Mobile Milestone: The Number Of Smartphones In Use Passed 1 Billion In Q3, Says Strategy Analytics
We are just getting into reporting season, where some (but not all) handset makers tell us how many handsets they've sold in the last three months, but Strategy Analytics has taken a punt …
Context & Ripple Effects
The milestone follows evidence that smartphone demand was outpacing the wider handset market: Gartner reported a 43% jump in smartphone sales even as global mobile sales fell. In the U.S., Nielsen had already put smartphones in the hands of just over half of consumers, with Android accounting for 48.5% of smartphone users.
Strategy Analytics’ installed-base estimate matters because it turns rapid unit sales into a large, reachable audience for mobile software, advertising and paid content; the firm had projected $67 billion in global mobile advertising and content revenue for 2012.
First-order effects
- App developers, publishers and advertisers gain a billion-device addressable base, making mobile distribution a core channel rather than a supplementary one.
- Handset makers are competing for users whose device choice also determines the software and content ecosystems they can reach.
Second-order effects
- Android’s measured U.S. lead raises the value of Android support for developers and advertisers, while Apple must sustain demand as smartphone growth broadens beyond new-device launches.
- Mobile ad and content providers have stronger incentives to tailor products for smartphones, shifting budgets and product design away from handset-agnostic mobile services.
Third-order effects
- If installed-base growth continues, handset competition will increasingly be shaped by ecosystem participation—applications, content and advertising—not hardware sales alone.
- A larger smartphone base strengthens the shift from voice-centric mobile use toward internet-connected services as the principal source of value in the handset market.
The trend: Smartphone adoption is turning the mobile handset market into an ecosystem contest for developers, content providers and advertising spend.