Granter has released another round of its much dreaded technology estimates. This time around PC is not the only one under fire; the mobile industry has also been put under the spotlight. According to statistics released by the research firm, mobile phone sales declined by 1.7% y/y in 2012.
Mobile phone sales were 1.75 billion in 2012, as compared to approximately 1.78 billion. This might be a sign of worry for companies that are reliant more on mobile phones as compared to smartphones for their sales. Nokia Corporation (ADR) (NYSE:NOK) has been attempting to stem the flow of its mobile phone market share. Only a few quarters back, the company was the largest mobile phone manufacturer in the world; it now stands at a market share of roughly 18%. The growth slowdown in the mobile segment can be a sign of worry for Nokia, which sold 86 million mobile phones last quarter and only 7.8 million smartphones. The company sold a meager 39 million smartphones in 2012, a y/y decline of approximately 54%.
Nokia has recently partnered with Microsoft Corporation (NASDAQ:MSFT) to launch the Lumia series and is hoping to turn around its fortunes with Lumia’s Windows Phone 8. Last quarter’s results have shown that the Lumia is gaining some momentum and has shown good sales despite availability in limited geographical locations. Microsoft and Nokia investors would be closely monitoring the sales performance of Lumia in China and India. Microsoft has already failed out on ‘Search’ with the mediocre performance of Bing and on ‘Social’ with the dying Windows Live; the software giant would ideally like to at least have a stake in the smartphone operating system market.
Gartner has also stated that although Asha is gaining a lot of momentum, Nokia will have to take the Asha platform seriously and spend more resources to enrich the ecosystem. Both Nokia and Microsoft can benefit from expected growth in the value smartphone segment with Asha and low-end Lumia. According to IHS, value smartphone demand will grow to 559 million from the current 206 million. This 51% growth is almost double the 26% growth rate expected in high end smartphones.
While the overall mobile phone industry has suffered, the smartphone industry is growing at an outstanding pace. According to Gartner, smartphone sales were 207.7 million in 4Q2012, which was a record. This was also a 38.3% y/y increase over smartphones sales in the last quarter of 2011. Apple Inc. (NASDAQ:AAPL) and Samsung have increased their dominance in this arena, with a combined market share of 53% in 4Q2012, up from 46.4% in 3Q2012. Samsung was the biggest smartphone manufacturer in the world and now controls 43% of the Android market. According to Gartner, the word Android is fast becoming synonymous with Samsung and Samsung Galaxy.