Smartphones Capture Almost 20% Of Cellphone Market

By Amy Gilroy -- TWICE, 9/8/2008

Port Washington, N.Y. — U.S. sales of smartphones are up 84 percent year-to-date through July, compared with the same period last year, reaching a total 9 million units, with Apple taking the No. 2 market share slot behind Research in Motion, according to the NPD Group.

Smartphones, such as the iPhone, now represent 19 percent of handset sales compared with 9 percent for the same period last year. NPD credits the gains to lower prices, slimmer form factors and better Internet connectivity, according to industry analysis director Ross Rubin.

Average prices for smartphones declined 7 percent for the period to $185, down from $199.

But even as overall cellular phone revenues declined, smartphone revenues increased 71 percent, reaching nearly $1.7 billion, said NPD.

Only some of the gains are due to the iPhone 3G, as that was introduced on July 11, towards the end of the period analyzed. But the original iPhone played a significant role, with Apple ranked second in market share, followed by Palm, Samsung and Motorola, respectively.

Rubin said competition for the attention of developers for smartphone applications is now intensified with the launch of the software developer kit for the iPhone, plus the arrival of Google’s Android phone platform and the open-source strategy of Symbian.