BlackBerry Ltd (NASDAQ:BBRY) Has The Longest Replacement Cycle And Microsoft (MSFT)’s Lumia The Shortest
BlackBerry Ltd (NASDAQ:BBRY)(TSE:BB) smartphone owners hold onto their devices the longest compared to owners of other brands. As such, it turns out that BlackBerry is the smartphone brand with the longest device replacement cycle in the U.S. On the contrary, Lumia from Microsoft Corporation (NASDAQ:MSFT) has the shortest replacement cycle. For Apple Inc. (NASDAQ:AAPL) and Samsung brands, the replacement cycle is about two years.
Kantar WorldPanel has figured out which smartphone brand has the longest and shortest replacement cycles in its latest report. It is emerging that those who own BlackBerry smartphones in the U.S. tend to hold onto their devices longer than say those who own iPhones.
The U.S. upgrade cycle
In the U.S., the average BlackBerry Ltd (NASDAQ:BBRY) smartphone owner upgrades after 32 months. In comparison, the average Lumia owner upgrades their devices after 16 months. The upgrade cycle in Apple’s camp is 25 months and that of Samsung is 18 months. Perhaps the longer lifespan of BlackBerry smartphones could help explain the weakness in BlackBerry’s hardware business.
On average, the smartphone upgrade cycle in the U.S. is 22 months.
China’s replacement cycle
In China, Nokia Corporation (ADR) (NYSE:NOK) has the longest replacement cycle of 39 months, while homegrown Xiaomi has the shortest upgrade cycle of 12 months. The average lifespan of iPhone is shorter in urban China than in the U.S. at 19 months.
The average smartphone replacement cycle in China is 20 months, shorter than in the U.S.
In Apple’s camp, 32% of iPhone owners have upgraded their devices since September 2014 when the iPhone 6 series was launched in the U.S., but not all upgraded to the iPhone 6 series. Of the iPhone owners that have upgraded over the last year, 47% upgraded to iPhone 6 and 16% upgraded to iPhone 6 Plus. The number shows that Apple has a huge iPhone install base to appeal to for upgrades.
Given the ongoing saturation in the smartphone market where first-time buyers are shrinking, vendors are trying to get their existing users to upgrade. For BlackBerry Ltd (NASDAQ:BBRY), the longer upgrade cycle could also explain its struggles in the smartphone market.
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