Smartphones Lead Fast-Growing Mobile Internet Device Category

Size matters, and it’s a good time to be small. New data from iSuppli predicts that by 2012 the mobile Internet device category is expected to grow by a factor of eight from 2007 numbers. Global shipments are set to rise to 416 million units in 2012 — a compound annual growth rate of 50.8 percent from 2007, when only 53.8 million shipped.

Smartphones, e-book readers, UMPCs (ultramobile PCs), netbooks, portable navigation devices, portable MP3 players and handheld gaming devices are all considered MIDs.

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More specifically, iSuppli defines MIDs as devices that include integrated connectivity for wireless LANs and 3G-or-better wireless WANs; have displays that measure no more than 8 inches diagonally; feature instant-on and always-connectable capabilities; and offer a typical day’s worth of battery life.

Smartphones are expected to dominate the category, with iSuppli estimating that 60 percent currently meet MID criteria and 100 percent will by 2012.

E-book readers, such as the new Amazon Kindle 2, currently have 35 percent MID penetration—which iSuppli expects will rise to 76 percent by 2012.

Only 2 percent of UMPCs currently fit the MID criteria, generally due to screen size, instant-on capabilities and battery life, but this is expected to grow to 28 percent by 2012. iSuppli considered netbooks in its research, though most were excluded due to screen size, instant-on capabilities and battery life. However, as improvements to battery life are made, more UMPCs are expected to reach MID performance levels by 2012.

Only a small segment of gaming devices—many lack 3G-or-better connectivity features—meet the MID criteria, with only 2.8 percent expected to be in the MID category by 2012. And finally, portable navigation devices make up the smallest segment of the market, with only 0.22 percent meeting MID requirements, though 10 percent is expected to join the MID category by 2012.