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Apple Captures Record 91 Percent of Global Smartphone Profits: Research (cnbc.com) 196

Apple has captured a record share of profits in the global smartphone industry in the third quarter, according to new research, despite grappling with falling iPhone sales. From a report on CNBC:Third-quarter smartphone operating profit reached $9 billion globally of which Apple took 91 percent of the share, Strategy Analytics said in a note on Tuesday. This amounts to $8.19 billion for the U.S. technology giant. Apple has the highest profit margins in the smartphone industry thanks to a loyal brand following and the ability to price its iPhones at a premium. And the figures come even after Apple reported three straight quarters of iPhone sales declines. Sat a long way behind Apple is China's Huawei which managed to grab 2.4 percent of global operating profit share in the smartphone market, accounting for $200 million, according to Strategy Analytics. Chinese start-up brands Vivo and OPPO are in third and fourth place, both capturing 2.2 percent of global smartphone profit each.
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Apple Captures Record 91 Percent of Global Smartphone Profits: Research

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  • Sigh. (Score:5, Insightful)

    by ledow ( 319597 ) on Wednesday November 23, 2016 @11:44AM (#53347251) Homepage

    You DO NOT want the company you are buying things from to make record profits.

    It means that they are taking a higher percentage of your money than any of their competitors.

    You might want the company to have the greatest sales figures (not true of Apple), or the greatest proportional re-investment (not true of Apple), or the greatest customer base even (not true of Apple).

    But, like walking through Las Vegas... all that show and money to blow on things comes from one source... people like you paying over the odds for their products.

    • Value for money (Score:5, Insightful)

      by sjbe ( 173966 ) on Wednesday November 23, 2016 @11:54AM (#53347369)

      You DO NOT want the company you are buying things from to make record profits.

      As long as I'm getting what I consider good value for money I don't care at all if they are making a big profit. The only way Apple or any company makes a big profit is if people like what they are getting for the price. If it wasn't worth the price then they would be forced to charge less. Apple products are a completely discretionary purchase.

      It means that they are taking a higher percentage of your money than any of their competitors.

      Which is irrelevant if I am getting a higher value for my money as well. Obviously a lot of people think Apple gives better value for the money than the alternatives. You don't have to agree with them for yourself but that doesn't mean they are wrong.

      But, like walking through Las Vegas... all that show and money to blow on things comes from one source... people like you paying over the odds for their products.

      Clearly people don't find that to be a problem. Yes Vegas wasn't built on winners but people keep coming so obviously they feel they are getting good value for what they spend. If it's not your thing then do something else and I assure you nobody will care or think less of you for it.

      • by ghoul ( 157158 )

        Apple owes its success to the 2008 crash when lots of smart engineers were out of work and were willing to bet thousands of hours on writing apps instead of full time jobs. This created the App economy where Apple gets 30% of the cut but more importantly the apps drive the demand for the phones. People dont want to switch to Android as iOS still has the most and best apps and app developers dont want to switch as the paying public is on iPhones. Android users are more sophisticated and more likely to use a

    • "You DO NOT want the company you are buying things from to make record profits."

      Unless you're a CEO there or a shareholder of the company.

    • It means that they are taking a higher percentage of your money than any of their competitors.

      That depends on why you are buying it. If you are buying it as a status symbol, then the higher prices are a benefit, because they make it more exclusive.

      • My company just bought me a MacBook pro. I don't want to go out with it, because it is too risky with such a device. Really it feels like more of a burden than anything.
        • by mlts ( 1038732 )

          Slap a case on it, get some insurance, and use a secure backpack to lock it up when out and about. Travelon and PacSafe make some decent secure backpacks. For security on the machine, FileVault Pro, and have the user that unlocks FV different from your usual user. That way, an attacker is confronted with the much longer FV boot password user if trying to turn the laptop on, while your day to day user can have a shorter PW.

