Demand for Android phones makes 'monstrous' 250% jump

ChangeWave sees huge leap in Google Android interest; Apple iPhone demand to slip

A "monstrous" jump in demand for Android-equipped smartphones has turned the market upside down, a retail pollster said today.

Of the people who told ChangeWave Research in a mid-December survey that they planned to buy a smartphone in the next 90 days, 21% said they expected to purchase a handset powered by Google 's Android operating system. That number represented a 250% increase over the 6% that pegged Android as their mobile OS of choice when ChangeWave last queried consumers' plans in September.

"That change rivals anything that we've seen in the last three years of the smartphone market," said Paul Carton, ChangeWave's director of research, adding that the sudden surge in consumer interest in Android had "roiled" the market.

"This is an indication that Android has finally caught consumer interest," added Carton, who cited the recent advertising campaign by Motorola for its Droid smartphone as the reason why interest in the operating system has skyrocketed.

In September, the Android OS was tied for last place in consumers' preference among the major mobile operating systems. Since then, it "has surged into second place ahead of all competitors except the iPhone OS," said Carton.

The iPhone remained the No. 1 desired smartphone, according to ChangeWave's latest survey, with 28% of those who plan on buying in the next three months saying that they would choose an Apple device. However, that figure was down four percentage points from September, when 32% said that they would acquire an iPhone.

The drop in the iPhone's planned purchasing percentage wasn't unexpected. "The first two quarters after the introduction of the iPhone 3G [in mid-2008], you saw this huge pop in buying plans, and then a downtick," Carton said. "Same for the 3GS ... actually, the drop-off for the iPhone after the 3GS was far less than the 3G."

Android's leap translated into good news for Motorola and HTC, the most prominent makers of Google-powered handsets, with the former reaping most of the benefit. Motorola's share of smartphone purchases in the next 90 days shot up from 1% in September to 13% in December. Carton tagged the company's Droid as the reason.

"[It's] the first increase for Motorola we've seen in three years," said Carton.

All smartphone makers and mobile operating system developers are benefiting from the industry-wide upswing in sales, Carton contended. Approximately 42% of the 4,000-plus American consumers surveyed in December said they owned a smartphone, a three-point increase over September and 10 points higher than a year ago. "If a rising tide lifts all boats, then just by itself, the increase [in sales] means that it gets dicey to bet against anybody, or to bet on just one company," Carton said. "But Android phones are clearly going to benefit the most from this tick up."

The only mobile OS makers that Carton would peg as being in real trouble from Android's new popularity were Palm and Microsoft . "This puts a lot of pressure on the Palm Pre ," he said, noting that the Pre didn't have enough time to solidify its place in the smartphone market before Android handsets became the newest and latest rage. "And Windows Mobile ... those are the [operating systems] that have to worry about Android's numbers, they're the ones that have to strike back somehow, not Apple or RIM. It's hard to bet against those two."

Consumers who own an Android-powered smartphone are almost as satisfied with their purchases as are iPhone owners, who have been historically extremely happy with their hardware. Of the people who told ChangeWave they had an Android handset, 72% said they were "very satisfied;" 77% of those who reported they own an iPhone answered the same way.

By comparison, only 41% of the people who own a BlackBerry said they were very satisfied, and just 25% of Windows Mobile-equipped smartphone owners rated their satisfaction using that phrase.

While he acknowledged the buzz around the expected announcement on Tuesday of a Google-branded smartphone, Carton argued that it was unlikely that the Nexus One would kill sales of other Android smartphones. He cited Motorola's Droid as especially immune, in large part because of its link to Verizon.

"Unless Google's phone is magnitudes better, I can't see people walking out of Verizon and heading to T-Mobile," he said. Reports have pegged T-Mobile as the likely carrier partner for Google's own smartphone. "Look at Google's move not in the short term," Carton said. "But for three or four years from now."

ChangeWave has posted some of the smartphone survey data on its Web site.

Gregg Keizer covers Microsoft, security issues, Apple, Web browsers and general technology breaking news for Computerworld . Follow Gregg on Twitter @gkeizer , send e-mail at gkeizer@ix.netcom.com or subscribe to Gregg's RSS feed .

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