Good Numbers for Smartphone Penetration and Carrier Density

Carl Weinschenk
Slide Show

Seven Sexy Smartphones

This latest batch of smartphones calls attention to glasses-free 3D technology, front- and rear-facing cameras and Snapdragon processors.

Yesterday, I posted on a comparative network speed test run by PCMag.com. The post made two points. The more specific of the two was to highlight the yeoman work done by the site on rating the speed of Verizon Wireless, AT&T, T-Mobile, Sprint, Cricket and Metro PCS.

The other point was more general and universal: It is unwise to trust service providers, vendors or any other company with a dog in the race to be honest about the metrics used to describe their offerings.

The gap between the advertised and the real also was a theme of a comment made by FCC Commissioner Michael Copps in his statement on the release of the annual report on the U.S. wireless industry. Copps, whose statement was quoted by Newsfactor, would prefer more original research:

Copps expressed concern that the FCC's ability to arrive at intelligent decisions concerning wireless competition is being constrained by the staff's reliance on pricing and investment data gathered by third parties. He also noted that the new report incorporates coverage maps that simply reiterate the mobile provider information gathered by American Roamer. "I would prefer to have the commission gather and verify this data ourselves," Copps said.

Copps' cautions aside, the report suggests some real progress for smartphones' wireless networks in general. The report confirms what everyone knows: Smartphones are hot. The FCC found that 28 percent of all subscribers have them, and that they account for 41 percent of recent purchases. Android is the hottest of that group; its share rose from 5 percent to 20 percent during the year.

The companion news - again, the numbers are hard to verify - is that the density of providers is on the upswing. The story says that four or more providers serve 68 percent of the U.S. market, an increase of 10 percent between November 2009 and August 2010. The three-or-more provider mark was hit by 82 percent of the nation, up from 76 percent in the earlier period.

It will be interesting to see how the combination of AT&T and T-Mobile spin the numbers going forward, providing that the deal closes. But, for now, that it is a very good trend line. In rural areas, 69 percent of the population had a choice of two or more providers and 38 percent had access to three or more. Those numbers, according to Commissioner Robert McDowell, compared to 62 percent and 29 percent in 2008.

Another sign of the growth - and, no doubt, another case in which the metrics are supplied - is the explosion in revenues Canlys sees from "apps, in-app purchases and subscriptions" involving smartphones and tablets. The firm said that this year, the composite category will hit $7.3 billion. Next year it will grow 93 percent to $14.1 billion and will hit $36.7 billion. That represents a compound annual growth rate of almost 50 percent.

Apparently, the U.S. will finish behind Canada in something other than hockey and beer. eMarketer, reporting on comScore numbers, said that last year 33 percent of Canadian mobile users had smartphones. That is 2 percent more than in the United States. The numbers, according to eMarketer, were similar to those found in March by Quorus Consulting.

It's not a shock that smartphones are exploding. The numbers, as I've said, must be taken with a bit of salt. However, it's reassuring that they seem to be consistent - no matter where they are coming from.

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