Smartphone sales shoot up, benefiting RIM, Apple, Android

It's the biggest increase in smartphone sales since 2006, Gartner says

The smartphone's impact on the mobile phone marketplace globally is well-established, but smartphone growth continues its upward trend in fairly astounding degrees, according to market research firm Gartner Inc.

Smartphone sales in the first quarter of 2010 grew by nearly 49% compared with the first quarter a year ago, the biggest year-on-year increase since 2006, said Carolina Milanesi, a Gartner analyst. That rate of growth put smartphones at 17.3% of all mobile phones sold in the first quarter (54.3 million out of 314.6 million) up from 13.6 % in the first quarter of 2009.

Gartner previously projected that the smartphone's share of the overall mobile phone market would reach 43% globally in 2013 and jump to 70% in Europe and North America. Milanesi said the first quarter results bolster that forecast.

The biggest beneficiaries of the smartphone growth trend are the companies that control the entire smartphone ecosystem, including the operating system, hardware and services, such as Blackberry maker Research in Motion Ltd. and iPhone maker Apple Inc., Milanesi said in an interview.

RIM only makes smartphones, yet in the first quarter made its debut as one of the top five best-selling makers of all kinds of mobile phones.

RIM sold 10.5 million smartphones in the first quarter, up 46% from 7.2 million sold in the first quarter of 2009, putting it fourth behind top-selling mobile phone maker Nokia. Samsung was in second place and LG Electronics was third. But RIM also finished second in sales of all smartphones, behind the Symbian OS used in Nokia devices, but ahead of the iPhone OS in third, the Android OS in fourth and the Windows Mobile OS.

Milanesi said RIM helped itself in the market about two years ago with a focused marketing program on consumers, following up its strong reputation with business users.

"People generally now know who RIM is, and the experience by consumers in Europe is that it's pretty cool to have a RIM device," said Milanesi, from offices in Egham, UK.

But Milanesi said the smartphone competition is "very tough" and Gartner continues to forecast that in 2012, the Symbian will lead in smartphone sales, followed by the Android, and RIM and the iPhone in a tie with 13% market share each.

For the first quarter of 2010, the iPhone sold nearly 8.4 million units, up from 3.8 million in first quarter and increased its market share.

The Android OS joined the iPhone OS as the only two OSes in the top five to increase smartphone market share , Gartner said.

In terms of the smartphone OS wars, Symbian finished with 24 million sales in the first quarter and 44% of the market, while RIM had 19.4% of the market with its 10.5 million in sales. The iPhone OS reached nearly 8.4 million in the quarter, with 15.4% of the market, followed by Android with 5.2 million and 9.6% of the market, Gartner said.

The Windows Mobile OS in smartphones reached 3.76 million units sold or 6.8% of the market, a slight drop from the 3.738 million units sold in the first quarter of 2009 when Windows Mobile had 10% of the market.

Milanesi said that a somewhat surprising market trend has developed around Asian manufacturers of mobile phones, including Hong Kong-based G-Five, which sold 4.3 million phones in the first quarter to garner 1.4% of the overall mobile phone market. G-Five doesn't make smartphones.

"G-Five has pretty much come out of nowhere and really underlines how some vendors...have been growing in markets such as India and the pressure they put on tier-one players," she said.

There has also been a rise in the so-called white-box vendors that manufacture phones for other brands, Gartner said. As a group, they commanded 19% of all mobile phone sales, or 60 million of the 314.6 million sold in the first quarter.

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