TECHNOLOGY FOR CHANGE

Apple vs. RIM: Mobile Quickly Becoming a Two-Horse Race

Stephen Wellman | Date: 06-02-09 | Comments

While the number of companies offering smartphones remains high, industry profits are increasingly being captured by just two companies: Apple and Research In Motion. What does this mean for Microsoft's Windows Mobile platform?

The market for smartphones is shaping up as a two-horse race between Apple with its non-stop mobile app juggernaut, the iPhone, and Research In Motion, manufacturer of the enterprise stalwart BlackBerry. Which is bad news for Microsoft and its Windows Mobile platform.

According to a short piece from Silicon Alley Insider, Apple and RIM will combine to account for the largest share of wireless industry profits in 2009:

For instance, Apple and RIM will combine to sell somewhere between 5% to 10% of mobile phones shipped worldwide this year. But Apple will capture 31% of the industry's operating margin dollars, and RIM will represent 35%, according to a report by Deutsche Bank analysts Brian Modoff and Jonathan Goldberg.

This finding should give pause to IT managers looking to adopt any mobile platform as a solution other than the iPhone or BlackBerry, including Palm or Nokia Symbian, both of whose shares of wireless industry profits have declined in recent years, or even Windows Mobile or Google Android.

While RIM remains the king of the mobile business market, there is evidence that Apple's iPhone is starting to make inroads in the enterprise too. According to a recent report in eWEEK, several larger enterprises are gladly letting the iPhone in the door:

As of this past January, almost half of Kraft Foods� mobile team were using iPhones�a number Schadler pointed out is significant, given that mobile adoption at that stage is generally 10 percent, with 20 percent being the higher end�and about 400 new iPhones are being ordered each month.

Among the benefits Kraft is seeing is a change in the culture of the company to take advantage of new technologies; among the challenges were problems with calendar synchronization.

While Windows Mobile remains the perennial No. 2 vendor in the mobile enterprise market, I think the iPhone's massive growth and profitability will give Apple plenty of time to eat up business mobility market share from the rest of the competition, including Microsoft. Many of the handset manufacturers listed in the aforementioned wireless profit report build smartphones for Windows Mobile, and their market shares are declining. If manufacturers building on Windows Mobile don't start to grow their share of industry profits, how much longer will they be around?

And what about yesterday's mobile enterprise champion, Palm? Well, if the Pre can't save Palm, then that platform could also disappear from the market.

Based on these market trends, RIM's BlackBerry and Apple's iPhone could soon be the only choices left for any IT manager looking for a long-term mobile platform.

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