How many Americans will be using an iPhone when the US smartphone market saturates?

As previously noted, the US smartphone market has followed an almost perfectly logistic growth. The measured data (via comScore, in green below) follows a predictive logistic function (thin blue whose formula is discussed here).

Screen Shot 2013-12-13 at 12-13-11.30.54 AM

The other notable market observation is how closely the iPhone follows the same pattern as the market. The red line representing the iPhone above is almost perfectly parallel to the green and blue lines which represent the overall market. The reason for this seems to be that consumers are absorbing the product in similar way to how they are absorbing the technology.[1] The “learning model” which underpins logistic models could offer clues as to the cause. It suggests that there is a direct communication that happens between the product and the consumer.

Incidentally, the reason other platforms do not follow this pattern is that they are not communicating value with the consumer but with manufacturers or distributors of the product. These alternative communications could create faster or slower growth than the overall market as they are not subject to the same large population imitation/learning models.

If we believe that the iPhone can be modeled behaviorally then it may be possible to forecast its growth. One can simply draw a line extending the existing red segment above and read the F/(1-F) figure at any point in time. Solving for F results in a measure of penetration and hence number of users (if population is known.)

An alternative is to use the following formula derived from the linear interpolation of the two measured market shares. iPhone market share is y/(1+y) where y=0.21x and x = F/(1-F) and F is the expected market penetration of smartphones.

Screen Shot 2013-12-13 at 12-13-11.29.59 AM

So if F = 91%, x = 10, y = 2.11 and therefore the iPhone market share =  68%.

We also know from the plot of the market that F = .91 is reached around February 2017. So we can suggest that at 90% penetration (approximately saturation) the iPhone will have 68% market share of users in the US. Forecasting the addressable market (US population aged older than 13) at about 266 million that implies 180 million US users of the iPhone by early 2017.

  1. Note that this pattern of adoption has happened even though the product has been at least partially unavailable to the entire market until quite recently. []