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Apple to Regain Smartphone Lead


New report says iPhone to power industry-wide growth.


Worldwide sales of smartphones totaled 32.2 million units in the second quarter of 2008, a 15.7% increase from the second quarter of 2007, Gartner reports.

Gartner, an information technology research and advisory company, says smartphones represented 11% of sales in the mobile device sector during the second quarter of this year.
In a prepared statement, Roberta Cozza, a principal analyst at Gartner, said:

"Although global smartphone sales (in the first half of 2008) reached 64 million units, up 22% compared with the first half of 2007, sales increased at a lower rate than 2007...The current economic environment continues to negatively impact the market, limiting consumer spending and replacement purchases in general."

Sales growth should improve in the third quarter with the global introduction of the Apple (AAPL) iPhone 3G.

Apple's share of the global smartphone market fell to 2.8% from 5.3% in the first quarter of 2008. However, the drop in sales can be traced to clearing out the first generation iPhone before the introduction of the new iPhone 3G in June. Gartner expects iPhone sales to increase significantly in the second half of 2008, enabling the company to regain a leading position in the rankings of global smartphone vendors.

Overall sales of smartphones in North America remain strong, growing 78.7% year-over-year in the second quarter of 2008. North America also accounted for about 25% of global smartphone sales. Europe, the Middle East and Africa grew about 21% year-over-year while sales in Japan declined about 24%. Sales in the Asia/Pacific region fell 4.8%.

Nokia (NOK) retained its No. 1 position with a 47.5% share of the market in the second quarter of 2008, but the company's year-over-year growth was about half the market average, Gartner said.

"To stay competitive, Nokia will need to introduce more design variation among its N-series models and keep innovating," Cozza says. "The expected introduction of a touch-screen smartphone in the second half of 2008 will test the company's capability to show differentiation and innovation."

Research In Motion (RIMM) said sales of its smartphones were up 126% year-over-year, nearly doubling the company's market share from the second quarter of 2007.

High Tech Computer, a Taiwanese company, grabbed the No. 3 position in the second quarter of 2008, up from No. 7 in the first quarter. The company's sales more than doubled year-over-year, but its market share remained about 4%.

Sales of Microsoft (MSFT) mobile equipment increased 20.6% year-over-year, but the company's market share remained flat, at about 12% in 2008's second quarter. North America and Western Europe accounted for 74% of global Windows Mobile sales.

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