comScore’s latest survey data is in and the news is good.
In March an additional 3 million Americans became smartphone users. That translates to 700,000 every week or 100,000 every day switching from a non-smart or feature phone to a smartphone.
The smartphone is now in use by 31% of the phone users in the US. A year ago 80% of Americans did not use a smartphone. Today non-consumption is down to 69%.
It also means that only 19% more penetration remains before half of the population is using smartphones and that penetration is increasing at an average of 1.3% per month.
I reset my Phone Tipping Point countdown clock to reflect the new data.
I call it the Phone Tipping Point because it’s the moment when I expect we’ll stop using the word “smartphone”.
It’s nearly one year away.
The pattern of Mac growth exceeding Windows PC growth (and overall PC growth which includes the Mac) is old news. It has been observed for at least 40 of the last 42 quarters.
It’s a historically interesting contest, but the story of computing has moved on. Starting with building computing, via floor computing, office computing and then to desktop computing and portable computing we are now in the era of mobile computing.. The problem with observing mobility in general is that there are too many mobile computing options. Phones have a wide range of capabilities, tablets and various other form factors are positioned on differing jobs-to-be-done. Platforms and services are also scattered around jobs which have been carved from fixed computing or have been established with no fixed precedent.
So can we pinpoint with any accuracy the moment when the tipping point has been reached? We could point to all mobile phone shipments, or even the vaguely-defined smartphone shipments compared to all PC shipments. We could look at tablets alone. If we could get accurate measurements.
One measurement could be to look at operating systems alone. When comparing iOS shipments (iPhone, iPad and iPod touch) to Windows we can see that combined iOS shipments exceed all Windows PC shipments for all three previous quarters.
The US has reached 50% smartphone penetration.
comScore data shows July penetration at 48.8% and a monthly growth in penetration of nearly 2 percentage points. Given the rate of growth, it’s nearly certain that we’ve crossed 50% in August.
The historic growth is shown below:
The platforms making up the smartphone market in the US have seen unequal shares of this new population of users. The following diagrams show how the install bases have changed in absolute and share terms.
To round out the analysis, here is the net user gains for the platforms showing the net addition or loss of users since early 2010.
According to comScore, as of end of May, the ratio of consumer phone users in the US (aged more than 13) who use smartphones as their primary phone has reached 47%.
The question is whether this is reaching saturation. My guess has been that saturation will be at levels well above 80%. The data shows that during May the rate of smartphone adoption (first time users) was 630k/week. This number is a good recovery to above the historic mean indicative that saturation is not yet in effect.
50% penetration will happen this summer. A year ago the predicted “tipping point” date was also the same: August 2012.
The platform shares data is also returning to a historic consistency. A month ago I asked if there was “trouble with the robot” because Android net adds dropped to a level unseen for two years and the decline in net adds had been going on for four months.
This last report shows a recovery in Android net adds to about 1.5 million new users.
[Note here too that there is no sign of saturation: The net user gains are far above net user losses. Even BlackBerry showed a gain. In a market where there is saturation, net gains and losses among platforms would balance each other out.]
In terms of share, Android shows two months of no growth.
A glance at Nokia and RIM’s market values today shows that they are both valued below book. With respect to RIM,
The company’s share price has collapsed in the past year, and it is now only valued at about $5.4 billion, down from $84 billion at its peak in 2008. Excluding its cash and the estimated value of its patents, RIM’s device business and its 78 million subscribers around the world are in aggregate worth less than $1 billion to investors.
Analysis: RIM’s new woes seen speeding loss of BlackBerry users – Yahoo! Finance
With respect to Nokia,
MKM: We are downgrading Nokia to Sell from Neutral following our U.S. retail Lumia model checks. We assume no value for the handset business and no value for the roughly four billion euros [about $5 billion] in net cash.
Nokia Suffers From Hang-Ups – Barrons.com
Three years ago the situation was dramatically different. RIM’s share price was six times higher and Nokia’s about four times higher. Here’s what the market looked like in Q1 2010:
This summary view shows individual competitors in the phone market as well as their combined total volumes. The profitability/volumes/pricing can be visualized as well as margins and revenues.
The same visual summary is presented for the first quarters of 2011 and 2012 below:
The August comScore mobile survey (MobiLens) is out. It measures the penetration or consumption of various mobile products and services in the US over a three month period.
I track the change in this data over time. Here are some highlights:
In August about 520,000 users switched to using smartphones (from non-smart phones) as their primary phone. This is a bit down sequentially from July but about average for the period starting January 2010.
Penetration increased by about 1 % to 36%.
Extrapolating this growth implies 50% penetration by September 2012. However growth is accelerating slightly so that tipping point may come sooner. Separately, T-Mobile reported that 75% of its device sales during this year have been smartphones, so if this is indicative of overall US market, then by next year it may in fact be quite difficult to find any non-smart phones to buy.
Among the smartphones, the different OSs have the following installed bases:
Yesterday comScore published survey results for EU5 (France, Germany, Italy, Spain, UK) on smartphone use and installed base. The headline is very similar to what would be written about the US: Android had phenomenal growth over the last twelve months. I also noted that the apparent growth of Google (16.2% share change) seemed to be matched by an apparent decline of Symbian (-16.1% share change.) However the reading of the data is not so simple.
In order to understand what has happened to usage, it’s much more valuable to look at consumption and the actual number of users rather than change in share of a subset of the market. Consider the following charts:
The bar chart shows that
ComScore’s latest survey data shows the following net user gains in the US smartphone installed base:
In summary, the key data points for June:
At the end of last year I was saying that the smartphone boom was a tide that lifted all boats. That is no longer the case.
But the big story is that there has been a clear non-seasonal counter-cyclical decline in Nokia and RIM’s smartphone performance. RIM’s steady rise has come to an abrupt halt. Nokia’s decline has accelerate precipitously. So much so that Samsung and Apple have overtaken Nokia and RIM and it looks like HTC will overtake RIM within one quarter and perhaps Nokia as well.
The latest comScore MobiLens is out and it allows an update to the picture of the US phone using population. Through the three month period ending May 2011, smartphones were in use by 76.8 million or about one in three US phone users. Here are some other highlights:
- A total of 513k users switched into using a smartphone every week during the period, a rate of switching consistent with the last 17 periods (average of 510k/wk).
- Penetration of smartphones increased by 940 basis points, slightly higher than the 900 bp increase in the last period but consistent with average.
- Using a four-period trailing average and linear extrapolation, 50% penetration will be reached by August 2012. “Summer 2012” seems a safe bet as that target has not changed much.
I’ve updated the countdown counter (Phone Tipping point at top of right column on this page) to reflect the new date.
The following charts show the penetration and switching rates.