The recent reports of Android dominance Asymco based on an ITG Investment analysis seems to have created a firestorm of controversy as to the source and validity of the data, as well as implications for both Verizon and RIM. In the report, ITG stated that over a twelve-month period, the share of Blackberry smartphones sold via Verizon’s retail channels dropped from over 90% to under 20%. At the same time, the share of Android phones, spread amongst a number of handset vendors, grew to over 80%. Net-net, RIM is out of favor, and Android is Verizon’s proxy for the iPhone (separate from rumors regarding when and if Verizon will actually carry the device).
Now, Asymco went on to state that Verizon has three strikes against them due to reliance on Android and lack of the iPhone. This is an over-simplistic view. One point of contention is whether BB sales into Verizon are understated due to the enterprise channel. But this is beside the point. Android growth within Verizon is actually a good thing, freeing the provider from dominance on a single supplier and given Android’s broad hardware base, offering customers greater choice. One would expect a greater percentage of Verizon’s featurephone customers to eventually migrate to Android than the same percentage of AT&Ts. Of course, some of this will depend upon how Verizon chooses to stratify the Android market, and they’d be wise to do so.
The real question is what about RIM? A follow-up article went on to state that the company is doing well overseas, and that their new OS, QNX, has a bright future. Typical statements when things are rotten at home. A while back, in an open letter to RIM, I stated that time was running out. A year later, and I’ve not seen much progress. The form factor and user experience is losing favor amongst both consumers and those purchasing employee-liable devices for work, and even within the enterprise, these are the same individuals who will be shortly making purchasing decisions. For all the negative rhetoric about iPhone and Android security, current solutions seem to be ‘good enough.’
So, think of it as evolution in action… a quickening of the long shakeout. Over the past few months we’ve seen the Symbian Foundation close, re-absorbed into Nokia. The long-awaited Windows Phone 7 launch was successful, but I personally have not seen anyone I know with one of these devices. Samsung’s bada may have some traction, mainly overseas, and Palm has gone into hibernation within HP. I have hope for RIM, but the possibility that it will take its place as a dried up twig on the smartphone family tree grows stronger every day.
