Smartphone Sales Rise As Selection Grows

By Joseph Palenchar -- TWICE, 6/21/2010

NEW YORK — Smartphones dominated the most recent round of cellphone introductions as carriers try to goose up smartphone sales and data revenues, and market-research companies indicate the carriers are succeeding.

New smartphones include the iPhone 4, which goes on sale June 24; Sprint’s HTC-made 4G Evo, available since June 7; and AT&T’s first Android 2.1 phone, the HTC-made Aria, available since June 20.

In other smartphone announcements:
• T-Mobile launched its second Symbian- based Nokia smartphone with embedded portable navigation device (PND).
• Ridgeland, Miss.-based Cellular South, the nation’s largest privately held wireless communications provider, announced plans today to expand its Android selection with The Motorola Milestone, an enhanced version of Motorola’s Verizon-sold Droid. It’s not the same Motorola Milestone announced for sale in the U.K. and Europe.

The outlook for smartphone sales in the U.S. “remains quite favorable” because of “a plethora of new handsets from a variety of vendors already in the pipeline along with new generations of existing handsets slated for release,” according to a June 11 Barclays Capital assessment.

A Gartner study forecasts 46 percent unit growth in U.S. smartphone shipments this year to 62 million units, accounting for almost 35 percent of cellphone shipments for the year, up from a 25 percent unit share in 2009.

Gartner sees U.S. shipments of all cellphones growing by 4.8 percent in 2010, up from 2009’s 1.4 percent gain, but shipments of entry-level smartphones will grow 574 percent to 8.2 million while shipments of enhanced-feature smartphones will grow 30.8 percent to 54.2 million.

The opportunity for selling smartphones has grown as the replacement cycle for the average subscriber has accelerated to roughly a year, driven by product wear, subscribers switching carriers, upgrades as a subscriber’s contract expires and demand for the latest features, Barclays said.

Into this cycle, carrier AT&T announced June 20 sales of its first Android 2.1 OS smartphone, the HTCmade Aria, which will retail for $129 after $100 mail-in rebate through AT&T-owned stores and AT&T’s website.

The full-touchscreen Aria is HTC’s first Android phone sold through AT&T, giving it an Android presence in all four national carriers. It is also HTC’s first AT&T phone with the handset maker’s HTC Sense user interface and its Friend Stream feature, which aggregates Facebook, Twitter and Flickr updates in a single spot on the display. The Sense UI has a seven-panel home page that brings often-used apps and info to the main screen for easy access.

Aria features 850/1900MHz 7.2Mbps HSPA wireless-data technology, Wi-Fi 802.11 b/g/ for free access to AT&T’s 20,000 hot spots, 600MHz processor, 3.2-inch capacitive WVGA touchscreen with haptic feedback, included 2GB MicroSD card, SDHCcapable MicroSD slot, assisted GPS, stereo Bluetooth, 5-megapixel camera/ camcorder with autofocus and up to six hours of talktime.

For its part, Sprint said first-day sales of the $199 HTC-made Evo, the first 3G/4G phone to hit the U.S. market, exceeded first-day sales of any phone launched by the carrier in its history. The Android 2.1- based smartphone went on sale in early June in 22,000 locations, including Sprint-owned stores, RadioShack, Best Buy, Walmart and other indirect dealers. The phone delivers 4G speeds up to an average 3Mbps to 6Mbps and provides two-way video chat to other Evo phones or to PCs in either 3G or 4G networks. Sprint offers 4G service in 33 markets and expects to launch 4G service in at least 13 more markets this year, including Boston, Los Angeles, Miami and New York.

The industry awaits the expected launch of RIM’s first BlackBerry with both touchscreen and hard QWERTY keyboard, expected to be available in late June or July. The QWERTY keyboard/ dialing keypad will slide down vertically from the phone. The device would provide a hard QWERTY keyboard and dialing keypad for heavy email users while providing touchscreen convenience.

For its part, Cellular South plans summertime availability through its direct channels of the Android 2.1-based Motorola Milestone, which will join its first Android phone, the HTC Hero, launched last November.

In the Pacific Northwest, carrier TMobile planned mid-June availability of a second Nokia 3G cellphone that doubles as a portable navigation device (PND) and downloads applications from Nokia’s Ovi store.

The new model, the E73 Mode, is a GPS-equipped 3G phone with hard QWERTY keyboard and no touchscreen. It as due June 16 in T-Mobile stores, select authorized dealers and TMobile’s website.

Like a traditional PND, both Nokia PND-phones incorporate onboard maps, points-of-interest data and routing algorithm.