updated 01:45 pm EST, Tue February 5, 2008
iPhone vs. rivals
Apple ranked third in the global hardware market during the fourth quarter of 2007, according to canalys.com, with its iPhone garnering a whopping 28 percent of the smartphone market. Smart mobile device shipments reached 118 million last year, up 53 percent over 2006, while converged device shipments of smart phones and wireless handhelds rose 60 percent to hit 115 million in 2007. Apple entered the market late in the year, and has thus far shipped only one device.
Apple's entry into the smartphone market in 2007 caused speculation about how well the company could fare in such a competitive market. Some rival smartphone makers scoffed at the prospect of an Apple-branded device achieving a 10 percent share of the total market after just one year of sales, a goal that Apple CEO Steve Jobs announced alongside the portable handset when the company announced the iPhone's forthcoming launch in January of 2007.
"When you consider that it launched part way through the year, with limited operator and country coverage, and essentially just one product, Apple has shown very clearly that it can make a difference and has sent a wakeup call to the market leaders," said Pete Cunningham, Canalys senior analyst. "What it must demonstrate now is that it can build a sustainable business in the converged device space, expanding its coverage and product portfolio. It will also need to ensure that the exclusive relationships that got it so far so quickly do not prove to be a limit on what it can achieve."
Cunningham elaborated on the Cupertino-based company's first cellphone, detailing key features as well as a potential roadmap for the firm to follow in the near future.
"Apple's innovation in its mobile phone user interface has prompted a lot of design activity among competitors. We saw the beginnings of that in 2007, but we will see a lot more in 2008 as other smart phone vendors try to catch up and then get back in front," he said. "Experience shows that a vendor with only one smart phone design, no matter how good that design is, will soon struggle. A broad, continually refreshed portfolio is needed to retain and grow share in this dynamic market. This race is a marathon, but you pretty much have to sprint every lap."