          • Yeah, but those "secure backpacks" will not present much trouble once the thief/robber has made it back home to their tools. They'll cut open that bag in a minute or two.

            My advice would be to use a cheap or heavily worn bag or backpack to falsely signal that the computer is cheap or old.

    • by Geoffrey.landis ( 926948 ) on Wednesday November 23, 2016 @12:30PM (#53347797) Homepage

      You DO NOT want the company you are buying things from to make record profits.

      Standard economic theory says that they will make record profits if and only if their customers believe that they are providing a superior product. So, yes, actually you do want to buy from a company making record profits: this is a sign that their customers like them; and, in this case, iPhones have been around long enough that it is a sign that their customers are repeat customers.

      • by ledow ( 319597 )

        Churches make record amounts of profit.
        De Beers makes record amounts of profit.
        Microsoft made records amounts of profit before they were sued for anti-monopoly practices.
        Perfume manufacturers make record amounts of profit.
        I'm sure Dr Dre makes record amounts of profit from his Beats.

        It doesn't follow that they offer a superior product to their competitors. What it tells you is they are deliberately over-priced and under-delivered. And what you've bought into is snake-oil.

        In terms of VALUE for money, you'v

        • It doesn't follow that they offer a superior product to their competitors. What it tells you is they are deliberately over-priced and under-delivered. And what you've bought into is snake-oil.

          I believe you've misunderstood what the products are in the examples you gave.

    • Re:Sigh. (Score:5, Informative)

      by vux984 ( 928602 ) on Wednesday November 23, 2016 @12:39PM (#53347905)

      If 2 companies are splitting the profits taken in a market 50/50 and one does a recall that wipes out their profit for a quarter, then the other company is making the same amount of money... but now has "100%" of the profit.

      This news is just a reflection of Samsung taking a giant loss on the Note7.

    • by hey! ( 33014 )

      It depends. Pretty much the goal of every business is to score a higher-than-normal profit, and there are a lot of ways to do that. Some of them are clearly unethical and unfair to consumers (Volkswagen). But a lot of them are beneficial to consumers -- like shrewd engineering, efficient manufacturing processes, and economy of scale.

      There is also the issue of design which is a subjective judgment for a consumer -- but which doesn't make paying a premium for that thing irrational. Quite the contrary. It

      • Most people get that. The thing people don't get is why people pay so much for the little bit extra that Apple puts into it. I mean, how much can you engineer a smart phone? I would have said ios is much smoother compared to a galaxy s3 but today android is just as smooth. There is an incredibly wide varience on what people will pay for those little small touches.
    • Interesting thoughts, but flawed.

      I like the idea of a company I've brought something from making record profits if what I buy from them is worth the money I've paid, then it's not over the odds.

      For example, recently I got work to buy an iPhone 7 (to replace my Samsung S5. Prior to that I had a Nexus 4).
      Wow, what a friggen awesome phone compared to my S5, they way iOS works is head and shoulders above Android (in my mind). Was so impressed with the device, I spent my own money to buy another iPhone 7 for the

    • I can somewhat agree but look at the stupid competition. Can't buy a cheaper android phone from china without a 60% chance of some kind of backdoor [arstechnica.com]. Also, given how Apple doesn't just discard updates for their phone after 6 months and trying to make the iPhone a black box really appeals to me.

      The constant interface between devices. A safer app store, abit shitty search for years. Its really REALLY hard for me to look at an alternative

      Hell, it was a Samsung phone I was looking to upgrade my iPhone 5 fr

  • by chispito ( 1870390 ) on Wednesday November 23, 2016 @11:49AM (#53347311)
    If that does not include their App Store profits, then it's even more significant.
    • If that does not include their App Store profits, then it's even more significant.

      Apple's software profits probably look like a rounding-error compared to their hardware profits.

