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Smartphone Market Grows 79.7% Year Over Year in First Quarter of 2011
Posted: 06-May-2011 [Source: IDC]

[IDC reports smartphone vendors shipped a total of 99.6 million units in 1Q11 nearly doubling the first quarter of 2010.]

Framingham, Mass. -- The worldwide smartphone market grew 79.7% year over year in the first quarter of 2011 (1Q11), driven by a combination of vendors releasing highly anticipated models, widespread availability of older smartphones at lower prices, and sustained end-user demand. According to the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, smartphone vendors shipped a total of 99.6 million units in 1Q11, nearly double from the 55.4 million units in the first quarter of 2010.

"Conditions in the smartphone market are creating a perfect storm for sustained smartphone growth," says Ramon Llamas, senior research analyst with IDC's Mobile Phone Technology and Trends team. "First, vendors are increasingly emphasizing smartphones as the key to their own growth. Second, selection has proliferated from mostly high-end devices to include more mid-range and entry-level offerings. Third, pricing has become increasingly competitive, with even high-end devices available at low price points. Finally, users continue to seek greater utility from their mobile phone beyond voice, and smartphones have been the ideal solution. Altogether, these add up to continued smartphone growth throughout the year."

The strong demand for smartphones also means the market will remain highly competitive and fragmented. "The rise of Android as a prominent mobile operating system has allowed several suppliers to gain share quickly," adds Kevin Restivo, senior research analyst with IDC's Worldwide Quarterly Mobile Phone Tracker. "Also, the relatively nascent state of smartphone adoption globally means there is ample room for several suppliers to comfortably co-exist, at least for the short term."

Top Five Smartphone Vendors

Nokia, despite announcing its intentions to move from Symbian to Windows Phone as its primary smartphone operating system, maintained its leadership position in the smartphone market. Demand for Symbian-powered smartphones remained strong within its traditionally strongest markets of EMEA and Asia/Pacific, and the company continues to announce more devices running on Symbian, including the E6 and the X7. Still, as Nokia transitions from Symbian to Windows Phone, it may find itself in danger of ceding market share as the competition ramps up smartphone production.

Apple reached a new record shipment volume in a single quarter, and inched closer to market leader Nokia with fewer than six million units separating the two companies. The company posted market-beating year-over-year growth and recorded triple-digit growth in two key markets: the United States, with the release of its CDMA-enabled iPhone, and Greater China. Additionally, the company enlisted South Korean Telecom and Saudi Telecom as carrier providers of the iPhone.

Research In Motion remained solidly in third place from the previous quarter, as the company grew its presence outside of its home territory of North America. RIM has launched several 3G devices to the market, and recently announced two new BlackBerry smartphones running on its new BlackBerry 7 OS. Still, the majority of RIM's shipment volumes have been comprised of older, lower-cost devices. The company expects this trend to continue into the following quarter.

Samsung posted the largest year-over-year gain of any other vendor on the list. With a multiple operating system strategy in place, Samsung has been able to grow its smartphone portfolio to meet the needs of a diverse market. Accounting for the majority of its smartphones and driving shipment volumes higher was the continued success of its Android-based smartphones, including the high-end Galaxy S devices and mass-market Galaxy Ace and Galaxy mini devices. Meanwhile, its bada-powered Wave devices and Windows Phone 7 devices continued to gain traction.

HTC posted yet another record shipment volume, nearly surpassing the ten million unit mark for the first time. Like other vendors, HTC announced multiple new devices, including the Facebook-optimized Salsa and ChaCha. In addition, the company launched several new devices, including its Inspire 4G, WiMAX-enabled EVO Shift 4G, and LTE-enabled Thunderbolt. These, along with its investment and developments on hardware, displays, and its HTC Sense layer have helped HTC differentiate itself further in an increasingly crowded market.

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