Market Equilibrating Process Paper Essay Example | Topics and Well Written Essays - 500 words

Market Equilibrating Process Paper - Essay Example However, I will argue that this may be the case at present but the product is at risk in the long term for several reasons. This can be reflected in the gradual shift in the supply and demand equilibrium. Successful branding and Apple innovation have ensured the current demand for iPhone. The product has been the first to usher in the era of "touch" smartphones and this has been displayed by the array of competitors emulating the product even until now. So for a time it has enjoyed leadership and dominance due to the scarcity of such product given the limited options and demand choices for consumers. Things are changing, however, because of the increasingly competitive market and the increasingly sophisticated requirements of the consumers. The development of the Googles Android operating system has launched the success of many smartphone manufacturers that collectively led to a viable and sophisticated alternative to the iPhones IOS. The Android phone and the iPhone became substitutes: as the price of the other increases, the demand for the other increase (p.50) Recently, a research by the firm IDC placed the market share of Android to about 68 percent whereas Apple claims only 16.9 percent (AP 2012). Of course, Android is fragmented into several phone manufacturers such as Samsung and HTC. But the trend signals an interesting shift in the market, which bring together buyers and sellers (p.46). This year Samsung toppled Apple as worlds leading phone manufacturer. As more and more people are exposed to many choices, they are able to expand the variables that inform the cost-bene fit analyses that drive their purchase decisions. In this instance, price and quantity are no longer the sole drivers of the market. The so-called other â€Å"determinants of demand† assume equal importance in the pattern of market demand (p.48). Moreover, increased competition aggravates the principle of "diminishing marginal utility", which argues that "for a