Nokia/Symbian alliance remains No. 1, but lead shrinking

Mobile device sales surged to 325.8 million units worldwide during the second quarter, a 13.8% year-over-year increase, according to a report from Gartner Inc. The report noted that smart phones accounted for 19% of sales worldwide to end users, a 50.5% increase from the second quarter of 2009.
Strategy Analytics reported last month that its data showed smart phone shipments jumped 43% year over year to 60 million units, while total handset sales grew by 13% to 308 million units.
Despite the strong sales, Gartner noted that average selling prices and margins both shrank year over year, which the firm attributed to “a stronger dollar, a depreciating euro, and intense competition that drove price adjustments and changes to the product mix.”
Among handset vendors, Nokia Corp. (NOK) remained the largest seller of mobile devices with nearly 111.5 million handsets sold during the second quarter and a 34.2% market share. The company’s total device sales were an increase compared with the 105.4 million sold during the second quarter of 2009, but market share dropped from the 36.8% it carried the previous year.
“Nokia’s senior executives need to do more to attract developers and other ecosystem members by revising its platform strategy and improving its communications,” Gartner noted.
Samsung Electronics Co. Ltd. maintained its No. 2 position increasing both its total device sales (55.4 million during Q2 2009 to 65.3 million during Q2 2010) and its market share (19.3% in Q2 2009 to 20.1% in Q2 2010).
“Although Samsung’s sales were strong in developing markets, its shift in product mix caused an overall decline in ASP,” Gartner noted. “Samsung maintained its position in the mid-tier by launching several new devices, including messaging handsets. This more aggressive strategy toward the mass market enabled it to reduce inventory in the second quarter of 2010.”
Despite slowing sales and market share losses, LG Electronics Co. Ltd. remained No. 3 selling nearly 29.4 million devices and securing a 9% market share, compared with 30.5 million devices and a 10.7% market share during Q2 2009.
Research In Motion Ltd. (RIM) plowed its way into the No. 4 position growing its device sales from 7.7 million devices during Q2 2009 to 11.2 million this year, while its market share jumped from 2.7% to 3.4%. RIM’s growth coincided with sharp declines from Sony Ericsson (SNE) (ERIC), which saw its sales drop from 13.6 million units to 11 million units and market share from 4.7% to 3.4% and Motorola Inc. (MOT), which saw sales drop from 15.9 million units to 9.1 million units and market share cut in half from 5.6% to 2.8%.
Symbian still No. 1 in OS, Google on fire
Among smart phone operating system sales, Symbian leveraged its position at Nokia to maintain its No. 1 position in sales during the second quarter that increased from 20.9 million units in 2009 to 25.4 million this year. Despite the increase, Symbian’s market share plunged from 51% during Q2 2009 to 41.2% this year showing that Symbian was not partaking in the sales boom of smart phones.
RIM barely held off Google Inc.’s (GOOG) Android operating system for the No. 2 position as its market share dropped from 19% to 18.2% while Android surged from 1.8% to 17.2% worldwide.
Apple Inc.’s (AAPL) iOS also saw its market share grow from 13% to 14.2%, which is remarkable since the OS is only available on the company’s iPhone and recently launched iPad device. The company was No. 7 in total device sales during Q2 2010 and No. 3 in smart phone sales.
“Apple’s sales would have been higher if it had not had to face tight inventory management in preparation for the arrival of the iPhone 4 at the end of the second quarter of 2010,” Gartner noted. “Apple also suffered from some supply constraint on the new device. We expect that a wider global rollout of iPhone 4 will sustain Apple’s sales momentum throughout the second half of 2010.”
Microsoft Corp. (MSFT), which is set to unveil its latest Windows Phone 7 OS later this year, dropped from No. 4 to No. 5 in OS sales with total unit shipments falling from 3.8 million during Q2 2009 to 3.1 million this year and its market share plunging from 9.3% to just 5%.
“Launches of updated operating systems will help maintain strong growth in smart phones in the second half of 2010 and spur innovation,” explained Carolina Milanesi, research vice president at Gartner. “But, we believe market share in the OS space will consolidate around a few key OS providers that have the most support from CSPs and developers, and strong brand awareness with consumers and enterprise customers.”