US handset sales dropped in Q1 for the first time in years, especially in lower income brackets, with the weakness attributed to economy and market saturation. High end phones–Apple (AAPL) and Research and Motion (RIM)–stayed strong. More bad news for Motorola (MOT). WSJ:
The drop was concentrated among poorer customers using prepaid plans and among households earning $75,000 to $99,000 a year. The upper end of the mobile phone market — phones featuring full keyboards for email and text messaging, and extra features for music downloads and video viewing — continued to see growth.
The overall decline in handset sales also comes amid finds that growth in wireless-service subscriptions is slowing as the market reaches saturation, with 83% of the U.S. population owning a mobile phone now.
One study, from United Kingdom-based market-research firm Strategy Analytics showed a 5% drop in the quarter compared with a year earlier, while a separate report from NPD Group, showed a 22% drop in purchases of new handsets in the quarter.
The studies are the latest piece of bad news for handset makers, particularly Motorola Inc., the U.S. market leader that is particularly exposed to the lower end of the market. Motorola mobile phone sales slid 39% in the first quarter, and the company attributed much of that loss to the U.S., where it sells half of its phones.