Profits Key in Evaluating Mobile Market Success
June 27, 2013
Tech writers have it all wrong when it comes to evaluating success in the mobile sector, says Tech.pinions‘ John Kirk in, “Android’s Market Share is Literally a Joke.” The article is the first in a series that examines the way we determine who is ahead in the mobile field.
In this entry, Kirk begins with a long list of recent headlines trumpeting Android‘s huge share of the mobile market, then explains why those who declare Google’s Android ahead based on market share alone are missing the big picture. He writes:
“Scoring by market share alone and ignoring profit is like saying that a hockey team won because it had more shots on goal when the other team had more goals.
“Market share without context is not only useless, it is worse than useless because it is likely to be misinterpreted.
“First, market share without context assumes that each percentage of market share is equal to another – that every Android activation is equal to an iOS sale. Nothing could be further from the truth. . . .
“Second, market share without context implies that market share is a zero sum game – that market share gains for one always result in a loss to another. But in a rapidly growing market, a company can actually LOSE market share yet have both positive unit sales and profit growth.”
Good points. See the article for Kirk’s in-depth discussion and appeal to reason. Essentially, he insists market analysts should focus on what really matters—a high ratio of profits to market share. Going by this more logical metric, Apple still dominates the field.
It is an interesting analysis. If current declarations of Android’s success are overblown, what effect will that have on Google‘s mobile search revenues in the long run?
Cynthia Murrell, June 27, 2013
Sponsored by ArnoldIT.com, developer of Augmentext
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