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iSuppli: smartphone market shrank in Q1

by Scott Bicheno on 9 May 2011, 16:37

Tags: Apple (NASDAQ:AAPL), iSuppli

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Pause for breath

Such has been the mobile device explosion that it's genuinely surprising to see even a quarter of negative growth, but according to researcher iSuppli that's exactly what happened in Q1.

There were 97.2 million smartphones shipped in the first quarter of the year, which represented a 1.5 percent decline of Q4 2010. While this was unexpected, if there's going to be a sequential decline in this market you'd expect it to be in Q1, when the festive period is over, but the phones announced at CES and MWC are not yet available.

One company did buck the trend substantially, however, and that was Apple. This was probably down to the launch of the iPhone on Verizon, bringing competition to the US iPhone market for the first time. The year-on-year figures look pretty consistent with those recently published by IDC.

"Apple's smart phone market share in the first quarter was boosted by the introduction of its first iPhone model with CDMA as well as by the addition of Verizon Wireless as a carrier in the United States," said Tina Teng, senior analyst, at iSuppli. "Not only did this allow Apple to expand its target market and boost shipments, it also placed additional pressure on rival smart phone brands - including Motorola, Samsung, LG and HTC - that focus on Verizon Wireless as a major customer."

The biggest losers over this period were Nokia, Motorola and ‘others', while RIM, HTC and LG did better than average. The year-on-year trend remained very positive, with overall growth of 74 percent. We would expect to see growth return strongly in this quarter.

"The reduction of shipments reflects inventory control efforts in the smart phone market, rather than weakening consumer demand," Teng said. "This decline does not change the IHS iSuppli forecast of 60 percent growth in worldwide smart phone shipments for the entire year of 2011."



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Verizon != world.

I would like to see the regulators break the cozy link between networks and phone supply. There would be much more competition on price if we bought the phone & the calling plan separately. And all those ghastly software mods would be done for too.