Android vs iOS: Revisiting Q2

Each year, the mobile world grows even more green and blue, and to every developer these two have become the primary colors of accomplishment. But, until now, we really don’t have the answer if the world is more green or more blue. Do we? But yes, we certainly do know that the mobile world and the app world, together, have grown tremendously and their achievement in years till now has been amazing. This year as well, the industry multiplied into an even bigger sphere marking new technological developments, newer portfolios, new vendors and more innovations.

As the quarter three of 2015 is soon to end, the mobile app developers need to revisit the highlights of mobile landscape up till now, so as to be calculative in taking up their future projects. Below are several key decision variables to help you assess the who, why, what and where of mobile application development.

App Revenues

App Revenue is perhaps the most important decision variable for a developer. The revenue landscape is dominated by Apple’s iOS. Interestingly, people using iOS are spending more to get better app experiences in contrast to those using Android. This ideology of the owners has led to an evidently wide gap between the revenues of Google Play and App Store. During past two, three years, with iOS’s growing acceptance and popularity even in the developing nations, the revenue gap has even widened between the duo. By leveraging alone on iPhone 6 and iPhone 6 plus, Apple was able to add another $51.2 billion of revenues to their cart. Now with the launch of iPhone 6S and iPhone 6S plus, the revenues are predicted to touch revolutionary heights. The App Store’s global revenue in the second quarter of 2015 was about 70 percent higher than Google Play’s, a trend almost similar to the first quarter of this year.

This great lead of iOS over Android is in a way ‘enormous but creased’. App Store’s revenues have increased just by 10 percent from the last quarter of 2014, when it bagged a win by 60 percent higher revenues than Google Play. This growth is a function of already established markets like the United States, China and Japan.

App Downloads

Another key decision variable is the app downloads which in a way also signifies the strength of market presence. The fact that iOS is mostly popular in established markets and Android in every other part of the globe, is a factor influencing this landscape. iOS might clearly dominate App Revenues, but the App Download market is ruled by Android. As per the figures, Google Play governed the iOS App Store in downloads by approximately 45 percent in 2014, up from 35 percent in the previous year. Also, Google Play’s global downloads in the second quarter of 2015 were about 85 percent higher than Apple’s App Store, a noteworthy jump above the 7​0 percent noted in the first quarter of 2015.

Google Play’s lead over App Store is in continuation with previous app download trends unlike the creased trend of App Store over Google Play in terms of revenue; where App Store could just manage to drift only a little higher. Google Play’s win in terms of download is majorly attributed to the growth in ownership of Android’s low cost-highly capable handsets in emerging markets like Mexico and Phillipines.

Loyalty

Loyalty to an OS is yet another factor which is critical to app developers. As a developer you would wish to never loose your target customers; but reality is customers switch: either their vendors or their OS. The latter can be disheartening. Loyalty is a measure derived from how many loyal customers you have versus how many switch over to another OS when buying a new phone. More conservative minds on this will say that the users of Apple tend to stay with it as its ‘ecosystem’ upholds loyalty, whereas the Android users are not loyalty-hit and thus readily switch to iOS. But this so not the case; instead Android user loyalty has jumped several notches and even exceeds that of iOS.

Despite all the differences between Apple iOS and Google Android, the retention rates for both of them are approximately equal. Both of them, quite impressively, have retained their users at almost the same rates. The dynamics behind how they retain their user loyalty is not yet widely known by now.

Retention -2013-Q3 – 2015-Q2

New OS Previous OS
  Android iOS Windows Blackberry Basic First Aggregate
Android 82% 20% 45% 39% 59% 62% 58%
iOS 16% 78% 35% 50% 24% 24% 37%
Windows 2% 1% 19% 7% 4% 5% 3%
Blackberry 0% 0% 1% 4% 1% 0% 0%
Basic 0% 1% 0% 1% 12% 9% 2%
Total 100% 100% 100% 100% 100% 100% 100%

As per the figures above, the user retention rate for Android has remarkably increased to 82 percent in the period 2014-2015 from 77 percent a year before in 2013-2014. Whereas the user retention rate for iOS remained somewhat constant at 78 percent in 2014-2015 as compared to 79 percent in the previous period. These figures clearly imply that when buying a new phone, there is more probability of an Android user to stay with Android than the probability of an iOS user to continue using iOS. Also, out of those who previously used iOS, 20 percent switched to a new Android OS; and the users who previously owned Android, 16 percent of them switched to iOS when purchasing a new phone. It is evident from the above figure that the users purchasing their first smartphone are more likely to choose Android OS over iOS.

Device Activations

The worldwide smartphone market is multiplying with an ever increased rate and this rate is not going to slow down any sooner. This year too, the global smartphone market grew 13 percent YOY in the second quarter 2015, with approximately 342 million shipments. This growth is primarily attributed to the gains in both established as well as emerging markets. For iPhone, its the sudden surge in China for bigger screens whereas for Android its the usability and economical aspect that makes it popular in emerging markets like Mexico and Brazil. The overwhelming growth is also a derivation of recent advancements in the mobile technology space with iOS and Android coming up with several advanced models, making recent developments and advancements in technology. Android still dominates with an 82.8 percent share in the second quarter of the year 2015 with iOS being next in line with about 13.9 percent share. By now, Android has more than 3 billion device activations as compared to 1 billion+ iPhone device activations.

