Though not as spectacular an area of news as tablets, “phablets,” and smartphones, the wireless beacon market is rapidly expanding, and Apple Inc. (NASDAQ:AAPL) appears to have a clear – not to say massive – competitive advantage over its competitor Google in this regard. The iBeacon is spreading rapidly in a number of spheres, including retail, sports arenas, museums, and possibly even the home. An even more crucial factor, however, is how many devices running a given operating system are beacon-ready. iOS devices are 82% beacon ready, according to a report today from Patently Apple, while Android devices are only 2.5% beacon ready.
Getting the jump on the competition in the beacon sphere could prove important in an age when sales of apps and digital services are beginning to rival hardware sales as a source of revenue even for gigantic electronics firms such as Apple (AAPL). Being successful in the world of beacon technology draws the business of huge retailers with deep advertising budgets, with a potential windfall of cash when these companies pay for access to both beacons and the server space that backs them up.
Another reward accruing to the company competing most successfully for leadership in beacon readiness is the added utility this provides to their devices from the consumer’s point of view. If, for example, people can get discounts, specials, and useful information from devices running iOS but not from an equivalent mobile device running Android, they have an additional incentive to pick iOS next time they buy a smartphone. Though widespread beacon access is unlikely to be the sole factor in a person’s buying decision, it is something that might tip an undecided purchaser in favor of an iPhone rather than a Samsung Galaxy, for example.
The unified approach of Apple’s (AAPL) products gives it an advantage over the fragmented Android market from the point of view of a company contemplating how best to deploy beacon technology. According to Apple, 87% of users are currently running iOS 7. This represents a huge, consolidated market of devices and users accessible by a single beacon system. Android, by contrast, is Balkanized across hundreds of different firms’ devices, which often show considerable incompatibility with one another. A beacon app designed for one Android device may only work on 5% or 10% of other Android devices, while an app for iOS 7 is guaranteed to work on close to nine tenths of Apple’s smartphones.
A look at actual numbers of beacon ready devices for each of the major competing platforms provides a better appraisal of what each has to offer retailers and organizations planning to use beacons. 82% of 600 million iOS devices means that an iOS beacon, such as iBeacon, can potentially reach a pool of 492 million people. 1.9 billion Android devices are in use, but with just 2.5% beacon ready, only 47.5 million people are possibly reachable by this means. Put another way, there are 10.4 iOS customers equipped to use beacons for every 1 Android customer who is beacon-ready.
Stores and organizations have a powerful incentive to install iOS-compatible beacons rather than Android-compatible ones in light of this data. Though matters can evolve quickly in the high speed world of modern electronics, Apple Inc. (AAPL) appears to hold a powerful lead over its competitors in the booming market for beacon-delivered advertisements and information.
