Apple's iPhone emerges as leading U.S. smart phone in July

[AppleInsider]

Apple Inc.'s iPhone outsold all smart phones in the United States during July, and equaled the sales of the most popular feature phone, according to market research firm iSuppli

The two models of the Apple handset accounted for 1.8 percent of all mobile-handset unit sales during the month, the firm said, besting sales of the Blackberry series, the entire Palm portfolio, and any individual Motorola, Nokia, Samsung or other smart phone model from a branded service provider. In addition, the iPhone's U.S. sales were equal to those of the most popular feature phone, LG's Chocolate.

"This is a remarkable accomplishment for Apple, considering that July marked the first full month of sales for the iPhone," iSuppli wrote in a report released Tuesday. "While iSuppli has not collected historical information on this topic, it's likely that the speed of the iPhone's rise to competitive dominance in its segment is unprecedented in the history of the mobile-handset market."

The firm went on to say that, while the speed of the iPhone's ascent to the top of the smart-phone and feature-phone charts is remarkable, it's equally amazing that Apple achieved this in the face of numerous, well-entrenched competitors.

iSuppli's consumer panel survey revealed that approximately 57 percent of iPhones bought in July were purchased by U.S. consumers 35 years of age or younger. The majority of those iPhone buyers were men, with 52 percent of purchasers being male and 48 percent female.

Additionally, the firm's survey revealed that nearly two-thirds, or 62 percent, of iPhone buyers in July had a four-college degree or more education, and one quarter of consumers who bought iPhones switched to AT&T service in order to do so.



"Some of the iPhone's success in July can be attributed to pent-up demand following months of hype. Real proof of success will come in the coming months as demand patterns stabilize," iSuppli wrote. "Based on consumer demand, Apple's brand image, industry anticipation and iSuppli's estimates of volume shipments by manufacturers and the market segment, iSuppli is maintaining its projection that 4.5 million iPhones will ship in 2007, rising to more than 30 million units in 2011."

Shares of Apple rose $4.48 or more than 3 percent to $142.9 on the Nasdaq stock market early Tuesday, following word of the report.

[digitalclips]

Nice to see the stock above 140

[tbsteph]

Assuming the iPhone reaches its projected sales volume, it will be interesting to see if there is any impact on Ipod sales.

[anantksundaram]

Does this market share include only personal purchases, or also corporate/ corporate-sanctioned purchases? If also the latter, then it is quite an impressive number, considering that nearly all of iPhone sales are to individual consumers.

Still, total sales of 4.5 million in 2007 sounds way too optimistic.

[MacGregor]

Even aside from the difficulties of culling facts from statistics, how unbiased is a firm called "iSuppli?"

If the data is accurate though, almost 2% of all handset sales is pretty tremendous! Even if it drops to 1.0-1.5% after the initial splurge it will do well until buyers can easily and legally go beyond AT&T, at which point .... boom.

Just keep regular firmware upgrades in the mix, Apple!

[steviet02]

EDIT: Meant to quote the article not a post

Why are these numbers believable?

[davebarnes]

Originally Posted by MacGregor

Even aside from the difficulties of culling facts from statistics, how unbiased is a firm called "iSuppli?"

I hope that was a joke.

[GQB]

Originally Posted by anantksundaram

Does this market share include only personal purchases, or also corporate/ corporate-sanctioned purchases? If also the latter, then it is quite an impressive number, considering that nearly all of iPhone sales are to individual consumers.

Still, total sales of 4.5 million in 2007 sounds way too optimistic.

To the best of my knowledge, there are no 'corporate sanctioned' purchases at all yet.
AT&T only allows individual contracts, so even if your company has a bulk plan with AT&T (as does mine), you still have to have your number transfered to you as an individual, and you have to expense it.

I would expect this to change before long, and when it does (along with some sort of Exchange solution), corporate sales will take off.

