John Paczkowski

Recent Posts by John Paczkowski

100 Million iPhone Owners by End of 2011? Maybe Once the Pre-Order Issues Are Sorted Out.

Apple will more than triple iPhone ownership in the next year and a half, giving it an installed base of 100 million people by the end of 2011. This according to Morgan Stanley (MS) analyst Katy Huberty, who theorizes that more than half of all current iPhone owners plan to upgrade to the iPhone 4.

Adding new purchases to that, Huberty figures Apple (AAPL) will sell at least 42 million iPhones in calendar year 2010, assuming a 30 percent upgrade rate for existing customers. If the rate hits 50 percent, sales will grow to 48 million. In 2011, Huberty expects another 19 million upgrades.

Result: “We see the iPhone installed base rising from approximately 30M subscribers at the end of 2009 to over 100M by the end of 2011,” says Huberty. “We believe there are several key drivers of iPhone upgrades including: 1) Redesigned hardware with many new important features, 2) ‘Stickiness’ of the installed base due to App store and iTunes, 3) 57% of U.S. installed base is not fully upgradeable to iOS4 (i.e. no multitasking), 4) Early upgrade incentives from AT&T and 5) Maturation of the installed base. We would also point to AT&T’s introduction of tiered data pricing (that potentially reduces iPhone total cost of ownership by 20%+) as a possible driver of the strong initial pre-order activity.”