Android Cracks 50 Percent as Smartphone Sales Rise: Nielsen

More smartphone users are out there for the taking, according to Nielsen. Android is benefitting the most from this smartphone surge, but the iPhone continues to hold sway over the market.

The U.S. market for feature-rich smartphones is still expanding at a rapid clip, with two-thirds of new mobile phone buyers opting for devices that can do far more than their old-style flip phones, according to new research from Nielsen released July 12. Google€™s Android operating system is the beneficiary of this surge, although the iPhone still holds sway.

The smartphone market is still just a little more than half saturated, with only 54.9 percent of U.S. mobile phone users owning a smartphone as of June, according to the new market figures from Nielsen. That means that the other 45 percent of mobile users still have non-smartphones, leaving a lot of users up for grabs in the marketplace.

The biggest winner in all this is Google Android. The latest version--4.1, or Jelly Bean-- is starting to hit the market.

"Android continues to lead the smartphone market in the U.S., with a majority of smartphone owners (51.8 percent) using an Android OS handset," according to the Nielsen data. "Over a third (34.3 percent) of smartphone owners use an Apple iPhone, and BlackBerry owners represented another 8.1 percent of the smartphone market."

Apple handsets have the highest manufacturer share of the smartphone market overall, Nielsen reported, but in June, about 54 percent of handset buyers chose an Android handset, compared with 36 percent who bought iPhones.

What this all means, said Chris Silva, a mobile analyst with The Altimeter Group, is that the smartphone market is still very open and ripe for competition, such as the rumored new Amazon smartphone and others.

"Keep in mind that 45 percent of U.S. users still don€™t have smartphones, so a lot of people will look for a low-priced phone," said Silva. "That's maybe 100 million handsets."

And despite the slow economy, worries about incomes and disappointing survey data of consumer moods and economic confidence, people always seem to find a way to afford new smartphones, Silva added.

"People are going to buy them, despite whatever is happening with the economy," said Silva. "They are so important in people's lives. And the pace at which this is growing, we're not even at the point where it's slowing down."