Smartphone Wars

Apple vs. BlackBerry vs. … Android?

By Jim Woods and Paul Carton

The release of the Apple (AAPL) iPhone rocked the cellular industry last year, and some analysts are wondering if the release of Google's (GOOG) Android cellular phone operating system will have a similar impact.

The answer: Not likely.

According to a March survey of 3,597 consumers, the smartphone industry continues to transform into a two-horse race between Research In Motion's (RIMM) BlackBerry and the Apple iPhone.

While RIM currently dominates smartphone sales among consumers, the Apple iPhone has had tremendous success and continues showing momentum in this market.

Meanwhile, the longstanding woes of Palm (PALM) and its Treo are accelerating.

---

No one can predict the future, but at ChangeWave Investing we've got the next best thing -- the ChangeWave Alliance. Made up of 15,000 strategically positioned experts, the Alliance can let you in on opportunities and risks months ahead of the crowd! Click here to learn more.

---

RIMM on Top, AAPL Growing

In our March survey, RIM maintained its towering lead in smartphone market share, while second-place Palm continued its two-year losing streak. Palm has now lost market share in seven-consecutive ChangeWave surveys dating back to October 2006.

Within striking distance of Palm, the Apple iPhone continues to exhibit strong growth in the smartphone market -- jumping three points since our previous survey in January.

Consumer Satisfaction

If customer satisfaction is an indicator of future growth, Apple occupies the sweet spot. An extraordinary 79% of iPhone owners reported they're very satisfied with their iPhone -- a significant lead over second-place RIM and far ahead of all other major manufacturers.

In the chart above, we see the percentages of respondents who said they are very satisfied with their current cell phone broken out by manufacturer. Note that Palm once again ranks low in terms of customer satisfaction, with 22%.

iPhone Has Momentum Going Forward

Among respondents planning to buy a new smartphone in the next 90 days, 35% said they'll purchase an iPhone -- a whopping 12-point jump since the previous ChangeWave survey in January 2008.

RIM came in second, falling three points to 29%, while Palm took yet another hit, falling five points.

The Apple uptick may be at least partially attributable to the recent flurry of announcements regarding the iPhone's software development kit. Ten percent of respondents said this has made them more likely to buy an iPhone in the future.

1  |  2

next >>

Mobile OS -- Androids Among Us?

We also asked respondents which mobile operating system they'd like to have on the smartphone they plan to buy. As expected, the consumer market is dominated by Research In Motion's OS and Apple's OS X.

Note that Google's Android OS hasn't been offered to the general public, and it's still too early to gauge any impact it may have on market share. However, the current survey begins to shed some light on the potential for Android.

While just 2% of respondents reported they're very likely to use the Android operating system, 15% said they're somewhat likely -- indicating that there is some consumer interest in Google's latest brainchild.

However, based on the quickly evolving RIM versus Apple landscape -- and the fact that both companies have high customer satisfaction ratings -- Google's Android OS being truly competitive with the BlackBerry or iPhone's operating system seems farfetched at this point.

Android's potential market niche appears to lie with a handful of second-tier smartphone players, such as HTC. But with RIM and Apple sucking all the oxygen out of this extraordinarily competitive market, our survey suggests that Google's entry into the space will be anything but easy.

It's a Two-Pony Contest

In addition to the battle between RIM and Apple, there is a two-horse race between cellular service providers Verizon (VZ) and AT&T (T). Both are jockeying for the top spot in regards to market share.

Going forward, AT&T appears to be getting another bump thanks to Apple's recent flurry of well-received announcements. Due to AT&T's exclusive carrier agreement with Apple, when planned purchases of Apple products rise among consumers, so do planned purchases of AT&T products.

Thus, among respondents who plan to switch carriers during the next six months, 28% said they'll go with AT&T -- a three-point increase since January. Verizon registered a one-point uptick in planned purchases.

As the smartphone wars rage on, one thing has become clear: Consumers love their fruit -- especially Apples and BlackBerrys.

---

Let the ChangeWave Alliance take some of the guesswork out of investing and help you grow rich. Click here to make sure you're riding the next wave to amazing profits!

---

Paul Carton is the Research Director of the ChangeWave Alliance. Jim Woods is ChangeWave's Senior Editor. The Alliance is a network of 15,000 highly-qualified business, technology and medical professionals in leading companies of select industries. The Alliance is surveyed weekly on a wide range of business and investment research and intelligence topics.

<< previous

1  |   2