Winners and Losers of the Smartphone Industry

Recently we debated about whether or not Apple would win the current smartphone “war”. With real competition finally on the rise, how will Apple respond? What’s more interesting is analyzing which companies haven’t responded and putting all this data into easy to read flow charts.

This is what Horace Dediu has done on his blog, and it clearly shows the winners and the losers of the current smartphone race over the past two years. Nokia clearly is the biggest loser and Apple is the winner when it comes to profit share.

Although the data does not contain all market participants, the shifts in share are quite closely conserved with the vector magnitude (arrow length) and angle (direction) paired. Note how Nokia and Apple swapped Profit without too much impact in Units volume. Similarly, RIM and Sony Ericsson traded profits and volumes quite symmetrically. Samsung also took volume while Motorola lost it. HTC and LG did not change positions dramatically.

Finally, moving all vectors to the same origin leads to this view of share gain/loss over two years in two dimensions:

It becomes quite easy to see who the winners and losers are and by how much.

This model is only an observation of the shifts in market power and is not conclusive about where share was gained or lost, however there is compelling symmetry which also matches the intuition of observers.

Competition is great for consumers as it gives us more choice and also forces companies to innovate and get better. Who knows what the next iPhone 5 (?) will entail. Maybe it will actually be available in white?

What do you think of Nokia’s fall and Apple’s rise?

[asymco via DF]