Worldwide mobile phone sales decline for the first time in two years
Samsung snatched the world’s premier smartphone position from Apple in the first quarter of 2012 — a period which saw worldwide sales of mobile phones reach 419.1 million units — a two per cent year-over-year decline from the same quarter last year, according to number-crunching researchers Gartner, Inc. The market hasn’t seen such a decline since the second quarter of 2009.
“Global sales of mobile devices declined more than expected due to a slowdown in demand from the Asia/Pacific region,” said Anshul Gupta, principal research analyst at Gartner. “The first quarter, traditionally the strongest quarter for Asia – which is driven by Chinese New Year, saw a lack of new product launches from leading manufacturers, and users delayed upgrades in the hope of better smartphone deals arriving later in the year.”
Nokia experienced a 22.7 per cent decrease in mobile handset sales compared with the same quarter last year despite launching its Lumia handset range. “Smartphone sales are becoming of paramount importance at a worldwide level,” said Mr. Gupta. “For example, smartphone volumes contributed to approximately 43.9 per cent of overall sales for Samsung as opposed to 16 per cent for Nokia.”
Nokia saw its overall market share slump from 25.1 per cent the same quarter last year to 19.8 per cent one year on. Conversely, Samsung’s mobile phone sales reached 86.8 million units — a 25.9 per cent increase from last year — and is expected to find further success with its impending Galaxy S3 phone, which will be available to pre-order in the UK from May 30.
Apple’s iPhone 4S, which many considered an anti-climax upon release, has continued to see healthy sales — particularly in China — where more than five million units were sold, making it the second-largest market for Apple after the U.S. RIM saw its poor run of late continue, shifting just 9.9 million units in the first quarter of 2012 and seeing its global share decline to 2.4 per cent.
“RIM desperately needs to deliver winning BB10 products to retain users and stay competitive. This will be very challenging, because BB10 lacks strong developer support, and a new BB10 device will only be available in the fourth quarter of 2012,” said Mr. Gupta. The Canadian Blackberry maker sold fewer than a million units more than Chinese smartphone maker Huawei, creator of the Ascend P1 handset. The telecoms equipment maker is currently trying to offset considerable losses by making the unusual decision to rotate four CEOs.
Android is proving increasingly victorious in the mobile operating system war, capturing more than half of all smartphone sales (56.1 per cent) in the first quarter of 2012, in comparison with 36.4 per cent during the same quarter last year. More than double the amount of units running Android (81 million) were sold than those running iOS (36 million) in the first quarter. Gartner also highlighted how Samsung’s Android sales in the first quarter accounted for more than 40 per cent of Android-based sales worldwide, with no other vendors achieving more than a 10 per cent share of the market.
“This is particularly true for smartphones based on the Android OS, where a strong commoditization trend is at work and most players are finding it hard to break the mould,” Mr. Gupta said.
“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 worsen with the entry of new players and the dominance of Chinese manufacturers, leading to increased competition, low profitability and scattered market share.”
The release of two new flagship phones from Apple (the iPhone 5) and Samsung (the Galaxy S3) in the coming months will make it difficult for competitors in the smart phone arena to gain ground.