Horace Dediu at Asymco has run the numbers and it’s not looking good. Samsung and Apple now control an estimated 99% of vendor profits with HTC scraping in with 1%. BlackBerry and Nokia barely register and, in fact, form a loss.
First, I’d like to note why Dediu believes carriers are willing to cede so much of their profit to Apple and, presumably, Samsung. It’s mostly about lock-in, a sort of bear hug that encourages customers to stay put in the long run. He writes:
With numbers like these, it’s easy to see where things are headed. Although I’ll give Nokia the benefit of the doubt this quarter with the rise of the Lumia line, these numbers don’t look good for runners-up, including LG, Motorola, and RIM.
Arguably, those three manufacturers could pull off a coup – a hot phone like the Droid can push Motorola back into the space and LG is at least popular outside of the U.S. But, like Sony, RIM is an established player with a tendency toward a closed system that serves a dedicated and dwindling audience rather than a general consumer. Buying into RIM at this point, especially with the prevalence of iTunes content and, increasingly, Google’s own marketplace, is akin to a suicide pact.
By this time, there should be few compelling reasons to expect anyone – in the next half-decade say – will be able to unseat Samsung’s dominance. While I’m of the opinion that Apple is in a much more precarious position in the long run, I’d give them the next five years as well. To the rest in the 1% of mobile profits? I’d recommend a realignment and/or moving into something more lucrative.
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