Android has overtaken Symbian smartphone operating system market share. Apple’s lead in tablets is plummeting (or not). These days news about mobile market share is rampant, and seemingly everyone wants to add their voice to the chorus of pundits discussing the numbers.
But let’s set aside questions of how market share is calculated to ask a simple question: why does market share matter?
Historically, in the case of PC operating systems, large market share attracted developers who built software exclusively for the dominant platform. That software, in turn, created further lock-in as users grew accustomed to the workflows and proprietary data formats that emerged. Typified by Microsoft’s “embrace and extend” strategy, market leadership yielded a nearly permanent advantage, which suffocated competing platforms and deprived customers of choice. (“Microsoft Trying to Dominate the Internet”)
Essentially, the historical advantage of dominant market share has been the ability to raise (discriminately) the switching cost of competing platforms.
Today’s mobile market is a collision of the wisdom and mistakes of the last 30 years of computing. Handset OEMs, OS vendors and carriers are rushing to open app stores. Tensions have flared over “open” access to mobile development platforms. And atypical competitors are entering the market in search of growth and profits.
The gold rush mentality is hardly surprising: most of the players assume that we’re at the beginning of the PC era redux. But I think they’re wrong.
The table stakes applications (Facebook, Twitter, Kindle, etc.) are available on most of the leading mobile platforms. If not available specifically as native applications, these services as often accessible as web applications. For apps beyond the main set, a reasonably informed consumer can find ready substitutes.
The data format worries of the PC era are now largely irrelevant, largely as a result of the web and outcomes of Microsoft’s Interoperability Commitments.
App stores have created a unique complication for developers. Despite dozens of app stores, only a handful (OK, really only one) has proven to monetize well. For independent third-party application developers, those most often driving software innovation on these platforms, share-heavy platforms have yet to pay off.
Further, the arrival of carrier billing and commercial payment powerhouses (Visa, Mastercard, Amazon, PayPal, etc.) onto mobile platforms promises to further erode the easy-payment advantage enjoyed by Apple’s iOS.
I could go on, but it’s apparent that there’s a level of parity in today’s mobile market that limits the likelihood of creating a permanent advantage.
Unfortunately, that parity is temporary. Over time, the breathtaking competition of the mobile industry will subside and those companies that have figured out how to make money will survive.
The lesson of the PC era has been misremembered; it was always to earn the disproportionate share of industry profits. Market share, in and of itself, does not matter.