EGHAM, UK: In the third quarter of 2008, the global smartphone market reached its weakest year-on-year growth since Gartner, Inc. began tracking the industry. Worldwide smartphone sales to end-users totalled 36.5 million units in the third quarter of 2008, an 11.5 per cent increase from the same period in 2007.

"The current economic climate is negatively impacting sales of higher end devices," said Roberta Cozza, principal analyst at Gartner. "Going forward, we should expect the smartphone device market to continue to grow but at a slower pace. Although leading mobile operators are subsidising more smartphones, to reach lower prices they tie the device to two year contracts with monthly data plan rates which remain too expensive for the mainstream user."

Nokia maintained its No. 1 position with 42.4 per cent market share in the third quarter of 2008, but for the first time it recorded a decline in sales of 3 per cent year-on-year (see Table 1). "Nokia is feeling the pressure from increased competition in the consumer smartphone market," said Ms Cozza. "The company introduced solid Nseries products with top features, but its lack of a commercial touch-screen device in its smartphone portfolio prevented Nokia from capitalising from consumer demand for this feature. The recently announced N97 is a much needed evolution for the n9x series of products. It is unfortunate that the device will not be available before the first half of 2009 as this is a competitive product in today's market."

Table 1
Worldwide: Preliminary Smartphone Sales to End Users by Vendor, 3Q08 (Thousands of Units)

Note: Under the name HTC, Gartner counts only the company's own-branded devices. The devices that HTC designs for mobile operators are shown separately under the operators' names in these statistics.
Source: Gartner (December 2008)