Needham Shock Jock

Charles Wolf released an interesting report to investors on the 19th. I couldn’t find it online so I requested the data directly from Mr. Wolf. Here it is. I felt that is was fishy so I investigated a little more.

On page 9 of his report wolf has a quote to support the inferior nature of the apps within the android market place from this article.

Darrell Etherington, “Apple Loses Ground to Android, But the App Store Still Dominates,” gigaom, February 9, 2011.

The vast amount of spamware (45,000 out of 100,000 apps in the Android Marketplace are spam apps) and the low number of top-tier game titles (20 for Android vs. 306 for iOS) and other app categories all play their part in making the Android app market a cottage industry compared to the profit-engine of the iOS App store.

Unfortunately this is never in the article or written by Darrell Etherinton, its a comment on the article from a user who goes by mrrtmrrt who signs his comment Mart. I’m still trying to track this guy down. But he loves commenting. InforWorld, Forbes, The Guardian, Marketwatch and the list goes on.

In another quote, page 10, said to be from
Kyle Baxter, “Android Isn’t About Building a Mobile Platform,”, January 4, 2011

Android’s market may… be terrible in comparison to Apple’s App Store for paid applications… because… discouraging paid applications on the Android platform is in Google’s interest.

The real quote is

For example, Android’s market may not be terrible in comparison to Apple’s App Store for paid applications just because Google hasn’t yet finished it; rather, discouraging paid applications on the Android platform is in Google’s interest.

A cleaver use of eliplise.

I wondered about the accuracy of his numbers and more importantly the accuracy of his interruption of the numbers from IDC. I requested the data from IDC directly and got this response from IDC PR.

Unfortunately, I can’t share that data with you — it’s proprietary research that was unfortunately usurped by a Needham analyst and plastered all over the Web.

From what I gather from released un-usurped data, Nielsen April 2011, comScore June 2011, and most importantly of all IDC June 9th 2011, the same company Wolf quoted the majority of his data from, Android is in no shape to stop or slow down anytime soon. This data which covers that same time period as Wolf’s report have drastically differnt trands.  I think IDC sums it up best

IDC expects Android, which passed Symbian as the leading operating system worldwide in Q4 2010, to grow to more than 40% of the market in the second half of 2011. A significant and growing list of vendors who have made Android the cornerstone of their respective smartphone strategies is propelling the growth of Android

iOS was the third ranked OS going into 2011 and will remain a force in the mobile phone market throughout the forecast. After an initial explosive growth period, iOS is expected to grow at a more modest pace throughout the latter half of the forecast as the smartphone market matures and diversifies. Although a small market share decline is expected, IDC expects significant overall shipment volume growth through the end of 2015.

I got ahold of William A. Stofega, Program Director of Mobile Device Technology at IDC and got his opinion from the same dataset that Mr Wolf has.

Quarter over quarter there will be fits and starts for all manufactures.  Android is a driver in terms of growth no matter whose numbers you look at. IDC see android as the leader in mobile right now especially with a huge growth in lower tier and emerging markets like China. Regarding Mr Wolf, its fine that he used our data, but IDC is unaware of his methodology of analysis. The bottom line is what the end of the year numbers will be.

I contacted Mr Wolf and asked for his methodology and dataset, but haven’t received a reply as of publication.

With the fact that Wolf’s main source of data, IDC,  sees Android as the leader and has the expectation of continued growth, the published numbers from multiple sources, I cannot see how Mr Wolf has reached his conclusions. He may have taken an extremely narrow subset of data to produce his numbers, but as IDC stated, its the end of the year numbers that matter, not a subset of data. Without his methodology and the dataset one cannot check his numbers, but if he cannot even cite a source correctly, I don’t trust his statistical analysis skills. In the end I think that Mr Wolf wrote this report for shock value and to make a name for himself. I don’t think I am alone in that opinion.

Finally just a reminder, don’t believe everything you read, check the sources, and check to make sure the sources were quoted correctly.

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