In technology, disruption is born from users accepting "good enough" solutions. In the case of smartphones, right now users are buying Google's (Nasdaq: GOOG) Android phones not because they're clamoring for them, but because it's the best available solution.
That's a huge problem for Apple (Nasdaq: AAPL). Fool.com analyst Eric Bleeker acknowledges that Apple gets concessions from AT&T (NYSE: T) for exclusivity with the carrier. The company also eliminates extending its supply chain to get new components required to run on either Sprint Nextel's (NYSE: S) or Verizon's (NYSE: VZ) network.
However, recent studies show the blown opportunity Apple faces. The Yankee Group recently released a survey showing that 34% of smartphone users want to buy an iPhone. Contrast that with 27% saying they’d buy Research In Motion (Nasdaq: RIMM) BlackBerrys and 20% preferring Android-based phones. The Android hasn't risen to 165,000 activations per day (and growing) because users go to Verizon, Sprint, and T-Mobile stores wanting it; they buy it because it's the phone that closest matches the iPhone's capabilities.
Bleeker says that's a huge problem. He sees smartphones as a platform war, where both Android and Apple are building up an ecosystem of products supporting their mobile operating systems. By allowing Android to gain a base, Apple's giving developers a reason to create a large catalog of apps. Apple's allowing a powerful foe to build unchecked on three of the nation's largest networks.
As evidence of the blown opportunity, look no further than France and the United Kingdom. Apple has pursued a multi-carrier model in those countries and enjoys better mobile market share. In France, for example, researcher Gartner now estimates Apple's market-share percentage is 78% higher than its comparable U.S. percentage.
Bleeker believes it's a rare opportunity for a technology company to have such a large advantage in a field as large and lucrative as smartphones. It's in Apple's best long-term interests to capitalize now, while buyers clearly are favoring Apple as the superior option. The company's leaving profits on the table and allowing a rival to grow; that's a decision that'll come back to haunt the company down the road.
Watch Bleeker's full thoughts in the video below:
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