US Smartphone Installed Base Sees Steady 2019 Growth, Strong Top-End Dominance

What was the most popular smartphone at the end of 2019? Apple iPhone 11? What about iPhone XR which was launched in 2018?

There are actually many ways to measure the most popular smartphones in the market. One way is to track the most sold or bestselling phone by unit sales but what about the phone currently used the most? For software companies understanding the smartphone model that is most used is more valuable information. If you want to develop software for the market you might as well develop for the device that has the largest user base. That’s when the concept of installed base becomes important.

The US smartphone installed base1 grew 7% YoY at the end of 2019. However full year smartphone sales declined 4% YoY.

Exhibit 1: US smartphone installed base

Counterpoint - US smartphone installed base

Source: Counterpoint Research

Exhibit 2: US smartphone unit sales
counterpoint - US smartphone unit sales

Source: Counterpoint Research

Apple continued to dominate the US installed base in 2019, accounting for 42% at end-2019, followed by a distant Samsung

and LG. Slightly higher numbers were seen in 4Q19 unit sales, with Apple leveraging its annual September new release window and the holiday season to take just under half of all sales.

Exhibit 3: US smartphone installed base, market share by brandcounterpoint - US smartphone installed base, market share by brand

Source: Counterpoint Research

Exhibit 4: US smartphone unit sales, market share by brand

counterpoint - US smartphone unit sales, market share by brand

Source: Counterpoint Research

Apple took all top 10 spots for US smartphone installed base in 2019. The older model XR – launched in 2018 – came out on top with 7% share, supported throughout the year by various price cuts and promotions. It continued to be popular even after a year on the market, securing the number three spot in terms of sales in 4Q19. iPhone 11 captured the largest sales share of 16% quickly after its launch in 4Q19. iPhone 11 with enhanced hardware, dual rear cameras and high-performing processor, and low prices, cheaper than its predecessor XR, lead to an immediate success.

Exhibit 5: US smartphone top 10, installed base share

counterpoint - US smartphone top 10, installed base share

Source: Counterpoint Research

Exhibit 6: US smartphone top 10, unit sales share

counterpoint - US smartphone top 10, unit sales share

Source: Counterpoint Research

Conclusion

Last year we saw stable installed base growth with strong performance from a premium player. The trend is likely to be broken in 2020 with impact due to the COVID-19 pandemic. We saw YoY 1Q20 sales decline by double digits, and we expect further falls in the second quarter. This will not only hit installed base growth but could also skew it closer to the low-mid end. Apple, Samsung, and LG will all be negatively impacted, with, potentially, Apple to suffer most with respect to its top-end devices. Price sensitivity will play a bigger role in competitiveness, making price cuts and promotions even more important.

[1]Installed base is defined as the number of active devices in use at a certain point in time. Installed base, is meaningful data to game companies, app developers, and content providers. Installed base data provides them with a tool to analyze devices that their users are holding and helps them offer optimized and stabilized services for devices. Global streaming services and e-commerce market are expanding rapidly amid the ongoing Coronavirus outbreak and demand for improved user experience is increasing. Accordingly, it calls for reliable analysis using installed base.