iPhone, Palm Pre Drive Smartphone Demand

July 23, 2009

This article is included in these additional categories:

Analytics, Automated & MarTech | Technology | Telecom

Driven by demand for the Palm Pre and new Apple iPhone devices, smartphone ownership is continuing to rise, with 37% of US consumers now reporting they own some type of smartphone, according to a June survey by ChangeWave Research.

The survey also found that 14.4% of respondents say they plan to buy a smartphone in the next 90 days – up one-third from a year ago (10.5% in June 2008) and the highest percentage ever recorded in a ChangeWave survey.

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Future Planned Purchases

In terms of market share, Research In Motion (RIMM; 41%) remains the current market share leader – unchanged since March 2009 – with Apple (25%; up 1 point) now firmly in second place. Apple has experienced continuous market-share growth each and every quarter for the past two years, ChangeWave noted.

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Palm (7%) remains a distant third, but ChangeWave said the company’s market slide finally appears to be slowing. Its share is down just 2 points in the past six months compared with 5 points in the six months before that.

An analysis of the smartphone brands consumers are planning to buy in the next 90 days reveals that Apple and Palm product launches have clearly driven interest in these products – as well as in smartphones in general, ChangeWave said.

Key survey findings:

  • Palm’s percentage of planned smart phone purchases among consumers has doubled since March (8%; up 4-pts).
  • At the same time, the release of the iPhone 3GS and price cuts to the basic-model iPhone have led to a big spike in future demand for Apple. A total of 44% of respondents planning to purchase a smart phone in the next 90 days say they’ll get an Apple iPhone – a major 14-point jump from three months ago. Notably, more than two-thirds of planned iPhone purchasers do not currently own an iPhone.

RIM Takes Temporary Hit

In contrast to this growth, Research In Motion’s share of planned BlackBerry purchases in the next 90 days (23%; down 14-points) is taking what ChangeWave believes to be a short term hit. This is likely, in part, a function of the timing of the survey, which was conducted after the high-profile launches of both the Pre and the iPhone, the firm said.

ChangeWave believes that once new Blackberry model releases are announced, RIM is likely to show a similar burst of momentum in planned buying as it did in the past when new products are announced.

Pre Buyer Profiles

An analysis of customers who plan to buy the Palm Pre revealed that current Palm owners are most likely to buy the new Pre model, with 11% saying they’re very likely and 18% somewhat likely. These percentages are higher than those for customers of any other manufacturer.
The Pre also shows it has the momentum to attract customers from Palm’s competitors – particularly Sanyo (7%) and HTC (3%).

Separate research from comScore about internet search behavior around the Palm Pre’s launch confirmed that those interested in the Palm Pre do not appear to be interested in the iPhone.

One-in-four (20%) consumers say the most important reason they’re not considering buying an Apple iPhone is because they don’t like the requirement they have to use AT&T. Similarly, 16% say they won’t buy a Palm Pre because they’d have to use Sprint, ChangeWave said.

Future Trends

ChangeWave noted that while the Pre is breathing new life into Palm and potentially could lead to a brighter future, “the far bigger story is that of the iPhone 3GS.”

“The new model release has resulted in a huge spike in demand for Apple going forward,” ChangeWave added.

About the survey: The survey of 4,063 respondents was conducted in mid-June and focused on consumer smartphone market trends, including demand for the new Palm and Apple offerings.

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