Apple edges out RIM to take No. 2 spot in smart phones

It also overtakes Microsoft in mobile phone operating systems

Apple Inc.'s iPhone 3G passed Research In Motion Ltd.'s BlackBerry to take second place in third-quarter global smart-phone rankings, according to a report by market researcher

Apple also edged out Microsoft Corp. in smart-phone operating systems, the report said.

A record-high 39.9 million smart phones were shipped globally from July through September, up 28% over the same period last year, according to Canalys. Smart phones now represent 13% of the total mobile handset market, up from 11% in the second quarter.

The devices, which combine computing functions of a personal digital assistant (PDA) with a mobile phone, have gained popularity as companies offer new functions, such as onboard cameras, music players, touch screens and speedier Web browsing.

Nokia Corp. retained its lead in smart phones but lost significant market share during the quarter because heavy competition from Apple and third place RIM. The Finnish company shipped 15.5 million smart phones in that period, down slightly from last year as its market share fell to 38.9% from 51.4%.

Apple shipped 6.9 million smart phones, up from just 1.1 million in the same time last year. That was enough for a market share of 17.3%, compared to 3.6% last year.

"It was expected that Apple would figure among the smart phone leaders this quarter, with that huge initial new product shipment, it was just a question of how high up it would be -- and this is impressive," said Canalys senior analyst Pete Cunningham in a statement.

RIM shipped 6.1 million smart phones during the quarter, followed by 2.3 million each for Motorola Inc. and fifth-place High Tech Computer Corp. (HTC).

HTC was the only non-Western smart-phone vendor among the top five in the third quarter. The Taiwan-based company has won acclaim for its Touch Diamond line of touch screen smart phones, as well as working with Google Inc.'s Android software to develop the G1 handset now being sold by T-Mobile USA Inc. Sales of G1 handsets were not included in this survey because the devices were not yet on sale in the quarter.

The Canalys report also highlighted Apple's growth in mobile phone operating systems.

Although Nokia's Symbian OS retained its market dominance, the Apple OS took a chunk of its market and posted a huge year-on-year growth rate.

Symbian shipped in 18.6 million smart phones in the third quarter, down 12.4% compared with last year. The Apple operating system, by contrast, shipped in 6.9 million handsets, growing 523% over last year.

RIM came in third to Apple with its operating system in 6.1 million smart phones, up 83.5% compared with a year ago, Canalys said. Microsoft's Windows Mobile operating system grew 42.9% year on year to 5.4 million, and Linux was the operating system for 2 million smart phones, up 49% compared with last year.

Canalys noted that creating new mobile phone technology, such as mapping programs, has become critical because of competition in the smart-phone business.

"You also need to be able to integrate them seamlessly into the device to provide a great total user experience," said Canalys analyst Tim Shepherd. "And that means having sufficient control of development of the operating system, which Apple and RIM clearly have already. Nokia's acquisition of Symbian should help it in this regard, regardless of what other Symbian Foundation members choose to do."

Copyright © 2008 IDG Communications, Inc.

Shop Tech Products at Amazon