Is Android Paying Off For OEMs?

Lets face it, the only real phone debuts anybody cares about at the moment on the Android platform is of the Samsung variety. Even with HTC launching their One series in an attempt to recapture the hearts and wallets of once loyal customers its quickly become an afterthought. Caught square between the Galaxy Nexus, Motorola Droid Razr Maxx and the newly announced Samsung Galaxy S III its hard to anybody to get any more than a passing glance.

Apple and Samsung Duopoly

For all the huff and puff about Apple and Google potentially become a true duopoly I’d argue that there already exists a duopoly and its Apple and Samsung. According to a post on Engadget.com, Apple and Samsung combine to gobble up an astounding 99% of the mobile phone profits. That’s not a typo folks. Of course if you’ve been paying attention you will recall HTC, Motorola, LG, Dell, RIM and the like have all missed estimates and seen dip in growth. Outside of Apple’s iPhone 4S the next best selling phone, by a huge margin, is the Samsung Galaxy S II.

Arms Race

If you want the latest and greatest technology in your phone Android is where its at. Quad cores, NFC, HD screens, 16MP cameras, 4.8 screens, thin phones, 3D screens you name it and chances are Android has it in spades. The problem with Android OEMs is that they are all caught up in an Arms Race. Having the public’s mindshare almost entirely convinced that the iPhone’s user experience is head and shoulders above any Android device makes hardware OEMs focus on hardware innovation. Mind you, mindshare is definitely different from reality, but it doesn’t change perception.

It costs big time money to keep pushing ahead with new hardware components to build different models to cover the price and customer spectrum. Apple has the advantage of advanced planning and only a single device to procure parts for. When added to Apple’s recent heavy investment in components and their cost is driven down significantly. Android OEMs don’t have that luxury. They are all forced to keep up with the next company, Samsung releases a new screen display and everybody has to react and utilize the same or similar type of display to stay competitive. 4 inch screens were introduced and quickly came 4.3, 4.7 and now 4.8. All in the span of a couple of years. Yes the Android license is free but companies still have to invest heavily in engineering the OS to their devices and test upgrades for currently selling devices alongside  future devices. Apple with the iPhone and Microsoft with Windows Phone has shown that you can have an excellent user experience and generate strong loyalty without having to throw everything but the kitchen sink into your device. As long as Android is the preferred choice though of every OEM not named Apple, Nokia and RIM the race will only heat up and those who don’t already have strong brand loyalty will only sink further into the red. Every Arms Race produces its casualties though. It’s a truism at its finest.

Really if you’re an OEM and have turned your full attention to Android as the OS of choice and your results reflect dwindling market and mindshare is it really worth it to rely so heavily on something just because it allows you the freedom to do whatever you want with it? There is a reason why everyone who is successful is accountable to a mentor. The customer votes on what is valuable and what isn’t. Why continue to waist valuable resources to develop skins that nobody cares about? Why not innovate on the physical aesthetics. Or is that time not better spent on hiring outside counsel to evaluate the wisdom of the current strategic plan.

Wrap Up

Its clear that companies who lead the way in developing mobile tech like screens and chips have a leg up. Samsung does both of these two things and not so coincidentally they are dominating the Android market. Just like analysts and techies have a hard time seeing any other OS breaking up the Android/iOS duopoly the same should hold true for the Apple/Samsung duopoly.

The future is bright and booming in the mobile space but when was the last time you really looked forward to a phone that was not produced by Samsung? The last one I can think of is the Motorola Droid Maxx. HTC One X is a pretty good phone but still, in the minds of the consumers Samsung will reign supreme. It doesn’t help that Verizon in the U.S. likes to make Droid Does commercials and customers group up all Android devices together under the generic Droid moniker.

So what do you think? I’ve shared my views and would love to hear yours. Comment and lets get this thing called dialogue kicked into high gear.

Source: Engadget