Steve Jobs may perceive Android simply as a weed that is encroaching on his walled garden, but it is a persistent weed that has become resistant to Apple's weed killers. Android devices are multiplying much faster than many of us could have predicted, and it seems to be very likely that Android will be Apple's second Windows. A new, rather sobering report for Apple (Nasdaq: APPL) arrived today -- 25 years after Steve Jobs' departure from Apple, and 13 years after his return.
Apple has had an amazing ride over the past decade, with very few product flops and sheer genius inventions that propelled the company's market value beyond Microsoft's valuation. Now it appears that Apple and his Jobs-ness may have its first serious challenge on its hands. It's called Android, and it has already begun taking market share from Apple.
According to Comscore, Research In Motion remained the most popular smartphone platform in the U.S. in the second quarter of the year, but it lost 1.8 market share points, down to 39.3% in July 2010. Apple was second, but was also down 1.3 points to 23.8%. Google (Nasdaq: GOOG) was third with 17.0% and a gain of 5.0 points. Microsoft landed in fourth, with 11.8% and a loss of 2.2 points. If the trend holds up, then there will be more smartphone subscribers using Android phones than iPhones in the U.S., which could be perceived as a problem by Apple, and as a small victory for Google in the cat fight between the two companies. At the very least, it is a loss of prestige and market opportunity for Apple.
It is interesting to note that Apple has maneuvered itself into this "problem," as it is still selling all the iPhones it can manufacture. The installed base may grow, but the market share does not, and that may have further implications for the platform down the road ... for example, advertising opportunities (which Google is after). Apple may not care so much about this trend now, as iPhone users are heavy App Store users, and developers around the world still claim that iPhone users purchase more applications than Android users. As the installed base of Android devices grows, however, that may change, and the number of Android users could make up for this disadvantage at some point.
It is unlikely that Apple will open up its platform to other manufacturers, even if it has shown that it is willing to compromise on software development. But it does not take a genius to predict that Apple will have to find ways to push its iPhone platform into more channels and possibly more battles. As far as we can see, this may be a battle of Steve Jobs against the world, and even that may be a bit too much for Apple's CEO. Could Android turn into Apple's next Windows experience? Absolutely. It already has.
As a side note, 25 years ago, on September 16, 1985, Steve Jobs left Apple, which he often described as the worst day in his career: Not even 10 years after he had founded Apple, his own company ditched him, but they paid a high price as the company almost died. Jobs returned 12 years later, on September 16, 1997, and turned Apple into the most envied tech company on the planet.
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