Surging smartphone shipments failed to stop the global handset market falling for the first time since 2009, according to new figures from Gartner.
Worldwide handset sales were 419.1 million in the first quarter of 2012, a 2% year on year decline. The slump was blamed on low demand from Asia. The first quarter is typically the region's strongest but was hampered by a lack of product launches from leading manufacturers, and more users delaying upgrades in the hope of better phones arriving later in 2012. Gartner has now downgraded its forecast for 2012 shipments by 20 million handsets to 1.9 billion units.
The report revealed that 144.4 million smartphones were shifted during the quarter, up 44.7% from 2011. It said Samsung had a strong quarter, shifting 38 million smartphones. The Korean manufacturer's Android-based smartphone sales accounted for more than 40% of total sales for the platform. No other vendors achieved more than a 10% share of the market. The report backed IDC research from earlier this month, which said Samsung has overtaken Nokia as the world's top mobile handset vendor. Gartner revealed that Samsung supplied 86.6 million handsets during the period, up 25.9% on last year.
Apple recorded the largest surge in handset sales, up 96.2% on 2011 to 33.1 million, thanks to increasing demand in the Asian market and the continued popularity of the iPhone 4S.
However, the report said both Nokia and Research in Motion (RIM) were continuing to experience challenges. The Finnish manufacturer's handset sales fell 22.7% on 2011 to 83.2 million. Gartner principal research analyst Anshul Gupta said: 'Smartphone sales are becoming of paramount importance at a worldwide level. For example, smartphone volumes contributed to approximately 43.9% of overall sales for Samsung as opposed to 16% for Nokia.'
RIM's market share fell by a fifth with 9.9 million handsets shipped and a 2.4% global market share. Gupta said: 'RIM desperately needs to deliver winning BlackBerry 10 products to retain users and stay competitive. This will be very challenging, because BlackBerry 10 lacks strong developer support, and a new BB10 device will only be available in the fourth quarter of 2012.'
While the Android operating system continued to dominate the market with a 56.1% share among smartphones, Gartner said differentiation in this area was becoming more difficult for manufacturers. Gupta said: 'This is particularly true for smartphones based on the Android OS, where a strong commoditisation trend is at work and most players are finding it hard to break the mould. At the high-end, hardware features coupled with applications and services are helping differentiation, but this is restricted to major players with intellectual property assets.
'However, in the mid to low-end segment, price is increasingly becoming the sole differentiator. This will only [get] worse with the entry of new players and the dominance of Chinese manufacturers, leading to increased competition, low profitability and scattered market share.'
Editor: Graeme Neill