Google Inc (GOOG), Apple Inc. (AAPL): Do Gartner Inc (IT)’s Smartphone Numbers Add Up?

Also note that I’ve provided a curve fit to the Google Inc (NASDAQ:GOOG) activation announcements in order to interpolate between announcements, since Google management makes announcements at irregular intervals. There’s always some uncertainty about the time phasing of the Google activation announcements. For instance, Larry Page’s blog of March 13 didn’t quite come at the end of the quarter, so there’s still some uncertainty about when the 750 million activations became effective. For simplicity, and because the potential errors are small, I always treat the announcements as effective as of the end of the relevant quarter.

The cumulative Android smartphone shipments according to Gartner are way above the total Android device activations as of Q1 2013. Gartner’s errors are more difficult to detect on a quarterly basis, but it becomes apparent that these errors are systematic when you plot cumulative results. Conversely, Gartner Inc (NYSE:IT) slightly, though consistently, underestimates iPhone shipments.

The take-away

In order to accept that Gartner’s Android shipment data is valid, one has to assume that Google is deliberately low-balling their activation number announcements. This strikes me as highly implausible, given how proud Google is of their activation tallies when they do announce them.

In fact, I regard Google Inc (NASDAQ:GOOG)‘s activation claims as somewhat suspect, since, as I have previously pointed out, there is a potential to activate the same device multiple times.  But I certainly don’t believe numbers that are substantially in excess of the announced activations. It would be great for investors if Google and Microsoft Corporation (NASDAQ:MSFT) followed Apple’s lead and announced product shipment data on a quarterly basis.

Google’s Android is still trouncing Apple Inc. (NASDAQ:AAPL)‘s iOS in market share, but the margin of victory is smaller than Gartner would have us believe. As of the end of Q1, Apple had sold a total of 523 million iOS devices, while at most 750 million Android devices had been sold.

If Gartner Inc (NYSE:IT)‘s numbers for Android device shipments in 2012 were in error by such large amounts, should we believe their prediction of 866.8 million Android devices shipped in 2013?  In a word, no.

The article Do Gartner’s Smartphone Numbers Add Up? originally appeared on Fool.com and is written by Mark Hibben.

Mark Hibben has a position in Apple. The Motley Fool recommends Apple, Gartner, and Google. The Motley Fool owns shares of Apple and Google. Mark is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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