Android vs. iPhone In China: Will Google Beat Apple?

Google may be winning in China: Not in search--Google's premiere product has been losing market share since the company's clash over censorship with Chinese officials--but in the smartphone market, with Android, Google's open-source mobile operating system.

The battle over China's massive cell phone subscriber base is a fierce one as the spoils of war are plentiful. Already, the country boasts over 800 million mobile phone users --more than double the population of the United States. As the spending power of the country's citizens grow, that number is certain to swell substantially, and with it competition for Chinese users' yuan and eyeballs.

Google's Android operating system has already nibbled away at Apple and BlackBerry's lead in the smartphone market domestically and it appears to be growing quickly in Mainland China as well. Google's Android seems be poised to become the most popular mobile operating system in the world's most populous country.

Though Apple reported stunning results in Asia, Deutsche Bank technology analyst Jonathan Goldberg argues that Android is winning in China, its market share bolstered by the omnipresence of the operating system.

It can be difficult to compare the success of Google's Android to the success of Apple's iPhone, given that Google's software, which is open-source, can be used by anyone, on virtually any mobile product, while Apple's iOS is available only on Apple-manufactured products (the iPhone, iPod, and iPad). By contrast, Android is used to power smartphones from numerous different suppliers. In addition, Android's rise can be tied to its use not only in phones and tablets, but also in set-top boxes, laptops, and even ATMs.

"Our latest visit to China made it clear that Android has become the faraway leader in mobile operating systems [OS]," Goldberg wrote in a recent edition of the Digits newsletter, according to Daily Finance.

As Daily Finance notes, Goldberg also found that Android-based phones "likely" outsold the iPhone in Asia last December, a lead that Goldberg predicts will be sustained in 2011 and 2012. Addition data from Morgan Keegan, a financial services firm, support Goldberg's assessment that Android is on the up-and-up in China: by December 2010, around 50% of smartphones in China were running Android, up from zero in 2009.

At the same time, however, Apple's performance in China, a market the company identified as a "top priority" several years ago, has been nothing less than superb. Revenue from China increased threefold in a year, from $1 billion in 2009 to $3 billion in 2010.

Which operating system do you think will prevail? Weigh in below.

Comments

[MrVee]

12:58 AM on 01/26/2011

Iphone is hardware. Android is software. The question should be Is Android winning against IOS in China. The answer is yes.

[ed insider]

05:02 PM on 01/25/2011

Here is an interesting take on the Chinese Android market from Arstechnica -

"That is exactly what the Chinese mobile industry is doing with OPhone. They are creating a completely distinct third-party Android software ecosystem that is independent from Google and they are building a heavily-customized userspace stack that integrates with completely different Web services and allows them to deliver the kind of user experience that they want.

In effect, they are using Android—but not Google's Android. They don't need Google's Android Market and they aren't necessarily integrating with Google's search or other services. When you think about it in those terms, it makes Android's ascent towards dominance in Asia seem like a hollow victory for Google"

http://arstechnica.com/gadgets/news/2010/07/androids-ascent-in-china-is-not-elevating-google.ars?comments=1&start=40#comments-bar

That has to figure into this discussion someplace.

[OhioPoBoy]

12:44 PM on 01/25/2011

Apple haters need to take a deep breath and let it go. Apple does not want to be the Walmart of smart phones. Google makes ZERO profit off their operating system. They created the system because they saw how quickly Apple was creating a sandbox that allowed users to opt out of the Google spy network. All those "open" pronouncements mean nothing when it comes to tracking your every move online. At least Apple allows you to opt out of any ads you want to. That would drive Google nuts, since they are giving away the OS. Additionally, the hundreds of Google phones, dozens of flavors and iterations don't work too well in some situations, particularly when 90 % of Apple users have the latest software while less than a quarter of Google users do. It's not about number, it's about profits. Apple profits big time from all they do. Google is just a serch engine.

