18 Aug 2014

Price Buckets vs. Market Segments

IDC - Smartphone Segmentation by Price

IDC announced their smartphone shipment estimates for Q2 2014 last week, but the chart above seems to have captured all the attention. Regular readers may already be aware that I am a proponent of usage-based segmentation, rather than price-based segmentation. However, data can always be useful when interpreted correctly.

12 Aug 2014

The AOSP Myth

ABI Research - AOSP
Source: ABI Research

A report from ABI Research estimates that Android devices held 86% of the smartphone market in Q2 2014. Of this, forked Android or AOSP devices (without Google services) accounted for 20%, while the rest were devices certified by Google (with Google services preloaded). Some analysts see this as a threat to Google and Android. In reality, there is virtually no competition between these two categories.

8 Aug 2014

The Devices & Services Myth

Apple - Hardware vs. Services

The "devices & services strategy", as coined by Steve Ballmer, has long been my pet peeve. This is because it clearly attempts to conflate two business models that are diametrically opposed to one another -- monetizing hardware vs. services. While my initial analysis focused on Microsoft, this applies to other companies as well. Of course, this hasn't stopped analysts from arguing in favor of the very same "devices & services strategy" for Apple. The lack of specificity in this argument has always amused me. So let's be specific and look at the avenues available to Apple for monetizing services.

4 Aug 2014

Xiaomi: Leadership and Demand-Supply Mismatch

Canalys - China Smartphone Sales

Canalys just reported that Xiaomi became China's largest smartphone maker by shipping 14.99 million units in Q2 2014. This data point is interesting for two reasons -- the first deals with their success in China, and the second deals with the state of their international expansion.

28 Jul 2014

Facebook and the Potential of App Install Ads

Facebook - Revenue Break-Up

This quarter's results announcement from Facebook underscored a now familiar trend -- Mobile advertising revenues are skyrocketing while the desktop advertising and payments business remain in a holding pattern. Jan Dawson from Jackdaw Research has a terrific collection of charts that summarize Facebook's financial picture. However, I disagree with his position Facebook's app install ad business.

24 Jul 2014

Benchmarking Xiaomi's Services Revenue

Xiaomi - Services Revenue

The most important takeaway from Xiaomi's Mi-4 launch was the amount of media attention it received. In response, some have begun to question the validity of Xiaomi's proposed business model. Interestingly, Xiaomi has been fairly transparent revenue from services. We can use this to benchmark Xiaomi's monetization performance with other leading in services players.

21 Jul 2014

Low-End Disruption in Consumer Markets

Low-End Disruption - Automobiles

Disruption theory has become a very controversial topic of late. This is especially true for what some refer to as the "theory of low-end disruption". One of the most common misconceptions about "low-end" disruption is that it is only applicable to enterprise markets and not consumer markets. The goal of this post is to highlight examples of "low-end" disruption and value chain evolution in consumer markets and put to rest a few other common criticisms of the framework.

15 Jul 2014

Analyst Estimates and the iPhone 6

iPhone Installed Base

Apple is widely expected to launch an iPhone with a larger screen later this year. As this is expected to be a major upgrade, analysts expect a mid-year slowdown in sales followed by a blowout holiday quarter. In line with this expectation, Canaccord Genuity has released their regional installed base and sell-through estimates. Data from 2010 to 2013 is estimated from Apple's actual sell-through numbers, while figures for 2014 and 2015 are projected. This data is could be useful to understand current regional trends and analyst tendencies.

10 Jul 2014

Xiaomi and the Premium Market

Xiaomi - Time Spent in Apps

Flurry just posted some interesting data comparing Xiaomi's users to those of the iPhone and other Android smartphones. We already know that Xiaomi's users download roughly twice as many apps as iPhone and Android users, but now we also have comparative data on engagement and user demographics. This data paints a picture that is very different from the popular narrative surrounding Xiaomi, i.e. it only caters to low-end, price sensitive customers.

8 Jul 2014

Wearables: Job-To-Be-Done

Activity Tracker Usage
According to a report from Endeavour Partners, "more than half of U.S. consumers who have owned a modern activity tracker no longer use it and a third stopped using the device within six months of receiving it". This trend is symptomatic of a larger problem -- the job that a wearable device does is still unclear to most consumers. This is the crux of the problem I see with wearables, as they exist today.