Decline in smartphone growth

Gartner: Smartphone growth continues to slow

Sales of smartphones increased by 3.7% during the fourth quarter of 2008, compared with the same period in 2007, according to Gartner.

Worldwide sales of smartphones to end users reached 38.1 million units, compared with 36.8 million units during the fourth quarter in 2007 and 36.5 million during the third quarter last year -- which was an 11.5% increase.

The combination of the worsening economic climate and the lack of attractive products compared with the third quarter affected sales, according to Roberta Cozza, research director at Gartner.

The winners among the vendors were Research In Motion (RIM), Samsung and, to a lesser extent, Apple.

Samsung entered the top five vendors for the first time, at the expense of Sharp. The Korean vendor sold 1.6 million smartphones, which is an increase by 138% compared with the fourth quarter last year.

RIM and Apple are still the second and third largest smartphone vendors with a market share of 19.5% and 10.7%, respectively.

RIM increased its sales by about 85% -- which is slightly better than its third-quarter growth -- and ended up selling about 7.4 million phones to end users.

Apple's growth slowed compared with the third quarter. But sales in units still grew by about 112% compared with the fourth quarter in 2007. It sold 4.1 million mobile phones to end users, which is less than the 4.7 million it sold from July to September. The slowdown in growth puts pressure on Apple to launch a new model, according to Gartner.

The big loser was Nokia. Even though it is still the largest smartphone vendor, its sales decreased by about 17% compared with a drop by 3% during the third quarter -- in both cases, compared with the corresponding quarter in 2007. Its market share has dropped from 50.9% to 40.8% in a year.

As a result of Nokia's problems, sales of Symbian-based smartphones also continue to drop.

In the platform war, Microsoft managed to reclaim the third spot from Apple and its Mac OS X. Microsoft has the Samsung Omnia and touch-screen phones from HTC, the fourth-largest smartphone vendor, to thank for that, Gartner said.

The phone vendors are putting a lot of effort into smartphones, and Gartner is still bullish about sales during 2009. It expects the market to grow by 28%, compared with a 4% drop for the overall mobile phone market.

Entry-level Symbian-based smartphones from Nokia and the introduction of more Android-based smartphones will play a key role in securing that growth, according to Carolina Milanesi, research director at Gartner.