  • by Noishkel ( 3464121 ) on Wednesday November 23, 2016 @11:57AM (#53347405)

    Digital Trends work worked out a while back that Apple makes about $288 in profit for each iPhone sold. The average Android device... well it varies very widely. But According to 'Pocketnow' it works out to only about $25 of actual profit per device.

    Honestly... Apple is really REALLY screwing it's customer base by selling them last years hardware in every new phone and just pocketing the profits. And for some reason people STILL flock to them.

    • by RightSaidFred99 ( 874576 ) on Wednesday November 23, 2016 @12:00PM (#53347465)

      Look, I hate Apple. I hope they go out of business, sell their headquarters, and the land where it stood is razed and salted.

      That said, the "last year's hardware" comment is a bit silly. I can be a hater and still be rational enough to say they make good hardware. Their hardware is cutting edge when released and their CPUs top shelf. Being in denial helps no one.

      • Well you say that, but from where I sit all of my Apple friends are actually getting very frustrated with Apple, especially given the new MacBook Pro and it's gimmick TouchBar. Hell... Apple straight up REMOVED features from the entry level MacBook, then added them back in an over priced 'Pro' model.
        • by lusid1 ( 759898 )

          I'm as disappointed as everyone else in the new macbook pro, but I also recognize that its a great machine that been incorrectly positioned. If they had positioned it as "The best Macbook Air we've ever made" it would be enjoying completely different sentiment in the press. We'd all still be wondering WTF am I going to get a new pro level laptop, but it would be easier to move on if they admitted outright that they were abandoning the pro market.

        • by mccalli ( 323026 )
          Wasn't aware the MacBook was a phone...
      • by kuzb ( 724081 )
        It's not silly. Compared to the hardware their competition is often using Apple devices ARE last year's hardware. They're about as cutting edge these days as a used 6 month old razer. To add to that, they make disposable products that are so anti-consumer that people are forced to replace these lemons more often.
        • by tsa ( 15680 )

          Have you ever touched an Apple product?

        • by Dog-Cow ( 21281 )

          Apple's phone hardware rates with the best available. Being a single manufacturer, they don't release as frequently as Android devices from half-a-dozen manufacturers do, so it might look like they're outdated pretty quickly. However, the hardware remains viable for years, and the iOS updates are optional, if you happen to be one of those who doesn't update because they don't want their device to feel slower. People hold on to iPhones for much longer than Android devices, so I don't know why you think th

      • Their hardware design is not "cutting edge". Their hardware efficiency and utilisation is.

        There's no arguing that Apple provides a fast and silky smooth experience to the user. But to claim that this is due to "cutting edge" hardware is laughable when most of their competitors regularly outspec Apple's products long before they are launched.

    • Digital Trends work worked out a while back that Apple makes about $288 in profit for each iPhone sold. The average Android device... well it varies very widely. But According to 'Pocketnow' it works out to only about $25 of actual profit per device.

      Honestly... Apple is really REALLY screwing it's customer base by selling them last years hardware in every new phone and just pocketing the profits. And for some reason people STILL flock to them.

      (Apple, circa 2015) "Here's our shiny new iTurd."

      *iLemmings buy millions of them*

      (Apple, circa 2016) "Here's the same iTurd, in Rose Gold."

      *iLemmings still buy millions of them*

      I'm not going to even remotely blame the company here when it's rather obvious just how fucking ignorant millions of their rabid fans are.

      • by Dog-Cow ( 21281 )

        Better to be a rabid Apple fan than whatever it is you claim to be. In fact, being a turd is better than being whatever it is you are.

        Seriously, your bigotry and unreasoned hatred is so last election.

