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Innovation and competition in the smartphone industry:
Is there a dominant design?
Grazia Cecere a
, Nicoletta Corrocher b,n, Riccardo David Battaglia c
a Institut Mines Télécom, Télécom Ecole de Management, 9 rue Charles Fourier, 91011 Évry, France and Université Paris Sud 11, RITM, 54
Bouleveard Desgranges, 92260 Sceaux, France
b CRIOS, Bocconi University, Via Sarfatti 25, 20136 Milan, Italy
c MEDAlics Research Center for Mediterranean Relations, Via del Torrione 95, 89125 Reggio Calabria, Italy
a r t i c l e i n f o
Available online 14 August 2014
Keywords:
Smartphones
Dominant design
Product differentiation
a b s t r a c t
The mobile phone industry is a very innovative segment within the ICT sector and the
smartphone is becoming the standard configuration among the different types of mobile
devices. Technical change and new product proliferation have made this industry
extremely dynamic, even if market shares are highly concentrated in the hands of very
few companies. The present article investigates whether a dominant design has emerged
in the smartphone industry. In particular, it studies the evolution in hardware components
relying upon an original dataset of product characteristics including all smartphones
launched in the market between 2004 and 2013. Results show that, despite some
convergence in the introduction of vertical innovations, product differentiation still
characterizes the competition among manufacturers and a dominant design has not yet
emerged.
& 2014 Elsevier Ltd. All rights reserved.
1. Introduction
Smartphones have emerged in the market as the standard configuration for mobile devices and currently represent the
fastest growing market segment in the telecoms industry. For the first time, in 2013 sales of internet-connected
smartphones exceeded those for more basic handsets.1 Global mobile phone sales grew by 3.6% to 435 million units in
the second quarter of 2013, for the first time smartphones accounted for more than half of the market. Although devices
offering telephony and computing features were developed in the 1970s, it was not until the end of 2006, when the
Blackberry was introduced onto the market by RIM, that the smartphone became a commercially successful product.
In 2007 Apple entered the market by developing the first model of iPhone and soon after (June 2008), Samsung released the
Samsung Instinct, a direct iPhone competitor. Since then competition in the market has been quite harsh among incumbents
and between incumbents and new entrants. The recent legal battle over patents and designs between Apple and Samsung is
a clear signal that smartphone vendors are fiercely competing for leadership in the market, even if Samsung is consolidating
its leadership also thanks to the diffusion of Android operating system.2 Despite the success of the iPhone design in the
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URL: www.elsevier.com/locate/telpol
Telecommunications Policy
http://dx.doi.org/10.1016/j.telpol.2014.07.002
0308-5961/& 2014 Elsevier Ltd. All rights reserved.
n Corresponding author. Tel.: þ39 02 58363396; fax: þ39 02 58363399.
E-mail address: [e-mail] (N. Corrocher).
1 〈http://www.ft.com/cms/s/0/eb8ed76e-0500-11e3-9ffd-00144feab7de.html#ixzz2id9vhg8y〉.
2 In August 2012, the court obliges Samsung to pay Apple just over $1 billion in damages for infringing six of the American firm's software and design
patents.
Telecommunications Policy 39 (2015) 162–175