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October 30, 2008

In Tough Economy, Lower Income Mobile Consumers Turn to iPhone As Internet & Entertainment Device

comScore unveils demographics of iPhone owners and their usage behavior in new report

Reston, VA, October 27, 2008 – comScore, Inc. (NASDAQ: SCOR), a leader in measuring the digital world, reports for the first time the demographics of iPhone owners and reveals that while 43 percent of iPhone owners earn in excess of $100,000 annually, the strongest growth in users is coming from those earning less than the median household income, particularly since the launch of the iPhone 3G. According to a new comScore report, “All about iPhone,” iPhone adoption since June 2008 rose 48 percent among those earning between $25,000 and $50,000 per year and by 46 percent among those earning between $25,000 and $75,000. These growth rates are three times that of those earning more than $100,000 per year. Overall, iPhone penetration grew 21 percent.

“As an additional household budget item, a $200 device plus at least $70 per month for phone service seems a bit extravagant for those with lower disposable income,” said Jen Wu, senior analyst, comScore, the report’s author. “However, one actually realizes cost savings when the device is used in lieu of multiple digital devices and services, transforming the iPhone from a luxury item to a practical communication and entertainment tool.”

iPhone 3G Launch Analysis: Growth of iPhone Owners by Annual Household Income
Source: comScore Mobile
Three-month average ending June, July and August 2008
Household Income % Growth June to August 2008
Under $25,000 16%
$25,000 to $49,999 48%
$50,000 to $74,999 46%
$75,000 to $99,999 3%
$100,000 or more 16%
Total 21%

While the number of consumers in the $25,000 to $50,000 income demographic declined marginally from June to August 2008, their ranks among smartphone owners and mobile content users grew, in most cases above the rate of the overall market. According to comScore Mobile, the number of people earning between $25,000 and $50,000 accessing news and information via their mobile browser grew by five percent since June, while the market overall grew by three percent. comScore also reported seven percent growth in mobile e-mail usage and five percent growth in mobile music consumption among those earning between $25,000 and $50,000 per year.

 “These data indicate that lower-income mobile subscribers are increasingly turning to their mobile devices to access the Internet, e-mail and their music collections,” observed Mark Donovan, senior analyst, comScore. “Smartphones, and the iPhone in particular, are appealing to a new demographic and satisfying demand for a single device for communication and entertainment, even as consumers weather the economy by cutting back on gadgets.”

Installed Base and Consumption Trend Among Mobile Subscribers with Income of $25,000-$50,000
Source: comScore Mobile
Number of Users: Three-month average ending June and August 2008
  June August Growth Overall Market Growth
Smartphone 2,870 3,314 15% 12%
iPhone 266 394 48% 21%
Listened to mobile music 4,682 4,901 5% -0.3%
Sideloaded music 3,721 3,768 1% -2%
Used Email 6,818 7,261 6% 8%
News/Info via Browser 7,934 8,322 5% 3%

More details on the demographics and usage patterns of iPhone users and related industry trends in the U.S. are available in the comScore report, “All about iPhone,” which is available now at www.comscore.com/iphone.

About comScore
comScore, Inc. (NASDAQ: SCOR) is a global leader in measuring the digital world and preferred source of digital marketing intelligence. For more information, please visit www.comscore.com/boilerplate.

Tags: Internet Use, Mobile