A report from analyst firm Piper Jaffray says that in the long run, Android is going to lead the smartphone market with about 50% market share. iOS will shrink down to somewhere between 20-30% market share, while RIM and Nokia will have the remaining.
The report predict that even with 20% of the market, the iPhone will contribute Apple more money than Google gets from Android. Piper Jaffray estimates that Google will make $1.35 billion in revenue from Android in 2012, whereas Apple made $1.5 billion in revenue from iPhone just in the first quarter of this year.
We estimate Google will control 14.9% of the smartphone market through Android in 2010, growing to 23.2% in 2012. For Apple, we expect the iPhone 15.9% of the smartphone market in 2010, growing to 17.6% in 2012. However, we believe the question is where the two platforms top out in terms of market share. An important factor for Android is that we ultimately believe that Nokia and RIM do not have the core software competency to be competitive in the smartphone space and will eventually need to adopt Android or potentially Windows Mobile Phone 7. Ultimately, we believe Android is likely to control over half of the smartphone market in the next five years. Apple’s essentially two phone focus (low price 3GS and higher price 4) will likely limit how much of the market Apple can control and we believe ultimately Apple’s smartphone market share tops out between 20-30%, which still offers significant room to grow.
