BUSINESS

RIM to exit consumer smartphone market; US mobile gamers top 100m

TAGs: android, Apple, mobile gaming, Research In Motion, smartphones

research-in-motion-exits-smartphone-marketResearch outfit Nielsen posted fresh figures on US smartphone usage on Thursday, showing the market is essentially down to two players. Some 49.7% of US mobile phone users now own smartphones, up from 36% a year ago. Android leads the field with a 48% share, with Apple’s iPhone at 32%. In September, those numbers were 40% and 28% respectively, and recent sales figures show a case of the rich getting richer. Over the past three months, Android and Apple split the new smartphone purchases market 48% to 43%. Research In Motion’s (RIM) once iconic BlackBerry continues its slide toward irrelevance with just 5% of new sales. Every other manufacturer – including Microsoft’s Windows Phones – accounted for a mere 4% of new purchases.

As if on cue, on Thursday RIM announced that it was exiting most consumer markets in a bid to focus on its core business clientele. CEO Thorsten Heins said the company had no future “if we tried to be everybody’s darling and all things to all people.” The company will launch a “comprehensive review” of just what it is they need to do to right the ship. Heins announced the plan along with figures that showed RIM losing $125m in Q4, compared to a profit of $934m the previous year. Revenue dropped 25% to $4.2b from $5.6b. Heins also revealed that RIM co-founder Jim Balsillie had resigned from the board of directors. Balsillie resigned as co-CEO in January, along with co-founder Mike Lazaridis, who remains on the board. Also heading for the exits are software CTO David Yach and COO for global operations Jim Rowan. Heins floated the possibility that RIM might seek partnerships and licensing agreements with other industry players. “Given the challenges we face, we believe it is prudent to explore all the company’s options.”

Meanwhile, analysts at IDC project that Android-operated devices will overtake Windows computers by 2016. Last year, Windows PCs held a 35.9% share of the “smart devices” market, which IDC defines as smartphones, tablets and PCs. Android-powered devices held a 29.4% share, and Apple iOS accounted for 14.6%. By 2016, IDC expects Android to lead the pack with 31.1%, Windows machines to be back at 25.1% and Apple at 17.3%. Interestingly, IDC doesn’t see this as a serious profit boost for Android, given the traditionally low margins of the devices on which it runs. The theory is that Android’s parent Google will benefit from increased ad views, while Apple will just keep tossing money on the pile.

And what are people doing with these oh so smart devices? Solving world hunger? Curing cancer? Fuck, no… they’re playing games. Market researchers Newzoo say the number of US mobile gamers has now topped 100m, up 35% over last year. Comparable figures from key European markets are up 15% to 70m users. Smartphones were US mobile gamers’ platform of choice at 69m, with 21m playing on tablets and 18m using an iPod Touch. As far as betting games are concerned, the top US iPhone/iPod games in February included Zynga Poker (#3) and Playtika’s Slotomania (#4), while Zynga Poker was #1 in Europe. Slotomania was the #2 US iPad game, while Europeans put Kamagame’s Texas Poker at #3 and Zynga Poker at #4.

Collectively, mobile gamers spend over 130m hours per day playing games, representing 13% of all electronic game play. Slightly more men than women are playing games both in America (52%) and Europe (56%). Users who convert from free play to paying for virtual goods within games are also more masculine in the US (58%) and Europe (65%). The overall conversion rate is highest in Asia (defined as Russia, Korea, China) at 47% followed by the US (36%) and Europe (26%). However, despite the number of paying Asian gamers being more than twice the US figure (66m v. 27m), those US players vastly outspent their Asian counterparts ($2b v. $1.3b). Read the full report here.

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