iPhone

Generator Research: iPhone will overtake Nokia in 2012

Generator Research has released a new report predicting that the Apple iPhone's current growth trajectory will enable it to catch and surpass Nokia for the top spot in the global smartphone market within three years. Here's my quick analysis of the report.

Generator Research, a small firm focused on digital media and the Internet, has released a new report predicting that the Apple iPhone's current growth trajectory will enable it to catch and surpass Nokia for the top spot in the global smartphone market within three years.

The report sees iPhone growth accelerating due to a combination of the rapid multiplication of apps and the price drop of $99 for the lowest-priced iPhone. Meanwhile, Generator Research also predicts that Nokia will stumble and see its market share cut in half from 40% in 2008 to just 20% in 2013.

Chart credit: Electronista

Quick analysis

This report appears to compare Apple and Nokia in a vacuum. It sees only modest growth for other smartphones in the years ahead. That doesn't take into account the momentum that both BlackBerry and Palm also have right now. I think we have to expect that as the smartphone market grows steeply over the next several years, it's going to lift several boats, not just the iPhone.

As the smartphone market grows and consolidates, Nokia is definitely vulnerable, as is Windows Mobile. Google's Android platform is still a wildcard. It has potential, but also has some serious challenges to overcome.

However, this market is still extremely fluid. Nokia has yet to launch its new Symbian OS. Windows Mobile 7.0 comes out in early 2010. And there's still the possibility that Android could find the right hardware partner and turn its fortunes around.

If there's anything that could give the iPhone to leap forward in the global market, it could be partnerships with new mobile carriers. For example, if the iPhone comes to Verizon in the U.S. in late 2010 (as rumored), it could have a very disruptive impact on that market.

About

Jason Hiner is the Global Editor in Chief of TechRepublic and Global Long Form Editor of ZDNet. He is an award-winning journalist who writes about the people, products, and ideas that are revolutionizing the ways we live and work in the 21st century.

12 comments
jfreedle2
jfreedle2

Neither Nokia nor Apple produce an actual smartphone. A smartphone is a phone that runs Windows Mobile.

tony
tony

I recently got a Nokia E71 smart phone - no touch screen, but a small keyboard which is surprisingly useful. Having previously used a hi-res (640 x 480) PDA with a touch screen, for me, thie E71 is much more useful as a general tool. Easier for email - definitely. The iPhone is generally locked to just one carrier in most countries - here in the UK, I value my carrier more than the phone, so until it is freely available on all carriers, its market will be more limited. Phones are very much "horses for courses" - Nokia make many styles - touch screen, qwerty keyboard, screen with sliding keyboard. Apple have one style only. Although there may be some shift in market shares, a monoculture Apple will never dominate - it hasn't in the PC world, so what is different in the mobile phone world?

Hardik Upadhyay
Hardik Upadhyay

When apple came up with the innovative product with iPhone, lot of people predicted that it will be a player for a long time. But they failed to predict one important thing is that iPhone will take market by storm. The whole world was just stunned by the usability and features of iPhone. Apart from that, Apple App store was like icing on the cake. It was a huge success which even apple failed to predict. This all came up and was like a surprise christmas gift from Santa. And people were standing in queue for hours to get their own iPhone. All this things shows that Apple has huge potential in the future. With Steve Jobs mentoring the huge ship of Apple, I guess Apple will overtake nokia much before 2012.

