In The Reset Button I looked at some analysis from Horace Dediu and wrote:
Samsung is making most of the money in the Android ecosystem and companies like HTC are suffering significant losses. In Dediu’s analysis of HTC’s woes it looks as if they’ve struggled to match Samsung in volume in their transition from a relatively low volume Windows Mobile smartphone business to Android. An area that Apple has excelled at, thanks largely to Tim Cook, is in volume, and they’ve been able to quickly ramp up production, purchase components in unheard of quantities, and are investing billions in their production facilities.
With their warning of a weak Q3, disappointing results for July, and return of half of its investment in Beats Audio also in July – HTC lost more than 1B in market cap so far this week with Fox Business analysis adding:
In the high-end market, HTC has been squeezed out by its rivals, Apple and Samsung, which together command more than 50% of the global smartphone market. In the second quarter, HTC’s global market share dropped to 4.8% from 8.9% a year earlier.
Another interesting point in Fox’s article is:
Even if HTC is increasingly focusing on China, that strategy may also be difficult to execute, analysts say. China’s economy is now showing signs of a slowdown and the company faces increasing competition from companies like Huawei Technologies Co. and ZTE Corp. which are pushing out low-end, mid-tier and high-end phones at more affordable prices.
With the iOS 6.0 preview at WWDC Apple rolled out some features aimed squarely at the Chinese market and based on Dediu’s comments Huawei and ZTE are growing incredibly quickly in China and other growing markets, despite their small (nonexistent?) presence in the US and European mobile marketplace. With Samsung on the defensive in the ongoing multi-billion dollar patent trial and a rumored iPhone 5 release this Fall it’s going to be great to see how this all plays out with respect to mobile market share in China, software patents, and the evolution of the iOS and Android ecosystems.