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Rumors of Apple's Demise May Be Greatly Exaggerated

The prevailing wisdom says that Apple's brand is losing share in developed markets as Samsung cranks out better phones. The data we're getting this week, however, says something different.

Verizon's results Tuesday refuted that notion in rather startling fashion. In the holiday quarter a year ago, iPhones made up 55.8 percent of Verizon's overall smartphone activations — an unusual feat because Android phones are usually the majority. In Q4 this year, 6.2 million iPhones made up a whopping 63.2 percent.

Not only that, but Apple's old iPhones — the 4 and 4S — were more popular than every Android phone combined. Verizon said it activated more than 3 million of those older models.

In addition, these weren't cheap Android phones Apple was facing off against. Verizon said 95 percent of Android activations were onto the LTE network.

Now, we won't have the results from AT&T until Thursday, the day after Apple's report. However, the company has already said it activated 10.2 million smartphones in the quarter.

Recently iPhones have been about 80 percent of AT&T's smartphone mix, so it seems reasonable to expect to see 8 million iPhone activations there. Sprint will probably add another couple of million units.

And then there's the matter of channel fill. If Apple is managing to make enough iPhone 5 units to meet demand — and few analysts seem to be worried about that lately — then Apple's iPhone sales number will be higher than the activation number.

Because the iPhone 5 just came out, carriers haven't built up the four weeks or so of inventory cushion they like to have. So if AT&T and Verizon activated a combined 14.2 million iPhones in the quarter, they probably tried to buy more than 15 million, to "fill the channel."

So at a time when investors are worried about Apple losing its cool in developed markets, the latest numbers suggest the opposite is happening. When given a choice between the latest LTE-equipped Android phones and iPhones on a network whose main selling point is nationwide LTE, not only are customers choosing iPhones, they're choosing old iPhones that don't even use the LTE network.

This is not good for Android, or for Verizon, really. But it's very good for Apple.

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