Google has activations, Amazon doesn’t release any numbers, Microsoft touts licensees sold. Truly knowing the success of a device or platform is hard when companies selling the devices or supporting the platforms don’t share with us actual sell through numbers. I am rarely interested in how many devices or software licensees are sold into the retail, carrier, or OEM channel. I am interested in how many people are actually using these devices and have personal ownership of them.
Take Amazon for example. Why Amazon gives no indication as to how many Kindle products (namely the Fire) they are selling is beyond me?. If it is doing remarkably well wouldn’t you want to tell people this. Especially if you want developers creating applications for your Android fork. You would think if developers knew what their total addressable market would be on Amazon’s platform, that it would be helpful and lure them if the number was attractive.
Then there is Google. They proclaim Android figures by way of activations. No one truly knows what that means but now Google is changing the methodology to report only those device which activate Google services, namely the Play Store, rather than just an activation of any Android device that pings their servers. There are many more millions of Android devices access to Google service, which now makes it harder than ever to know how many Android devices are sold and actually in the hands of users. At least Google’s new reporting more accurately reflects devices in use, and using Google’s services, but even then we have some discrepancies. John Kirk points that out here.
Samsung is a little better. But only at times. Some quarters they will tell us how many specific device models they sold. But then sometimes they won’t specify sales of specific device models and just lump all devices together and tell us how many smartphones they sold.
Now I turn to Microsoft. The buzz last week around the fact that they had sold 100m copies of Windows 8. On this point, I must highly recommend an article Charles Arthur wrote in the Guardian where he built upon my Tech.pinions colleague Patrick Moorhead’s methodology for calculating actual Windows 8 devices in use.
Moorhead combines the NetMarketShare figure from April, which shows a 4.2% share, with the 1.4bn installed base to come up with a figure of 58.6m machines presently running Windows 8. That’s an average of less than 10m per month since it went on sale – which doesn’t feel like a lot, especially since the run rate for Windows 7, once it got into its stride, was 20m per month.
100m copies sold. Not yet in use. They will get there by the end of the year. If they don’t we have a real problem.
Then, in an attempt to counter some of the hard hits they took this past week, Microsoft’s Corporate Vice President of Corporate Communications Frank Shaw wrote an interesting blog post. One quote stood out in particular.
So let’s pause for a moment and consider the center. In the center, selling 100 million copies of a product is a good thing. In the center, listening to feedback and improving a product is a good thing. Heck, there was even a time when acknowledging that you were listening to feedback and acting on it was considered a good thing.
Frank is right. Selling 100 million copies of anything is a good thing. But as Charles and Patrick point out, there are far less than 100m copies in the hands of consumers. Furthermore, I would ask Frank a question about these 100m copies sold. What choice do the OEMs have? If you want to make a PC, and you are not Apple, where else can you get your operating system? The answer is no where. OEMs are bound to Windows if they want any chance to hit sales numbers. So realistically they are going to buy whatever Microsoft sells them. Harsh reality but its true. And yes Frank, listening to feedback is a good thing. I’m just worried Microsoft is not listening to all the RIGHT feedback.
Microsoft will continue to sell 100s of millions of copies of Windows each year by default. The OEMs have no viable alternative. Maybe this will always be true, maybe it won’t, time will tell. Maybe Chromebooks will be the alternative. Android clamshells certainly aren’t the answer. But I can tell you one thing I am extremely confident about. Microsoft and their partners worst nightmare should be if Apple ever decided to get price competitive with their Macs.
Giving all the facts with regard to sales numbers that reflect their actual use by customers is the only way to be genuine and forthcoming. Consumers either want your products or they do not. By telling us how many of them are actually buying them, using them, and not returning them, is the only metric for us to truly gauge whether your company or its products are actually viable and growing true market share.
I can only conclude that by not giving us the whole story, that the whole truth is not as rosy as its made out to be.
Extra Thoughts:
– Keep in mind most of those 100m copies were sold to OEMs making PC, hybrid, and convertible hardware, all who hope to sell them through the retail channel for actual customers to use.
– Of course by Macs being price competitive I mean in the sub $599 range. That is where the Windows volume is and will be.
– There are other companies who aren’t specific when it comes to numbers, I just mentioned the ones with the biggest spotlight on them.
– It should go without mentioning but I will anyway. Good or bad, Apple is the only one who gives real sell through numbers.
“if Apple ever decided to get price competitive with their Macs.”
Ben, can you envision a scenario where Apple would do that? I cannot.
My impression of their business model is to not be bothered with low margin low end part of whatever market they choose to play in.
I suspect I am largely ignorant of the nitty gritty details of the markets that Apple plays in . That said, It seems to me that moving downmarket would in fact be a low profit burden on Apple.
I just read an essay outlining how Mercedes Benz attempts to move downmarket is tainting their brand image, and they are not having much success in the lower tier markets in any case.
It is something I have thought about. And while I agree that Apple’s products will never be the cheapest thing out there, I still feel there are some moves they can make with macs to make them even more affordable. If they did this, they would put serious pressure on their competition which strategically would cause their competition to focus more on being competitive in their core PC strength’s and perhaps focus less on tablets where they are failing. Strategically this move could be good for the iPad, which is a cornerstone of Apple’s future. Mac’s not so much, so if they could still make some margin but disrupt the competition, it could be a fascinating strategic move.
