Americans are keeping their phones longer; new data says U.S. users wait 29-months between upgrades

Americans are keeping their phones longer; new data says U.S. users wait 29-months between upgrades
According to data computed by Citibank, by the first half of this year the average American will be keeping his phone for an average of 29-months. That is up from the 28-month holding period that Americans averaged in the fourth quarter of last year. With the demise of the two-year contract and the subsidized phone offer, more Americans are paying full price for their handsets, As a result they are not as eager to turn them over so quickly.

Two to three years ago, the average smartphone was being held for only 24 to 26-months, which you might expect with consumers upgrading to a new phone every two years. And who wouldn't, considering that they were paying $199.99 for a $500 to $600 phone. But it is not only the end of subsidized pricing that is responsible for the longer period of time that Americans are holding their phones for. It also has to do with the fewer number of new features being added to each year's generation of flagship phones.

T-Mobile and Sprint have tried to work around the new world order by offering leasing plans. Customers pay monthly lease rates for 18-months. After that year and a half, they have the opportunity to trade in for the latest model (with another 18-months of lease payments starting over). Or, the consumer can pay off the balance due in order to keep the phone.

In 2011, a peak 35% of U.S. postpaid subscribers upgraded to a new handset. In 2014, that figure dropped to 32.5% before slipping to 30% last year. It seems pretty certain that we will slip under the 30% mark this year.

source: WSJ

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38 Comments

1. TheGranter

Posts: 63; Member since: Jan 28, 2016

It's all leading to the a big market crash couple of years from now. Could be in 2years, could be in 20years. It all comes down to when the phone manufacturers start to make phones that are just not innovative and not really an improvement from the previous models. So it will be a littlebit like the PC market is today where you can actually keep the same "rig" for years. I've had my current computer for over 4years and i can play all the modern games on good settings, see what i mean? Those huge step in phonepower/camera quality/battery life is all going to mellow out. Unless new technologies comes by, which ofcourse happens with time but sometimes some techologies can take time so we get to the point where nothing really much is happening.

8. xondk

Posts: 1904; Member since: Mar 25, 2014

you can't really 'innovate' constantly, because if you do it just becomes a stable development. And when there isn't a new flashy item to look at the development part often gets missed by many people. Which is a shame, there is a ton of development taking place, that just doesn't have any flashy to show for it, but can be much more important then those flashy parts. Course a lot of brands are brands because of flashy parts, so when they don't have that any more...could lead into trouble.

15. jroc74

Posts: 6023; Member since: Dec 30, 2010

Yup. Also at some point innovation turns into bloat. I mean a few years ago there were 3D phones, phones that had 2 screens, projector phones, phones with built in game controllers, etc....but the market rejected them. All this means is we are at the point where phones are so good there's no reason to upgrade every year or new phone release.

24. bambamboogy02

Posts: 838; Member since: Jun 23, 2012

Engineered obsolescence. Make phones not last as long .

31. TheGranter

Posts: 63; Member since: Jan 28, 2016

When phones become marginal upgrades for every generation i can see phones with swapable parts becoming more of a thing. Where you have your 3year old phone, swap out the broken camera, and put a new battery in. Good to go again! The inevitable future. A lot of phones have that today but it's just not the same thing because older phones already feel very sluggish when they get over 3years old. Hopefully this will take a lot of time before it happens!

34. PHYCLOPSH

Posts: 652; Member since: Jun 28, 2014

Apple has been engineering obsolescence for years. Look at all the dubious iOS updates that (sometimes literally) kill old phones..

35. sgtdisturbed47

Posts: 966; Member since: Feb 02, 2012

It's not just phone manufacturers that are guilty of this, since most tech companies want people to buy the new version as soon as it's out, including television makers. If I kept a phone for a full 2 years though, I'd go nuts. I buy a phone once a year, sometimes twice, and bounce back and forth between Samsung, LG, and Apple.

9. nctx77

Posts: 2540; Member since: Sep 03, 2013

I partially agree with you. The market is turning a bit like the PC market, but where I disagree is the amount of time you can keep a phone visa PC. A smartphone literally goes everywhere with us and we use it constantly throughout the day. The wear and tear on it will make you upgrade much quicker than a PC. The tablet would be a better comparison to the PC. While very portable, these things don't go everywhere and you don't use them constantly. You could use o e for 4 years easily and still get the latest software update on most. The tablet market has already hit that wall actually.

11. QWERTYphone

Posts: 654; Member since: Sep 22, 2014

I happily waited for the LG G5 before dumping my S4 and S5.

29. Shocky unregistered

You bought an LG G5? No accounting for taste I guess.

38. g2a5b0e unregistered

But you told us all you bought an S7 Edge & returned it for a G5. You can't even keep your own stories straight. #liar

13. htcisthebest

Posts: 436; Member since: Nov 15, 2011

Well said!

18. xq10xa

Posts: 810; Member since: Dec 07, 2010

I have also had the same rig for 4-5 years. I thought I was running games on high until I saw my friends....

