Things in Europe aren’t exactly going too well. Unemployment has become a serious issue in several of the bigger countries, the Euro is losing value against other currencies, and in some places there’s even riots taking place thanks to the steep tax hikes that governments are putting in place to reduce sovereign debt. Add all that up and what you get is a shift in consumer’s preferences for smartphones. Devices like the iPhone, which typically go for around 600 Euros, are selling in fewer numbers, meanwhile Android is blowing up because it provides better value for your money. According to a recent report from Reuters, between September and November of this year Apple’s market share in the French smartphone market has fallen from 29% to 20%. In Germany the fall was from 27% to 22%. “Similar drops were seen in Italy and Spain.” Meanwhile Android’s market share in Germany hit 61%, a figure we haven’t seen that high since Nokia was dominating the market with Symbian.
Will things get better? Of course they will, time has a way of fixing these sorts of things, but the bigger question is should Apple start cooking up a low cost iPhone? We’re not talking about simultaneously offering the 3GS, the 4, and the 4S, we’re talking a totally new device that can sell for 300 Euros or even lower that offers 80% of what a regular iPhone does. Apple has traditionally chased margins instead of market share, and that’s been fantastic for them, but today’s battles are different from the PC versus Mac war of the 90s and early 00s. When consumers invest in an ecosystem, whether that be by purchasing apps or using services that are optimized for one particular platform over the other, switching becomes an incredibly difficult thing to do.
What do you think, will 2012 be the year we see the iPhone for the masses?