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NPD: Prepaid Fuels Q2 Smartphone Unit Growth

Port Washington, N.Y. – Unit
sales of smartphones to U.S. consumers grew 9 percent in the second quarter,
but prepaid smartphones accounted for all of the gain, The NPD Group found.

Unit sales of post-paid
smartphones were flat, but prepaid smartphone unit volume rose 91 percent compared
with the year-ago quarter, NPD said.

NPD also found that most of smartphone
sales growth in the quarter was attributable to Samsung and Apple, whose combined
smartphone unit sales rose 43 percent in the quarter compared with the year-ago
period. Unit sales for other brands fell 16 percent.

“Prepaid smartphones are no
longer just cheap, also-ran options focused on older and less-capable phones,”
said Stephen Baker, NPD Group’s industry analysis VP. “As the smartphone market
matures, and as growth slows, carriers have been smart to aggressively market
some of their best current smartphones on a prepaid basis to a new set of
customers in order to keep sales humming along.”

 NPD also found that the income level of the
average smartphone buyer is heading down. In the second quarter of last year, 24
percent of smartphone buyers had average household incomes of less than $35,000
per year. In the second quarter of 2012, the number jumped to 33 percent. Among
smartphone buyers in the quarter, 71 percent of prepaid smartphone buyers had
an average income of less than $35,000, up by 12 points over the year-ago

The company also determined the
top-five smartphone brands by share of units sold to consumers in the quarter.
The brands and their shares are Apple (31 percent), Samsung (24 percent), HTC (15
percent), Motorola (12 percent) and LG (6 percent).

For its report, NPD excluded
sales of cellphones purchased by businesses and given to employees.

In other stats, NPD told TWICE
that prepaid smartphones represented 18 percent of all smartphones sold in the
second quarter and that smartphones accounted for 39 percent of prepaid phones
sold in the quarter.