This is an animation.
There was quite a heated debate on Asymco.com between me and a couple of other commenters about the vertical size of the above graphic. In my humble opinion the graph height chosen by Horace Dediu is misleading the reader and exaggerating the potential that is left in the phone market for Apple.
As shown above the graph would’ve been just as informative if it had been reduced in height by 50%. All of the vendors are still visible, even Windows Phone which just holds a tiny one or two percent of the market (guesstimate). Because even at a height of 400 pixels, each percent still is about three to four pixels high. With a height of 817 pixels in the original, more than half of the users on the internet will have to scroll to see the whole graph, have to adjust their display size in the browser or chose „Show image“ to have it squeezed on another browser window to fit their vertical screen resolution.
By doing this most of the users get the impression that „the market is huge“.
The other error in my humble opinion is that this basically omits that not everything that is „blue for Apple“ in this graph really is potential market. As stated in the comments on Asymco.com, I think it is obvious that the emerging markets that simply do not have the 3G networks nor the buying power to afford smartphones can’t be regarded as part of „non-smartphones“ when you label the article „The iPhone opportunity“, or better: they will stay non-smartphone for a long time to come this way or the other and can’t be regarded „an opportunity“.
As a hint on the current state of GSM coverage around the world take a look at the map Amazon provides for the Kindle’s Whispernet. I don’t say this is a map of all the cellphone networks in the world but it’s a hint where you can download a book via Whispernet on Earth. These markets will first have to have billions of dollars invested in their network infrastructure and the people living in these countries will need to move up from third world countries to second or first world countries (by today’s standards) so that they can even be regarded as a potential market for Apple, the iPhone, or other smartphones in the first place. At the moment, Africa is a Nokia continent and I don’t see any reason for that to change. As Tim Cook stated, the emerging markets and growth potentials lie in Brazil and China and you just can’t color all of the „non-smartphones“ blue if Brazil’s and China’s numbers are just part of that non-smartphone number.
Of course this isn’t intentional by Horace Dediu. I don’t fault him. The problem here lies in the reader who usually is NOT well versed in analyzing data. That’s what journalists are for. They need to be able to interpret the data and their graphic representation and they need to do it right. I think I am not wrong when I state that a large portion of the readers, given the title of the post, will be unable to interpret the graph correctly without the proper context and background information.
To me this is misleading the layman.
I really don’t see an „improvement“ in the graphs on your points of difference. Yours is definitely more readable to me — I use a MacBook Pro without an external monitor, so I can’t see the full graph in Dediu’s version — but I don’t think his is misleading in its height. Both graphs show that the smartphone market is still only between 30-40% of the full cellphone market, implying that there’s lots of room for Apple to grow its smartphone business without necessarily taking share from Android.
I agree with your other point (re: emerging markets), as well, but the compressed graph does nothing to address this issue.
Sure. There can’t be a difference since it’s the same data. As long as you see it all on one screen without scrolling it’s basically the same. I just contest that more than 50% of the users will be able to do that. And it’s hard to argue with so many tech-savvy commentators who of course know how to view the whole graph if it’s to large to view.
The problem is that this graph will be taken by other websites to illustrate a point. And since it’s given without context other than the title, it most likely will be misleading. I don’t say that Horace did something horribly wrong here just like someone who builds a 3D pie-chart doesn’t do anything wrong. But SOME parts have to be at the front and SOME parts at the back and those usually are perceived as larger. And my point simply is: this is perceived as LARGE. BIG. Because it is HIGH. That’s basically it. I thought that was something I could get across easily. Apparently not 🙂
Challenging the methodology is much more complex and writing an essay on Asymco in the comments wasn’t really my plan. I kinda got pushed into that because I had to back up my first point.
Anyway… about the methodology and the problems with the data itself and how it is given as a percentage: What makes a current buyer of a dumb-phone a potential Smartphone customer? first, you need 3G network. Then you need buying power for people to even be able to buy a Smartphone. Then you need affordable service, e.g. data plans that allow for cheap enough access to the Internet.
And I didn’t want to give a „stupid“ example. I tend to do that but try really hard not to because people (trolls) tend to then argue specifics about the example, not the overall point. Let’s just say that this is like pretending that all people who buy cars around the world are potential buyers of Porsche 911s. Because those dumb-phones Nokia sells all around the world at 10 to 20 bucks a pop compared to an iPhone that’s at least 369$ (the 3GS) makes it a factor of 1 to 20. And given that the cheapest cars in China sell for 5000 US$ that equals a car for 100,000$. That’s a Porsche (a troll would now argue that Porsches are cheaper or more expensive linking to a US Porsche dealer. That’s why I chose to argue the graph height that’s higher than what the layout of the blog is designed for).
Anyway, pretending that you can just lump in all of the cars around the world, any car from a 5000$ knock-off in China (Top Gear Episode 18×03 just had a special about Chinese cars) to Ferraris or a Zonda or Veyron for 2 Million bucks and say that all those people are „the opportunity“ for Porsche would be regarded idiotic. Still the marked Porsche currently sells the most cars in, where they have the most growth is – you name it – CHINA. But putting all the potential buyers of a Porsche in the „people who currently don’t have a Porsche but ‚a car'“ group is just plain wrong. And that’s what giving „non-smartphones“ like that is.
And that’s not even figuring in the lack of roads (3G networks) to use them on.