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iPhone users less loyal – Apple’s aura dims

The number of iPhone users who say they will definitely buy another iPhone has declined for the first time. And the iPhone 5 has only temporarily halted the decline in Apple’s share of the smartphone market.

Apple remains the world’s largest company by market value, and one of the world’s most recognised and respected brands. But what goes up must come down, and signs are the Apple has reached its peak.

This happens to everybody eventually. It’s hard to remember today that only a generation ago IBM was bigger than all its hardware competitors combined. Now, for the first time since the iPhone was released in 2007, the number of iPhone owners who say they will purchase their next phone from Apple has declined.

A recent report from market tracker Strategy Analytics found that only 75% of iPhone owners in Western Europe say they are likely to buy their next phone from Apple, down from 88% in 2011. US repeat purchase intentions have also seen a slight decline, down from 93% in 2011 to 88% in 2012.

“There is no doubt that Apple is continuing its success in retaining existing user base while attracting new customers,” said Strategy Analytics’ Paul Brown. “But negative press prompted by a perceived lack of recent innovation by Apple has meant we are starting to see some growth in the number of previously highly loyal consumers who are now reconsidering whether or not they will purchase a new iPhone for their next device.”

The levels of loyalty are still very high, and would be the envy of most other brands. But they are declining. So is Apple’s market share, of both smartphones and tablets. Samsung is number one smartphone provider, and Android tablets are now selling nearly as well as iPads. And of course now Windows 8 devices are entering both markets.

Apple’s dominance was becoming boring. It is good for all concerned – even Apple – that it is over.

There was no way the iPhone was ever going to maintain its lead in the smartphone market it essentially defined five years ago. In the last year, and especially in the last few months, a bewildering array of new devices has been released or announced.

Apple is now just another player in a very crowded and competitive market, and is increasingly playing catchup with other innovative players. The stumbles with the iPhone 5, in particular the mapping fiasco, have cost Apple its aura of invincibility. They always say companies are not the same once the founder leaves.

Requiescat in pace, Steve Jobs.


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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire and editor of sister publication CommsWire. He is also founder and Research Director of Connection Research, a market research and analysis firm specialising in the convergence of sustainable, digital and environmental technologies. He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.