Agreed, Ben! What if apple were to release a cheaper (material build) Mac book to compete with MS/PCs and support its iOS sales, (or a bare base, plastic?, Mac mini)? The Mac line is not a huge profit maker and the sacrifice of margins might be made up from iOS lines. Apple is not a hurry company but all seems fair in the line of commerce and such a move would certainly grab notice, if not headlines.
As you have suggested, its time Apple made the serious move to further ‘grow’ its presence in its PC line while supporting its line of iOS devices? Such a strategy might take some of the wind out of the claims to Apple being over priced.
Given that the Mac business, is not as central to Apple as other categories, I think it is interesting to thing about how Apple could use the Mac line, and pricing, as a spoiler for the incumbents entrenched PC businesses.
I think that woud be a terrible idea. If Apple stands for anything, its first quality hardware. Besides, why does Apple want a piece of the no-profit end of the market. To spite Lenovo? HP, Dell, and doing a lesser extent Acer are already doing a fine job of killing themselves.
Right, HP and Dell are pretty good at that…
Steve, I didn’t mean ‘cheaper’ as in poor quality. Manufacturing and size have come to the point that small, and inexpensive components might make it possible to produce a proletarian Mac two-thirds the size of a mini, 500 mb hd, four USB with video output; and Bob’s your uncle, Apple takes a grander share of the waning computer market as a sportive device for iOS and the rigours of computing beyond iOS but less than gaming and intensive video computers. Then the world of Apple is better set to assist average users strapped for cash or the frugal with fewer needs. Such would cover iTunes Library, storage and syncing, bit torrents, work applications and needs most inclined for tablets and handheld computing. I wouldn’t see a skimpy notebook as a possible part of this plan. BittyMac might be its name. 🙂
While part of the disparity between Apple and the rest of the tech industry is probably cultural (apple also seems to be one of the few who announces pricing and ship dates when they unveil a new product), another part of appears to be either that companies choose secrecy when the numbers aren’t all that great (eg, Microsoft on Windows 8, where they aren’t telling us the installed base, vs Windows 7, where they did reveal that from time to time) or else, the company carefully only chooses to reveal those numbers that put their position in the best possible light (eg, Google).
exactly what I am alluding to. By not telling us the whole story, it must be because the whole story is not as good as the half one. I see this as looking bad in the long run, especially as we find out the truth.
What we never hear, and what I am extremely interested in, is what the return rates are for Windows PC, Android phones, and Windows phones. A sale will count as a sale even if that device is returned. So returns and inventory would be two telling statistics as well. But those will remain heavily guarded by those with vested interest to not let them get out.
Ben, Jeff Bezos has said repeatedly that the reason Amazon won’t give out sales numbers is that they’re a datapoint that would be useful to their competition.
As far as Microsoft goes, they’re too slippery and evasive with their statements.
Amazon and Microsoft are in different markets but in terms of success, the two companies are on a seesaw and Amazon’s end of it is rising while Microsoft’s end is obeying the law of seesaws.
I find Bezos answer unacceptable. Jeff believes so strongly that Amazon has no real competitors that I call shenanigans on his statement.
And my point about MSFT is really that although 100 million sales is good, they simply sold that many by default. So its sort of hard to say “wow, look how many we sold” when your customers don’t really have a choice.
Now if they (OEMS) had a viable choice, and they still sold that many, then that would be a claim. Because customers (OEMS) are CHOOSING to install Windows on their machines to sell to the end market.
“… law of seesaws”. that’s rich! 🙂
And if Amazon plays its game of negligible profits out to the end, that law may or mayn’t work in its favour. ; I’d add a smilie but thar would be a meanie, and bad karma to boot.
All the information a company gives out is useful to competitors. Some companies give out no more than is required by law. But in many cases, management feels that giving information to investors is worth the cost.
Microsoft, somewhat oddly, has mostly been a model of openness in its financial, giving out not only revenues by business units but profits. Apple doesn;t go that far, but has generally been good on disclosure and sales details. Amazon basically gives out nothing the SEC doesn’t require and investors love it. Go figure.
“Samsung is a little better.” Really? Selective disclosure is not necessarily better disclosure….
As I previously mentioned, I do daily www searches for “Samsung S4 demand”. There was apparently a highly choreographed chorus of stories about “high demand” BEFORE the launch (I say choreographed because they all came out right around the same time). Then nothing….
Now, only 2 weeks after launch and notwithstanding “overwhelming demand”, “It now looks as though stock levels are returning to normal following the initial rush for the device.” It’s almost comical — almost — but why don’t they announce sales numbers (as Apple consistently releases) to back put the claimed demand? Better? Not by a darn sight in my eyes….
http://www.newsbroadcast.co.uk/37186/the-samsung-galaxy-s4-sky-high-demand-leads-to-supply-shortages
I think the biggest limitation to Mac market share is Windows software lock in, not price. Consequently, I think Apple can only gain a little market share but sacrifice overall profits if they decide to cut Mac margins.
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