Smartphone sales skyrocket amid decline for feature phones

Computerworld - Global smartphone sales skyrocketed by 38% in the fourth quarter year over year. Meanwhile, Samsung ended 2012 in the top position for both smartphone sales and overall mobile phone sales, Gartner reported Wednesday.

Even with the dramatic increase in smartphone sales in the fourth quarter, for the full year both smartphone and feature phone sales fell 1.7% from 2011 sales. Feature phone demand was weak, but record smartphone sales in the fourth quarter reached 207.7 million, up 38% from the fourth quarter of 2011. The last time mobile phone sales fell was 2009.

Apple finished the year second to Samsung in smartphone sales. Together, the two companies raised their combined market share from 46% in the third quarter of 2012 to 52% in the fourth quarter.

The success of Samsung and Apple is "based on the strength of their brands as much as their actual products," said Anshul Gupta, an analyst at Gartner. Their direct competitors often have comparable products but "struggle to achieve the same brand appreciation among consumers who, in a tough economic environment, go for cheaper products over brand," he added.

Samsung sold 205.7 million smartphones in 2012, with 64.5 million sold in the fourth quarter, an increase of 85% over the fourth quarter of 2011. More than half (53.5%) of all the phones Samsung sells are smartphones.

Apple sold 130 million smartphones globally in 2012, with 43.5 million sold in the fourth quarter, an increase of 22.6% over the fourth quarter of 2011. Gartner said the iPad Mini "created a dilemma for some users" when deciding if they wanted to upgrade an iPhone 4 or iPhone 4S to an iPhone 5 or buy the new tablet.

Samsung had a 42.5% share of all Android phones globally in 2012. "The Android brand is being overshadowed by Samsung's brand with the Galaxy name nearly a synonym for Android phones in consumers' mind share," Gupta said. However, he said competition will grow in 2013, especially from Sony and Nokia.

One of the biggest declines in smartphone sales for 2012 came from Nokia's 53.6% decline over 2011. For all of 2012, Nokia sold 39.3 million smartphones, just 12% of its total sales. Nokia saw some success in the fourth quarter of 2012 from its Asha feature phones and Lumia smartphones running Windows Phone 8, but its overall mobile phone share (including feature phones and smartphones) was 18%, its lowest ever.

Gartner ranked Huawei as the number three smartphone vendor in the fourth quarter of 2012 for the first time. For the entire year, Huawei sold 27 million smartphones, up 74% from 2011.

Overall, Android smartphones sold by several vendors reached 69.7% of the global smartphone market in the fourth quarter, compared to 21% for iOS, 3.5% for BlackBerry, and 3% for Windows Phone.

Matt Hamblen covers mobile and wireless, smartphones and other handhelds, and wireless networking for Computerworld. Follow Matt on Twitter at @matthamblen or subscribe to Matt's RSS feed. His e-mail address is mhamblen@computerworld.com.

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