[Supercruize]

12:06 PM on 01/25/2011

F those tiny little glossy white gadgets. Get Android and fly.

[ResearchtheFacts]

11:23 AM on 01/25/2011

I guess Apple isn't so superior after all. It had the market what happened?  Oh yeah, it just doesn't work.  Only on planet Apple and with its citizens. Trends come and go.  Apple got about two to three really good ones and now Google.  Who is next?

[John Kramarz]

09:17 PM on 01/25/2011

" It had the market what happened?"

You call yourself "Research the facts"?
When did Apple lead the market?

[ResearchtheFacts]

09:23 PM on 01/25/2011

When they were selling $800 iphones.

[buddhistMonkey]

10:13 PM on 01/26/2011

((( You call yourself "Research the facts"? )))

I'm pretty sure it's an intentionally ironic misnomer, like referring to Rush Limbaugh as "Slim."

[buddhistMonkey]

10:18 PM on 01/26/2011

((( "[Apple] had the market what happened [sic]?" )))

Apple's sales quadrupled in China last year, and they're set to triple again over the next two years. That's what happened.

Apple’s Really Good Quarter Was Really, Really Good in China

http://mobilized.allthingsd.com/20110119/apples-really-good-quarter-was-really-really-good-in-china/?mod=ATD_rss

[bayjinger]

10:00 AM on 01/25/2011

Anecdotally, I spent the winter in Beijing. Every time I went out I was looking out for Android phones. I ended up noticing far more Nokia high-end phones and iPhones.
I won't claim to recognize every Android model on the market - I could probably only spot the high-end models such as the Droid X and the Galaxy S, but let's just say it's not too difficult to spot a large touch screen phone that's not an iPhone / Nokia model. I think I only saw a handful during my whole month.
Anyway, this only reinforced my notion that the Android invasion is happening at the low-end of the market - they are having the greatest success replacing feature phones, instead of at the high end challenging Apple (or in the context of China, Nokia's high end models). It remains to be seen whether 1) Android can climb to mid and high end; 2) how Google can profit as these low-end customers typically are not 3g subscribers and therefore use much less data.

[Krek]

11:24 AM on 01/25/2011

Nokia is the main player in the world smartphone market, with 37% market share. Android is second with 25%, then Apple with 17%. China has been good for Apple but it doesn't entirely reflect the world market.

[J0E1]

11:49 AM on 01/25/2011

Android users, although lesser in numbers, actually use more data total than iphone users.

[katwright]

12:59 PM on 01/25/2011

Almost scanned your Avatar!

[MikeyJaii]

01:14 AM on 01/25/2011

It's whoever's Chinese factories makes the most will win China.

[Hunter Peress]

12:07 AM on 01/25/2011

No one has brought up the elephant in the room. Namely that Google's official Android marketplace does not actually sell apps in Mainland china....Believe me, I'm an app developer and I watch for any bit of news regarding this. Right now, Android developers have to go through Motorola, or one of dozens of Chinese home-grown Android markets which honestly have failed to entice me. Maybe Elliot Ng's new appointment of Google-China will help move the company forward in the Chinese market. Google's snafu in China is one of the reasons Eric Schmidt stepped down, so a lot of catch up is going to be required. I'm starting to lose faith :|

[aneesoft]

10:23 PM on 01/24/2011

Both of them are decent Phones, But i am now using iPhone, which works well. I think Android is like an very dynamic young guy who may Beat iPhone. More info about iPhone:http://www.aneesoft.com/tutorials/iphone/index.html

[tleb]

09:15 PM on 01/24/2011

Is 1 billion to 3 billion a good increase for apple in the Chinese market? maybe.

Google seems to be growing fast, would love to be able to afford Google stock... everything points to that company growing growing growing...

[rmaenza]

09:08 PM on 01/24/2011

This is very misleading, market share means squat. mainstreethost

[Ratnok]

09:29 PM on 01/24/2011

You either know nothing about business or you own an iphone.

