While Apple (NASDAQ:AAPL) co-founder Steve Wozniak was whinging (he's been whinging for three decades) about how Android is better at some things than iPhone (while admitting his iPhone is his regular device) Nielsen was reporting that, in a word, the iPhone won Christmas.
In just the two months since the Apple 4S with Siri debuted, Apple's share of new smartphone subscribers nearly doubled, from 25.1% to 44.5%, while those of Android fell from 61.6% to 46.9%. The two platforms are nearly level among new subscribers.
What that should tell investors is that smartphone buyers pay attention. They like new features, and they will pay-up for them. They compare what they have with what friends have and act accordingly.
This doesn't mean Apple's continuing dominance is assured. And that was the heart of Wozniak's message - that Android can do GPS, it can do voice commands, and Apple can not rest on its laurels.
The chief threat to Apple this year, as the Nielsen numbers make clear, is continuing price pressure. As Deloitte notes, smart phones will be practically given away by carriers later this year.
Those cheap smartphones may well replace current feature phones, meaning the current market bifurcation will continue. Instead of it being between smartphones and feature phones, it will be between branded smartphones and non-branded smartphones.
Thus Apple faces a choice. Does it take its iPhone market down-market, or does it continue to set a high-end standard and maintain its $500 price point?
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.