Feature phones accounted for 72% of handset purchases in the quarter, NPD said, and messaging-centric devices are getting a big push from carriers because of the revenue that text messaging generates. The report said the top-selling feature phones for the quarter were the LG enV2 and the Samsung Rant.
While feature phones captured the bulk of the market, it is slowly ceding ground to smartphones like Apple's iPhone and Research In Motion's BlackBerry lineup. Smartphones reached 28% of overall purchases, which was an increase of 47% from the same period last year. The iPhone 3G and the BlackBerry Curve were the top-selling smartphones for the quarter, NPD said.
NPD said the advanced features of smartphones are drawing customers away from feature phones, even though the sophisticated handsets come with a pricier data plan.
"Although their user interfaces continue to improve, the depth of their applications generally lags behind those of smartphones," NPD's Ross Rubin said of feature phones, in a statement. "With the price gap between smartphones and feature phones narrowing, to remain competitive feature phones need to develop a better Web experience, drive utility via widgets, and sidestep the applications arms race."
The Google-backed Android operating system may play a significant role in blurring the lines between feature phones and smartphones because it will be on a slate of low-cost devices that have high-end capabilities. Motorola is placing a big bet on the Linux-based OS, and it plans to release multiple Android smartphones with feature-phone pricing. Samsung has also said it will offer Android handsets for "well under $100."
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