Worldwide mobile phone sales totalled 269,1-million units in the first quarter of 2009, a 9,4% decrease from the first quarter of 2008 – but smartphone sales surpassed 36,4-million units to show a 12,7% increase from the same period last year.
"There were some signs of a recovery in markets such as North America and China, but overall sales in the first quarter of 2009 registered the biggest quarter-on-quarter contraction since Gartner began monitoring the market on a quarterly basis in 2001," says Carolina Milanesi, research director for mobile devices at Gartner.
"This was also the first time the market contracted year over year during the first quarter, a period traditionally helped by strong seasonality in the Asia/Pacific market."
The channel intensified its efforts in the first quarter of 2009 to reduce the levels of stock it holds, as Gartner predicted in the fourth quarter of 2008. Stock reduction is intended to minimise capital investment in response to low consumer confidence.
Sales into the channel were just short of 244-million units in the first quarter of 2009, while sales to users were just over 269-million units – a difference of 25-million units, compared with 17-million units in the fourth quarter of 2008, the biggest difference ever recorded. Gartner expects channel inventory reductions to continue into the second quarter of 2009, albeit with lower volumes.
Nokia continued to lead the mobile phone market, but its share dropped to 36,2% from 39,1% in the first quarter of 2008. Samsung retained second place and improved its market share as its sales totalled 51,4-million units, and LG came in as the third-largest vendor. After dropping to the fifth position in the fourth quarter of 2008, Motorola overtook Sony Ericsson to regain fourth place.
Smartphone sales represented 13,5% of all mobile device sales in the first quarter of 2009, compared with 11% in the first quarter of 2008. Gartner analysts says positive performance by Research In Motion (RIM) and Apple showed that services and applications are now instrumental to smartphones' success.
"Much of the smartphone growth during the first quarter of 2009 was driven by touchscreen products, both in midtier and high-end devices," says Roberta Cozza, principal analyst at Gartner. "'Touch for the sake of touch' was enough of a driver in the midtier space, but tighter integration with applications and services around music, mobile e-mail, and Internet browsing made the difference at the high end of the market."
Symbian accounted for 49,3% of worldwide smartphone operating systems market share in the first quarter of 2009, down from 56,9% in the first quarter of 2008.
RIM's smartphone OS market share reached 19,9% in the first quarter of 2009, up from 13,3% in the first quarter of last year. The iPhone OS accounted for 10,8% of the market, up from 5,3% in the first quarter of 2008.
Nokia¹s worldwide sales reached 97,4-million units in the first quarter of 2009, thanks to reductions in inventory in markets such as Asia/Pacific and Latin America. This was the first time Nokia¹s sales dipped below 100-million units since the first quarter of 2007. The real impact of the current market recession was on the average selling price (ASP), which saw an 18% drop year over year. Nokia managed to grow its sales in the smartphone segment by introducing the Nokia 5800 into more regions.
Samsung had a very successful first quarter of 2009. With sales of 51,4-million units, Samsung's market share grew 4,7 percentage points to 19,1%. It returned to double-digit profitability due to a good product mix.
LG sold 26,5-million units in the first quarter of 2009, growing its market share by 1,9 percentage points year over year. The company benefited from a very strong portfolio of touchscreen, messaging and imaging devices.
Motorola continued to experience significant difficulties even in its home market, but it had a solid quarter with prepaid operators Boost Mobile and Tracfone. It expects worldwide sales of iDEN handsets to be up 50% in 2009 compared with 2008.
Sony Ericsson lost market share compared both with the fourth quarter of 2008 and the first quarter of 2008, with sales of 14,5-million units. While the recession contributed to this decline, a weak product portfolio was also a factor.
"With inventory-reduction efforts expected to continue in the second quarter of 2009, although to a lesser extent than what we have seen so far, and better-than-expected figures for the first quarter of 2009, we remain confident that overall sales to users for 2009 will remain considerably higher than the sell-in that many vendors are expecting," says Milanesi.
"Device vendors will focus increasingly on smartphones, improved user interfaces and services to differentiate themselves and fuel consumer demand. We maintain our view that sales to users will decrease by about 4% for 2009 compared with 2008, while sell-in will slow to around a 10% decrease."