23. bambamboogy02

Posts: 838; Member since: Jun 23, 2012

Engineered obsolescence. Make phones not last as long .

2. zeeBomb

Posts: 2318; Member since: Aug 14, 2014

Damn 3 and a half years for a phone? I still got my N4 (tho I acquired it in 2013) and I know lots of people with an iPhone 4S, S3, etc as their daily drivers. Not all too surprising, as tablet sales plummeted down too because people don't upgrade often or at all.

20. Settings

Posts: 2943; Member since: Jul 02, 2014

I still got my Nexus 7 2013. It can still do its part of my gaming and entertainment needs. One thing I make sure about choosing a gadget is that I make sure its FUTURE PROOF. My tablet didn't disappoint me.

3. jove39

Posts: 2146; Member since: Oct 18, 2011

Smartphones already do more than one needs...capable hardware and regular OS upgrades help people stick with phones for long periods. If it wasn't for larger screens, I'd still have nexus 5.

4. Tziggy14

Posts: 624; Member since: Sep 02, 2014

No surprise there. There hasn't been a real "wow" factor the past couple of years on both the iOS and Android sides during each upgrade. Smartphones can already do what one wants it to do and do it well years after purchase. My mom is a hardcore iPhone fan and yet she hasn't bother to upgrade her 5S since she got it on release day.

33. bucky

Posts: 3784; Member since: Sep 30, 2009

that 5S is one of the best phones. Its still going strong for my wife too.

5. darkkjedii

Posts: 31039; Member since: Feb 05, 2011

I honestly don't think I could go 2 years without a compelling reason. I can't wait to see the 7 Plus and Note 6. I have space on my night stand for both of those beasts. #wellpaidandlovestech

27. Wiencon

Posts: 2278; Member since: Aug 06, 2014

Well, you have cash to upgrade so why not. Most people don't want to throw they money just to have higher number on their model, lately I had to almost force my mother to change her G2 to S7 and I pointed her everything that's better so she finally agreed and is happy with awesome screen and camera but I don't think in 3, even 5 years there will be a reason to change it because it already does more than she, or me would ever want to

32. darkkjedii

Posts: 31039; Member since: Feb 05, 2011

How often do you upgrade?

6. jeroome86

Posts: 2314; Member since: Apr 12, 2012

Trying to go 3 years this time. We will see.

10. nctx77

Posts: 2540; Member since: Sep 03, 2013

I possibly will with the tumors the next major redesign of the iPhone will be next year. I may just buy this years model cash or do a yearly contract. What scares me about that is they might launch the 2017 iPhone early.

36. GoTstan

Posts: 386; Member since: Jul 25, 2015

You're right about that, the iPhone is riddled with tumors

7. Fallen1

Posts: 288; Member since: Nov 14, 2014

Seems accurate as a whole lol but my personal average is 8 months sadly... phone wh*re here

12. htcisthebest

Posts: 436; Member since: Nov 15, 2011

I think this might be due to 2 reasons: 1. no more carrier subsidized phone purchase. 2. smartphone innovation has slowed down and consumers don't feel excited anymore.

26. quakan

Posts: 1418; Member since: Mar 02, 2011

Wow so much insight. You must've read the same article as the rest of us.

14. Derekjeter

Posts: 1489; Member since: Oct 27, 2011

I have a had a new iPhone every year for the past 6 years and a new Android since the Mototroal Droid, Droid 2, R2D2 Droid, Moto Droid 3, HTC EVO, HTC Incredible, HTC M7 M8 M9, S2, S3, S4, S5, S6, S7, Note 3, Note 4, Note 5, Galaxy Nexus, Nexus 6, Nexus 6p, LG G2, G3, G4, Every Black Berry since the curve to the storm 2 and the Tour 2. I have had 5 Window Phone LUMIAS and after those phones I only kept 5 of them as my favorites. The original BB Storm, R2D2 droid, HTC EVO, iPhone 5s, LUMIA 800 light blue color. All others I sold or traded, new phones don't have anything that attract me to upgrade from my current Nexus 6p and iPhone 6s Plus. I tried the S7 edge to replace me Nexus but too many issues with the screen, sound and the battery was not enough my Nexus last longer. Anyway my point is there's no need to upgrade every year now, your not loosing out on anything mind blowing. The economy will fall again and phones will drop so much in price and value and will stay where they are in innovation. There's so much bad debt that carriers have because of people switching from one carrier to another and leaving huge bills unpaid for the device payment plan. That thing was the worst idea in cell phone history thanks T-Mobile. I will pass on this years iPhone and Note 6 will keep my current phones and I will also skip the new Apple Watch this year. Nothing great is coming. Not need to waste more money.

16. zunaidahmed

Posts: 1183; Member since: Dec 24, 2011

don't really see your point listing all the phones you bought, unless you r trying to show off, but I do hope thats not your point. Yes, the smartphone industry is becoming saturated. Even I, a techno-lover don't really see a point in upgrading my note 4 and iP6p, not that I don't see the newer feature useful, just not enough to make me upgrade because the ones I have already fulfill my use. Guess this is the same for most of us.

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