The Reason Why Smartphones are Hot - written by Valerian Nakaar

The cell phone is certainly one gadget that more and more people are putting in their pockets. It is seen not just as a must-have device for communication but also as a tool for productivity as well. For this reason, the cell phone is continuously advancing and expanding its role beyond its basic function of making and receiving calls.

Cell phones have in recent years been transformed into mini-computers dubbed "the smartphone". For example, in 2008 for which data was available, out of the 1 billion camera phones shipped, smartphones which currently represent the high-end of the cell phone market, made up about 10% of the market or about 100 million units. Current smartphone brands on the market include BlackBerry, iPhone, Palm, Nokia and Samsung. These products are an- Internet-connected multimedia devices with a multi-touch screen or a sliding keyboard. Smartphones are designed to function as a camera phone, portable media player, and with internet connectability: with text messaging, email, web browsing and local Wi-Fi connectivity.

Interestingly, the rise in sales of smartphones will come at the expense of declining cell phone sales, currently 90% of the market. The rapid growth of the market for smartphone has everything to do with the technology as it has to do with the consumer. The smartphone- basically a pocket computer with cell phone capability-allows people to carry information and to access it everywhere they go. Just as portable lap top computers permitted desk-top users freedom of mobility, the smartphone allows its users the function of a desk-top PC with the portability of a laptop, and the utility of a cell phone.

In this severe economic down turn, where penny-pinching is commonplace, it is only reasonable that many people will turn away from luxury consumer items such as a smartphone purchase. Instead, many people are shelling out money to buy smartphones. To be sure, the sales of iPhones, Blackberrys and other smartphone models are rising rapidly. It is projected that growth will increase 25% this year alone. Other new models have either come on the market or are expected to be launched during the course of this year. These new additions will certainly help to fuel the popularity and growth of the smartphone industry.

For a growing segment of the population, the social expectation is that one must stay connected and be reachable almost instantly by voice or email. The smartphone gives people that dual ability to stay connected, and therefore they can justify the cost of buying a smartphone. Smartphones are also seen as a status symbol. Just as it became socially unacceptable in the late 1990s not to have an email address, it will become increasingly unforgivable in the next several years not to communicate via smartphone.

The growth in demand for smartphones is largely due to the fact that they are seen as productivity tools in a society that is highly mobile. Indeed smartphones were introduced to address a given market segment. For instance, the Blackberry smartphone when intially launched focused on the clientele in the corporate world. Interestingly, it was the introduction of less business-oriented phones first by Blackberry that scored a hit with the general public and led to the widespread use of Blackberry which doubled its customer base from last year to 25 million. The smartphone wave is continuing to gain momentum, and although sales are rising fast, smart phone sales still account for only 25% of the total cell phone shipments this year in the US. However, with the launching of new smartphones coupled with software offerings from RIM (makers of Blackberry), Nokia, Apple, Microsoft, Google and others this year, smartphones are poised to gain a greater market share of the cell phone industry.

Currently, smartphones are not cheap by any long shot. The handsets even with discounts from the wireless carriers typically cost a few hundred dollars, with the high-end going for several hundreds of dollars. Their data and calling service plans are typically up to a hundred dollars per month. One critical ingredient to low prices in the smartphone market place is the presence of vibrant competition among the various makers of smartphones. But if one considers that the market for smartphones is a large one, then new entrants to the market will seek to corner part of the market instead of competing with existing smartphone brands. However, the best avenue to making smart phones affordable to consumers is through innovation in smartphone technology that allows users to call and to connect to the internet no matter where they are at very reasonable cost.

It cannot be denied that even regular cell phones are getting smarter, and it's only a matter of time before all cell phones have the advanced levels of functionality associated with today's smartphones.