[hopefull2008]

10:52 PM on 01/24/2011

He's a spammer ..

[Highball]

08:09 PM on 01/24/2011

Ugh. When will people learn that market share means absolutely nothing. If I sell 5 widgets at a net margin of $10, and you you sell 25 widgets at a net margin of $1, I have a 2-to-1 advantage over you in net profits.

You control the market by a 5-to-1 margin, but I've made twice as much money as you have. Which would you rather be?

Of COURSE Android will do well in market share. That's not really the point, though (except to Google who, as an ad company, wants to get lots of eyeballs). But Apple's 4 retail stores in China were the busiest in both traffic and sales over any of their 300+ in the world last year.

And they expect to have up to nearly 25 in China by the end of this year. So, from Apple's point of view, how many people have cheap Android phones doesn't really matter.

Oh. And it's not "Android vs. iPhone." It's Android vs. iOS. They are platforms.

[JasonMcl]

08:33 PM on 01/24/2011

" but I've made twice as much money as you have. Which would you rather be?"

Apple making huge profits is good for Apple and Apple stockholders, not good for Apple users.
If you aren't one of the first two, why brag about how much money you are giving away?

Know what is good for users?

Market Share! == More phones, more options, more apps, more uses.

[Highball]

08:41 PM on 01/24/2011

Well, I am an Apple shareholder.

But you're also wrong in that Apple making loads of cash is good for Apple users. The fact that, for instance, they have more than $60 billion in cash allows them to do things like invest in other companies (for example their semi-recent acquisition of a chip designer), invest in R&D, and take chances.

Use Apple products, or not. It's no skin off my back. But arguing that market share is somehow the be-all end-all of business is totally missing the point.

And I'm fairly certain that the App Store (and now the Mac App Store) are both more voluminous and much safer than the Android marketplace. The App Store, for instance, just had their 10 billionth download the other night.

[LightShadow62]

08:36 PM on 01/24/2011

Last time I looked there was virtually no difference in the prices of iPhones and devices running Android. So that part of your argument is out the door.

I think it comes down to choice.
With the iOS you have a choice between the black iPhone4 and the black iPhone4. Sorry I forgot you can chose which case you want to put on your phone.
With Android you can chose from a wide array of devices and pick the one that suits your personal tastes and needs. And you can pick out a case that you like too.

[Highball]

08:45 PM on 01/24/2011

One, there is a HUGE difference in price, since there are so many different models on which Android is presented.

But more importantly, *price* and *margin* are not at all the same thing. We can both sell the same widget for $100, but you might have a net profit of $25 and I might have a net profit of $10. A lot more goes into margin than price.

[Morgantheaxe]

07:46 PM on 01/24/2011

Ive noticed a pattern of behavior. Iphone lovers such as myself tend to applaud and welcome new and better android phones as we find that Apple tends to innovate to compete and that means better products for us all. Ihaters like JasonMci tend to constantly attack Iphones even though by his posts people who actually own Iphones can tell he knows absolutely nothing about them. Im becoming prouder of that fanboy title each and every day.

[JasonMcl]

08:03 PM on 01/24/2011

Yes, and you never see hundreds of one sentence comments in every single Android thread saying enlightened things such as "Sucks, Lame, notaniphone".

I have used an iPhone3GS and the newest iPod touch extensively. I have never said that they were bad at what they did, I only criticize Apple for what they designed them not to do.

Open Innovation and pushing technology forward is so much more important than expanding the profits of a tech monstrosity.

But really, don't take my word for it.
http://fora.tv/2008/04/08/MITs_Eric_von_Hippel_Open_Innovation

Ask this MIT professor about just how important it is to let your users decide what to do with your product.

Now you can say what you want about my posts and my knowledge level, but I will continue to push people to think less about magic and more about customization and community development so long as Apple keeps giving me a reason to.

