Apple beats Coca-Cola to emerge as most valuable global brand

Apple has emerged as the most valuable brand in the world, passing Coca-Cola which held the top position for 13 years, according to a report released by brand consultancy Interbrand.

The maker of high-profile products like the iPad and iPhone, which was ranked second last year, saw its brand value grow 28 percent this year to US$98.3 billion. Other tech companies that figured in the top five rankings for 2013 were Google at number two and IBM and Microsoft at fourth and fifth place, respectively. Google was number four in 2012, while IBM was third and Microsoft held the fifth position last year.

"Few brands have enabled so many people to do so much so easily, which is why Apple has legions of adoring fans," Interbrand said in the report released Monday. Apple has set a high bar for aesthetics, simplicity and ease of use that other tech brands have to match, and Apple itself will have to continually exceed, the report said.

Competitor Samsung Electronics, at number eight, saw its brand value go up 20 percent to $39.6 billion, as the brand continues to strengthen its position globally, spending more than $4 billion in marketing last year, and launching innovative products such as the Galaxy S4 and Galaxy Note II, according to the Interbrand report.

The challenge for Apple is to slow "Samsung's momentum and capture the booming Chinese mobile market." As significantly, the world is awaiting another innovative product from Apple, which could be perhaps the iWatch wearable computer or something completely unexpected, Interbrand said. The company's reputation has, meanwhile, taken some hits after it was found guilty of conspiring with five large book publishers to fix e-book prices, and faced allegations about worker conditions in China at its supplier Foxconn, and ongoing patent disputes with Samsung.

The going is getting tougher for Apple, which reported that revenue was flat at about $35.3 billion in its fiscal third quarter ended June 29, while net profit dipped to $6.9 billion from $8.8 billion in the same quarter last year. Its smartphone market share dropped in the second quarter to its lowest level in three years of 13.6 percent compared to Samsung's over 33 percent, according to research firm Strategy Analytics. Apple was, however, ahead of Samsung in tablets in the second quarter of 2013, with a 32 percent share of the market to Samsung's 18 percent, according to IDC.

Interbrand's rankings, first introduced in 2000, covers global brands that have at least 30 percent of their revenues from outside the brand's home region. The brands must also have a presence in at least three major continents, and broad geographic coverage in emerging markets. Brands are rated on the financial performance of the branded products or services, the role they play in influencing customer choice, and ability of the brand to command a premium price or secure earnings for the company, Interbrand said in a statement.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow John on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service.
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Slight drop in tablet sales expected as wearables emerge

Researcher IDC last week slightly lowered its tablet shipment forecast for 2013 and beyond, saying that competing technologies, including larger-sized smartphones, and futuristic wearable computing devices will steal some dollars that would have gone to tablets.

In its revised predictions, IDC trimmed 2013 tablet shipment expectations by 1 percent from 229.3 million units to 227.4 million.

The change also affected forecasts IDC has made for the years 2014-17. IDC said global tablet shipments in 2017 will almost reach 407 million, about 1 percent less than a May estimate of 410 million.

IDC's projection for 2013, however, hinges on the tablet business having a bang-up back half of the year.

"A lower than anticipated second quarter, hampered by a lack of major product announcements, means the second half of the year now becomes even more critical for a tablet market that has traditionally seen its highest shipment volume occur during the holiday season," said Tom Mainelli, IDC analyst, in a statement.

Apple's iPad, for example, had a disappointing second quarter, with tablet shipments down 14 percent from the same period the year before. Like Mainelli, Apple CEO Tim Cook explained the downturn on the company's lack of a new iPad in the quarter. The first Retina-equipped iPad debuted in March 2012, and sales ballooned.

Along with slightly lower shipment tallies—which IDC attributed to the influence of larger smartphones, often dubbed "phablets" by wags, and wearable accessories that link to smartphones—the research firm also revised the timetable when emerging market dominate the business.

Phablets and wearables will impact developed markets—the U.S., Western Europe and Japan—before they do other regions, Mainelli said, and cause a faster-than-predicted slowdown there.

Where earlier this year IDC predicted that developed markets would hold a very narrow edge over emerging markets in 2017, now it has flipped the two, saying emerging markets—Africa, Central and Eastern Europe, China, Latin America and the Middle East—will account for 51 percent of all shipments in 2017.

Not surprisingly, China was highlighted as one of the countries expected to drive tablet sales.

"Much of the long-term growth will be driven by countries like China where projected growth rates will be consistently higher than the worldwide average," added Jitesh Ubrani, another IDC analyst, in the same statement.

If IDC's estimates end up accurate, Apple will have to adapt to retain its diminishing share of the tablet business. While the Cupertino, California company dominated the market with relatively high-priced devices until 2012, ever-cheaper models based on Android are continuing to drive down Apple's share.

The price competition will only get more fierce.

"We expect average selling prices to continue to compress as more mainstream vendors utilize low-cost components to better compete with the whitebox tablet vendors that continue to enjoy widespread traction ... despite typically offering lower-quality products and poorer customer experiences," Mainelli said.

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Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news.
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