The truth is, the average Android user is not the same as an average iPhone user. iPhone users surf the web more, they’re more willing to buy software, they’re more willing to install and use apps. […] What Apple has shown with the Mac, and now with the iPhone and iPad, is that all users are not equivalent. Counting only the Mac, Apple is not the biggest PC maker by unit share. But it is by far the most profitable, quarter after quarter, year after year. What’s more important than a company’s share of the overall market is the company’s share of the profitable side of the overall market.
If market share was all that mattered, today’s products wouldn’t be a slue of Apple clones. Although Apple has never really been in the ‘invention’ business (aside from the ultra-thin laptop), its penchant for improving existing products seems to be working to its advantage.
Update: Though if market share did matter as much as people seem to say, maybe Android should be worried.