Google's giving 199%
David is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
Google’s (NASDAQ: GOOG) Android operating system has long had an update issue. It takes years in some cases for the latest version of Android to make its way onto the majority of devices in the wild. This means that although Google releases a new version of their operating system every year, sometimes even more rapidly, most Android users never get their phones updated to the newest version. On Apple’s (NASDAQ: AAPL) iOS platform over 80% of all iOS devices were running the latest version of their operating system iOS 5 within one year of its launch, according to Apple’s bragging at WWDC. Additionally Apple’s latest version of iOS, iOS 6 will be available on Apple devices going back to the iPhone 3GS and iPad 2, although all the new features will not be available.
The latest report from Google illustrates the wide variety of Android operating systems still in use. This report comes directly from Google and is a tracking of what devices accessed Google’s Play store in the two weeks up to August 1st. It shows that Android 4.1 Jelly Bean is up to .8%, while this is a tiny percentage; Jelly Bean was just announced by Google on June 27th. There are very few devices that actually run Android 4.1 at this point, the Nexus 7 tablet and the international version of the Galaxy Nexus. A few other stock Android devices will get the upgrade soon but after that it is up to manufacturers to update the thousands of Android devices. Ice cream sandwich, Android 4.0, which came out last year is now up to 15.9% of all Android devices. ICS has been seeing steady increases over the last year but with just 15.9% and now rendered obsolete by Jelly Bean, Google’s update cycle is far ahead of the actual OS rollout.
The most popular version of Android continues to be Android 2.3 Gingerbread, which was initially release in 2010 and last updated in 2011. Gingerbread was an excellent version of Android, it was the first version that I liked but it is now completely obsolete. Even Froyo, Android 2.2, the version of Android that came out before Gingerbread has 15.5% of the market, nearly the same as ICS.
Google continues to be more focused on gaining market share than building a unified ecosystem. In that regard Google is seeing ever more success. Canalys has just reported that Android has hit 68% global market share in the second quarter of 2012. This is up from 47% last year and the news is even better in the Chinese market where Android grew to 81% market share. This represents an 11% increase in the Chinese market in one quarter and further demonstrates the appeal of affordable Android smartphones. Globally Apple’s iOS platform dropped from 18.9% last year to 16.4% during the second quarter of this year.
Android had 199% year over year growth in China and shipped on 81% of the 42 million smartphones sold in the second quarter. Manufacturers of Android phones also got a boost as Samsung, Lenovo, ZTE and Huawei all outsold Apple in China. Apple is in fifth place for Chinese smartphone shipments after those four Android makers. Manufacturers like Motorola and Nokia have not been able to get on the Chinese juggernaut. HTC, whose US fortunes are looking ever bleaker had 389% year over year growth in smartphone shipments in China. As HTC retrenches, their future success will be closer to home in the Asian markets.
Globally Samsung is the largest maker of smartphones, followed by Nokia and Apple. Samsung and Apple are in strong positions for record growth in Samsung’s case and record profits in Apple’s case. Going forward as the smartphone market stabilizes and growth in emerging markets slows Google will need to shift their focus from one of market share to one of unifying their ecosystem. Apple has a very unified ecosystem and they keep their devices up to date for years, as will Microsoft (NASDAQ: MSFT) once they launch Windows Phone 8. Not only does the array of Android versions in existence have a negative impact for users but it also hurts app developers. When making an app you want it to run well on all the devices in the ecosystem. However with so many different types of devices running different operating systems optimizing applications can become a lengthy process. This degrades the user experience as certain applications will function better on different devices just because of the difference between Android 2.2 and 2.3.
There is no doubt that Android will continue to grow, internationally it will also continue to take market share from the iPhone. Windows Phone has thus far failed to catch on in any market and Research in Motion's (NASDAQ: BBRY) Blackberry continues to slide. With Blackberry 10 delayed until next year and Windows Phone 8 not launching on any current Windows Phone device the strongest competition Android will face comes from the soon to launch iPhone 5. However Android has the high end covered with devices like the Samsung Galaxy SIII and the HTC One X to compete with the iPhone 5 and they have the low end covered with devices from ZTE, Huawei and older devices from Samsung and HTC. This virtually ensures Androids continued market share gains thus it is time for Google to focus on turning Android into the ecosystem it deserves to be.
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