[Constable Odo]

Undoubtedly, with introduction of Leopard to the iPhone and the upcoming holiday season, the iPhone should sell even faster. It's very likely that with the Leopard versioned iPhone there should be provisions for synching with corporate mail servers. I believe that will severely hurt BlackBerry sales while boosting iPhone sales.
I can only hope that iSuppli is not made up of Apple fanboys and that their data is accurate. If Apple gets the iPhone launched in Europe in the fourth quarter, then sales should spiral upward at a fast rate. 4.5 million doesn't seem unreachable. I really believe many people are waiting for the Christmas holidays to buy iPhones and iPods. We'll see.

[backtomac]

Originally Posted by anantksundaram

Does this market share include only personal purchases, or also corporate/ corporate-sanctioned purchases? If also the latter, then it is quite an impressive number, considering that nearly all of iPhone sales are to individual consumers.

Still, total sales of 4.5 million in 2007 sounds way too optimistic.

Yeah the 4.5 million sales this year is going to be tough to reach under current conditions. IMO, it'll only happen if they start selling phones in Europe and they introduce an iPhone 'nano'.

The current model is doing well but Apple won't meet their sales goals without the above IMO.

[city]

Originally Posted by MacGregor

Even aside from the difficulties of culling facts from statistics, how unbiased is a firm called "iSuppli?"

These are the good people that break open new products and give us a cost break down.

[kenaustus]

While hitting the #1 spot is great news it also reflects 6 months of build up demand and there is some skewing because people had to wait so long.

Personally I think the iPhone is going to have it's own market segment. It really doesn't compete with "smart phones" that have a hundred buttons to press, nor does it compete with the $29.95 phones with a 2 year contract.

It's a new market segment and over time we'll see other mobile OEMs trying to join it. Unfortunately the iPhone has OS X, allowing Apple to continually add features.

So for now, look for Apple to satisfy the initial surge demand, then provide supply that will meet the demands from the kids going back to school and finding that the "have just got to have" an iPhone because everyone else does. Toss in an increase in demand as word spreads about how good the iPhone really is and you have growth all the way to the start of the holiday buying season.

[steviet02]

Originally Posted by city

These are the good people that break open new products and give us a cost break down.

OK, so they took one apart, are they qualified for or have access to the facts to come up with these numbers? They might be I don't know, but dont you have to ask that question?

[bsenka]

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

[Louzer]

Originally Posted by kenaustus

While hitting the #1 spot is great news it also reflects 6 months of build up demand and there is some skewing because people had to wait so long.

Not to mention the rabid "I'll stand in line for three days to buy anything from apple, despite the fact that I know nothing about it" apple fanatics.

Originally Posted by kenaustus

Personally I think the iPhone is going to have it's own market segment. It really doesn't compete with "smart phones" that have a hundred buttons to press, nor does it compete with the $29.95 phones with a 2 year contract.

Sorry, but 'smart phones' don't have a hundred buttons, and the iPhone has just as many, its just they're in a different spot.

It's a new market segment and over time we'll see other mobile OEMs trying to join it. Unfortunately the iPhone has OS X, allowing Apple to continually add features.

How is it unfortunate that it has OS X? And am I mistaken, or don't all 'smart phones' have an underlying OS allowing the company to add features? Or is it somehow magical for OS X? (Of course, if OS X is any indicator, they'll keep adding features while ignoring issues real-world users have with the phone for the next 4 years).

And how would you define this new market, if not a smartphone? Semi-smart phone (no custom apps need apply)? MediaPlayer/InternetConnectivity Phone? Touch-screen phone (no, that won't do, because somebody already has touch-screen, but its not MULTI-TOUCH! That's it!) Apple Multitouch phones. There, that makes it a new market.

So for now, look for Apple to satisfy the initial surge demand, then provide supply that will meet the demands from the kids going back to school and finding that the "have just got to have" an iPhone because everyone else does. Toss in an increase in demand as word spreads about how good the iPhone really is and you have growth all the way to the start of the holiday buying season.

Initial surge was satisfied by mid-July. I'm not sure how many kids are going to be getting an iPhone (didn't you read the report, most are going to under-35 grads, kids in school generally haven't graduated yet). The overall cost (on a college income) seems to outweigh its supposed advantages (except in the all important "Look at me! I'm cool! I've got an iPhone!" crowd). Well, maybe they can afford it at the higher-tier private schools.

