Apple (NASDAQ:AAPL) has been great at sparking consumer interest in new features to its iPhone operating system iOS. Such developments are critical in the smartphone OS space, as competition has intensified over the past few years with Google’s (NASDAQ:GOOG) Android making a big splash. Nokia’s (NYSE:NOK) Symbian, Research in Motion’s (NASDAQ:RIMM) BlackBerry OS, and Microsoft’s (NASDAQ:MSFT) Windows Phone 7 and Palm webOS (now acquired by HP (NYSE:HPQ)) also add fuel to the competitive atmosphere.
Apple Remains Ahead Despite Push from Android
Android’s U.S. smartphone subscriber market share has come a long way from the 4% reported in November 2009.  Its market share crossed 23% in October 2010 and increased further to around 31% by January 2011.  Although Android has overtaken Apple in terms of smartphone OS market share, Apple benefits by selling premium products, which it is able to sell it at high prices and hefty gross margins.
Here we highlight some of the factors behind Apple’s success.
Apple Has the Upper Hand in a Few Critical Software Features
Two of the most important factors behind smartphone software success are browser experience and the apps ecosystem.
Browser experience: Mobile phone companies are constantly looking to improve browsers to provide higher speed with less bandwidth consumption. Nokia, for example, acquired Novarra last year to strengthen its browser features,  and RIM acquired Torch Mobile to generate a much-needed browser makeover.  Apple remains atop the hill in this regard, a key factor to its rapid adoption among smartphone users.
Apps ecosystem: Apple’s iPhone app store went live in July 2008,  and now includes more than 350,000 applications.  Developers and the applications that they create can both play a key role in a mobile phone’s success. Apple by far holds the app edge over Android, while RIM remains behind both ecosystems. Notably, RIM acquired the app store infrastructure developer Cellmania last year in order to revive its app store. Notes:
- Comscore U.S. smartphone subscriber market report for November 2009, April 5th 2010 report [↩]
- Comscore U.S. smartphone subscriber market report for January 2011, March 7th 2011 report [↩]
- Nokia press release, March 2010 [↩]
- RIM acquires Torch Mobile, August 2009 [↩]
- Apple’s app store launch, July 2008 [↩]
- Apple press release, January 2011 [↩]
- RIM acquires Cellmania, August 2010 [↩]