More feature phones among new handsets sales in Q2 2009

PORT WASHINGTON, USA: According to The NPD Group, a leading market research company, when it comes to sales of mobile phones in the US feature phones still rule the market, even as smartphone sales continue to increase their share of overall handset sales.

NPD’s Mobile Phone Track information reveals that unit-sales of new feature phones fell 5 percentage points to 72 percent of new handset sales in the second quarter (Q2), while sales of new smartphones (i.e., handsets that are sold with their own operating systems) reached 28 percent of overall consumer purchases -– a 47 percent increase in the category’s share since last year.

“Despite their ties to pricey data plans, the rich Internet access capabilities of smartphones are attracting consumers wooed by lower device prices,” said Ross Rubin, director of industry analysis at The NPD Group.

Overall handset sales volume in the US grew 14 percent year over year in Q2 2009, as sales revenue increased 18 percent. The average selling price of all mobile phones increased 4 percent year over year – reaching $87 in Q2.

NPD’s Q2 2009 ranking of handsets showed the LG enV2 and Samsung Rant led feature phone sales, while Apple iPhone 3G and RIM Blackberry Curve were the top-selling smartphones.

Wi-Fi capability increased three-fold since last year, with 20 percent of all new handsets equipped with this capability. Touch screens on both feature phones and smartphones have also seen tremendous growth since last year, with 26 percent of all new handsets purchased in Q2 including this feature; physical QWERTY keyboards, by comparison, were available in 35 percent of handsets sold.

"Feature phones are taking on more of the physical characteristics of smartphones, and often offer greater exposure to carrier services," Rubin said. "Although their user interfaces continue to improve, the depth of their applications generally lags behind those of smartphones.

"With the price gap between smartphones and feature phones narrowing, to remain competitive feature phones need to develop a better Web experience, drive utility via widgets, and sidestep the applications arms race."