In What Year Apple WIll Have One Billion iOS Devices In Use?
Horace Dedui answered the above question in his usual “illustrative” style using graphs.
When I looked at the penetration of iPhones in the US (as a part of smartphones in total) the surprising pattern was that it followed a logistic curve (while other platforms didn’t.) If this is indicative of a particular learning process to be observed in the market, then can we extend the logistic growth pattern to iOS overall?
I tried it with the assumption that at 500 million, iOS is at the half-way point in its growth. This assumption comes from growth being near an inflection point. It could be that iOS might accelerate further in which case peak penetration could be higher than 1 billion, but might take longer to reach.
The 500 million as 50% penetration point assumption fits the model as shown below.
The fit is pretty good for the period after the iPhone 3G launched. This assumption would therefore imply (nearly) one billion iOS devices in use by the end of 2018.
Dediu noted that Apple does not need to discover new markets/users to reach this number. The company only needs to get current users to buy more iOS devices.
“This means that we already have “existence proof” that Apple can reach half-a-billion users.” Horace Dedui said. “Apple does not need to discover a large new set of non-consumers. The idea of 1 billion iOS devices is simply the projection that each current user could some day use two devices.”
Dediu’s theory echoes Apple investor – David Einhorn’s recent comments that Apple strategy of building a large ecosystem around their products is likely to drive recurring sales.
.. But I think Apple’s a little bit different from those companies, because the ecosystem component [drives] recurring sale[s]. If you have an iPhone, you’re more likely to buy the next iPhone [and maybe one for your spouse/ a family member]1. They have over a 90 percent renewal rate on that basis, which is something those other companies never had.
1 – Not in original quote.