Smartphones are heeding the call of consumers

At a time when sales of cell phones are slowing in the United States, there's one kind of mobile device that appears to be defying the trend: smartphones.

Whether you're an Apple fan or not, there's no question the company's iPhone, with a new model to be announced today, has helped contribute to the recent success of smartphones, devices that can handle e-mail and Web surfing, as well as other programs.

Lower monthly prices on phone data plans, a growing consumer interest in using the mobile Internet and a wide offering and price range of devices are all also among reasons for smartphones' success.

"Despite economic concerns, the smartphone market continued to expand in the United States, driven by heavy advertising and strong marketing promotions as more devices reached mass-market price points," Gartner analyst Hugues De La Vergne told the Associated Press recently.

Cell phone sales in general  in the U.S. were down 22 percent in the first quarter this year, compared to the first quarter of 2007, according to The NPD Group.

However, smartphone sales represented 17 percent of all cell phone sales in the first quarter of 2008, up 10 percent from the same period last year, the research firm said.

Step back a bit further in time, and the smartphone trend is evident. In 2006, smartphones accounted for 5.1 percent of all mobile phones shipped in the U.S., and last year that number more than doubled, says IDC Research.

Apple’s impact on the field has been huge in a relatively short period of time. It went from zero percent of the smartphone market in the first quarter of 2007 — before the iPhone was released — to 19.2 percent in the first quarter of 2008, according to IDC.

Research In Motion, which makes the BlackBerry line of smartphones, dominates the market with a 44.5 percent share in the first quarter of this year. Apple is second, and Palm third, according to IDC Research.

'Prosumer' appeal

INTERACTIVE iPhone iWannabes Some focus on specialty interests, such as scheduling, GPS or camera capabilities.

Smartphones’ appeal began with the business set, but has quickly spread to busy moms, college students and folks who are just plain squeezed for time — which pretty much includes everyone these days.

“In the past several quarters, there’s been the development of this prosumer segment,” said Ramon T. Llamas, IDC senior research analyst for mobile technology and trends.

“It’s the kind of user who says, ‘I want more from my mobile phone. I want e-mail. I want to surf the ‘Net. I want to be in touch with a whole lot of folks, and I want to run a whole lot of high-powered applications on my phone.’ ”

The iPhone appeals to this market, and RIM has stepped up its efforts in the consumer field, with its Pearl and Curve models.

ComScore research firm surveyed more than 2,000 U.S. wireless customers earlier this year and found that 36 percent said they access the Web from their mobiles more than once a day, up from 18 percent in 2006.

"Mobile Internet usage is at a tipping point," ComScore said in its March report.

Smartphones usually come with calendar software, and often, but not always, include keyboards, whether a tactile QWERTY one or on a touchscreen.

Their costs vary widely, from the $99 Palm Centro, offered by Sprint and AT&T (with a two year-contract), to more than $600 for a high-end smartphone by HTC, appropriately called the Touch Diamond, that is just being released in Asia, but won’t be in the United States until the fall. In between is a range of prices and choices.

J.D. Power and Associates, in a May 29 report on cell phone pricing, noted that the average purchase price by customers for a phone is $101, up $9 from “just six months ago,” and is the highest average price paid for a cell phone since the firm started studying phone pricing in 2003.

“As more customers start to upgrade to mobile phones that offer real-time connectivity and access to Internet content — particularly those offered by smartphone devices — we should continue to see the wireless handset price point rise,” said Kirk Parsons of J.D. Power, in a statement.

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