Mobile phone market grows smarter

By Suzanne Deffree, News Editor -- Electronic News, 11/23/2007

Mobile phone sales were up in Q3, no matter which research house you choose to reference.

Following sequential unit growth reports from IDC and Strategy Analytics  late last month, The NPD Group  this week released quarterly data that showed mobile phone sales to consumers in the U.S. reached 38 million units in Q3, an increase of nearly 16 percent compared to unit sales figures from the previous quarter. The firm noted, however, that Q2 is traditionally a slow sales quarter for mobile phone retailers. (See manufacture ranking below.)

NPD estimated total Q3 consumer sales of $3.2 billion, which is a 47 percent increase year over year. The percentage of smartphones sold during Q3 increased from 4 percent of all phone sales in Q3 2006 to 11 percent during the same timeframe in 2007, an increase of 163 percent year over year.

“The mobile phone market is not only growing, it is growing smarter,” said Ross Rubin, director of industry analysis for NPD, in a statement. “The nearly threefold increase in smartphones shows that this once negligible niche is becoming a more influential force in the consumer market -- attracting entrants such as Apple and the Open Handset Alliance.”

Indeed, Apple’s iPhone, released in June, continues to be in high demand, while the Open Handset Alliance,  promoting “Android” as the first truly open and comprehensive platform for mobile devices and brought about by a partnership between Google, T-Mobile, HTC, Qualcomm, Motorola and others, is expected to further the trend of smartphones as open devices and quenched rumors of a possible “gPhone.” 

3G also on rise

In a separate report from Strategy Analytics’ ProductTRAX service this week, the firm broke out the top 10 selling consumer handsets in the U.S. market, stating that Motorola, with its RAZR and KRZR, and LG, collectively accounted for seven of the top best selling consumer handsets. (See handset ranking below.) 

“Overall the average retail price paid for these top 10 handsets was 19 percent higher than the market average; and we continue to see strong upgrade dynamics continue to supplement U.S. market growth,” Barry Gilbert, VP of the ProductTRAX services said in a statement. “Motorola, however, despite selling four of the top 10 models in Q3, realized an ASP [average selling price] of only $80, nearly 40 percent lower than the group average.”

The firm went on to point to 3G as a high selling point.

“3G devices accounted for 55 percent of these top selling device volumes. That share will continue to grow during Q4,” Chris Ambrosio, a director in the wireless practice at Strategy Analytics said in the statement. “While the iPhone gets the headlines, the Sync from Samsung and the Chocolate from LG quietly stole the show in the category of iconic, 3G feature phones. Samsung, in particular, is well-positioned to dominate 3G sales during the critical Q4 holiday season.”

Top five handset manufacturers’ Q3 share of units sold:

Motorola  31%
LG   17%
Samsung  16%
Nokia   11%
Sanyo   4%
Source: NPD

U.S. Q3 best selling consumer handsets:

1. Motorola RAZR V3
2. Motorola RAZR V3m
3. LG VX8300
4. Apple iPhone
5. LG Chocolate VX8550/8500
6. Motorola MOTOKRZR K1m
7. Samsung SGH-A707
8. LG VX5300;
9. Sanyo Katana II
10. Motorola V323i/V325i
Source: Strategy Analytics