Two years ago, almost to the day, the iPhone 4 was launched to widespread acclamation and the general hysteria which accompanies most Apple launches. Two years is a long time in this market, just ask RIM and Nokia, who between them shipped almost 50% of the smartphones sold globally in 2010. That was before both companies, due to both internal and external challenges, fell from prominence in rapid fashion.
At the time of iPhone 4's launch Apple was very much in the ascendancy and while no one could have predicted the alarming rate at which Nokia and RIM's sales would drop, the signs were already clear that the iPhone was unrivalled in the consumer space and was clearly the handset of choice. The product was launching to a market that was ready, expectant and starved of a genuine alternative.
The vast majority of those consumers, some of whom queued overnight to get their hands on the device, will have signed up to two year contracts which are now coming to an end. As they now consider what handset to opt for next, they are faced with a significantly different market than the one they were faced with two years ago.
The biggest single force which has shaped the market and impacted consumer choice has been the monumental tide of momentum which has built up behind the Android platform. Back in 2010 Android was the upstart, albeit one with significant backing. Now, it is the most widely deployed mobile OS - 68% of the phones shipped in Q2 2012 were based on Android, according to Gartner's latest figures.
At the beginning of August, Apple delivered, by its own other-worldly standards, disappointing financial results. Most notable amongst these results was the weak growth in iPhone sales, something Apple tried to counteract by claiming rumours about the iPhone 5 were leading to consumers holding out for the new model, rather than purchasing a phone which will soon be outdated.
Samsung, on the other hand, has been making rather more positive noises. The Galaxy SIII, introduced on May 30, was Samsung's most anticipated smartphone to date, attracting three million pre-orders. It has cemented the Korean giants status as Apple's main rival and Galaxy as the brand with a profile capable of challenging the iPhone. Apple's current model, the iPhone 4S, sold four million units on its first weekend on sale last year. However, just two months after the launch of the Galaxy SIII, Samsung announced it had broken the 10 million barrier, an illuminating statistic indicating that this device is no mere flash in the pan.
So what does this all mean for Apple, and those consumers now looking to review their handset options? Firstly, the market can no longer be characterised as Apple versus 'Up and Comers / Established companies in freefall'. In Samsung the Californian giant has a viable and dangerous competitor whose star is in the ascendancy. From the consumer's perspective this is now the first time that it can be viably claimed that the iPhone is not the best handset on the market. While Apple will continue to received support from its loyal fans, neutrals basing their handset choice on specifications and performance would be hard pushed to ignore Samsung.
All of this makes the next iPhone launch perhaps the most important in recent memory, and one which may answer the question about whether Apple can continue its unprecedented track-record of growth and innovation. Since the game-changing launches of the iPod, iPhone and iPad, many within the industry have asked where the next groundbreaking Apple technology is going to appear. It has been some while since Apple launches have been anything more than upgrades to existing products; while the next incarnation of the iPhone will not be a 'new' product, it will surely have to be the most major overhaul of an existing Apple product in some time for it to silence the doubters.
The stakes are clearly huge; with RIM's seeming demise, not only is there a huge opportunity in the consumer space, but the enterprise market, once the domain of the BlackBerry, is without an incumbent. From Apple's perspective the potential is huge, but so are the threats. Several new competitors loom on the horizon - perhaps most notably two giants from Asia, ZTE and Huawei. While their brand recognition and 'desirability-factor' may not yet pose any threat to Apple, make no mistake, these companies mean business. Both have shown an appetite for aggressive expansion and a competitive streak that is unlikely to dim any time soon.
'Upgrade Armageddon,' as the spate of contract renewals two years on from the iPhone launch is being billed, will provide an incredibly illuminating view into the true state of the mobile handset market. The market is more dynamic than ever before and, with the waning of RIM and the rapid growth of the Android platform, in a state of flux. For consumers now in the market for new handsets, this is no longer a one-horse race.
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