According to the latest research from our Wireless Smartphone Strategies (WSS) service, global Android smartphone profits reached US$5 billion in total during the first quarter of 2013. Samsung dominated and captured an impressive 95 percent share of all Android smartphone profits.

We estimate the global Android smartphone industry generated total operating profits of US$5.3 billion during Q1 2013. The Android platform accounted for 43 percent share of the entire smartphone industry’s operating profits, which reached US$12.5 billion worldwide in the first quarter of this year.

We estimate Samsung’s Android smartphone shipments generated US$5.1 billion of operating profit worldwide in Q1 2013. Samsung captured a huge 95 percent share of all Android smartphone industry profits. An efficient supply chain, sleek products and crisp marketing have been among the main drivers of Samsung’s impressive profitability. LG followed in second place and took 3 percent global profit share. LG delivered a small profit during the quarter, but it currently lacks the volume scale needed to match Samsung’s outsized profits.

Samsung is, for now, the undisputed king of the global Android smartphone industry. We believe Samsung generates more revenue and profit from the Android platform than Google does. Samsung has strong market power and it may use this position to influence the future direction of the Android ecosystem. For example, Samsung could request first or exclusive updates of new software from Android before rival hardware vendors.

Exhibit 1: Global Android Smartphone Profit Share in Q1 2013 [1]

Facebook Home, announced last week and due to be released on Friday April 12, occupies a space somewhere in-between an app and a bespoke user interface, or ‘skin’. Unlike OEM skins, Home is optional and requires manual download by the end-user, but unlike most apps, Home is intended to supplant the native user interface of the device.

The potential positives for end-users revolve around easier access to Facebook from your smartphone and a deeper, more intuitive integration of Facebook services such as photo sharing, instant messaging and event notification. However this is a double-edged sword, and all but the most committed Facebook users may view such a comprehensive change in the user experience as a negative, especially if native apps such as Maps, Gmail, search, etc are made more difficult to use. We believe this will result in a large proportion of the initial installs of Facebook Home after its release this Friday will subsequently be uninstalled.

The potential positives for Facebook will come mainly from greater user-engagement with Facebook on mobile and an enhanced ability to monetise that activity - through targeted advertising pushed to the ‘Cover Feed’ for example - which Facebook is under considerable pressure to achieve. The main threat to Facebook from Home will be in the form of potential negative publicity regarding the user-experience compromises the app requires and, of course, privacy concerns arising from such deep Facebook integration.

Among the major smartphone OSs, Facebook Home is likely to be restricted to Android, as iOS, Windows Phone and BlackBerry make no claims to being ‘open’ and are under no obligation to accommodate Facebook’s attempt to replace their own UI. While we expect the majority of users to continue to access Facebook via a browser or the less intrusive native mobile apps currently on offer (assuming Facebook maintains them), if even 5% of Android users retain Home as their UI that would give Facebook tens of millions of Home users in 2013. Facebook may attempt to increase this proportion through revenue-sharing arrangements with OEMs and mobile operators (most likely tier 2 and below), but the more coercive it is in encouraging end-users to use Home, the greater the likelihood of public backlash and consequent damage to the Facebook brand in general.

According to our Wireless Smartphone Strategies (WSS) service, smartphone sales volumes will surge +56% in Africa Middle East this year. The rate of growth in Africa is almost two times higher than the global average. Growth will be driven by first-time buyers and 2G handset upgraders in major countries such as Nigeria, Egypt and Saudi Arabia. More details can be viewed by clients in this published report, which forecasts worldwide smartphone sales for 88 countries globally, including Brazil, Spain, Russia and others.

According to our Wireless Smartphone Strategies (WSS) service, smartphone sales volumes will surge +69% in India this year. The rate of growth in India is two times higher than the global average. Growth will be driven by a wave of low-cost Android and Microsoft models for prepaid users from companies like Samsung, Micromax and Nokia. More details can be viewed by clients in this published report, which forecasts worldwide smartphone sales for 88 countries globally, including India, China, US and others.

According to our Wireless Smartphone Strategies (WSS) service, global smartphone sales will grow by +33% in 2013. Asia Pacific will remain the largest region, accounting for half of global smartphone sales in 2013. The two largest countries by far in 2013 will be the USA and China. This published report, available to clients, forecasts global smartphone sales, for 88 countries worldwide, from 2007 to 2017. Almost every major country worldwide is covered, including United States, China, India, Indonesia, Japan, South Korea, Russia, Brazil, Mexico, South Africa, Saudi Arabia, UK, Germany, France, Italy and Spain. This report can be used by operators, software developers, content developers, handset vendors, component makers, car manufacturers and other stakeholders to determine the size and growth rate of the huge global smartphone market.

