Apple's sliding mobile market share

CNN
Wednesday, September 4, 2013 - 5:00am

 The iPhone and iPad make up more than two-thirds of Apple's overall sales. But the once-skyrocketing demand for both devices has begun to stall, and Apple needs to find new ways to stay on top.

Apple's next chance will come September 10, when the company is all but confirmed to be launching a new iPhone. Reports are split on whether a refreshed iPad is also on tap.

Apple is by no means in a dire situation with its mobile devices: Except for a few bumps along the way, sales for both the iPhone and iPad have mostly been rising. But Google's Android is growing at a much faster clip, and nothing Apple has done recently has been able to reverse the trend.

Losing market share: The iPhone's share of the smartphone market peaked at nearly 24% in the holiday quarter of 2011, according to research firm Gartner. But Apple's share dropped to 21% the next holiday season, and again to 14% last quarter. Android dominates the market with a 79% share.

Meanwhile, the iPad is losing its grip on the market even more quickly. Data from tech consultancy IDC shows the iPad scored more than 76% of the market when it debuted in 2010, but its share plummeted to 33% last quarter. During the same period, Android tablets nearly tripled their share from 23% to 63%.

Part of the problem is that Apple hasn't launched a new smartphone or tablet in about a year, while rivals release new devices far more frequently.

But there are other reasons for Apple's weakening grip on the mobile device market. An oft-cited issue: Apple has an innovation problem.

"[The iPhone and iPad] were revolutionary when they first came out, but [rivals'] products that are out there now are about as close to Apple's devices as they can be," said Scott Kessler, equity analyst at S&P Capital IQ. "The question is whether Apple is going to introduce products that are different enough from their competitors."
 

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