And it doesn't matter how 'good' the phone is, as $600 for a phone, plus $60 a month (can you put this thing on a cheap family plan?) is still a lot of money just to have what everyone else has.

[Louzer]

Originally Posted by bsenka

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

Well, it could be an unprecedented success at being a complete disappointment. Or, to some, a complete disappointment at being an unprecedented success.

Although the August/September numbers are what everyone wants to see. I never doubted it would sell big in July (since everyone talked about it for 6 months and how it was a life-changing device), but once you get past those people, how's the month after month sales going to proceed?

[aegisdesign]

Originally Posted by backtomac

Yeah the 4.5 million sales this year is going to be tough to reach under current conditions. IMO, it'll only happen if they start selling phones in Europe and they introduce an iPhone 'nano'.

The current model is doing well but Apple won't meet their sales goals without the above IMO.

A little trickier in Europe though. Apple actually have competition there and the iPhone in it's present hardware is two year old tech.

[SpamSandwich]

Originally Posted by bsenka

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

How else do you expect these turds to sell their consulting services or drive traffic to their web sites... no one ever made the headlines with, "Nothing significant to report here".

[Rot'nApple]

Originally Posted by AppleInsider

"Based on consumer demand, Apple's brand image, industry anticipation and iSuppli's estimates of volume shipments by manufacturers and the market segment, iSuppli is maintaining its projection that 4.5 million iPhones will ship in 2007, rising to more than 30 million units in 2011."

IF TRUE...

"Say it ain't so...." - Steve Ballmer

[mdriftmeyer]

What is with everyone's ``IMO''? Is this a new technique to cover your butt when you are shown to be wrong?

The only counter opinion to such reported statistics are from representatives who have done the work in recording purchases and done breakdowns by whatever set of criteria they have determined before they start recording statistics.

Everyone else is talking out their rears.

However, one could comment on whether or not this iSuppli was sponsored by Apple to write a favorable report or not.

[cameronj]

Originally Posted by MacGregor

Even aside from the difficulties of culling facts from statistics, how unbiased is a firm called "iSuppli?"

If the data is accurate though, almost 2% of all handset sales is pretty tremendous! Even if it drops to 1.0-1.5% after the initial splurge it will do well until buyers can easily and legally go beyond AT&T, at which point .... boom.

Just keep regular firmware upgrades in the mix, Apple!

I guess you don't pay much attention to IT news huh?

iSuppy has been around and doing market stats long before Apple started using the i prefix on products.

[MacTel]

Originally Posted by bsenka

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

Yep, it is too early to call the iPhone a success or failure. If it meets Apple's sales goals then we'll know for sure. Everything else is hyperbole.

[backtomac]

Originally Posted by aegisdesign

A little trickier in Europe though. Apple actually have competition there and the iPhone in it's present hardware is two year old tech.

Wait until you use one. You'll fall for it just like everyone else.

[GQB]

Originally Posted by aegisdesign

A little trickier in Europe though. Apple actually have competition there and the iPhone in it's present hardware is two year old tech.

Please elaborate...
- visual voice mail
- full touch interface with virtually unlimited expandability
- ease of use

How are these 2 year-old technology?

I recently had to use a Motorola Razr as a replacement for my existing Nokia (can't switch to iPhone until there is blessing of corporate pooling account), and the comparison to my experience with the iPhone is a joke. There wasn't a single basic function I could use without consulting (and often continuing to consult) a manual. All functionality buried deeply in cryptic menus, and buttons that make the iPhone's interface look like a billboard.

I really don't get where there's any comparison between iPhone and existing products. Even existing failings can and will be addressed by software updates.

I've been buying AAPL on dips, and can't wait 'til tomorrow. Hopefully a phone-less video iPod.

[SpamSandwich]

...and maybe a touchless miniPhone™.

[cameronj]

Originally Posted by bsenka

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

Hyperbole? This is market research. The numbers are what they are.

