Gartner: Smartphones Outsell Feature Phones For The First Time

Sales of smartphones around the world surpassed those of feature phones for the first time in 2013, according to latest figures released by Gartner, with Samsung and Android retaining their crowns as the most popular smartphone manufacturer and operating system.

Smartphones accounted for 53.6 percent of all handsets sold last year, and 57.6 percent of total sales in the fourth quarter, with analysts suggesting that the falling cost of hardware and the rise in number of local manufacturers contributed to the drop in feature phone sales.

“Feature phone sales have been going down in almost every quarter of 2013,” Anshul Gupta, principal research analyst, told TechWeekEurope, noting that although quarter-on-quarter increase was small, smartphones were becoming more affordable.

Apple and Samsung

Samsung shipped 299.8 million smartphones during 2013, an increase from 205.8 million during 2012. The company now commands a 31 percent share of the market. Apple was second with 150.8 million units shipped and a 15.6 percent share of the market, down from 19.1 percent a year ago, but it shipped 20.7 million more devices in 2013.

Gupta says Apple has met expectations with the combined sales of the iPhone 5S and 5C, the first time the company ever launched two new smartphones at the same time, however he adds the company is likely to be happier with sales of the former.

“Certainly 5S sales have exceeded their expectations and 5C has underperformed,” he says, explaining that the 5C is just too expensive. Customers in developing markets prefer the 4S, but deals with NTT DoCoMo in Japan and China Mobile have also boosted sales volume.

Rise of the Chinese

Huawei, LG and Lenovo were the third, fourth and fifth most successful manufacturers during 2013. LG’s mobile renaissance has been fuelled by the Google-branded Nexus 4 and Nexus 5 handsets, but Gartner expects regional manufacturers to increase their market share in 2014.

“The top three players’ [Apple, Samsung and LG] share has come down because of local players,” says Gupta. “Some of the prominent ones, like ZTE, Huawei and Lenovo, are becoming very strong in their home market. I’m expecting these regional Chinese players to have a larger share.”

Lenovo acquired Motorola Mobility from Google last month in a deal worth £1.76 billion. Gartner believes that this will allow the firm to expand, but not necessarily in the saturating US market. It says the acquisition will give Lenovo a platform outside of China and access to Google’s patents that should protect it in Europe.

Operating systems

Android dominated smartphone shipments in 2013, with the operating system present on an astonishing 758.7 million units, an increase from 451.6 million in 2012, giving it a 78.4 percent market share. This was significantly more than its nearest rival iOS, whose share shrank from 19.1 percent to 15.6 percent year-on-year, but shipped 150.8 million units – 20 million more than the previous year.

Windows Phone is a distant third with 30.8 million units and a 3.2 percent market share and Gupta admits Microsoft’s mobile platform has disappointed. He says that although market share has increased year-on-year, Windows Phone failed to maintain its momentum, and it will be interesting to see what happens once Microsoft completes its takeover of Nokia.

“We were certainly hoping them to make progress,” he says. “To some extent they’ve really underperformed.”

Looking forward

Gartner expects Android to continue its dominance in 2014, unsure about the prospect of new operating systems such as Tizen and Firefox OS making an immediate impact.

“Android is definitely the strongest mobile operating system,” declares Gupta. “We are expecting more than one billion sales in 2014. That’s really massive.

“We were really expecting Tizen to generate sales in Japan, but this didn’t happen. For any new operating system coming from behind is not going to be easy, but Firefox OS being an HTML5 operating system where you don’t really need to build applications from scratch does give it some advantages. Then again, it is all about the number of devices and the number of manufacturers.”

What do you remember about the smartphones of 2013? Try our quiz!