[John Kramarz]

12:38 AM on 01/26/2011

"Ask this MIT professor about just how important it is to let your users decide what to do with your product."

You could parallel his Lego story with the iPhone, and people who used to jailbreak them just to get 3rd party apps on them.
Apple decided to embrace this army of developers, and even make a store where millions of people were already registered to purchase their wares.
Sure, there are some controls, just like "user designed Lego pieces" are probably not going to include vibrating anatomical devices anytime soon. Hey, I didn't even hear that the people designing Lego pieces ended up getting any money! What a rip!

[Morgantheaxe]

04:54 AM on 01/27/2011

I guess thats the crux of it. You want Apple to do what YOU want them to do with their products and want others to dislike them because they will not. I on the other hand want a good smart phone. So, I find myself in the position of NOT wanting Apple to do things differently because I can go to them and buy a good smartphone. I also enjoy the decreased security concerns that I have as a result of Apple controlling their own code. Oh but feel free to build your own smartphone and market it. If its good Ill buy it. Sitting back telling people a company is making a bad product when they aren't and you are simply not getting what you personally want from them (which seems to be a measure of control) is dishonest and low.

[Onutz]

09:41 PM on 01/24/2011

Yeah, what's that about?
I agree, Apple may have initiated the touchPhone/tablet boom but it's strange to see people clamoring over the "new improved" iClones while hating the source.
Meanwhile as you said, competition enhances the entire market!

[JasonMcl]

07:41 PM on 01/24/2011

Openness and variety trumps restricted and monotonous every-time.

Just ask 90% of the desktop market. The only think keeping Apple afloat in the current market share is their two-year head start. Android last year experienced nearly a 700% growth and dominated Apple last year in new phones sold. Even with the iPhone4 release.

Although the Verizon iPhone will set Android back a peg, the end result will be, once those contracts expire, people will go with variety, customization and power over fashion sense, celebrity endorsements and "magic".

[Onutz]

04:46 AM on 01/25/2011

Unless Apple invents something else that's two tears ahead of it's time

[JasonMcl]

08:15 AM on 01/25/2011

... And takes it one tier back intentionally.

[J0E1]

11:58 AM on 01/25/2011

Hasn't happened yet.  Probably won't in the future.

[michaelmarian]

11:39 AM on 01/29/2011

I'll be pleased with Android topples Apples dream of world leadership and their dreams of monopoly. If Sir Paul McCartney wasn't such a gentleman he'd straighten out Steve Jobs on continued abuse of the Apple brand by Apple Computers bad behavior and attitude. Apple has actually successfully sued Apple Computers twice for a total of $50 million in damages and a trademark agreement due to Apple Computer's trademark abuse http://www.foxnews.com/story/0,2933,97064,00.html

[JasonMcl]

09:21 PM on 01/29/2011

"Apple Corps Ltd. (informally known as Apple) is a multi-armed multimedia corporation founded in January 1968 by English rock band The Beatles to replace their earlier company (Beatles Ltd.) and to form a conglomerate. Its name (pronounced "apple core") is a pun."

I literally had no idea that the Beatles had done this already. I wonder why Jobs chose to copy the name directly? I guess back in the garage days it didn't matter so much to them.

Thanks a lot for that information!

I guess I should thank jobs though, If the iPhone was anything resembling an open system and if the app store was just to keep malicious Apps out, instead of apps that compete with Apple's goals, then there wouldn't be a need at all for Android.

I take these smartphones and tablets pretty seriously, because there may come a time in which they replace desktops as our primary means to interact with the wider world.

And when this happens, there needs to be an dominant open system, free of centralized control, that ensures that specialized business interests don't dominate the way that we get information.

I have this dreary notion, that in 10 years or so, there will be some kind of "Digital 9-11", and an "Alternative Internet" will be released which provides "Premium and Secure" content, and it will naturally be censored all to hell.

People need to stand up for openness. Because without it, the potential for abuse is justtoogreat.