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Actually, what I think is pretty simple – Apple will continue to focus on their target audience as a premium product provider because that strategy seems to be working well. Even in the face of rapid (and potentially significant) market adoption of Android, what benefits would there be to engaging in hand-to-hand combat at low margins? Apple seems to target buyers, not competitors – they prefer to carve out uncontested market segments rather than going where the bloodier fights are.

-Andrew

First, Apple is not in love with AT&T; they made a business decision to give them an excloo in exchange for the control that Verizon was unwilling to cede. In fact, a VZ/AAPL marriage would have been rocky. But on non-exclusive terms, they might yet find common ground.

Second, you already assessed the geek opportunity; I'd throw in the jailbreakers and increase nothing by 50%. Not much reason to get excited about it once Apple goes wide.

Third, the iPhone IS more expensive, but a pittance against two years of service. Now that they have a huge share of the smartphone market, Apple has some economies of scale — in hardware, in 3rd-party apps, and in negotiations with the phone co's.

Finally, I'll wager that you soon see a dramatic turn of events in the corporate IT world. Firms are cutting committed programs wherever possible. In-house support is very expensive and oftentimes the apps look barely better than 1-2-3 (DOS 3.0) era stuff that makes everybody feel out of it. Given a decent turnkey system (a big part of the latest iPhone s/w upgrade was for exactly that), firms would be thrilled to lose the expense, inflexibility and quality issues that they now face. Very few firms can cost-justify inhouse expenses in our downsizing world versus paying say, $15/month per user plus MAYBE an inhouse app store.

Few remember it, but the iPod faced some reasonably good technical competition when it first surfaced. Apple realized that if they wanted to commit the resources, they could own the market, and the iPod Touch is NOTHING like the aging iPod 1.0 in my bottom drawer. Apple now faces an ten-fold bigger opportunity, has set the world afire with one (maybe with the Touch, two) models, and you think they're gonna try to extract every penny and not reinvest in targeting the competition?

Android will do just fine and it will likely surpass Apple OSes on mobile devices sometime before the end of 2012. But I think its success will be somewhat different in terms of its audience.

Android buyers will come in four flavors; (i) current and previous iPhone customers dissatisfied with Apple/AT&T, (ii) geeks that love all things googley, (iii) new smartphone consumers that don't have the budget for iPhone or desire more agility with their mobile carrier, and (iv) businesses that require complete control of the mobile experience and openness of the app platform.

Category (i) won't be any more pleased with Android, and category (ii) is not a large segment of the buying audience. In fact, the geek category is unlikely to pay for apps. Category (iii) and (iv) will be quite successful, so yes — it's going to be a worthy competitor. But in any case, the nature of success will be different from iPhone and I predict customer satisfaction for both of these classes of Android users will fall significantly short of iPhone's ratings.

Meanwhile, there's the installed base: the survey doesn't show Apple ahead of competitors, it shows them SMOKING every one of them on EVERY count except battery life. And arguably, the battery life issue is only one because users actually play with apps all day long on the iPhone, versus “oh yeah, I can get an app like that” on Platform X.

Also fun to watch: how wholeheartedly Google backs its favored platform, versus platform agnosticism that is more in keeping with its overall ethos (and with not having egg on its face from being perceived as competing head-on but failing).