Apple believes their customers browse more, buy more, and are just plain worth more than Android's. And they're saying so now. A lot.
It's commonplace now for an Apple event keynote to include a slide or two pointing out Google's struggle to get tablet-optimized versions of Android apps, or to get any sort of usage momentum. That makes sense. Unlike the raw marketshare numbers that so often consume the popular media narrative these days, usage is hugely in Apple's favor.
During their Q1 2014 conference call, Apple took those numbers to another level. They hammered them more times, in more ways, than ever before. They made a constant, concerted, and conscientious effort to position themselves as first and foremost in the areas they believe should matter the most to investors, developers, and ultimately customers. And just as much effort to position Google's Android as a distant #2.
The biggest, boldest claim came near the beginning — iOS 7 is the most popular operating system in the world.
That claim caused an internet-wide double-take, because pretty much everyone is used to hearing that Android enjoys a massive marketshare lead over Apple. The metric, so often repeated, has led to questions about whether or not Apple can maintain developer loyalty, much less exclusivity. By changing the metric of comparison from generic platform vs. platform to specific version vs. version, Apple is changing the conversation to what they believe really matters.
According to App Store numbers, 80% of iOS devices now run iOS 7. Apple compared that to "single-digit" adoption rates for the latest version of Android 4.4, KitKit. (Google Play numbers peg KitKat at 1.4% at the time of this writing). Although Apple didn't call it out, 4.1 Jelly Bean, released July 13, 2012, enjoys the largest share of Android adoption, 35.9%. The next highest is 2.3 Gingerbread, released December 6, 2010, at 21.2%.
Yes, given the very different platform models, it's absolutely an apples to oranges comparison, but that makes it no less valid. Marketshare numbers are next to useless, given the lack of segmentation currently in place in the industry — Apple has 0% of the under $400 phone market but a huge share of the over $600 market. There's an urgent need for better, more mature metrics. Absent that, Apple's making their own case.
The message here is that the sheer quantity of devices that make up the platform doesn't matter anywhere nearly as much as the value of the platform, be it consistency of install base, or engagement and even affluence of the customer base.
Usage numbers were once again front and center as well, with Chikita Insights quoted as saying the iPhone controlled 54% of U.S. smartphone web traffic and the iPad, 78% of tablet traffic. Apple, of course, pointed out that these usage numbers were far greater than the market share numbers, specifically calling how engaging and important that made them. They also singled out China specifically, saying 57% of mobile web browsing in China happened on iOS devices.
To show that where attention goes, money follows, Apple used IBM's numbers. iOS counted for 32.6% vs. Android's 14.8% in traffic — thats over 2x — and a 23% vs. 4.6% in sales — over 5x — on Christmas. Black Friday numbers skewed massively in Apple's favor as well.
The message here is Apple customers have more money and/or spend more money than Android customers, and merchants should want Apple customers to be their customers.
The carriers were given a reminder of that as well. Apple pointed out that, in the U.S., the iPhone accounted for a 41% share of subscribers during the quarter ending November, 2013. That's the value to carriers. Despite grumbles about the price of carrying the iPhone, it still drives customer adoption and sells lucrative service plans. Where average revenue per customer (ARPU) is king, iPhone's value still far exceeds its cost.
For developers, this was further re-enforced with numbers. Big numbers. 6 billion cumulative downloads. $2 billion paid out to developers in the December quarter alone. $15 billion cumulative, half of which was generated in the last four quarters. That says it's not only massive, but still growing massively. Apple cited Business Insider Intelligence, saying iOS has a 5x advantage over Android when it comes to developer revenue per app download, a 4x advantage for in-app purchases (IAP), and a 2x advantage for paymium (paid + IAP). Citing Distmo, Apple said the iOS App Store had a 63% to 37% advantage over Google Play in global app review. To complete the shock and awe, download stats were shared for some exclusive launches and apps — in the millions.
Apple called it a "superior marketplace". In other words, if you target Apple customers, you'll make more money.
