In this recession, smartphone market behavior contradicts conventional economic theories predicting that demand for expensive goods falls when consumer income falls (inferior vs normal good):

In Europe, smartphone sales are expected to rise 22% in 2009, defying the 21% slump in handset sales predicted by Pyramid Research. In the United States a poll by ChangeWave Research in June suggested that 37% of consumers already own a smartphone, while more than 14% planned to buy one in the next three months.

Microsoft predicts that in a few years smartphones will make up 30% of the volume and more than 50% of the value of the mobile phone market.

This is clear evidence that we deal with a new stage in S-curve, that doesn't conform to standard economics. Another important aspect of this phenomenon is that it's not about the phone itself (hardware), but about many new ways to use it (software):

Apple needed just two ingredients to be successful: ease of use and a wide range of "apps" - small software applications that allow owners to optimise their phone, whether it is Sudoku puzzles or sugar trackers for diabetes sufferers.
It is here where rivals like Samsung falter. With few apps to satisfy the whims of owners

iTunes is a critical control component in Apple's iPhone/iPod architecture. The software was originally built to help users manage thousands of songs, and now it seamlessly manages thousands of applications.

P.S. I would love to insert an annotated S-curve chart here, but my Mac doesn't have the tablet functionality. Damn.

system, mobile, apple, tool, control, control point, niche construction,