HTC Smarphone Sales Climb 139% While LG Crashes 27%

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Sales of Smartphones are booming with research company, Gartner, are reporting a 50.5 per cent increase in sales during the past 12 months. One of the big losers was LG who saw sales fall 27 per cent while HTC saw sales climb 139 per cent.

Smartphone sales to end users accounted for 19 per cent of worldwide mobile device sales, an increase of 50.5 per cent from the second quarter of 2009.
Apple captured 8.7 million units while Samsung 65.3 million mobile devices. Research in Motion only managed 11.2 million units. 
“Although the mobile communication devices market showed double-digit growth this quarter, average selling prices (ASPs) were lower than expected and margins fell,” said Carolina Milanesi, research VP at Gartner. “We attribute the decline in ASPs to a stronger dollar, a depreciating euro, and intense competition that drove price adjustments and changes to the product mix.” Manufacturers such as LG and Samsung pursued market share in a low-margin market but this approach proved risky, as shown by LG’s decline of 27.8 per cent in ASP in the second quarter of 2010.
While new product introductions from Apple, HTC and Motorola, along with the drop in ASPs, drove strong sales of smartphones, shortages of components, such as AMOLED displays impaired sales volumes of some of the more popular new smartphones, the research company said.
The second quarter also saw some movement in the top 10 mobile device manufacturer rankings. HTC made its debut in the top 10 worldwide ranking, holding the No. 8 position with 139.1 percent growth year on year. This reflects the popularity of its Android portfolio but also a more aggressive branding strategy compared to the same period in 2009. 
Gartner reported that in the second quarter, Nokia’s mobile device sales to end users reached 111.5 million units and a share of 34.2 per cent. But good-quality, well-priced products were not enough to maintain Nokia’s leadership in the high-end sector, Gartner said, which caused Nokia to lose 2.6 percentage points year on year. Nokia’s senior executives need to do more to attract developers and other ecosystem members by revising its platform strategy and improving its communications, Gartner said.

 
Samsung sold 65.3 million devices in the second quarter of 2010 that translated into a 20.1 percent market share. Although Samsung’s sales were strong in developing markets, its shift in product mix caused an overall decline in ASP. Samsung maintained its position in the midtier by launching several new devices, including messaging handsets. This more aggressive strategy toward the mass market enabled it to reduce inventory in the second quarter. 
Research In Motion (RIM)’s mobile device sales to end users reached 11.2 million units in the second quarter of 2010, confirming RIM’s position as the fourth largest brand with a share of 3.4 per cent this quarter. New devices running BlackBerry OS 6.0 — such as RIM’s first touchscreen QWERTY slider, the Torch — will be available from the third quarter of 2010. Gartner said Torch’s form factor will still appeal more to business users than to consumers and will stop many loyal BlackBerry users defecting to other platforms, but it won’t attract many new users to the brand.
Apple’s mobile device sales reached 8.7 million units or a 2.7 percent share of the overall mobile device market, but a 14.2 percent of the smartphone market. Apple maintained its No. 7 position in the worldwide mobile device market and held the No. 3 position in the worldwide smartphone market. Apple’s sales would have been higher if it had not had to face tight inventory management in preparation for the arrival of the iPhone 4 at the end of the second quarter of 2010. Apple also suffered from some supply constraint on the new device. 
A wider global rollout of iPhone 4 will sustain Apple’s sales momentum throughout the second half, the research company said.
In the smartphone operating system market, Android expanded rapidly in the second quarter of 2010, overtaking Apple’s iPhone OS to become the third-most-popular OS in the world (see second table). In the U.S, it also overtook RIM’s OS to become the No. 1 smartphone OS in this region. “A non-exclusive strategy that produces products selling across many communication service providers (CSPs), and the backing of so many device manufacturers, which are bringing more attractive devices to market at several different price points, were among the factors that yielded its growth this quarter,” said Milanesi.
Smartphone sales to end users totaled 61.6 million units in the second quarter of 2010, a 50.5 percent increase from the same period in 2009. The top four smartphone OS vendors exhibited growth in the second quarter of 2010, and accounted for 91 percent of the worldwide smartphone OS market, up 6 percent year on year.
Gartner said CSPs will increasingly offer more affordable tiered data plans to users. Tiered data plans will make smartphones more accessible to different market segments and help make smartphones the dominant device category in mature markets. This means that total cost of ownership will be lower, and new users will face less of a barrier to entry.
Additional information may be found in the Gartner report “Competitive Landscape: Mobile Devices, Worldwide, 2Q10,” which is available on Gartner’s website at www.gartner.com.
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