Some 77 percent of customers buying iPhones on iPhone 4 launch day were upgrading from earlier models, according to a survey conducted by Piper Jaffray analyst Gene Munster. In comparison, 38 percent of iPhone buyers in 2008, and 56 percent in 2009, where upgraders, according to AllThingsD.
“Apple is effectively building a recurring revenue stream, where iPhone users pay on average US$200 a year to stay current with the latest phone,” Mr. Munster said.
He added, “While its true that iPhone 4 is a more significant feature upgrade compared to the 3GS, and we expect this upgrade rate to decline next year, Apple has in three years built brand loyalty in the phone market that compels users to upgrade to the latest version and wait in line for one to six hours to pick up their iPhone.”
Along with its loyal customers, Apple seems to still be drawing new iPhone users into the fold. Based on Mr. Munster’s estimates, 16 percent of iPhone buyers this year have switched to AT&T just for the combination iPod and smartphone.
In comparison, 28 percent of iPhone buyers in 2009 were new to AT&T. That suggests, according to Mr. Munster, that it’s time for Apple to add a second U.S. iPhone carrier.
Mr. Munster is estimating that Apple will sell between 1.0 and 1.5 million iPhone 4 units, including pre-sales, during the first three days of availability. That number, while high, ultimately doesn’t matter, he said, because “Apple is tapping into the global consumer spending sweet spot, mobile, and as a result iPhone numbers are going higher in the coming years.”
Apple is currently trading at $266.02, down 2.98 (-1.11%).