iPhone Life magazine

iPhone leads Android; Walmart stores drop iPhone 4S by $74

In a post a couple days ago, I noted a consumer survey that found that more Android phones were sold in the March quarter of this year than iPhones. Wrong, according to Business Insider. The three major carriers in the U.S. all reported that they activated more iPhones in the first quarter of this year than Android, with the iPhone counting for 63% of the activations. After reading the article, I’m betting that the Business Insider data is more accurate than the consumer survey.

[update: Walmart said this was a pricing error.] And to spur iPhone sales even further, AppleInsider is reporting that a few Walmart stores are offering the 16GB iPhone 4S for $114, which is $74 off the regular Walmart price of $188. In addition, the 8GB iPhone 4 was going for $34 at a Walmart in Oklahoma. In general, Walmart sells the iPhone at a lower price than other retailers, but these prices are unusually low. It will be interesting to see if there are more reports of low prices at other locations.

It would be nice to see a lower price on the iPhone, given Apple’s huge profits. The most astonishing fact I’ve seen lately is this: If you look at the worldwide mobile phone market (not just smartphones), Apple is making 73% of the profit despite having just an 8.8% market share. Samsung is the only other major player, with 26% of the operating profit.

Things are also looking good for Apple in the tablet arena. After the Christmas quarter it began to look as if the Kindle Fire would be a competitor to the iPad, with over 4 million units sold. But according to IDC, sales of the Fire dropped sharply in the first quarter of this year. Sales of the Kindle Fire went from a 16.8% share of the tablet market in the fourth quarter of 2011 to 4% in the first three months of 2012. At the same time, the iPad went from 54.7% to 68%. Plus, Samsung took over second place from Amazon in the tablet market.

To make matters worse for Amazon, Target recently announced they'd be discontinuing sales of the Kindle Fire and all other Kindle devices. Apparently, they feel like they've increasingly become a showroom for Amazon. People go into Target and handle the devices to decide if they want to buy one, and which model to get, and then they go home and order it on Amazon's website. However, Target will continue to offer the iPad and is currently testing expanded displays of Apple products.

And if things don't look rosy enough for Apple, BGR is reporting that Apple will soon start offering its own wireless service. In other words, you won't need to sign up with AT&T or Verizon or Sprint. You'll get your service from Apple. When I first read the headline, it sounded impossible. After all, Apple doesn't have a network of cellphone towers in the U.S. But as I understand it, just as the government deregulated the telephone industry so that other companies could sell phone service using the telephone lines installed by regional telephone companies, it's also possible for competitive mobile carriers to enter the mobile business by using the infrastructure installed by one of the major carriers. The competitive carriers simply pay a fee for using the infrastructure. Of course, the established companies don't like this, but in the interest of fostering competition, the government has forced them to make their infrastructure available to competitors. It will be interesting to see what happens.

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Jim Karpen's picture

Jim Karpen holds a Ph.D. in literature and writing, and has a love of gizmos. His doctoral dissertation focused on the revolutionary consequences of digital technologies and anticipated some of the developments taking place in the industry today. Jim has been writing about the Internet and technology since 1994 and has been using Apple's visionary products for decades.