[Wingman16]

Originally Posted by Constable Odo

Undoubtedly, with introduction of Leopard to the iPhone and the upcoming holiday season, the iPhone should sell even faster. It's very likely that with the Leopard versioned iPhone there should be provisions for synching with corporate mail servers.

The iPhones are currently using the embedded version of Leopard.

http://www.appleinsider.com/articles...e_release.html

A quote from that article:

"Originally slated for June, Leopard's release was pushed back to October when Apple was forced to borrow some key software engineering and QA resources from its Mac OS X team in order to make good on a promise to launch iPhone -- which runs an embedded version of Leopard -- by the end of June."

[anantksundaram]

Originally Posted by GQB

To the best of my knowledge, there are no 'corporate sanctioned' purchases at all yet.
AT&T only allows individual contracts, so even if your company has a bulk plan with AT&T (as does mine), you still have to have your number transfered to you as an individual, and you have to expense it.

I would expect this to change before long, and when it does (along with some sort of Exchange solution), corporate sales will take off.

I guess it was not obvious from the context, so let me clarify: In saying "corporate/corporate-sanctioned purchases" I was referring to the market share of non-iPhone "smart"phones such as BBs and Palms. And, therefore, that the claim in the article -- if true -- suggests an even more impressive accomplishment for the iPhone.

[solipsism]

Originally Posted by GQB

Please elaborate...
- visual voice mail
- full touch interface with virtually unlimited expandability
- ease of use

How are these 2 year-old technology?

I recently had to use a Motorola Razr as a replacement for my existing Nokia (can't switch to iPhone until there is blessing of corporate pooling account), and the comparison to my experience with the iPhone is a joke. There wasn't a single basic function I could use without consulting (and often continuing to consult) a manual. All functionality buried deeply in cryptic menus, and buttons that make the iPhone's interface look like a billboard.

I really don't get where there's any comparison between iPhone and existing products. Even existing failings can and will be addressed by software updates.

I've been buying AAPL on dips, and can't wait 'til tomorrow. Hopefully a phone-less video iPod.

Those comments are best ignored. They are typical hyperbole rhetoric referring to mainly to Apple's use of he 2.5G EDGE technology, and partly to only having a 2MP digital camera.

I am under the impression that Apple's choice for EU providers have substantial EDGE networks and that O2 in the UK has the largest customer base in the UK. If this is correct, I think the iPhone will fair quite well.

The digital camera on the iPhone is fine but there are some some software issues that need to be addressed, like image stabilization and color syncing, though it fairs better than other higher resolution cameras in this area. But these can hardly be called "2 year old tech."

I love how with all the R&D Apple puts into products, and how they have confounded and proven wrong the pundits at every turn for a decade now, that people still come to this board claiming Apple doesn't have the slightest idea what they are doing.

[Sladuuch]

You guys really need to start using iWork for your graphs…

[melgross]

Originally Posted by steviet02

OK, so they took one apart, are they qualified for or have access to the facts to come up with these numbers? They might be I don't know, but dont you have to ask that question?

Did you actually read the article, or just that post?

[melgross]

Originally Posted by bsenka

The hyperbole from these third party reports is hilarious. Depending on who you believe, the iPhone is either a complete disappointment, or an unprecendented success. Not much in the middle.

Would you let us know which market research firm recently had a report that said that the iPhone is a "complete disappointment"?

[cutemartin]

Originally Posted by Louzer

Not to mention the rabid "I'll stand in line for three days to buy anything from apple, despite the fact that I know nothing about it" apple fanatics.

Sorry, but 'smart phones' don't have a hundred buttons, and the iPhone has just as many, its just they're in a different spot.

If you're going to call someone out for exaggeration, it's probably best not to discredit yourself by doing exactly the same thing in your previous paragraph.

I do not remember anyone standing in line for three days. The relatively small number who queued that long were, I believe, in sedentary positions for much of the time. And I don't believe any of them were infected with rabies....

[melgross]

Originally Posted by mdriftmeyer

What is with everyone's ``IMO''? Is this a new technique to cover your butt when you are shown to be wrong?

