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Unlocked Smartphone Market Keeps On Growing: Analysts

U.S. unlocked smartphone shipments grew 140 percent in the U.S. to a record 14.6 million units in 2015, and sales will grow another 58 percent in 2016 to 23 million units, Strategy Analytics said.

The unlocked phones captured 7 percent of U.S. smartphone shipments in 2014, hit 9 percent in 2015, and will hit 14 percent in 2016, the research and consulting company said.

“Leasing and EIP (equipment installment plan) programs take smartphones back to their ‘real’ values,” said director Linda Sui. “This has made cost-sensitive consumers search for alternative or cheaper options in open and online channels in the U.S.” Other catalysts include major carriers selling SIM cars separate from phones and Apple’s iPhone upgrade program, she said.

In contrast, total U.S. smartphone shipments grew only 7 percent in 2015 to 158.7 million units. “The unlocked smartphone market is the faster growing segment in the U.S., which is the most valuable smartphone market worldwide. No smartphone makers can afford to ignore the booming unlocked smartphone market in the U.S.,” Sui said.

In 2015, Blu took the unlocked-share lead with 35.6 percent of unlocked smartphones sold, with Apple following with 12.3 percent, Motorola at 9.6 percent, and all others at 42.5 percent.

Florida-based Blu “has been growing rapidly” because of “extensive distribution channels like Amazon and BestBuy and popular Android unlocked models like the Studio 6.0 model,” said Strategy Analytics executive director Neil Mawston. “Apple also ramped up volumes quickly in the U.S. unlocked smartphone market driven by the iPhone upgrade program launched in Q3 2015.”

Motorola solidified its third-place rank in 2105 by increasing its share to 9 percent from 2 percent, said director Ken Hyers. Motorola’s newly launched third-generation Moto X and third-gen G, plus the company’s price reductions on the second-gen Moto G, were the company’s main growth driver in the unlocked segment, Hyers said. “LG and Huawei also saw strong growth in the U.S. unlocked smartphone market, mainly thanks to healthy demand for the Google Nexus 5X and 6P, respectively.”