Android always had a larger installed user base, the majority of the smart phones run on Google Inc. (NASDAQ:GOOGL)’s operating system, but Apple Inc. (NASDAQ:AAPL)’s iOS led the game in data traffic. But not any longer, Android has outdone iOS, gaining a market share of 45% as against iOS’ 44%. The CNBC’s “Squawk Alley” team discussed the importance and implications of this for both companies.
Jon Fortt feels that Android surpassing Apple Inc. (NASDAQ:AAPL)’s iOS in internet traffic is not a critical indicator. It not people just surfing the internet but rather it is people who are actually buying, either physical or digital goods through the device that really matters. And iOS has a growing base of such users, which makes their installed base effective. On the other hand, Android does not necessarily imply Google Inc. (NASDAQ:GOOGL).
“You got a number of different companies out there. OEMs that are using Android devices that don’t have Google Apps installed, Amazon.com, Inc. (NASDAQ:AMZN) for example. But there are others in China, for instance, that don’t necessarily accrue to Google,” he said.
Another key aspect is the upcoming launch of iPhone 6. A new design by Apple Inc. (NASDAQ:AAPL) will certainly increase sales for the company.
“But then, at the same time, what you also see when Apple Inc. (NASDAQ:AAPL) comes out with a new design, is lower margins overall, because there are the start-up costs for the factories, it costs some more to tool these things and pump out the new design. There is a give and take, but they see a surge in market share certainly,” he added.
Fortt also believes that Apple Inc. (NASDAQ:AAPL) has managed to create a more healthy ecosystem than Google Inc. (NASDAQ:GOOGL). The users of Android are divided across its different versions and do not necessarily upgrade to the latest version. While users who have an iOS device tend to upgrade it to the latest version of the operating system which makes for a robust ecosystem.