Apple wins a battle over Nokia

15th November, 2009 by Adina
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Apple is considered to be the most profitable phone manufacturer in the United States, although it only has 2.5 percent share of the market and only makes two similar models of its iPhone. Apple’s profit from cell phone sales in the summer was about $1.6 billion, while the market leader Nokia only generated $1.1 billion and came second this time. Despite being one of the most experienced phone producers, Nokia was surpassed by Apple, the latter entering the business in 2007 only. Analysts revealed the big volume of sales, the high price and the low production cost of Apple’s phones, as well as the fact that all these were achieved in only two years of activity in this market.

The major discrepancy between Nokia and Apple stems from the first one’s flat market share, with an increasing trend in its line-up oriented towards low- and mid-range regular phones sold in larger numbers but generating small profits. The Finnish firm had few sales in the United States that is rather considered to be Apple’s homeland. Nokia sold its best devices in the United States only months after shipping them to Europe or only as carrier-independent and full-price handsets, which do not sell very well in the American market.

Nokia could recover if focusing on the American market, taking Motorola as an example. Motorola’ Cliq and Droid are models that create four times as much profit as the regular models of the same company, which gives Motorola a strong reason to focus all its efforts on creating smartphones instead of low-cost models. As an example, only ten million Android phones sold in one year generate half of the profit the company got from the entire line of Mobile Devices, according to recent analyses.


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