The Macalope: A massive misunderstanding


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Who’s ready to get craaaaaaaaazy?!

Well, sit down, because Don Reisinger has used up all the crazy in this post telling us “Why Google has already won the tablet race” (tip o’ the antlers to Harry Marks).

No, no! You read that right!

It’s official, game over: Google has won the tablet market. Apple, Microsoft, and every other company thinking seriously about breaking into the space, move on. It’s game over.

“Breaking into the space?” You mean the space that Apple created three years ago and still owns? That space?

In order to not “break into” that space, Apple would have to invent a time machine and go back to 2010 to prevent itself from making the iPad. The Macalope’s not sure why it would do that, but that’s what it would have to do.

Some might read that and call me crazy.

Let’s just take the indefinite pronoun out of that sentence.

You’re crazy.

Sure, Apple is currently winning the tablet market when it comes to unit sales and market share, and those battles are important to win. But it’s Google – not Apple – that’s actually winning the war.

So, not only can Apple not win when it’s taking all the profit but not the market share, it can’t win when it’s taking both, but is not also taking someone’s imagination of what future market share will be. Boy, this game is hard when the rules are so malleable!

Let’s start first with the expectation of Android’s success in the coming years. In 2010, Android owned a little over 20% of the tablet market, according to IDC. In 2011, that figure jumped to 32.3%. By the end of this year, IDC believes that Android will own 48.8% of the tablet market.

And it’s not like market-share projections have ever been wrong before! It’s in the bag! Just give up already, Apple!

By the end of 2017, Android will hold strong with 46% market share, according to IDC, but iOS will drop to 43.5 percent.

If you believe IDC’s numbers, Apple will still own almost half of the market four years from now. Total fail. And allow the Macalope to suggest that there might be a slight margin of error in numbers that have been constructed from faeries, unicorns, and unadulterated elf crack.

Also, what about that 46 percent that’s “Android?” Yes, some of it will be straight Google Android, but much of it will be Amazon and Chinese forks of Android, which don’t directly benefit Google. And if Samsung chooses to fork Android, as everyone expects, Google’s share of that 46 percent will be probably be the smallest share overall.

That Reisinger doesn’t get that is astounding. And, at the same time, completely unsurprising coming from him. It’s a paradox.

If this sounds familiar, it’s because a similar scenario played out in the smartphone market. When Apple launched the iPhone in 2007, its iOS platfom was on top of the world.

That’s some cutesy phrasing on Reisinger’s part, possibly because he knows that, as Horace Dediu has pointed out, Apple only ever led the smartphone market for two separate quarters, both in 2011. Or possibly he doesn’t know that at all and just likes using imprecise terminology.

Actually, if the Macalope had to guess, he’d go with the latter.

In fact, last year, Google generated $2.2 billion of the $4.1 billion spent on mobile ads in the U.S.

Yeah, and, hey, which platform did that money come from? Because last time the Macalope heard (which was a couple of years ago), Google made most of its mobile revenue from iOS, not Android.

By 2015, that figure is expected to soar to $9.3 billion.

OMG THAT’S A BIG NUMBER! Well, it is until you realize that it’s a billion less than Apple made selling iPads alone last quarter.

So, maybe we’re all looking at things in the wrong way.

Well, you are. That we’ve already determined.

Yes, Apple is successful and yes, Apple will continue to make billions of dollars.

Billions of dollars more than Google. How do you not see this?

But the company’s market share will fall behind that of Android, giving Google at least a leadership position in the tablet space.

No! Wrong! Again, “Android” might have a larger market share, but Google will not.

It’s worth pointing out that IDC (which, along with Macworld, is owned by IDG) is also the firm that last year predicted 2012 would be the high-water mark for both Android and iOS in smartphones because WHOOO WINDOWS PHONE, YEAH! How’s that working out? Oh, turns out they’ve already revised Windows Phone’s 2016 estimated share from 19 percent down to 11 percent. Oops.

Still, the Macalope is sure their market-share projections in tablets are solid gold on which you can base a massive misunderstanding of market dynamics without concern.

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