Smartphone sales beat out feature phones for first time: Gartner

It’s a sign of the times – smartphones have finally overtaken feature phones in sales, with smartphones representing just over half of the number of mobile phones sold, according to Gartner Inc.

In 2013, smartphones took 53.6 per cent of the market, with sales booming in Latin America, the Middle East, Africa, the Asia-Pacific region, and eastern Europe. India especially saw huge growth, racking up a 166.8 per cent increase in sales in the fourth quarter of 2013.

The lion’s share of smartphone sales went to Samsung Electronics Co. Ltd., which sold about 300,000 units over the course of 2013, taking home 31 per cent of the world’s market share. Apple Inc. was at just half that, moving about 151,000 sales, or 15.6 per cent of the sales in 2013.

Trailing behind Samsung and Apple were Huawei Technologies Co. Ltd. at 4.8 per cent, LG Electronics Inc. at 4.8 per cent, and Lenovo Group Ltd. at 4.5 per cent, though the “others” category took up about 39.3 per cent of global market share.

While the numbers show Samsung and Apple as leading the pack by a huge margin, they’re actually considered a slowdown for the two high-end smartphone makers, Gartner’s report said. As buyers in emerging markets keep picking up low-priced and mid-priced smartphones, sales of higher-priced smartphones are going to slow, pushing down the average selling price and cutting back on revenue.

“Mature markets face limited growth potential as the markets are saturated with smartphone sales, leaving little room for growth with declining feature phone market and a longer replacement cycle,” said Anshul Gupta, principal research analyst at Gartner, in a statement.

“Lack of compelling hardware innovation has further exacerbated replacement cycles for high-end smartphones in 2013 because consumers don’t find enough reasons to upgrade.”

To succeed, Samsung needs to boost its midrange phones and make them more attractive to consumers. The Korean device maker also needs to create simpler user interfaces and innovate, as it won’t be able to compete on price alone, the Gartner report said.

And while Apple’s numbers seem to indicate it’s losing out to Samsung, it’s not out of the game yet, Gartner notes. The Calif.-based company recently inked a deal with NTT Docomo Inc., one of the key wireless carriers in Japan, which should boost its sales in 2014. It also signed a deal with China Mobile Communications Corp., which can only be a good thing for its growth.

The other smartphone maker to watch is China’s Lenovo, especially given its recent purchase of Motorola Mobility from Google Inc.

“The acquisition will also provide Lenovo with patent protection and allow it to expand rapidly across the global market,” Gupta said. “We believe this deal is not just about entering into the U.S., but more about stepping out of China.”

On the operating system (OS) side, Google Android is still in the top spot, with a 12 per cent increase in the number of smartphones running the OS. It took 78.4 per cent of global market share in 2013, with roughly 759,000,000 smartphones sold.

Apple iOS was at 15.6 per cent with about 151,000,000 smartphones sold, while Microsoft Corp.’s Windows is at 3.2 per cent with sales of 31,000,000 smartphones. BlackBerry Ltd. took about 1.9 per cent at about 19,000,000 while the “others” category was set at 0.9 per cent.

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Candice So
Candice So
Candice is a graduate of Carleton University and has worked in several newsrooms as a freelance reporter and intern, including the Edmonton Journal, the Ottawa Citizen, the Globe and Mail, and the Windsor Star. Candice is a dog lover and a coffee drinker.

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