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Lower Income People Are The iPhone’s Fastest Growing Demographic

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The fastest growing user base of iPhone owners are lower income people, who are using the multi-purpose device in order to ditch other Internet and entertainment services, according to comScore (NSDQ: SCOR), which is releasing its first report detailing iPhone demographic data on Thursday. ComScore found that while 43 percent of iPhone owners earn more than $100,000 per year, the strongest growth in users is coming from those who make between $25,000 and $50,000. Between Jun and Aug. 2008, users in this income bracket jumped by 48 percent, making it three times that of those earning more than $100,000 per year. Overall, iPhone penetration grew 21 percent. “These data indicate that lower-income mobile subscribers are increasingly turning to their mobile devices to access the Internet, e-mail and their music collections,” said comScore’s Mark Donovan. “Smartphones, and the iPhone in particular, are appealing to a new demographic and satisfying demand for a single device for communication and entertainment, even as consumers weather the economy by cutting back on gadgets.”

The study indicates that the iPhone, which costs $200 plus at least $70 a month, is moving from a luxury item into a way consumers can save money since it can replace mutliple devices. But still, it seems hard to draw any conclusions on such a small time period, not to mention that the original iPhone, at $600 each, likely got a bigger turnout from higher-income people. On the other hand, the cheaper $200 version was able to appeal to a wider audience. It will be interesting to see if this has an impact on the broader smartphone category, as the economy continues to have troubles. ComScore said the overall growth of smartphones for this income bracket grew at a more moderate 15 percent. However, the T-Mobile G1 device, which came out this month, may also be appealing for the same reasons. In addition to it having features, like Internet access and e-mail, it is $20 cheaper than the iPhone and can cost as little as $55 a month.

Oct 29, 2008 11:41 PM ET

Posted In: Research & Metrics, Companies, Apple, iPhone, Google, T-Mobile

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