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U.S. Consumers Buying Fewer Mobile Phones, Paying More
Monday, August 18th, 2008 at 4:00 PM - by .(JavaScript must be enabled to view this email address)
The NPD group reported on Tuesday that U.S. consumers are buying fewer mobile phones overall, but the phones they do buy are costing more. NPD said this is the third quarter in a row with a year-over-year decline.
Motorola still leads in phones sold overall, but its market share has plummeted from 32 percent last year to 21 percent this year. The New York Times carried the AP story. [Subscription may be required.]
NPD said the survey excluded government and corporate buyers, and other figures from IDC suggest that those organizations are taking up the slack.
In the second quarter, 42.9 million handsets were shipped in the U.S. By comparison, Apple has been shipping about 3 million per quarter, but the iPhone’s appeal is mainly to the smartphone market, a much smaller segment. That market, feature rich phones which can browse the Internet, doubled in the last year.
"One explanation [for the overall drop] might be that there’s a group of consumers that’s holding off, making do with the devices that they have, either because of larger economic concerns or because they don’t see any value yet in the new voice and data services that are driving some of these new handsets," said Ross Rubin with NPD.
The research lends credence to the disappearance of the middle class thesis, a bi-modal society. Those on the lower side of the economic spectrum are cutting back on even basic phones or upgrades. Meanwhile, those on the high side of the spectrum, as well as government and corporations, are snapping up smartphones. In that market, Apple and RIM are in a two horse race in the U.S., with Palm falling off quickly, according to recent ChangeWave research.
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