Smartphone leaders Apple, Samsung leave Nokia behind

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Apple Inc.’s iPhone and Samsung’s Galaxy S are selling at such a rate that Nokia now stands third after these two, in smartphone rankings.

Second quarter sales shows Apple’s share of the smartphone market rose to 18.5% in Q2 of 2011 from 13.5% a year earlier, while Samsung’s smartphone market share jumped to 17.5% from 5.0%, data released Friday by market research firm Strategy Analytics showed. Nokia saw its share of the market slip to 15.2% from 38.1% a year earlier.

Having become the first ever vendor to ship 100 million smartphones in a single year during 2010, long-time leader Nokia has slipped two places in our rankings in Q2 2011, said Tom Kang of Strategy Analytics. The vendors 15 per cent global market share is less than half of what it was just one year earlier, as the industry awaits Nokias pending transition to Windows Phone 7.

Samsung, which adopted Android in its Galaxy S smartphones, gained more ground in the second quarter, with handset shipments reaching an estimated 19.2 million, up from 3.1 million a year earlier, Strategy Analytics said.

The South Korean company, which reported an 18% decline in second-quarter net profit Friday to 3.51 trillion won (US$3.33 billion), didn’t disclose cellphone shipment figures. But based on the estimate, it surpassed Nokia’s 16.7 million units.

The Apple high and Nokia low

Apple sold 20.3 million smartphones in the second quarter. “Apple’s growth remained strong as it expanded distribution networks world-wide, particularly in China and Asia,” senior analyst Alex Spektor wrote in the report.

Despite of the fact that Apple currently sells only two models of its smartphones flagship iPhone 4 and low-cost iPhone 3 GS that is sold through various third-party stores it managed to outsell tens of variations available from Samsung and Nokia.

Despite its lackluster performance in the smartphone sector, Nokia remained the global handset market leader in the second quarter in terms of overall phones due to strong demand for low-end and feature phones in emerging markets.

Its share of the global handset market was 24.5% in the second quarter, falling from 34.7% a year earlier. Samsung’s second quarter global handset market share rose to 20.5% from19.9%, while Apple’s share of the market rose to 5.6% from 2.6%, ranking it in fourth place. LG Electronics Inc. ranked in third place with a market share of 6.9%, down from 9.6% in the second quarter of 2010.

Sales of Nokia’s smartphones powered by Symbian operating systems started to plummet in February after the company’s chief executive officer announced transition from Symbian platform to Windows Phone operating system. End-users slowed down purchase of high-end Symbian devices and started to look at Apple iPhone and Google Android-based handsets. In mid-Q2 2011 several operators started to boycott Nokia’s smartphones following purchase of Skype by Microsoft Corp. as well as Nokia’s plan to start selling dual-SIM handsets.

Nokia only introduced its N9andOro smartphones in Q2.The N9 is the first and the last and smartphone powered by MeeGo operating system. The handset sports impressive design and feature-set, but it will only become available in September, 2011, which means that it will face competition from loads of rivals, including Apple and Samsung. Nokia Oro is a smartphone in golden enclosure that is based on C7 low-cost smartphone platform from Nokia.

The ever-shifting top of the smartphone food chain is illustrative of the ultra-competitive nature of the business. Over the past year, Nokia has seen its market share drop as consumers opted for more sophisticated operating systems made by Apple and Google. The declines have forced Nokia to partner with Microsoftand switch to its Windows Phone operating system.

Smartphones in the region

According to Booz & Company research, smartphones are not yet prevelant in the region with penetration rates roughly around 15 per cent in the UAE and 11 per cent in Saudi Arabia, as opposed 50 per cent in the United States and Western Europe.

However, smartphone penetration is expected to grow by a healthy 11 per cent over the next three years in both, the UAE and Saudi Arabia, said Dr Karim Sabbagh, Vice President and Global Practice Leader for global management consulting firm Booz & Company, early this year.

Sources: WSJ, xbitlabs, telegraph, Emirates 24|7, cnet

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