Another Kind of Monopoly

Back in the 1990s and early 2000s, Microsoft ruled personal computing with market share. At their peak around 2004, more than 90% of personal computing devices ran some variant of Windows. Even before this, they wielded enormous influence. It took a long time to topple Microsoft from the top of the stack. All during this time I was a staunch Macintosh supporter. I felt that this sort of monopolistic market was unnatural -- that consumers would be better supported in a market with three or four major competitors, rather than just one.

I happened to catch this short blog article referenced from the Stocks app on my iPhone under AAPL. It states that Apple has captured 88.7% of the profits from the Forth Quarter 2014 Smartphone sales. Apple has no where near 80+% of the Smartphone market share --  nearly 20% in Q4 2014, but more typically around 15%.

Seems this is another kind of monopoly -- not of share, but of profits. Google Android captured the remaining  11.3% of the profits, and other vendors lost money.

I'm not sure how I feel about this. It doesn't have the permanence that Microsoft seemed to have in the late 90s, since profits can change from quarter to quarter. But, unlike Microsoft, Apple seems to be in a mode where it is continuously re-inventing itself. And with the Smartphone cash cow, it has plenty of resources to do so.

And yet, Microsoft's hegemony wasn't permanent either -- the market eventually pivoted out from under them. I wonder where the market will pivot next.