Telecom & Wireless

Global Smartphone Sales Nearly Double In Q3, A Bonanza For Carriers.

Research firm Gartner says that global smartphone sales were up 96% in the third quarter compared with the same quarter last year. That outstripped the 35% rise in total handset sales. “Smartphones accounted for 19.3 percent of overall mobile phone sales in the third quarter of 2010”, Gartner reported

“This quarter saw Apple and Android drive record smartphone sales. Apple’s share of the smartphone market surpassed Research In Motion (RIM) in North America to put it second behind Android while Android volumes also grew rapidly making it the No. 2 operating system worldwide.”

The other important result mentioned in the survey is that the sale of “white box” phones in emerging markets increased. These “white box” phones are not made by any of the major handset companies. This could help a number of manufactures that get many of their sales at the low end of the cellphone business.

Carolina Milanesi, research vice president at Gartner, said

“In the third quarter, white-box manufacturers continued to expand their reach outside of China into markets such as India, Russia, Africa and Latin America. We firmly believe this phenomenon will not be short-lived as we still see a continued need for non-3G devices. Although we have seen acceleration in sales this quarter, we expect an even bigger volume in the fourth quarter of 2010.”

The most important revelation of the survey is the extent to which smartphone champion Apple (NASDAQ: AAPL) has gained  in its position among manufacturers. Its market share rose to 3.2% of the overall global handset market from 2.3% last year. Research In Motion (NASDAQ: RIMM) and Apple now have together 6.1% worldwide share, nearly as much as behemoth LG.

Nokia’s market share plummeted between the two periods from 36.7% to 28.2% . LG’s shares dropped from 10.3% to 6.6%

The news is important to carriers, particularly those that rely on 3G customers and hope to rely on 4G customers in the future. Companies such as AT&T (NYSE: T) get large sums of money for subscriber plans which include the data programs which are highly profitable. Competition among 3G carriers is fierce, which has pushed down prices. A volume of new customers may help offset that.

The smartphone market has two winners–smartphone makers and carriers that rely on broadband mobile products and services which aid their profits.

Douglas A. McIntyre

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