Smartphones Show No Signs of Slowing

Smartphones are selling, well, like smartphones these days with a new Gartner study reporting worldwide sales hitting 32.3 million units in the second quarter of 2008 — a 15. 7 per cent jump over the second quarter of 2007.

Despite a continued sluggish economy the North American market is still one of the fastest growing segments with an increase of 78.7 percent year to year. While Nokia is still tops worldwide, with 47.5 percent share in the second quarter, growth year to year was just about half of the market average, according to Gartner, which attributes the trend to increasing competition and new features such as touch technology.

“To stay competitive, Nokia will need to introduce more design variations amongst its Nseries models and keep innovating,” Roberta Cozza, an analyst at Gartner, stated in a press release. “The expected introduction of a touch-screen smartphone in the second half of 2008 will test the company’s capability to show differentiation and innovation,” Cozza added.

Some of that innovation arrived last week when Nokia debuted a new mobile music subscription in the UK. The Finnish handset maker also recently launched three new models in its Nseries line of phones.

Yet any sales slowdown experienced by Nokia or other market players will be reversed by the end of the third quarter given iPhone 3G sales and new touch smartphone models coming into play, according to Gartner.

“Smartphone sales slowed down as a result of new compelling touch technology mainly available on enhanced phones rather than smartphones,” stated Cozza in a press release.

Right behind Nokia is Research in Motion (RIM) which experienced 126.4 market growth since the second quarter of 2007, achieving 17.4 percent market share in the second quarter of this year after selling 5.6 million units. In third place is HTC, which sold 1.3 million units to attain 4.1 percent second quarter market share. In the second quart of 2007 it held 2.2 percent share.

“RIM continued to execute well at the consumer level, increasing its global market reach. In the second half of the year, the company is expected to launch smartphones based on new form factors, which are necessary to keep pace with the competition at the consumer level,” according to Gartner.

One of those new form factors, the Bold, should be arriving any day though RIM has yet to announce a U.S. launch date for its latest BlackBerry.

HTC gained the No. 3 position during the second quarter of 2008, moving up from the No. 7 ranking in the first quarter. HTC’s sales more than doubled year over year, but its overall share was flat at 4 per cent compared with the first quarter of 2008. HTC continued to perform well during the second quarter primarily thanks to sales of its Touch product line.

While Gartner’s report indicates that Apple’s iPhone is lagging in sales, the decrease from 5.3 percent in the first quarter to 2.8 in the second quarter of 2008, was primarily due to inventory issues with the initial iPhone units. Gartner expect iPhone sales to increase “significantly” in the second half of 2008, given the rapid adoptions of its 3G handset.

In terms of OS, Symbian’s still at the helm, holding 57 per cent of the global sales to end users in the second quarter of 2008 compared with 66 per cent in the same period last year.

The drop was due to less sales in Japan, according to the report, and Mitsubishi, a Symbian licensee, leaving the market.

RIM’s OS held tight to second place, achieving 17.4 percent market share for the second quarter of 2008 with unit sales of 18.4 million.

Microsoft’s Windows Mobile indicated strong growth with a 126.4 percent spike from the second quarter of 2007 to second quarter of 2008. Its sales of 3.9 million units grabbed 12 percent market share for the second quarter of 2008.

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