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How can Apple capture 62% of global smartphone profits?

The figures from market researcher Counterpoint show that Apple made the most profit in the second quarter of 2018. The numbers: Apple holds 43 percent of the telephone market when it comes to appliances of $ 400 and more. For comparison: Samsung needs 24 percent for a second place and behind it is not entirely surprising the Chinese trio Huawei, Oppo and Xiaomi with even smaller percentages.

The premium segment (between 600 and 800 dollars) is largely distributed by Apple and Samsung. Apple takes 44 percent of that, compared to Samsung’s 41 percent. Then there is ultra-premium: 800 dollars and more. That segment is 88 percent in the hands of Apple, thanks to the iPhone X.

Average share, very high profit margin

If you compare these figures with the profit margins, then it is really striking to see that Apple is therefore 62% (just under two-thirds) of all profits in the smartphone market. Samsung has a meager 17 percent of all profits. The explanation is simple: Apple fans apparently like to spend far too much money on their brand experience. And for the record: I say that as someone who also fists deeply (and no further, otherwise my new Apple Watch is dirty) is in the ecosystem.

At Apple it is always said that the brand is doing everything to get as premium as possible, that it wants to be an ” aspirational fire “. These figures show that it has succeeded. To make a long story short: Apple’s stuff is absurdly more expensive than it needs to be, just because it’s possible. Because we pay it anyway, because we want Apple. There is no other way to explain such a large profit margin.

Pressing until nothing comes out of the stone

It’s true too: Apple is doing everything to get you extra money from the bag with the details. A nice example is the dongle you need to use an old-fashioned headset in the new iPhones. It costs a tenner in the store, which means that the production cost is probably about 30 cents. Do not get with your new device from between 1100 and 1650 (!) Euro. You must buy separately. Charging cables? Trashes that always break and are almost guaranteed to be useless in a few years thanks to a constant rotation of connections . Repairs? Approximately 300 per cent more expensive than at the barge working with the same materials but not allowed because reasons . Guarantee? Can you buy, otherwise your iPhone has to undergo an inspection in case of complaints where the American TSA can suck a point before something is fixed free of charge.

Anyway, you will not just become the first billion company in the world . And it’s not like Apple makes stuff: the smartphones, Apple Watches and Macbooks are genuine beautiful devices . However, they could all be a few hundred euros cheaper, as many other smaller hardware makers continue to prove in an increasingly convincing manner.

The difference between an iPhone Xs and any other Android device of more than 500 euros from 2018 is negligible, but we still pay the main prize as Apple fanatics. Because it’s possible. Because you want to show that you pay double the price without any worries to have that extra two percent finish compared to the already fantastic alternatives . Then you should actually know it yourself. It is only surprising that so many people still do it. The market has become so democratized in the meantime that there are few rational arguments to choose for Apple. Except if you have always opted for Apple.

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