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NPD Reports Smartphone Growth Spurt

According to The NPD Group, the U.S. smartphone market has entered a significant growth spurt. October 2006 sales soared 230 percent from January 2006, rising from 216,000 units to nearly 715,000. On a quarterly basis in 2006, smartphone sales have risen more than four percentage points to more than 6 percent of new phones sold through October in the fourth quarter of 2006. The report also includes a list of the top 5 selling smartphones in the US, which includes two Palm OS Treo models.

"The long-awaited growth in smartphone sales comes at a crucial time for carriers who have been anticipating wider adoption of smartphones,” said Neil Strother, research director for wireless devices at The NPD Group. “For the past couple of years, carriers and their handset suppliers have been hoping more buyers would migrate to these devices, since smartphone owners tend to spend much more on wireless data than those who don’t own them."

Here’s the breakdown of the top sellers from August through October:

  1. Motorola Q
  2. Palm Treo 650
  3. Verizon Wireless XV6700
  4. Palm Treo 700p
  5. BlackBerry 8700

The current top five best-selling smartphones reflect a shifting market that’s no longer limited to Treos and BlackBerries. Motorola’s Q has come on strong, and actually led sales between August and October 2006. The key reasons behind the overall growth in smartphone sales included the following:

  • Prices have declined by 10 percent on average since January 2006.
  • More smartphone choices are available – Motorola Q, Palm Treo 700p, BlackBerry Pearl and Nokia’s E62 have all entered the market this year alone.
  • Smartphones meet the growing demand for personal e-mail usage, which has doubled since March 2006.
  • More robust devices are now capable of better handling of music and video applications.
  • Devices now boast significantly greater data storage capacity than standard phones, and many provide slots for removable memory cards.
  • Smartphones can now take advantage of faster networks for quicker data transfers and Web browsing.

“All of this is welcome news to carriers, and not just because devices are moving in record volume,” Strother said. “The simple fact is that smartphone owners spend more on data and are therefore more attractive customers.”

Smartphone users spent an average of $6.31 per month for wireless data in the third quarter. By comparison, owners of all types of mobile phones spent just $0.89. “It’s no wonder carriers covet smartphone owners so much,” Strother said.

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Treo 700p vs 700w vs 680?

drbuzz0 @ 1/1/2007 9:16:56 PM # Q
One thing I've been very interested to find out about is the sales numbers for PalmOS vs. Windows Treos.

Obviously there is some fluctuation because not all devices are available for all carriers and whatnot.

However, given, for example the 700p and 700w, which are available for the same networks, have similar features and cost roughly the same, I'd be interested to know which one has higher sales numbers. Of course, you'd have to do it for summer of 2006 on, because the 700w was out before the 700p.

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Treo competitors coming on strong...

The_Voice_of_Reason @ 1/1/2007 10:42:48 PM # Q
From the article "TVoR's predictions for 2007" http://www.palminfocenter.com/comments/9164/#128612:

"4) Treo sales stagger under the multi-pronged assault of several new pseudo-smartphones from Motorola, Nokia, Sony Ericsson, Samsung, LG, etc. Nokia's E models and (especially) Motorola's new Q will seize massive marketshare from the Treos. Palm initially tries to bolster sales by cutting prices, but the competition smells blood and goes in for the kill by slashing prices + initiating a savage price war by April 2007."

The NPD report is rather meaningless without cold, hard, accurate NUMBERS regarding handset sales by model (e.g. did the Motorola Q sell more in total than the COMBINED totals for next 4 devices in the top five list? Or did it generate just one or two more end user sales than the #2 device (the now-discontinued Treo 650)? In the end, only carriers and manufacturers know the ugly truth.

The sad part for Palm is the competition isn't sitting still, while Palm essentially hasn't moved in the past 3 years. Can Palm compete with devices like these that are either already released or are expected to arrive within weeks?:

Motorola Q Pro (http://www.slashphone.com/83/5781.html)

Samsung SGH-i600

Nokia E62

Sorry, Palm - simply doubling the amount of RAM in your Treo offerings every 2 years and E V E N T U A L L Y lopping off the external antenna is NOT the way to compete with the big handset providers. Motorola, Nokia et. al. are about to eat you alive. Good Luck. Vaya con dios, amigo...

TVoR

RE: Treo competitors coming on strong...
joad @ 1/2/2007 1:33:40 AM # Q
Aw c'mon TVOR - they DID give us the "extra special" 700p LAG that we were hoping for (right behind screwed-up button arrangements that we had also begged for...).

Palm is on the move with innovation!!!

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again?

retrospooty @ 1/1/2007 11:53:41 PM # Q
still waiting for TVoR to buy one of those other superior devices and stop hating on Palm... I guess it wasn't one of his new years resolutions. =)

RE: again?
surfmaniac @ 1/2/2007 10:03:50 PM # Q
Don't pay any attention, he's probably a disgruntled short. On a positive note, it will be interesting to see this list when the 680 and (eventually) the 750 are widely available in the U.S. I understand from my sources that the 680 is doing quite well here and the 750 moving briskly in Europe (thanks to a big push from Vodafone, I would think.)


RE: again?
SeldomVisitor @ 1/3/2007 7:59:02 AM # Q
> ...I understand from my sources...

Giggle.

surfmaniac's source REVEALED!!!
The_Voice_of_Reason @ 1/3/2007 4:24:33 PM # Q
I understand from my sources that the 680 is doing quite well here and the 750 moving briskly in Europe (thanks to a big push from Vodafone, I would think.)

My sources say this is your source:

http://www.amazon.com/Mattel-30188-Magic-8-Ball/dp/B00001ZWV7

Giggle.

Snort.

Guffaw.

Tee hee.


RE: again?
SeldomVisitor @ 1/4/2007 6:18:14 AM # Q
> ...My sources say this is your source:
>
> http://www.amazon.com/Mattel-30188-Magic-8-Ball/dp/B00001ZWV7
>
> ...

Reply - no, no, no! Sheesh - what an anachronistic person!

THIS:

-- http://www.mattelgamefinder.com/demos.asp?demo=mb

is instead!

> ...Giggle.

I like the sound of that!

RE: again?
ChiA @ 1/4/2007 6:13:09 PM # Q
surfmaniac said
the 750 moving briskly in Europe (thanks to a big push from Vodafone)

Vodafone is the only one pushing the 750; w.r.t the UK it seems to be only available either through Vodafone directly or with a Vodafone contract when purchased from another retailer.

Vodafone UK isn't pushing as hard now as it was last month; the 750 no longer features on their website front page.

Your "sources" should also be aware that the 750 wasn't selling briskly enough to make it into UK Vodafone's list of bestselling phones: http://tinyurl.com/yarpps

Statistics are like bikinis. What they reveal is suggestive, but what they conceal is vital. Aaron Levenstein

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