Innovation and competition in the smartphone industry: Is there a dominant design?

• The paper discusses the evolution of smartphone along two dimensions: vertical and horizontal innovations.
• The number of new smartphones has increased over time, due also to the entry of “new” companies.
• Despite some convergence in vertical innovations, competition is still fierce in horizontal innovations.
• A dominant design has not yet emerged in the smartphone industry.

The mobile phone industry is a very innovative segment within the ICT sector and the smartphone is becoming the standard configuration among the different types of mobile devices. Technical change and new product proliferation have made this industry extremely dynamic, even if market shares are highly concentrated in the hands of very few companies. The present article investigates whether a dominant design has emerged in the smartphone industry. In particular, it studies the evolution in hardware components relying upon an original dataset of product characteristics including all smartphones launched in the market between 2004 and 2013. Results show that, despite some convergence in the introduction of vertical innovations, product differentiation still characterizes the competition among manufacturers and a dominant design has not yet emerged.