Thursday, December 20, 2012

Nokia knocked off mobile industry perch

Nokia knocked off mobile industry perch
Samsung's ability to fill demand gaps quickly has led to its success say analysts. (Shutterstock)


Samsung Electronics has knocked Nokia off its perch at the top of the mobile phone chart, according to IHS iSuppli figures.

After 14 years at the head of the global unit shipments table, the Finnish manufacturer has lost sufficient market share to allow its South Korean rival to take the lead and demote Nokia to runner up.

Nokia's share of the overall mobile market, which includes smartphones and conventional handsets, is projected to fall from 30%, in 2011, to 24%, while Samsung's share is expected to rise from 24% to 29%. Apple is predicted to increase its market share of the overall phone market to 10% from last year's 7%, and remain in third place.

"The competitive reality of the cellphone market in 2012 was 'live by the smartphone; die by the smartphone,'" said Wayne Lam, senior analyst for wireless communications at IHS. "Smartphones represent the fastest-growing segment of the cellphone market-and will account for nearly half of all wireless handset shipments for all of 2012. Samsung's successes and Nokia's struggles in the cellphone market this year were determined entirely by the two companies' divergent fortunes in the smartphone sector."

In the smartphone market Samsung retained its 2011 top ranking, swallowing even greater share as its 2012 projected sales hit 28% of the market total, up from 20% in the previous year. This gave the South Korean firm a hugely widened lead on Apple, which managed a modest bump from 19% to 20%. The bad news for Nokia is that, although it managed a 16% share of the market in 2011 its slice tumbled to 5% in 2012.

Analysts believe Samsung's success comes from its ability to quickly fill demand gaps with products and to cater to a wide range of price points while Apple's premium-only approach has led to limited opportunities for the iPhone maker to grab market share. In addition, the iPhone incompatibility with LTE networks in much of the European market will likely hurt its sales in that market, leaving Nokia and Samsung to soak up speed-focused consumers.

With the prevailing acceleration of smartphone adoption, HIS expects penetration to reach 56% in 2013, moving the mobile phone scuffle more prominently into the smartphone space.

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