19 Comments

Summary:

A little statistical analysis on a Friday never hurt anyone, right? OK, maybe it’s not your thing but Horace Dediu is great at it. And his graph illustrates why 180 million Apple iPhones could be used in the U.S. by 2017.

iphones

Apple’s next big opportunity may be in China, but that doesn’t mean the U.S. still isn’t a big market for the iPhone. As the country reaches smartphone saturation — the point where nearly everyone has a smartphone — Apple’s iPhone could account for a whopping 68 percent of the U.S. market by 2017, which works out to around 180 million handsets.

The figures come from industry analyst Horace Dediu, one of the best in the business from my perspective. And they’re not based on simple forecasts either. Dediu has a knack for leveraging statistical analysis that’s far more often right than wrong. The numbers for this particular forecast are based on Dediu’s research on smartphone uptake in the U.S.

This graph, for example, measures the historical smartphone penetration in the U.S. and Dediu found that sales of iPhones follow the same velocity as overall smartphone sales.

Asymco US smartphone update compared to smartphone penetration

Compare that to the curve for Android share, which rises significantly but appears to have peaked and may be in decline: Essentially now lower than the smartphone penetration rate.

Apple’s iPhone sales ebb and flow on a quarterly basis, yet the trend-line shares the same rate as overall smartphone sales. Add in a little more math and Dediu deduces a nearly 70 percent market share for iPhones in the U.S. once smartphone penetration reaches 90 percent.

Obviously, anything could happen between now and then. The fact that Microsoft’s Windows Phone is now on the rise — see the trend starting to reverse on the graph — could play a factor over time. Even a major market disruption in this space, however, would likely take several years to significantly change the smartphone landscape, so I think Dediu has provided yet another successful glimpse into the future.

  1. Sorry but I think phones like the $179 android based Moto G will destroy Apple and their high margins. Anyone who pays $600 for an iPhone in 2014 is an idiot. They aren’t worth 3-4x comparable android phones like the Moto G.

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    1. Not all phone purchase decisions are made based on cost. It is simply a matter of people being able to afford their preference.

      It could be argued that anyone paying $179 for any kind of Android device is an idiot, but that would be a very broad and inaccurate statement. Many people making those purchases do so based solely on cost and there is absolutely nothing wrong with that.

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    2. Nicholas Paredes Friday, December 13, 2013

      Just an idiot here… Perhaps my calculations are askew, but that $600 is about a quarter of my 2 year data usage costs. And, I tend to sell the phones for somewhere just south of $300 at the end of my use.

      Anybody who uses the word “idiot” in an assessment of tech, simply shows the level of their intellectual capabilities. Given that I make an iPhone a day, I doubt that the cost is truly bothersome. Your mileage may vary.

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    3. I switched from the $199 LG Optimus L9 to the $650 iPhone 5s. I miss some of Android, but I love my iPhone :) I can use it with one hand, it’s fast, it lasts all day, it has apps :)

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  2. Horace Dediu cheering for Apple? Shocking

    Let’s look at the market share in 2017

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    1. I must have missed the part where he was cheering: I see nothing but data and analysis here. ;)

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      1. Yap, and take the numbers one year before and we will have that in 2017 Android will have 90% of the market, but then it won’t be the number he would like.

        I repeat, let’s see the numbers in 2017.

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        1. Indeed, predicting market share four years out is insane. If we went back 4 years ago to 2009, what would the predicted market share of Symbian for 2013 have been? Hmm…

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      2. And, by the way, If you can’t see what the majority of posts Dediu cheers for I can’t do anything.

        80% of them are Apple is better, prettier, more successful than everyone else. He, with Gruber and Arment are the biggest evangelists around here.

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        1. “Cheering for”in this sense to me means simply backing something because of brand loyalty, blindness to alternatives, etc…

          Analysis with data that has been far more correct than incorrect is what I read from Horace.

          Put another way: what major mistakes has Horace made with his analysis over the past year or two? He’s not perfect, but he’s pretty damn good from an empirical standpoint unless I’ve missed something.

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          1. What data? This “report” doesn’t have any research data, he has applied a linear regression to “predict” what he likes, nothing more, nothing less.

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  3. Seems to me the Android curve shows a much more compelling story about stomping and predicts a path of stepper ascent if the forecast model growth.

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  4. Sure take a known fanboy and just dump his opinion on us without thinking about it for a minute.
    There are no more carriers to expand to ,most of the share growth comes from that and since T-Mo is relatively new there still are a few quarters that will be impacted by this expansion.
    If he had any intention of getting proper results he would have looked at the actual TAM not at the total US TAM since the iphone wasn’t addressing the entire market until now.

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  5. My biggest issue with this forecast is that it assumes equal availability of all platforms. APPL’s string linear growth in the US can be directly attributed to carrier support. As market share growth on ATT begins to slow – they added VZW… then Sprint.. then T-Mo. I bet if we broke out growth for all those carriers we would see logarithmic graphs on all 4 carriers (like we see overall for Android), when added up – become linear.

    There are no more carriers in the US for APPL to add – which will not help the change in iOS market share.

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  6. Just finished crunching the numbers and I am now predicting that based on the same trends the asymco observed, Apple will have 100% of the smartphone market sometime after he said they will have 68%!

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    1. lol, good that any one didn’t predict it will go over 100%.

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      1. Martians have smaller hands so Apple will dominate there thus conquering more than the 100% Earth has to offer.

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  7. Given the recent trends, iphone is more likely to have a 18% market share than 68%. My statistical analysis shows windows phone will be at 10%, android at 70%, iphone at 20%. The rest are negligible and within margin of error.

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    1. Is your analysis for the U.S. or global?

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