At the Apple (NASDAQ:AAPL) Worldwide Developers Conference coming up next week, CEO Steve Jobs is widely expected to unveil a new 3G version of the iPhone. Meanwhile, in the last few weeks, a number of carriers have announced deals to sell the phone, which will make it available in dozens of countries. Every time there’s another announcement, the Street issues higher estimates of the total addressable market for the device.
Pacific Crest’s Andy Hargreaves today asserts that the numbers have gotten out of hand. He points out in a research report this morning that the carriers that have announced deals with Apple have total subscribers of 669 million people, an increase of 520 million in the last month. That’s impressive: Global handset sales are expected to 1.27 billion this year, growing to 1.37 billion next year. But to state the obvious, not everyone wants a smartphone. “A substantial majority of these subscribers should not be considered potential iPhone purchasers,” he cautions. Hargreaves forecasts global smartphone sales at 61 million units this year, and 81.3 million next year; of that he sees Apple taking 17.2% share this year, and 18.8% next year. That comes to 10.5 million units in 2008, and 15.3 million in 2009.
That said, Hargreaves says current estimates could be driven higher by compelling corporate software applications for the phone; and he says carrier subsidies that lower the cost of the phone for customers would also boost demand. Another potential boost: carrier deals in China, Russia and Japan.
Hargreaves maintains an Outperform rating and $225 price target on the stock.
