Smartphone Growth Declines in 3Q, But Total Phone Market Still Growing

While the mobile phone market grew by 12.8% from last year’s third quarter, it appears smartphone growth declined in key mature markets, according to a new report.

Economically stout regions like the United States and Western Europe experienced a year-over-year decline of shipment volumes in mobile phones, a reflection of delayed smartphone purchases and conservative consumer spending. This past quarter was also the second-lowest growth rate for the overall mobile phone market over the past two years, according to market-research firm IDC.

The decline was in part to consumers waiting for products like the iPhone 4S, which was rumored to launch in the third quarter, yet was not released until October. Apple also missed third quarter expectations due to the device’s delayed debut. 

The Importance of Smartphones
Ssmartphones have become key components of the general mobile phone market and, despite lagging sales this quarter, will continue to drive the market in the years to come. 

"Smartphone centricity continues to be the hallmark of the mobile phone market," says Ramon Llamas, senior research analyst with IDC's Mobile Phone Technology and Trends team. "Two years ago, smartphones comprised just a small portion of overall shipments among the leading vendors. Today, that proportion has grown considerably, thanks in large part to LG, Motorola, Samsung, and Sony Ericsson making Android smartphones a priority. At the same time, the growing presence of companies focused exclusively on the smartphone market -- Apple, HTC, and RIM -- also demonstrate the impact that smartphones have had on the mobile phone market as a whole."

While the new iPhone demand went unfulfilled during the third quarter of 2011, Samsung took advantage of the playing field and experienced double-digit growth compared to its year ago results. The company’s growth was due mostly to smartphone sales, especially its Galaxy S II handset, which launched at three of the four largest carriers in the United States this quarter. Samsung will most likely experience growth next quarter as well thanks to its buzzed about Galaxy Nexus smartphone. 

Source: IDC