This Cyber Monday Sale Is the Best Way for Google's Android to Surpass Apple's iPhone
The Moto X, the flagship handset from 's subsidiary Motorola, will be on sale this Cyber Monday. Motorola will sell an unlocked version of the Moto X for just $350, the same price as Google's own unlocked Nexus 5. subscribers should find the deal especially enticing, given that their carrier no longer subsidies smartphones.
Although Google's Android dominates the globe, in the U.S., Apple's iPhone remains the premier smartphone platform. Selling cheap, unlocked Android smartphones would be the easiest way for Google to change that.
Apple's iPhone dominates the U.S.
On a worldwide basis, Android absolutely crushes Apple's iPhone in terms of raw numbers. More than 80% of recently shipped smartphones ran Google's mobile operating system, while about 13% were Apple-made handsets.
In the U.S., the gap is decisively smaller, but there, too, Google's Android has the edge: about 52% to 40%. Yet in terms of quality, Apple remains on top -- Western mobile developers still seem to favor the iPhone; hit apps such as Tinder and Plants vs Zombies 2 remained iOS-exclusive before eventually being ported to Android.
Usage statistics seem to suggest that Apple's iPhone is preferred by more affluent, tech savvy users; analytics data from IBM and Adobe showed that iPhone owners spent more money shopping online during Black Friday than did their Android-handset owning counterparts (via Business Insider).
Moreover, once a consumer becomes an iPhone customer, that consumer is unlikely to switch. Recent studies from both Yankee Group and Consumer Intelligence Research Partners found an unprecedented level of loyalty among Apple's customers.
T-Mobile subscribers don't like Apple's iPhone
But there's one way this could change: more quality, unlocked Android smartphones. For a subscriber on a major carrier, choosing between Apple's iPhone 5c and Motorola's Moto X is a toss-up: Both phones boast similar specs and cost about the same on a two-year contract. Unless you really want a custom paint job, or a 0.70-inch larger screen, you'll probably go with Apple's device.
But when there are no subsidies involved -- when customers have to pay the full cost of their handset upfront, or else in varying monthly installments -- they seem to be much more likely to go with a phone sporting Google's operating system.
Last quarter, just 21% of the smartphones T-Mobile sold were Apple-made. In comparison, more than half the smartphones Verizon Wireless sold were iPhones. One plausible explanation for the discrepancy seems to be the difference in subsidies -- Verizon Wireless subsidizes phones, and T-Mobile does not.
A new T-Mobile subscriber opting for the iPhone 5c can either purchase the phone upfront for $550, or pay for it in installments over two years (in addition to their regular bill). But either way, they must ultimately pay the entire cost of the phone. Buying a cheap, unlocked Android handset, then, would be a much better deal for a T-Mobile subscriber -- either Google's own $350 Nexus 5, or Motorola's Moto X on Cyber Monday.
T-Mobile is the smallest of the nation's largest carriers, but it's growing the fastest. Investors in the sector should closely watch its continued rate of growth, and the percentage of iPhones it sells.
Will Google push unlocked Android?
Offering cheap, yet quality, unlocked Android handsets would be the easiest way for Google to overtake Apple in the U.S. market. As long as consumers remain dependent on carrier subsidies, they're likely to chose Apple's iPhone. Yet when they're responsible for their handset's entire cost, they seem much more willing to consider Google.
It's only one day, but as a subsidiary of Google, Motorola's unlocked Moto X sale is notable. If Google continues to push this strategy, Android could eventually overtake Apple's iPhone in the United States.
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The article This Cyber Monday Sale Is the Best Way for Google's Android to Surpass Apple's iPhone originally appeared on Fool.com.Sam Mattera has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Apple and Google. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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