31 January 2011

Mobile phone market grows 17.9% year-on-year in Q4

Driven by smartphones sales, global mobile phone vendor shipments were a record 401.4 million units in fourth-quarter 2010, up 17.9% year-on-year from 340.5 million in fourth-quarter 2009, according to the International Data Corp (IDC) Worldwide Mobile Phone Tracker. Shipments totaled 1.39 billion units on a cumulative worldwide basis in full-year 2010, up 18.5% from 1.17 billion in 2009.

The strong quarterly and annual growth comes after a weak 2009, which saw the market decline by 1.6%, says IDC. A stronger economy and a wider array of increasingly affordable smartphones helped lift the mobile phone market to its highest annual growth rate since 2006, when it grew 22.6%.

“Mobile phone users are eager to swap out older devices for ones that handle data as well as voice, which is driving growth and replacement cycles,” says Kevin Restivo, senior research analyst with IDC’s Worldwide Mobile Phone Tracker.

It’s not just smartphone-focused suppliers that capitalized on the mobile phone market’s renewed growth last year, notes IDC. Chinese handset maker ZTE, which sells mainly lower-cost feature phones in emerging markets, moved into the number 4 position worldwide in Q4/2010 (its first quarter among IDC’s Top 5 vendors).

“Change-up among the number four and five vendors could be a regular occurrence this year,” adds Ramon Llamas, senior research analyst with IDC’s Mobile Devices Technology and Trends team. “Motorola, Research In Motion and Sony Ericsson — all vendors with a tight focus on the fast-growing smartphone market who had ranked among the top five worldwide vendors during 2010 — are well within striking distance to move back into the top five list.”

IDC believes that the mobile phone market will be driven largely by smartphone growth through the end of 2014. “Feature-phone users looking to do more with their devices will flock to smartphones in the years to come,” notes Restivo. “This trend will help drive the smartphone sub-market to grow 43.7% year-over-year in 2011,” he adds.

Nokia’s overall unit volume fell 2.4% in Q4, due to the “intense competitive” environment and component shortages, resulting in lower feature-phone shipments. However, the firm did grow smartphone volume by 38% year-on-year. In Q4, Nokia launched the C7 and the C6-01 touchscreen smartphones as well as the C3 combination touchscreen & QWERTY device, but smartphone average selling prices (ASPs) still fell 16% year-on-year.

Samsung exceeded 80 million units for the first time in Q4 and improved its profit margins for the second consecutive quarter. Driving shipment volumes was the continued success of its Galaxy S smartphones, of which it sold nearly 10 million units for the year. Similarly, Samsung’s mass-market and touch-screen phones earned a strong following in emerging markets.

LG surpassed 30 million units, due partly to the success of Optimus One smartphone sales across multiple regions. Its smartphone strategy is paying off, selling more than 1 million units in the first month of availability, and newer versions (Optimus 2X, Optimus Black) are expected later this year. Meanwhile, LG’s feature phones comprised most shipments, but an aging portfolio and lower prices in emerging markets left the firm vulnerable to the competition.

ZTE finished Q4 in fourth place, with shipments steadily spreading from its home country China to developing regions such as Africa and Latin America. It has also recently made inroads into developed markets such as Western Europe and the US as well as Japan. While most shipments have historically concentrated on entry-level and mid-range devices, some recent success is due directly to its rapidly expanding smartphone line, such as the Android-based Blade and Racer devices. Meanwhile, its S- and C-series entry-level feature phones provided additional competition in emerging markets.

Apple slipped to fifth place despite a record quarter for unit shipments and the departure soon thereafter of CEO Steve Jobs on medical leave. It was the firm’s second consecutive quarter on IDC’s Top 5 list. The iPhone sold particularly well in developed regions, such as North America and Western Europe. Apple said it could have sold more iPhones had it been able to make more, and it is set to introduce the touchscreen device on Verizon next month.

Table 1: Top 5 mobile phone vendors, shipments and market share, Q4/2010 (in millions).
Vendor	Q4/10 shipments	Q4/10 share	Q4/09 shipments	Q4/09  share	Year-on-year change
Nokia	123.7	30.8%	126.8	37.2%	–2.4%
Samsung	80.7	20.1%	68.8	20.2%	17.3%
LG	30.6	7.6%	33.9	10.0%	–9.7%
ZTE	16.8	4.2%	9.5	2.8%	76.8%
Apple	16.2	4.0%	8.7	2.6%	86.2%
Others	133.4	33.2%	92.8	27.3%	43.8%
Total	401.4	100.0%	340.5	100.0%	17.9%

 

Table 2: Top 5 mobile phone vendors, shipments and market share, 2010 (in millions).
Vendor	2010 shipments	2010 share	2009 shipments	2009 share	Year-on-year change
Nokia	453.0	32.6%	431.8	36.9%	4.9%
Samsung	280.2	20.2%	227.2	19.4%	23.3%
LG	116.7	8.4%	117.9	10.1%	–1.0%
ZTE	51.8	3.7%	26.7	2.3%	94.0%
RIM	48.8	3.5%	34.5	2.9%	41.4%
Others	437.7	31.5%	333.5	28.5%	31.2%
Total	1388.2	100.0%	1171.6	100.0%	18.5%

 

Source: IDC Worldwide Mobile Phone Tracker, 27 January.

Note: Vendor shipments are branded shipments and exclude OEM sales for all vendors.

See related items:

Handset shipments reach 400 million in Q4/2010

Handset shipments reach 327m in Q3

Asia-Pacific helping push global handset shipments to 1.34bn in 2010

Handset market grows to 346.2m in Q3, while Samsung gains market share

Mobile handset shipments to reach 1.43bn in 2011

Tags: Mobile handset shipments

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