A report compiled and published by Credit Suisse Group AG (NYSE:CS) reveals that Apple Inc. (NASDAQ:AAPL) and Samsung Electronics Co., Ltd. (LON:BC94) are the dominant forces in the high end smartphone market. Despite the bubbling rivalry that shadows these two avid competitors, neither of them is willing to give in.
Apple Inc. (NASDAQ:AAPL) is reported to have a 47 percent share, while Samsung closely follows with a 40 percent share. The standard used to identify the highly coveted high end market, primarily revolves around pricing, where smartphones that range in the prices of $400 plus are considered as high end.
Another notable highlight is the high expectation placed in the Samsung Galaxy S3. Its price of $500 is perfectly matched with its impressive features, and analysts believe that it will glean incredible sales figures in the high end market.
Apple’s upper hand
As far as the competition between Apple and Samsung is concerned, the former is considered to have the upper hand. The report goes on to delve extensively on the competitive advantage exhibited by Apple. The iPhone maker has the edge, primarily because of its vertical integrated structure that allows it to simultaneously filter through all three markets- smartphone, pc, and tablet.
On other hand, Samsung Electronics Co., Ltd. (LON:BC94) is disadvantaged because of its reliance on Google’s android. The operating system’s dominance in the smartphone market is unquestionable. Nonetheless, its presence in the tablet market has failed to send ripples.
Another thing that has been highlighted in the report is the extent to which the legal system has taken a slant towards Apple Inc. (NASDAQ:AAPL). Right from the start, Samsung’s odds in winning the patent infringement case were lopsided. True to it, Samsung lost several cases and is now under legal obligation to cough up $1.05 billion
Effects of this dominance
In general, it is believed that Apple’s and Samsung’s dominance will not only push smaller competitors like HTC Corp (TPE:2498) and Nokia to the curb, but will also have greater effects on the industry as a whole. This is especially so if you consider the estimates forwarded by Credit Suisse Group AG (NYSE:CS). The report notes that the high end smartphone segment may be the largest contributor to the consumer electronic category by the fall of the year, representing up to 23 percent.
This means that the consumer electronic category as a whole may soon be dominated by Samsung Electronics Co., Ltd. (LON:BC94) and Apple Inc. (NASDAQ:AAPL). Competitors like Nokia Corporation (NYSE:NOK) and Research In Motion Limited (NASDAQ:RIMM) will have to fight an already uphill battle from the sidelines.
Here is a chart showing how the smartphone market share is divided among handset manufacturers. Take note of how former behemoths, like Nokia, have become shadows of their former selves.