Neil Hughes
Like loyalty to a political party or hometown sports team, smartphone users are extremely passionate about their choices — a commitment that led many customers to stick with Samsung, despite the disaster of its downright dangerous Galaxy Note 7.
Earlier this week, mobile analytics firm Flurry published data from the holiday season, showing that Apple saw twice as many device activations as rival Samsung. Despite Apple's continued commanding lead in holiday sales of smartphones and tablets, however, the numbers suggested Apple's share was lower and Samsung's was slightly higher from last year.
Attempting to explain the trends shown in the data, NPD analyst Stephen Baker told The Wall Street Journal he believes that Android loyalists are committed, and even dangerous exploding batteries in the Galaxy Note 7 were not enough to push significant numbers of customers over to the iPhone.
"Most of those who bought or wanted to buy a Note 7 opted for a different high-end Galaxy phone," Baker said.
Despite activation estimates from Flurry, or speculation from NPD, the actual effect of the exploding Note 7 on Apple's bottom line won't be fully understood until late January. That's when Apple will report its December quarter results, including the first full quarter of iPhone 7 and iPhone 7 Plus sales. It's expected to be a record setting quarter for Apple.
Until Apple announces actual sales, estimates from market tracking firms should be taken with a grain of salt. In the past, their methods have been unreliable.
Regardless of the Note 7's perceived impact on marketshare or brand loyalty, there have already been very real consequences for Samsung.
Samsung pushed out a software update to permanently disable any remaining U.S. Galaxy Note 7 models earlier this month. The South Korean electronics maker also took out full-page ads in major U.S. newspapers to address the public relations crisis for its jumbo-sized "phablet."
In October, Samsung's mobile unit reported a 96 percent decline in operating profits, after the company cut estimates by $2.3 billion due to the Note 7 debacle. Shipments of the handset were officially halted in late August, a full recall was later issued, and the handset was permanently discontinued by early October.
Amber Neely
Andrew Orr
William Gallagher
Christine McKee
AppleInsider Staff
Chip Loder
45 Comments
Did Apple need any help?
Apple is already making almost 100% of the profits.
I guess they could shoot for 150%.
I agree with the statement in the article that we need to wait to see actual sales figures from Apple before attempting to draw conclusions.
More generally, though, I don't really understand the mass market appeal of the high-end Samsung phones. In terms of display and camera, they are more or less even with Apple (fans of both products can point to particular advantages and disadvantaged, but I think they're in the same ballpark). But in terms of performance Apple has a very significant lead that goes beyond dry benchmarks -- it's a lead that affects daily usage in a noticeable way. Also, the security/privacy issues of Android would make me very nervous.
I know that geeks care about things like USB vs. Lightning ports, but I can't believe ordinary people care about that.
The only real advantage I see for the Galaxies relative to the iPhone is the audio port. I continue to believe that Apple jumped the gun on that. If it turns out that people are hesitant to switch to the iPhone, that could be the reason. But in the long term, dropping the audio port does make sense and it sounds like Samsung is going to copy them on that, too.
Overall I think the iPhone continues to be the best smartphone money can buy. There are legit gripes about the iPhone relative to the ideal, but relative to real-world competitors, I think the iPhone is still the best.
"...their methods have been unreliable." Then, why pander by reporting their results here?
A coworker who always had iPhones bought a Galaxy S7 Edge this time around when he upgraded. He summed it up the other day to me after having it for a few months:
"This phone is like that blonde-haired, large breasted model you see in the club. You hook up and start having a fling, but after a couple weeks you find out she's a bitch with a lousy personality and dumber than a bag of hammers and you can't stand to be around her."
Impressive in the store, lots of sex appeal with the bright screen and curves, but ultimately just an average device.
I don't see why Samsung's brand loyalty is any more surprising than Apple's or anybody else. Yes, they had a significant problem with the Note 7, and the replacement Note 7.
They lost big money, but whole N7 incident/situation was bad for them, not necessarily for their customer base. It's not as though they can no longer make a decent phone.
If this had happened to the iPhone line I use, I'd return it in a heartbeat. Less, maybe. If it happened to the replacement as well, I'd be concerned/disappointed/wary/etc. Doesn't mean I'd drop Apple as my chosen vendor. Even if this happened to my phone, I'd have to consider what this means for future products before I swore them off.
The thing I didn't/don't understand is why some owners didn't turn in their N7s, assuming they weren't going to regift them to someone they didn't like, but were going to use them themselves (without looking for a big Sammie Payday).