Deutsche Bank analyst Brian Modoff says the disparity will become even greater this year when the two companies take 5% of the market generating 58% of total profits.
Manufacturers of basic phones make virtually nothing, unless they have enormous scale. Nokia, the industry leader, manufactured 46% of the units sold last year but earned 55% of the profits, Mr. Modoff calculated. Even Nokia is hurting. It long has been the top smart-phone maker, but its share in that market has been declining. It reported a 66% drop in quarterly profits on Thursday.