Android Plays Big Role in Upgrades from Feature to Smartphones

By Gary Kim July 11, 2012
Though observers might complain that Android as an operating system is so fragmented that it is hard to tell what its market share actually means, Android continues to take share around the world.

The latest data from Kantar Worldpanel ComTech shows that for the first time Android has taken at least half of smartphone sales in Great Britain, Germany, France, Italy, Spain, the United States and Australia.

Android's share now ranges from 49.6 percent in Italy to 84.1 percent in Spain, Kantar says. And there is one important angle to that adoption process that has revenue implications for mobile service providers.

As it turns out, much of the Android adoption is being driven by users who are upgrading from feature phones to smartphones for the first time. That, in turn, is important because such upgrades normally entail an increase in average revenue per user, as customers buy data plans.

You might also say the Android trend therefore is troubling for suppliers, such as Nokia, that traditionally have done very well in the lower end of the market. As the whole market transitions to a smartphone driven pattern, rival suppliers selling Android devices might well be in a very-good position to supplant the traditional Nokia advantage in lower-cost devices, as well as the appeal of Research in Motion devices. 

“We are seeing much of the Android sales growth being driven by consumers trading up from feature phones to smartphones,” saya Dominic Sunnebo, Kantar Worldpanel ComTech consumer insight director.

“Our data shows that Android has a higher share of those consumers spending under £50 on buying their handset across the vast majority of countries we cover,” he says.

In markets like the United Kindgom, smartphone penetration in the prepay market also is increasing, with Android handsets such as the Samsung Galaxy Ace and Y performing well, especially attracting younger first time owners, a group who have traditionally been loyal to BlackBerry. 

Kantar also says smartphone buyers, “are much more loyal to their brand of handset and carrier than  feature phone consumers, highlighting the importance of capturing feature phone owners when they are starting to look to change their handset.“

So, smartphone adoption clearly is helpful to mobile service providers for several reasons, including higher average revenue per user and greater loyalty. Android might be helpful because it encourages users to upgrade to smartphones.

Edited by Brooke Neuman

Contributing Editor

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