Apple's [AAPL] iPhone 5 could be the most important smartphone release since the original iPhone, with the world watching to see if its introduction will help beat Samsung down from what Strategy Analytics and ABI Research agree is that firm's number one position in the global mobile phone biz.
[ABOVE: Strategy Analytics figures, released this morning.]
Analyst reports this morning mainly make infuriating reading for Apple's iPhone team. Two out of three of these analyses put Samsung in number one position in terms of global smartphone and mobile phone sales.
The news may be gloomy for Apple, but it's a living Hell for Nokia and RIM, the latter's marketshare has fallen beyond redemption, while the former now knows it's in the battle of its life.
In brief, the reports claim:
Strategy Analytics: Samsung's first quarter put it ahead of Nokia in handset sales, and in front of Apple in smartphone sales. Global smartphone shipments grew 41 per cent year-on-year to reach 145 million units in Q1 2012.
Samsung shipped 44.5 million smartphones and overtook Apple to become the world's number one smartphone vendor by volume. Samsung and Apple together accounted for more than half of all smartphones shipped worldwide for the first time ever.
ABI Research: "The smartphone market delivered 142 million shipments in Q1 for a 38 per cent year-on-year gain and a -8.1 per cent sequential decline. Apple's 35.1 million shipments were supported by sales in Asia-Pacific, while Samsung's 83.4 million mobile phone.." (not just smartphone) "...sales displaced Nokia from the top position that it has held for over a decade."
Dissent from IHS iSuppli: "Samsung in the first quarter overtook Nokia to become the world's largest cellphone brand for the first time. However, Samsung remained in second place in the smartphone segment of the cellphone market, behind Apple."
Bad news for Nokia, indeed
The three reports all agree that Nokia is spiraling downward toward its very own judgment day. That firm's only hope seems to be to become the de facto gold standard for future Windows 8 smartphones. This at least will help it differentiate its products from the rest of the smartphone market, dominated as it is by a medley of Android players (principally Samsung) and Apple.
That Apple has been beaten from the smartphone crown will infuriate some in Cupertino's iPhone teams. Samsung's offerings are based on Google's Android OS, and knowledge of this as a "stolen product" will not sit well within the company.
Even though it hasn't been announced, released or hinted at, the iPhone 5 remains the biggest story in the smartphone sector, indeed, news on the purported device dominates the technology agenda.
This underscores just how important the new smartphone will be when it ships. The phone will likely be supported by inclusion of support for 4G, LTE, a much-improved version of Siri, quad-core processors, a much improved screen with graphics capabilities to match and inclusion of iOS 6 and iTunes music streaming, potentially over-the-air.
Open to question is whether the release will be enough for Apple to claw back its leadership position from its former ally, Samsung.
Apple should widen its offering
Part of Samsung's offering is that it provides an array of different Android-powered devices at different price points and equipped with different functions. That being said, it would be interesting if analysts broke out data on smartphone sales by price point, as I have a hunch Apple is scooping the majority of sales at the top end of the market.
That's the killer for Apple. It's iPhone range has diversified to include the iPhone's 4S, 4 and 3G, but that clearly hasn't been enough to woo enough customers at the lower end of the sector.
This means pressure will be on the iPhone 5 to claw back or at the very least consolidate Apple's second place position in the mobile market. And, to be fair, second isn't a bad place to be for a company which only entered the sector in 2007. Despite which, first is better, so what can the company do?
Apple's iPhone sales have been buoyed by the popularity of the device in the Asia-Pacific markets, principally China. Apple has previously articulated its strategy to embrace newly-emerging markets, particularly as its traditional (US/European) heartlands have begun to stall.
Emerging markets are different places. While premium-grade $1,000 smartphones such as the iPhone are evidently popular, many in these markets don't aspire to anything much more than a feature phone. Sales of the latter class of device have propelled Samsung to a wider domination of the mobile phone industry. They are also reinforcing Nokia in its darkest of days.
It makes sense to me for Apple to at least consider the feature phone market. While the company won't make a play for low-end mobile phone sales unless it thinks it can innovate within that space, there have been previous signs the company's put a little thought into doing just that.
Earlier this month, Shaw Wu of Sterne Agee said: "We have picked up evidence since 2009 of Apple working with smaller, as well as larger screens ranging from 4-inches to 12-inches that could be used in a future iPad, iPod touch, and/or iPhone or even MacBook."
Take the next step
Except, in the iPod nano, Apple is already working with even smaller screens. These screens already offer widget support. Some users wear them like a watch.
Perhaps its schemes such as these which occupied Apple CEO Tim Cook's mind when he talked briefly about the estimated 2.5 billion mobile phones analysts expect to see sold in 2015. 37 million iPhone sales may be impressive, but what can the company do to invade this low end market?
He also said: "What seems large to me is the opportunity. So what we're focusing on is the same thing we've always focused on, which is making the world's best products. And we think if we stay laser-focused on that, and continue to develop to the ecosystem around the iPhone then we have a pretty good opportunity to take advantage of this enormous market," he told Goldman Sachs.
Challenge, or opportunity?
Reading the tea leaves, to me it seems Apple has an opportunity to introduce a smaller, cheaper, connected communications device in order to scoop up sales in the feature phone space, particularly within emerging markets. The effect of such a move would be to widen its marketshare.
This would consolidate its position in the wider mobile phone industry, at a certain cost to its competitors, and, if executed correctly, would only enhance the appeal of its iPhone brand.
This could be wishful thinking, of course, but with Samsung now dominant in the smartphone and mobile space, it surely crosses Apple executive's minds just how they can fight back against the new adversary.
How likely do you think it is that Apple will enter the low-end mobile phone space? Does it really need to, or are iPhone sales at the high-end of the market all the company should or could aspire too? Let me know in comments below.
Got a story? Drop me a line via Twitter or in comments below and let me know. I'd like it if you chose to follow me on Twitter so I can let you know when these items are published here first on Computerworld.