Samsung, Apple Smartphone Market Dips

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July 26 (Bloomberg) -- Bloomberg Contributing Editor Paul Kedrosky discusses the hight-end smartphone market with Emily Chang on Bloomberg Television's "Bloomberg West." (Source: Bloomberg)

First, to the lead.

Just days after apple reported record iphone sales of 31 million in the third quarter, we have a new report saying apple and samsung are losing market share to the makers of lower end smartphones.

Apple share of the global market toppled in doubles recent quarter from 16.6 million.

The lowest share in three years.

Samsung mark teixeira also dipped two percentage points like other countries like lg start make inroads.

This is a sign the high end market is shrinking?

Paul kedrosky is with us.

Which of these companies have the most to worry about?

A weirdly enough, the copies we have not named.

I make the analogy this a little like the early days of the pc industry.

Remember we had ibm creating a pc industry and it bunch of clone manufacturers starting up.

The compact dell and others.

A little while later, came packard and all of these clone manufacturers who can still share in much the same way as some at the lower end of manufacturers.

It turned out it was a nasty place to be.

A group quickly and collapse because it was price based.

There was no differentiation except for the price.

Consumers are fickle.

I am expecting was the just like in the early days of that industry this explosion.

They are all going to be beating each other on price.

There will be rapid consolidation.

It will be back to four or five dominant players which will be the playbook precisely.

Which are the smartphone makers are poised to collapse most likely?

Almost anyone who thinks they can sell devices or $70. we have seen a number of people over the last six months announce they can sell products for $70 or less and succeed.

And continue going forward.

I do not see that happening.

All sides of the clone manufacturers among me -- many factors, they cannot survive at the high end.

They do not have the price structure.

A are pumping out high volumes of android devices.

You cannot win there either.

Consolidation is probably around lenovo and a couple of others on the low end.

Then a couple of high-end manufacturers like samsung and certainly apple which the model they play by.

That is the way it is going to shape up.

They will all implode on themselves.

There has been a lot of talk about whether the high-end smartphone is saturating enough.

Tim cook talked about that earlier.

Had a listen to what he had to say.

I do not subscribe to the common view that a higher end of the smartphone market has hit its peak.

I do not believe that.

We will see.

Would you agree?

I actually do agree with that weirdly enough.

I agree with him on that one.

In part because apple, they are a good example.

Apple is a good aspirational product.

They have built themselves up over time.

Is for social status and positioning.

That is part of the charm of apple.

People by for those reasons.

As a result, the smartphone marketplace is self am a you need a company like that so people can position themselves -- itself, you need a company like that so people can position themselves.

If you are still seeing it as aspirational product.

That is the way apple continues to see itself.

Sort of a -- apple wants to be that kind of brand.

They will remain that brand.

That would never be the dominant market share that they helped to create.

One of the unlikely winners appears to be lg which is not only gained share but also making money and have some say and improve its portfolio and devices.

What is the fate of the company like lg?

Og and lenovo are likely to be the consolidators.

4 or five manufacturers at the end of the day the troll 90% of the market share in this marketplace.

That would not be until we get to the other side.

As a potion of taiwanese and japanese manufacturers.

Maybe some north americans what's. -- north american ones.

They all end up being absorbed into the skull manufacturer.

It will be consolidators and acquirers and apple and samsung on top among the only brand of products.

That's the way it will look.

Over the longer term, do you see samsung and apple remained in the top two spots?

I think so.

This text has been automatically generated. It may not be 100% accurate.


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