The only counter opinion to such reported statistics are from representatives who have done the work in recording purchases and done breakdowns by whatever set of criteria they have determined before they start recording statistics.

Everyone else is talking out their rears.

However, one could comment on whether or not this iSuppli was sponsored by Apple to write a favorable report or not.

Yeah, you could make that comment, but it would be nonsense, as you know.

[anantksundaram]

Originally Posted by solipsism

They are typical hyperbole rhetoric referring to mainly to Apple's use of he 2.5G EDGE technology.......

I have noticed in the past two or three weeks that, when all five bars are on, EDGE is really quite impressive for Safari -- and even YouTube -- use. (It has always been adequate for maps, stocks, weather and email).

Also in the past few weeks, the number of YouTube offerings for iPhone has expanded dramatically.

Originally Posted by solipsism

I love how with all the R&D Apple puts into products, and how they have confounded and proven wrong the pundits at every turn for a decade now, that people still come to this board claiming Apple doesn't have the slightest idea what they are doing.

I am no expert on R&D, but as a consumer, I agree. Based on my first-hand experience thus far, I will venture a guess that the iPhone, in its current form, will blow away Europeans too.

[melgross]

Originally Posted by Wingman16

The iPhones are currently using the embedded version of Leopard.

http://www.appleinsider.com/articles...e_release.html

A quote from that article:

"Originally slated for June, Leopard's release was pushed back to October when Apple was forced to borrow some key software engineering and QA resources from its Mac OS X team in order to make good on a promise to launch iPhone -- which runs an embedded version of Leopard -- by the end of June."

We really don't know, despite that article, which itself was just guessing, if the iPhone does run on Leopard. I seem to remember some comments from someone from Apple that said it didn't.

[melgross]

Originally Posted by Sladuuch

You guys really need to start using iWork for your graphs…

Wow! I can read the numbers SO much better now! Not.

[David Stevenson]

Originally Posted by Louzer

Initial surge was satisfied by mid-July. I'm not sure how many kids are going to be getting an iPhone (didn't you read the report, most are going to under-35 grads, kids in school generally haven't graduated yet). The overall cost (on a college income) seems to outweigh its supposed advantages (except in the all important "Look at me! I'm cool! I've got an iPhone!" crowd). Well, maybe they can afford it at the higher-tier private schools.

And it doesn't matter how 'good' the phone is, as $600 for a phone, plus $60 a month (can you put this thing on a cheap family plan?) is still a lot of money just to have what everyone else has.

I bet a lot of cell phones that college kids carry around are graduation presents that dad bought with the bargain "call your mother once a week" attached. And there are a lot of "higher-tier private schools" outside the ivy league (e.g. MIT, Stanford, etc) and a lot of higher-tier public schools (e.g. Berkeley, Big Ten, etc). So I think even a 2% penetration of the freshman class and say 1% of upper classes would be a significant contribution to sales in the September quarter.

[Sunbow]

Originally Posted by backtomac

Yeah the 4.5 million sales this year is going to be tough to reach under current conditions. IMO, it'll only happen if they start selling phones in Europe and they introduce an iPhone 'nano'.

The current model is doing well but Apple won't meet their sales goals without the above IMO.

However, do we know how many they sold in July; the article says 1.8% share but how many is that? We know it is over a million though isn't it, as we weren't far into July before the first million was claimed.

Given some back-to-school potential, some major holiday (Christmas ) sales potential and the ongoing word-of-mouth and rave reviews, we could expect each month (after a small 'correction' in Aug due to people being on vacation) to rise from July's numbers in the US and, if they arrive in the UK, France and Germany by the beginning of Nov 2007, we could expect 1 million to be sold in Europe before Christmas, when you consider the speed at which 1 million were sold in the US and add-in the pent-up demand in Europe!

So, conservatively, say 1 million were sold in July and then Sep, Oct, Nov and Dec each have 1 million each (and then assume (pessimistically) 0.5 million in Aug plus 1 million in Europe (Nov and Dec combined), that comes to 6.5 million for 2007; I'd suggest 4.5 million not only looks plausible but positively conservative!

[steviet02]

nevermind...