Gartner: Smartphones remain key to mobile growth

Global smartphone sales in first quarter of 2011 grew 85 percent year-on-year, outpacing overall mobile device sales and becoming main driver for industry growth, new report states.
Written by Kevin Kwang, Contributor on

Smartphone sales in the first quarter of 2011 jumped 85 percent over the same period last year, more than four times the growth in the overall mobile communication device sales, Gartner said.

Released Friday, the research firm's latest study showed that worldwide mobile device sales to end-users amounted to 427.8 million units in Q1, representing a 19 percent growth over the first three months of 2010. Comparatively, smartphones experienced an 85 percent year-on-year growth and contributed to 23.6 percent of the overall sales figure, it noted.

"[The smartphone] share could have been even higher, but manufacturers announced a number of high-profile devices during the first quarter of 2011 that would not ship until the second quarter of 2011. We believe some consumers delayed their purchases to wait for these models," said Roberta Cozza, principal research analyst at Gartner, in a media statement.

Delving into the results, Gartner reported that Nokia continues its leadership in the overall mobile market with 25.1 percent, or about 107.6 million devices units sold in the first quarter. That said, the Finnish phonemaker's market share has declined 5.5 percentage points from Q1 last year, when it held 30.6 percent of the market, and is at its lowest since 1997.

To stop the decline, Gartner predicted that Nokia will aggressively lower average selling prices in markets where communications service providers control the sales channels, in order to maintain shipments of Symbian-based devices. This will buy time for it to launch its Windows Phone 7-powered smartphones, which are slated to enter the market early 2012, it added.

According to the report, Korean phone manufacturer Samsung came in second, holding 16.1 percent of the market in what was its "strongest first quarter ever", while LG rounded off the top 3 with 5.6 percent. Apple sold 16.9 million units to take fourth spot while Canada-based Research In Motion (RIM) sold 13 million BlackBerry devices, Gartner added.

On Apple's sales figures, Gartner's research vice president Carolina Milanesi said:"This strong performance helped Apple consolidate its position as the fourth-largest brand in the mobile communication market overall. Considering the higher-than-average price of the iPhone, this is a remarkable result and highlights the impact that a strong aspirational brand can have on a product."

Besides top-tier smartphones, Gartner also revealed that several manufacturers such as HTC, Sony Ericsson and ZTE had announced a broader portfolio of mid-tier devices, mainly based on Android, which will be commercially available in the second quarter of 2011.

This is driven, in part, by Nokia's announcement earlier in February that it will be adopting Microsoft's mobile OS for its devices. "This [alliance] will precipitate a competitors' rush to capture Symbian's market share in the mid-tier," said Cozza.

Gartner's study follows an Ovum report in March which stated that Asia's smartphone market will double in 2016. It noted then that global smartphone sales will reach 653 million units in five years' time, with Asia accounting for 30 percent of the overall sales.

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