Analyst: Android's U.S. smartphone market share fell in Q1
Although Google's (NASDAQ:GOOG) Android mobile operating system currently leads its rivals in the race for U.S. smartphone market dominance, investment banking firm Needham & Co. contends that Android's growth is now leveling off and is primed for a sharp decline.
Wolf forecasts that the migration of Verizon subscribers to the iPhone has increased Android's share loss.
Basing his forecast on IDC data, Needham senior analyst Charlie Wolf states Android's U.S. smartphone market share slipped from 52.4 percent in the December 2010 quarter to 49.5 percent in March 2011, its first-ever sequential drop in any global region. Android's decline corresponded with Apple's (NASDAQ:AAPL) rival iOS increasing its U.S. share to 29.5 percent, a 12.3 percentage point quarter-over-quarter jump.
"In our opinion, this is just the beginning of Android's share loss in the U.S.," Wolf writes in a client note issued Monday. "The migration of subscribers to the iPhone on the Verizon (NYSE:VZ) network should accelerate this fall when Apple coordinates the launch of iPhone 5 on the GSM and CDMA networks. The iPhone could also launch on the Sprint (NYSE:S) and T-Mobile networks."
Despite Apple's success in the first quarter, Wolf calls Verizon's February launch of the iPhone "tepid," and goes on to speculate that Apple has delayed the introduction of the iPhone 5 to September in order to coordinate the launch of both GSM and CDMA versions of the device.
"To do so in June would likely have upset Verizon subscribers who purchased iPhone 4 in the preceding months," Wolf argues. "It's our expectation, then, that the anticipated surge in iPhone sales on the Verizon network is likely to occur this fall after Apple launches iPhone 5." He adds Android's market share could suffer a "material decline" following the iPhone 5's debut.
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