Andy Rubin, the boss and creator of the dominant global smartphone operating system, has stepped down from running Android in order pursue other avenues within Google, stressing “I’m an entrepreneur at heart.” Android was bought as a start-up by Google back in 2005, with Rubin kept in charge, and he spent the next eight years getting Android to the point it’s at now. But as he has said himself, Rubin is a product development guy rather than an operations guy, and he seems to be keen to get stuck into something new, maybe at Google’s mythical X Lab together with Google co-founder Sergey Brin, who also seems to prefer inventing to running things.

In the short term this should have little bearing on Android, which after all is also looked after by the Open Handset Alliance.  Rubin’s shoes are being filled by Sundar Pichai, who already runs the Chrome browser and Google Apps web applications arms of Google, so he is a steady pair of hands. But in the longer term, Rubin’s departure could well coincide with the need for Google reassess what its strategic aims are for Android. It’s got more installed base than Google could possibly have wished for, but effectively capitalising on that installed base is another matter.

Android so far has existed mainly to compete with Apple, but Chrome and Google Apps are more targeted at Microsoft products such as Internet Explorer and Office. Apple has its desktop and mobile operating systems on a convergent path, while Microsoft has made its intentions clear by shoe-horning the Metro UI on top of the latest version of Windows. Google has responded by ramping up its Chromebook operations, but it seems inevitable now that Android and Chrome OS will also merge in the not too distant future. With a unified OS across all devices - mobile, tablet, PC, TV, console, car, etc, choosing a platform looks set to be one of the biggest lifestyle choices a consumer can make. By replacing Rubin with Pichai Google is positioning itself for the next phase of the platform wars.

According to our Wireless Smartphone Strategies (WSS) service, global smartphone shipments grew +38% annually in Q4 2012, and +43% in FY 2012. Growth in the quarter was healthy but slowed a little as postpaid penetration matures. Samsung and Apple continue to dominate volumes due to their extensive retail presence. Huawei became the world's third largest smartphone player for the first time ever, highlighting the rise of Chinese brands. This published report -- available to download by clients --contains global smartphone shipments by the top 20 vendors by region by quarter from 2007 to 2012. Global smartphone shipments by vendor by operating system by quarter are also included in a pivot-table. The report is valuable for mobile stakeholders who want to size the huge market for smartphones and operating system marketshare by hardware vendor.

According to our Wireless Smartphone Strategies (WSS) service, global smartphone shipments reached a record level of 700 million units in full-year 2012. While Android was once more the dominant global OS by volume, Apple reclaimed some marketshare thanks to the first full quarter of availability for the new iPhone 5. This trend was especially apparent in North America, where Android appears to have peaked, but globally Android still accounts for a significant majority of all smartphones shipped. BlackBerry and Symbian continued to see their global presence shrink, and while Microsoft experienced a boost from the launch of Windows Phone 8 in Q4, the gain was smaller than expected.

This published report, available to download by clients, contains global smartphone shipments by operating system by region by quarter from 2009 to 2012. The report is valuable for mobile stakeholders who want to size the huge market for smartphones and operating system marketshare.

According to our Wireless Smartphone Strategies (WSS) service, HTC’s smartphone shipments worldwide declined by -29% annually in Q4 2012. We believe Chinese players such as Huawei, ZTE and Lenovo are grabbing large chunks of marketshare in China in the lower price-tiers, while the two smartphone giants Samsung and Apple achieved a lion’s share of volume and profit in the higher-tiers. As a result of the heightened competition, HTC’s global revenues were down -41% against the previous year and its gross profit fell by -92% annually. This published report gives more details for clients to download.

According to our Wireless Smartphone Strategies (WSS) service, smartphone shipments grew +25% annually in North America during the fourth quarter of 2012, the region's strongest growth rate for a year with both USA and Canada registering record high smartphone demand. Three out of Four mobile phones sold in North America now are smartphones.

However, Android lost eleven points of sequential share to Apple as it is approached a peak in the US market. Meanwhile, Microsoft overtook BlackBerry OS to become America's third largest platform for the first time since 2006. This report contains quarterly smartphone vendor and OS shipments and marketshare for the top 9 vendors and top 5 platforms in the United States and Canada for Q4 2012. The report also contains historical data for North America from 2007 to 2012, as well as a pivot table for data control and a deeper dive for an OEM-by-platform view in these countries

North America Smartphone Vendor & OS Market Share by Country: Q4 2012