updated 03:55 pm EDT, Thu August 7, 2008
iPhone 3G & cell industry
Sales of the iPhone 3G are already beginning to have an effect on the mobile phone industry, show results from analysts. Trip Chowdhry of Global Equities Research estimates that some 700,000 iPhones were sold to the public in July alone, a number which compares very favorably next to the 1.1 million phones sold during the entirety of Q3 2007. A UBS survey has also discovered that as many as 37 percent of launch-day 3G buyers previously owned a 2.5G phone, representing an extremely quick turnaround in terms of cellphone upgrades. J.D. Power & Associates notes that the average phone upgrade cycle in the US is once every 17.7 months.
BusinessWeek comments, though, that this has generated a flood of second-hand iPhones, which may be taking the place of new devices from Apple as well as other manufacturers. Statistics on substitution are not yet available.
Avian Securities observes that the iPhone may in fact be helping Apple's rivals, to a limited extent. While Samsung's "share of responses" -- number of stores reporting a phone as a bestseller -- has dropped, Avian writes that in terms of individual phones, the Samsung Instinct is currently trumping the iPhone. LG, meanwhile, has grown its amount of responses, thanks to products like the Voyager. Strategy Analytics is predicting that Apple's portion of the touchscreen phone market could shrink from 40 to 35 percent this year.
Finally, Charles Wolf of Needham & Co suggests that Apple may suffer from iPod cannibalization, because the new, lower price of the iPhone may make it the focus of demand by teenagers during the Christmas season. As much as 30 percent of iPod sales could be diverted towards the iPhone, says Wolf.