Device activations are also growing in mobile enterprise space with the total number activations increasing 20 percent quarter over quarter. Here, Apple’s iOS dominate majority of device activations with 64 percent activations in quarter two 2015, 6 percent lower than quarter one which was 70 percent activations. Even with the drop, it still enjoys a massive lead over its rival, Android with a growing 32 percent activations in second quarter 2015 (increased from 26 percent in the previous quarter).

Though iOS leads in enterprise device activations, Android dominates global device activations thereby making it crucial for the developers to understand this yet another decisive factor for app development.

Tablet World

Mobile and Tablet are two different worlds. Contrary to the ever growing mobile market, the tablet market continues to fall at a rate of -7 percent YOY till the second quarter of 2015.This fall is majorly because of vendors putting more focus on the mobile market than tablet market, and thus this space has seen little to no hardware innovations and limited assortment updates. The total, global shipments until quarter two of 2015 amounted to 44.7 million units; decreased by -7.3 percent as compared to the same quarter last year and -3.9 percent compared to the first quarter of this year.

Regardless of a persistent fall in growth and shipments for tablets, Apple sustained its lead in this market space with around 24.5 percent market share in the second quarter of 2015. The rest of the market share is divided between the many different Android based vendors. The key Andoird vendors hold roughly around 30 percent market share.

iOS also maintains a top spot in the enterprise tablet market. However, its market share is increasingly declining since past three quarters. It sustains a top rank with a total of 64 percent tablet activations in the enterprise space, dropping from 81 percent in the first quarter of 2015. It is increasingly giving away its market share to Android and Windows. Android is closing the gap by growing from 15 percent activations in the first quarter of 2015 to 25 percent activations in quarter two this year. Windows has also shown a notable increase and has a total of 11 percent activations by the end of second quarter 2015. With the launch of the new iPad by Apple, there is a chance that it regains its lost shares in the coming quarters.

Industry Adoption

The organizations are increasingly mobilizing their apps and content at a galloping pace and thus developers developing for enterprises need to know the industry-wide preferences for operating systems.

Three quarters in a row, iOS significantly outpaced Android in regulated industries. Apple’s iOS maintains its lead with 79 percent activations in Public sector, 76 percent activations in Education sector and 63 percent activations in the sector of Financial Services in the second quarter of 2015.

Surprisingly, iOS witnessed a declining trend in its total activations as its first quarter’s activations were much higher compared to second quarter of 2015.

However, Android observed a positive trend in activations with its much popular adoption in less-regulated industries like high-tech sectore where it has around 53 percent activations, a six counts rise than the previous quarter; and energy sector where it has 48 percent activations, with a jump of 4 percent from the previous quarter.

Key Takeaways

The conventional way of going about this is- developers should choose iOS if they want to bag big revenues whereas those who value wider reach without worrying much about the revenues should develop for Android.

But as said, those are just conventional thoughts, as the trends are signalling something very different. Here are some trends to consider before landing up on further conclusions.

  1. Since the time Apple has launched in the market, it has been winning in revenues; but if we look closely at the data for last four quarters (including Q2 2015), there lead over Google’s Android is not that enormous, intead it is limited.
  2. App Store revenues are only 10 percent higher than Google Play when compared to figures from last quarter of 2014, and zero percent higher when compared to first quarter of 2015. So what are we seeing next!! A fall in its share of revenues!! What might be hidding behind the figures is Android’s efforts to close this clichéd revenue gap.
  3. Android led with just 35 percent more downloads than App Store in 2013, but then it grew to 45 percent in 2014, 70 percent in first quarter 2015 and now 85 percent in the most recent quarter. In contrast to app revenue gap which is narrowing with time, the app download gap is widening and has witnessed a very positive trend in favour of Andoids’s Play store which is expected to remain positive for coming quarters.
  4. Android is multiplying in device activations; growing activations means more customers to add to revenue. But if we look closely at figures, their share of activations dropped this year in contrast to quarter one and two of 2014. This might be a function of Apple’s last year release of iPhone 6 and 6 plus. But, since Apple has added to more phones to their assortment this fall, we might see changes in upcoming quarter in the device activation landscape.
  5. Android is more blessed with loyal users than iOS; but the wider screen smartphone surge in China since the launch of iPhone 6 and 6 plus; and now with two more wider screen handsets launched this fall, we might se changes to user retention landscape.
  6. Apple, though dominates the tablet market, is continuously witnessing a falling share; while Android though not leading, but is still growing in numbers year over year. Android is getting more hold of market with model revisions, fragmentation fixes, timely updates, more innovation and capable & easy-to-pocket price. But, then Apple’s workaround strategy to regain its lost shares- iPad pro- might bring changes to this landscape.
  7. iOS is popular among industry activations because of their closed ecosystem and assumed security, but it is witnessing a declining trend there aswell, the reasons for which are yet not known.

Whether these figures occur to you as striking or not, but as a developer your success strategy should be a function of a calculated approach, keeping in mind all the aforementioned decisive factors. The figures above exemplify the current trends in the mobile industry. With the growing innovations and advancement in technology, mobile industry might witness even bigger changes by the end of this year.

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