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Why Android is outselling the iPhone

Apple had a leg up on the smart phone industry with the release of the iPhone in 2007 and record breaking sales that followed. Google on the other had taken a less traveled path to success. In late 2008, the company released their first smart phone powered by the Android OS. The HTC G1 was released on T-Mobile, the US wireless carrier ranked 5th in the US. Sales were lukewarm and did nothing to unseat Apple. Flash forward to July of 2010 and Google’s Android is now the leading operating system. Several factors contributed to this significant turnaround and it’s why Android is now leading the way.

For years, Verizon has been rumored to be the next US carrier to have the iPhone. Despite fast and furious rumors, it’s never panned out. Verizon customers clearly would like the iPhone, but they are also fiercely loyal and have resisted jumping to rival AT&T for wireless service. To satisfy their consumers demand for a modern operating system, Verizon looked to Google. Google does not sell their operating system, so multiple vendors can develop hardware without having to worry about licensing fees. This allowed Verizon to work with Motorola and HTC. Last year, the company released focused on two major releases, the Droid and Droid Eris. Backed by multi-million dollar advertising campaign, Verizon saw huge sales. Google saw the adoption rate of their OS grow at tremendous pace.

The wireless industry is not unlike other major industries. If they see a success, they try and copy it. Clearly Verizon had found a worthwhile competitor to the iPhone, so wireless carriers like Sprint and AT&T took note. This year, they took a page from Verizon’s playbook. Multiple handsets from HTC, Motorola and Samsung were released on all three major carriers in the US. The market muscle behind the carriers helped drive massive sales. Consumers have regained confidence in the Google Android platform, so they are more likely to spend money on an handset, knowing there is a plethora of community support and applications.

Google is benefiting from the rapid development on the hardware side. With the three major carriers all offering Android phones, the differentiating factor is hardware. This has driven innovation, which in turn makes Android devices more competitive against the iPhone. At the same time, Android has yet to see competition from Microsoft or Palm. Palm’s next generation operating system webOS is impressive, but they cannot compete with the sheer number of handsets on the market.

Google’s marketing strategy has proven effective as they are now the number one modern operating system in the smart phone market. Every day, over 100,000 Android phones get activated and that number is growing. Success breeds success. By not charging for the operating system, Google benefits from more manufacturers developing phones for an assortment of wireless carriers. Google has taken a page out of marketing 101, which is to offer customers choice. Choice in hardware and choice in wireless carrier has helped them become number one for now and the foreseeable future.

Michael is a writer for Everything Android and has been using Android phones since 2008. In addition to news coverage, Michael enjoys writing reviews of Droid 2 cases and spending time in the Android forums.