iPhone leads U.S. smart phone sales for July

Apple’s iPhone outsold all “smart” phones in the United States during July -- its first month of sales -- and equaled the sales of the most popular feature phone, LG’s Chocolate, according to research from iSuppli.

The iPhone, exclusively provided by AT&T, accounted for 1.8% of all mobile handset unit sales to U.S. consumers during July. iSuppli expects a total of 4.5 million iPhones to ship in 2007, rising to more than 30 million in 2011.

The speed of the iPhone’s rise to competitive dominance in its segment is unprecedented in the history of the mobile-handset market, said iSuppli.

According to iSuppli’s U.S. Consumer Panel survey, both the 4 GB and 8 GB models were top sellers, beating out the BlackBerry series, the Palm portfolio and any individual Motorola, Nokia and Samsung or other smart phone model from a branded service provider.

iSuppli's survey also included other facts about U.S. iPhone purchases made in July, including:

• 57% were purchased by U.S. consumers 35 years of age or younger
• 52% of purchasers were male, and 48% were female
• 62% of iPhone buyers in July had a four-year college degree or more education
• 25% of consumers who bought iPhones switched to AT&T service

Greg Sheppard, Chief Development Officer at iSuppli, said that the other 75% of consumers who bought the iPhone were made up of new users or existing AT&T customers. The fact that 25% were willing to switch service providers is a testament to the phone’s success, he said.

“As this product ramps and grows in popularity, it has become a service-switching phone,” said Sheppard. “A lot of it is because of the exclusivity that AT&T has with Apple, but still there are not too many phones that people are willing to switch [services] for.”

Sheppard also noted the balance in the demographics. He said that one thing the survey didn’t indicate is that those who are buying the iPhone are the early adapters who love new gadgets and having the latest in technology. He also notes that users need to create realistic expectations amongst all the hype surrounding the iPhone.

“If Apple choose to reduce prices, for example, and take advantage of lowering flash memory costs, that could help [sales],” Sheppard said. “If they introduce a speedier network version, that will help also. That has certainly been a hold-back for some users. Addressing these issues will all add up to a good [fourth quarter].”