    • my kid uses it as an always on instant social network with her friends. It's what keeps her on the iPhone. She wanted a Galaxy S7 last time she got a new phone but iMessage kept her on the iTredmill. Vendor lock-in for the win.
    • by mea2214 ( 935585 )
      People flock to Scientology which makes no sense either.
  • by NarcolepticPenguin ( 586989 ) on Wednesday November 23, 2016 @11:59AM (#53347439)
    From the article: Apple's closest rival Samsung does not feature in the Strategy Analytics report.
    • by edjs ( 1043612 )

      Probably because the Note 7 recall erased their profits and put them in a loss for the quarter. Including the loss is what pushed the mathematically correct but misleading headline that Apple earned over 100% of the profits we saw earlier.

  • Android commoditizes the remainder of the cell phone market, making margins slim. The revenue from Android is captured by Google in the form of advertising sales on their integrated browser/search instead of by the cell phone manufacturers.

    Own the platform, not the factory.

  • Despite the bendgates 'n whatnot, iphones has a very solid reputation for being reliable, secure and simple. You know, like a phone *should* be.

    People who make decent money have a tendency to seriously value their time and arn't willing to spend the time dicking around with their device to make it work.

    Buying an expensive item risks you overpaying. Buy a cheap item risks you buying something that isn't fit for purpose, and *all* the money is wasted.

    • by tsa ( 15680 )

      Besides that, an iPhone will still work perfectly after four years, while most Android phones are completely exhausted by then.

    • I just don't get what isn't simple about Android.
      • Well, off the top of my head:
        -You have to manually manage resources because applications can't be trusted to destroy your ram/battery. This is supposedly improved with Android 6 and 7, but there are very few phones that run those versions.
        -The interface is far from simple. Every major vendor wants to create their own spin on the UI, so putting two android devices side by side can still result in wildly different interfaces, making it difficult for people to help each other figure things out.
        -Assuming you

  • And yet they *still* say there is no way they could make any money if they built their phones in the U.S. Yeah. Right.
  • Apple, you've got $200 bilion dollars. Put $20 billion of that into finding a cure for cancer or spinal injury or something fucking useful. You know how much money you can make off a cancer cure? About $1 trillion easily. Because you can charge $100,000 per treatment (even if it's one injection) and the insurance companies will gladly pay for it because they are paying way more than that for chemo and other stuff associated with people fucking dying from it. Millions of people get cancer every year .. a can

    • Do you give 10% of your income to pay for finding a cure for cancer? If so, I commend you heartily.

      • And given the percentage [google.com] of Americans who identify as Christian I'd assume we'd have all these problems knocked out by the Churches.

        Yeah, I'm being an ass. Nobody likes to be reminded that people aren't really charitable. This is one of the reasons I'm a socialist. You can't have a functioning civilization based on people's niceness. It's too easily for a few assholes to put us all at each others throats. You can't give people the option to support decent human civilization. They'll trade it all in for
    • by ghoul ( 157158 )

      Far more than 20 billion is being spent on Cancer research. Its not a issue of money. Its just a difficult problem to solve. And by the way Cancer is not one disease. its a symptom of a disease like fever and many differnt things can cause cancer so cancer probably will never have one cure. You will need a cure each for all the thousands of things that can cause cancer

      • It's an issue of money. I am involved in research. $20 billion directly spent on cancer would help a little lot. You would be surprised at how little of the money people think is being spent on cancer research is being spent on finding novel treatments.

  • Comment removed based on user account deletion
    • by ghoul ( 157158 )

      The wealthy dont use apps. They have assistants (Trump doesnt tweet himself. He has 2 assistants to whom he shouts out his tweets and they tweet it). Its the assistants who are probably young interns making less than minimum wage, living in crappy shared apartments, surrounded by loads of money at work but having negative net-worths who spend their credit card limits on buying iPhones. Its the one thing in their lives which makes them feel in control. They are willing to skip buying groceries and mooch off

    • by Dog-Cow ( 21281 )

      If you think wealthy people (i.e. those who can afford good hardware) are going to go broke buying an extra life or whatever in a mobile game, you are so out of touch with reality that you probably should drown yourself in the nearest puddle.

  • ...to note that Samsung's profits for this year went up in flames?

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