And that was only during the prepared statements.
The Apple-is-doomed market and media manipulations didn't miss a trick in 2013, but this much is clear — Apple knows where they're strong, knows where their competition is weak, and they certainly seem more determined than ever to get their message out.
Whether or not we get a bigger iPhone 6 this year, or an updated Apple TV or iWatch this century, Apple is going to tell the story of Apple again — their verse, their history, and their core values.
And they're not going to let Android, media hit pieces, or market insanity get in their way.
Reader comments
Engagement, affluence, and value: The numbers Apple's using to show Android is #2
I thought Windows XP (or maybe 7) was the most popular operating system in the world? Anyhoo, reminding people why you are the king is probably a sure sign that the empire is crumbling.
Total Windows PCs, like total android devices, outnumber total iOS devices. The amount of smart phones being sold, however, is a massive. And a large share of a large share can out number many fragmented shares of even a larger share.
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Nokia S40 is the most popular OS in the world, with about one billion active users, followed by Windows XP or 7, both of which have hundreds of millions of active users.
A key thing to remember about marketing BS: If it is mentioned in an Apple keynote, it is very likely a lie, or a highly-contorted "factoid." Jobs established that culture, and the current crew is upholding it.
Are you counting embedded Linux and QNX? And those little chips in dollar store toys?
Apple, a crumbling empire? nonsense...
2013 Fortune global 500 = Apple #19 (rev=Bil$156 profits=Bil$41 #employees=76,100)
2012 Fortune global 500 = Apple #55 (rev=Bil$108 prof=Bil$25.9 #employees=63,300)
2011 Fortune global 500 = Apple #111 (rev=Bil$65 prof=Bil$14 #employees=49,400)
2010 Fortune global 500 = Apple #197 (rev=Bil$36.5 prof=Bil$5.7 #employees=36,800)
Even if they would stagnate or slip a little bit in the global 500 rankings next year, you couldn’t really talk about Apple "crumbling", and be taken seriously, at the same time.
Only problem with all of that is that Apple's lead is declining in every measure. In those measures were it lags, the gap is growing. Not a good trend.
The market is still growing so it's not a simple measure.
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'Apple is going to tell the story of Apple again — their verse, their history, and their core values.
And they're going to do it at the expense of Android.'
Doesnt mean its the correct verse, history and or core values. It just amazes me how apple can say things and people come up with how its justified lol. But to each his own
What did they say that was factually incorrect?
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Apple is a great company and all, but there will always be the competition from other companies. They slam Android because its there biggest competitor.
Nexus 5... enough said
Isn't Samsung a far bigger competitor then Nexus? And I think the key here wasn't that they were slamming android, but they weren't combating the negative market perception that android had left them far behind. That's true in terms of some numbers, but Apple is saying it's completely untrue, maybe even a relevant, in other numbers.
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Oh I wasn't meaning to bring Nexus into this! That's just my signature for all my mobile nations accounts :). You bring up a good point though. Samsung is the dominating force in android, and I think Google is trying to change that. There was a great article written on the Android Central side of mobile nations. As far as this article, I should have clarified. Apple gave the numbers they gave to show how much more relevant iOS is in their users lives against Android. Indirectly, they put Android down. I just don't want to come off as a jerk!
Nexus 5... enough said
Oh, no worries, sorry!
I think it was a double edged sword - numbers that made iOS look great, Android not so great. It grows their line, but also cuts Googles. It's targeted at investors nervous over Android's numbers, developers too.
I use an android tablet and phone. I buy lots of stuff from them and rarely use a "real computer".
But I'm in the minority, and Tim cook is right. If I were a business, I'd rather have 1,000 ios users looking at my stuff than 100,000 android users.
Great story!
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Totally agreed with this article numbers .. The issue is the competitor focusing on ppl who looking for device can do some unusual stuff and they call it innovation however in fact it can be done on jailbreaked iphone4 by any amateur developer !! lol
And the same competitor will neglect the system stability .. Security .. Apps quality .. OS updating and etc.
