The U.S. smartphone market is rising 2 percent year-over-year in 2022, Counterpoint Research reported Thursday, citing Counterpoint's Market Outlook Service.

While the market is still expected to grow, the 2 percent figure actually represents a downward revision from the previous estimation of 6 percent. 

“We began the year with strong sell-in momentum, with Q1 2022 seeing 6% YoY growth due to solid postpaid demand. However, we are adjusting our shipment forecast numbers downwards as we are increasingly seeing the impact of inflation in the US market,” Counterpoint research director Jeff Fieldhack said in a press release announcing the report. 

“Last year, we saw supply as a much bigger issue as chipset shortages impacted smartphone manufacturing. However, this year, it is more of a demand issue. Americans have changed their purchasing patterns — instead of tech products, they are spending more on experiences like travel and going out. In addition, as fuel prices go up due to inflation, people are making fewer trips to retailers and are adjusting their purchasing behavior even further. Baskets of goods have become costlier due to increased supply chain costs related to transportation.”

There are indicators, however, that will represent good signs for the market this year. 

“Despite the headwinds in prepaid, there are several scheduled industry events that will help low-end smartphone sales in 2022. 3G sunsets will force carriers to move subscribers onto new LTE and 5G devices,” research analyst Matthew Orf said in the report. 

"AT&T’s shutdown was scheduled for February 2022, with Sprint’s network following in March, T-Mobile in July, and Verizon in December 2022. Dish will also need to move millions of subscribers to its new MVNO partner AT&T. In addition, Verizon will attempt to move as many TracFone subscribers over to its network from AT&T and T-Mobile.” 

On Thursday, T-Mobile also announced the launch of its first-ever 5G Mobile Hotspot which is set to arrive on June 16. The product is offered free “with 24 monthly bill credits when adding a line on an eligible 50GB or 100GB Mobile Internet (MI) plan or for $99 when adding a line on an eligible 5GB MI plan.” It can also be purchased for $8.25 a month for twenty-four months for “well-qualified” T-Mobile customers. 

Meanwhile, Techdirt reported this week that wireless prices have risen in recent weeks from all three major U.S. carriers. 

“Again, economic evidence from other countries where the total number of major wireless competitors consolidated from four to three made it clear that price hikes would be inevitable,” the site said.  “T-Mobile will try to buck this trend for a while to maintain its reputation as the ‘uncarrier,’ but Wall Street gets what Wall Street wants eventually.”

 Stephen Silver, a technology writer for The National Interest, is a journalist, essayist and film critic, who is also a contributor to The Philadelphia Inquirer, Philly Voice, Philadelphia Weekly, the Jewish Telegraphic Agency, Living Life Fearless, Backstage magazine, Broad Street Review and Splice Today. The co-founder of the Philadelphia Film Critics Circle, Stephen lives in suburban Philadelphia with his wife and two sons. Follow him on Twitter at @StephenSilver.

Image: Reuters.