Don’t Trust Gartner’s Smart-Phone Market Forecast

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Apr 10 2011
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Bond ratings firm Moody thinks Nokia Corp’s (NYSE: NOK, stock) outlook is poor and reduced it to negative. It’s no brainer that Nokia’s position in mobile devices has been weakened tremendously especially in the current smart-phone business, not even Nokia’s adoption of Windows Phone 7 platform could raised much eyebrows. Maybe Moody’s latest rating was in following Gartner’s latest prediction that Nokia’s Symbian, once proud of its “Connecting People” tagline, is toast.

Interestingly although not surprising, Gartner predicts Nokia’s Symbian not only falling to Apple, Google, Research in Motion and Microsoft, but also vaporizing to a mind-blowing 0.1% worldwide market share by 2015. That’s 0.1%, as good as toast in the mobile market. But considering Nokia’s stock price is now less than US10 bucks a share and lost more than 40% since a year ago, there’s little reason investors are complaining now.

Nokia Connecting People

According to Gartner, the biggest winner is (*yawn*) obviously Google’s mobile OS, Android. Guess what, Gartner thinks Android would command almost 50% of smart-phone markets by 2012 – that’s one out of every two smart-phones globally (*whoa*). Heck, Research In Motion Limited’s (Nasdaq: RIMM, stock) OS, BlackBerry, would do better than Nokia although it would steadily losing market shares to merely 11% by 2015.

Who cares about Nokia and BlackBerry when the fight is between Google’s Android and Apple’s iOS. Surprisingly, Gartner predicts Apple Inc.’s (Nasdaq: AAPL, stock) iPhone iOS peaking in 2011 with about 19.4% market share before tumbling thereafter to 17.2% by 2015. But there’re more surprises in Gartner’s latest prediction. Microsoft’s Windows Phone 7 would spring a comeback with 5.6% market share in 2011, 10.8% in 2012 and a whopping 19.5% by 2015.

Gartner Smart Phone Forecast 2015

That’s right, Microsoft’s Windows Phone 7 would overtake Apple’s iOS in another four years – by 2015. But can you believe Gartner’s prediction? Is Gartner and IDC who share similarity that Microsoft’s mobile OS would emerge second to Google by 2015 realistic? Of course the obvious assumption here was that Microsoft will take over market share given up by Nokia’s Symbian so there’s no organic sales growth here on the part of Microsoft.

Didn’t Gartner forecast Windows would be toast by 2014 in its earlier prediction, not to mention the forecast that netbooks would be selling like hot cakes? Sure, maybe we should forgive Gartner and IDC because of the Microsoft-Nokia deal *grin*. Gartner somehow believe Apple will be interested in maintaining margins rather than market share. But Gartner should not presume Apple will not get aggressive in price-war.

iPhone vs Android vs Windows Phone 7

Was Gartner born yesterday that it didn’t know Apple’s strategy was to make the max profit on its latest iPhone model (iPhone 4) while let the older model (iPhone 3GS) take the role in eating up market share with slashed price? I would take the latest Gartner’s prediction with a pinch of salt, not because Windows is lucky that Nokia’s own Symbian is toast and Windows Phone 7 is better but rather because Apple has proven its pricing strategy works beautifully, not to mention Apple’s future iPhone model will always one step (some said two) ahead of other players.

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