SMS.

In other words, SMS capability is now a given, just like voice call capability is a given; what will cause someone to choose an iPhone over some other handset are the apps, content and simplicity of the touch user interface, and to a lesser extent, the closely-related iPad, Apple support, and soon iCloud.


Thanks so much for posting these, they are fantastic! So bummed I missed what looks like a truly unique evening.


I just stumbled upon your blog after reading your blog posts wanted to say thanks.i highly appreciate the blogger for doing this effort.


I just stumbled upon your blog after reading your blog posts wanted to say thanks.i highly appreciate the blogger for doing this effort.

griffey max

For most companies, this amazing realization has yet to dawn on them-and I wonder when they will finally take notice.

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