george.hickey
george.hickey

I bought a Nokia 5800 touch screen earlier this year - it does everything that the iPhone 3G does and more, although admittedly the interface is not as nice or fluid. The two big plusses for me over the iPhone are though: 1. Mail for Exchange - I can get my work email & calendar synched to my phone even with our network admin's (paranoid?) security settings. 2. Battery life - with a mix of using it for speech calls, email, text message & internet browsing over wifi & HSDPA, I'm getting approx 4 days between charges - two guys I work with both have personal iPhones and get 24-36 hours between charges with similar kind of usage. Oh, I really like the multiple interfaces you have on the 5800 - I especially find that the full screen keyboard and the handwriting recognition work very well for me so writing long emails is not a problem. If Apple can crack the power consumption / battery tech issue then they might get me as a customer, but I don't see myself switching from Nokia any time soon. Sorry - my point is that this is a mid-tier Nokia device and, for me at least, it is better suited than the iPhone which costs more than twice as much. If I were to have a budget that reached to an iPhone, I would be far more likely to look at a high end Nokia touch screen. That's just one opinion from a consumer. The current touch screen version of the Symbian OS is good, not as polished as the iPhone, but still perfectly good to use and very logical for anyone used to Nokia phones - I would expect the next generation will improve on it again, making it a more natural migration path for existing Nokia users, particularly business users. Given Nokia's track record in the industry, I would be very surprised if it's market share halved in 3 years....

Vulpinemac
Vulpinemac

Honestly, I can't credit any analysis that attempts to predict the future from a single point fact. Maybe their analysis can show a trend, but when you're using annual sales for 2008 as a starting point and annual sales for 2009 (which isn't even completed yet) as the second point, it's really difficult to say "Apple will surpass Nokia in 2013." There are just too many variables involved. While I may be hopeful that the trend comes true, I can't take this one analysis as gospel.

john.hamilton
john.hamilton

I doubt that all the specific needs for all the individual people can ever be satisfied by one phone. The vast array of types of phones, even from one supplier is there to ensure the customer gets the phone to suit their needs. One size does not fit all. Currently Apple with their choice of one phone fails to deliver my needs. I don't want to be tied to one supplier of apps, I don't want to be tied to to one carrier, I don't want a single tasking phone. Apple will certainly improve their phone. Their 3 x (upgrades) to the iPhone in 3 years and still the phone is not yet up to the standard of the high-end devices from other manufactures. I'd guess the assumption with this prediction is that the functionality of the competing phone manufacturers will remain static - this is far from true. Future success will be based on satisfying customer's needs and delivering new functionality which customers want and even functionality which they yet don't even know they need.

Vulpinemac
Vulpinemac

Nothing you said had any relationship to the content of the article. Bashing one company for its products is not debate, but merely sour grapes. Your last sentence even proves you don't understand the products, since each and every smart phone on the market is attempting exactly that.

adakar_sg
adakar_sg

My next phone will be a 50usd nokia; because i'm sick of all these smartphones Iphone is a toy with a big accesories store where you can buy all kinds of crap you'll get bored of within a week HTC is a buisness phone, i use one daily and i hate it because when i get home i still get emails from work Why i want the cheap nokia? Supreme battery time, its light, has all the things i want in a phone, and its not a touchscreen. I will not buy another "smart" phone until the day the seetrough version is done where you touch it at the backside and not in the front

Vulpinemac
Vulpinemac

[i]"... the day the seetrough version is done where you touch it at the backside and not in the front..."[/i] In other words, you want to see a new Microsoft smart phone. They're the ones with the patent on that particular technology.

ben_j_dover
ben_j_dover

I have yet to understand what persuaded Apple to agree to the AT&T contract. In my opinion that inanity has a deleterious effect on the marketability of the device. I have been an AT&T victim since my first cellular device - and will probably continue that. On the other hand - I will NOT purchase an Iphone as long as I have to accept the onerous terms AT&T demands to use its network. I can purchase an equivalent Nokia device - continue my present contract with 0 committment and no irritation with AT&T imposed limitations. That to me is a zero sum game - I win! Cellular marketing and it's attendant constraints have never made sense to me. I rather think that far too many MBA's have their digits in the marketing equation. May be why I am happy in the retired world!

Vulpinemac
Vulpinemac

... your comment had no relationship to the title or content of the article. While I won't argue with your feelings, this hardly shows professionalism, even if you are retired. In my own case, upgrading from a poor-quality, barely internet-capable cell phone to an iPhone meant a minimal increase on my monthly payments on a system that has given me better service than any other in my area. While I understand AT&T has holes in its coverage here and there, where I live it has fewer holes and better reliability... at least with a more reliable phone. I used to blame AT&T for dropped calls myself, until I realized that the fault was the phone itself, not the provider.

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