Google’s Android OS closer to overtaking BlackBerry in popularity

Capping a remarkable rise less than two years after it was launched, Google’s Android is closing in on the Blackberry as the best-selling smartphone operating system in the United States, according to a report released Monday.

The study, by the Nielsen Company, also confirmed Silicon Valley’s dominant role in the smartphone business. Apple’s iPhone remained the Lady Gaga of the category, with 89 percent of owners saying they plan to buy what Nielsen called “the most desireable smartphone” next time around, ahead of the 71 percent of Android users who would buy one again.

The news was less bright for Research In Motion, the Canadian company that makes the Blackberry and that is widely expected to introduce a new mobile operating system today intended to better compete with the iPhone 4 and the newest Android handsets. Nearly as many current Blackberry owners said they were likely to switch to an iPhone or an Android phone, Nielsen reported, as the number who plan to stay with a RIM device.

“You don’t have to be a great prophet to realize that Apple is going to have a very strong quarter, and there is no reason to believe that Android will suddenly implode,” said Roger Entner, head of telecom research for Nielsen. “There is a good likelihood that Blackberry is not going to be No. 1 in the third quarter” in U.S. smartphone sales.

Android’s growth spurt, almost exactly five years after Google quietly bought a low-profile Palo Alto start-up of the same name that was rumored to be trying to make the Internet more accessible from cellphones, has allowed the search giant to remain a central player in search as more users, services — and revenue — shift to the mobile Web.

Android’s share of new smartphone subscribers was just 6 percentage points behind RIM’s 33 percent share in the second quarter of 2010, Nielsen said. That compares to the 33 percentage point gap just six months earlier in the fall final quarter of 2009, when Android comprised 6 percent of new smartphone subscribers and RIM was at 39 percent.

The new Nielsen numbers also found that Android surpassed the iPhone in U.S. sales in the second quarter of 2010 — a milestone a competing research firm, Gartner, says Android has achieved for all of North America. However, the iPhone 4 did not go on sale until late June, meaning the impact of the fast-selling gadget will not show up until the third quarter.

Neither Gartner nor Nielsen has made an official forecast for when Android could pass the Blackberry in U.S. smartphone sales, but data from both companies show a clear trend in that direction. Because the iPhone and the Blackberry have been on the market longer, RIM and Apple still rank first and second in the total number of U.S. smartphone subscribers, Nielsen said, with Android almost neck and neck with Microsoft Windows Mobile for third.

Android and iPhone are eating into both Microsoft and RIM,” Entner said in an interview Monday. “There isn’t really a lot of (consumer) movement going on between Android and Apple. They are both just eating away at the competition.”

The first Android phone, the T-Moble G1, went on sale in October 2008. Google declined to comment Monday on the Nielsen report, but said that about 160,000 new Android-equipped phones are activated each day in 49 different countries. Android phones are now offered by all four of the major U.S. wireless carriers, while the iPhone is still available only on AT&T.

For competitors of the iPhone 4, enticing users to consider switching to another smartphone remains a high hurdle, said Ken Dulaney, a Gartner telecom analyst. “That’s the Holy Grail,” said Dulaney, adding that Android is “not there yet.”

According to the new Nielsen numbers, just 6 percent of iPhone users would buy an Android phone next time around, while 21 percent of Android owners are thinking about an iPhone for their next smartphone purchase. But 40 percent of Blackberry users are likely to switch to an iPhone or Android phone with their next smartphone purchase, Nielsen said, while only 42 percent would stay with RIM.

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