The customer culture will judge this competition.
Finally .. I think apple had one mistake only .. The iphone 5c .. I think if they release it with lower tech specification and really less price they will own the market .. TOTALLY !
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It might be me but it seems AAPL is getting just a little more disingenuous these days;
iOS7 is the most popular these days against Android 4.4, now I may have got this wrong and I'm happy to be corrected if that's the case. But should that say iOS7".0.5" has more adoptees than Jellybean 4.4? (I'm assuming 4.3 and 4.2 and 4.1 etc are variations on the same major codebase).
That would be like comparing iOS 5, 6, 7 v. Android 4.1, 4.2, 4.3, etc. The last "major" Android updates over the last few years have been "dot" releases.
...sort of. Numbering schemes are not standard across companies -- Android "dot" releases typically contain as much new functionality as an Apple full release, iOS6-iOS7 excepted. Android also releases much faster -- in the same time annual time frame where iOS releases one revision, Android will release 2-4. (4.3 was July 2013, 4.4 October 2013). Using your time period, from 2011 to now, iOS has released three revisions, and Android 9 (not including x.x.x point releases) in 2.3-4.4. That doesn't mean Android's schedule is better, just different.
Of course, a single iOS version is going to be more popular than any single Android version, because iOS has slower but far more coordinated release schedule. Complicating matters further is quite a lot of significant Android updates are wrapped up in Google Play Services updates, and are not counted in (or required to have) Android OS updates at all - many phones still on Gingerbread have received significant updates, though technically not in OS level.
It really is an Apples and Oranges comparison. Apple is not being disingenuous here -- they are marketing, spinning the numbers in the way that makes them look best - just like Google/Samsung/any Android OEM will spin them the other way. It is what companies do.
Typical Apple marketing bla bla.
Rene, I would like to ask about your opinion about something. In short Serbia, land with more than 120.000 iDevice users, still don't have iTunes and App Store and they even don't know when it will be available. We are paying so much money for having iDevices and Mac devices and we don't have any chance to buy software legally. Don't you think that APPLE will loose market with 120.000 costumers or it will finally do something about that?
The strangest is that we have official APPLE RESELLERS and still there is no iTunes and App Store!? If you wanna more costumers and happy users, then you need fast do to something about that.
Apple's numbers are generally irrelevant to journalist, this site excluded, and casual investors because they describe the salient nuance of Apple's position. The most telling number quoted above is that they don't compete in <$400 market and excel >$600. McDonald's market share is irrelevant to mid market chains like Chili's or high end eateries like Le Bernadin because they don't directly compete for the same customer. Gross Android installations skew the numbers because it is on both low and high end devices and is further segmented by aging versions. As a intelligent investor, developer, advertiser, etc you need to understand that iOS is more specialized than Android....not better or worse....but just occupying a narrower segment of the market and one that tends to spend more money. Android competes in this segment as well, but as pointed out, Apple dominates....for now. As a sales & marketing manager you may get a lot of traffic putting your Tampon ad on a Guns & Ammo website, but you likely are not targeting the right group to click through. The numbers Rene is quoting are just there to help you know where to put your Tampons.
Interesting article. But why talk about a competitor on keynotes. Focus on what you offer.
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And Apple makes their move...
Personally, I don't agree with promoting one's company at the expense of another but I guess this is just common practice for businesses.
This operating system comparison is not totally fair. Android pushes a lot of functionality that is part of iOS (like the calendar) through app updates. These can be received on various Android versions.
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Thank you for the detailed and informative article Rene, I always like how you try to keep it impartial and objective. I find the analysis very interesting
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Ithink this article is correct, as even when apple "looses" market share somehow they are still making great $ numbers as they are perceived as the BMW of technology the people who buys their products has interest and cash to buy their content! Which is not the case on android where SOME people buys content while the bigger part just wants a phone that can run social apps....
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As always, Apple is the king (queen?) of cherry-picking statistics.