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16 May 12 Samsung Tops Handsets With 40% Android Share, Gartner Says

Samsung (005930) Electronics Co. sold more
than 40 percent of all Android mobile phones in the first
quarter as the South Korean manufacturer became the world’s
largest handset maker, research company Gartner Inc. said.

Global handset sales declined 2 percent to 419 million,
dragged down by a drop in low-end handsets, Stamford,
Connecticut-based Gartner said today in a report. Smartphone
sales rose 45 percent, the researcher said.

Samsung, which also makes screens and other hardware used
in smartphones, has profited from its ability to offer devices
running Google Inc. (GOOG) (GOOG)’s Android software at a wide range of
prices. Android is currently installed on 56 percent of new
smartphones, more than twice Apple Inc. (AAPL) (AAPL)’s share. The prospect of
even cheaper Android models led customers in Asia to postpone
purchases, the researchers said.

The market for users of feature phones, or low-end handsets
that can’t run a full range of applications, to upgrade to
similar devices “has declined more significantly than we
expected,” Anshul Gupta, a Mumbai-based analyst at Gartner,
said in an interview. “Consumers are holding onto their
feature-phone devices hoping for better smartphone deals coming

Nokia Oyj (NOK1V), which Samsung overtook as the world’s biggest
handset maker, fell as much as 3.2 percent to 2.20 euros and was
trading down 2.3 percent at 1:25 p.m. in Helsinki. Samsung
extended dropped 6.2 percent, the most in 3 1/2 years, to 1.23
million won at the close in Seoul, before the Gartner report was

Smartphones as Commodities

The Gartner study measures sales to end users at operators
and retailers. No other vendor besides Samsung has more than a
10 percent share of Android handsets, the researcher said,
adding that the smartphone market has become “highly

Microsoft Corp. (MSFT) (MSFT) software ran on 1.9 percent of handsets
sold in the quarter, compared with 2.6 percent a year earlier.
Nokia Chief Executive Officer Stephen Elop has said his company
and Microsoft are trying to establish the Redmond, Washington-
based software maker’s Windows Phone as a “third ecosystem”
versus Android and Apple systems.

Nokia’s total handset market share declined to 19.8
percent. The Espoo, Finland-based manufacturer remained ahead of
Apple, which accounted for 7.9 percent of the market. The
proportion of smartphones running Symbian, Nokia’s older
operating system, fell to 8.6 percent, or about one-third of its
share a year earlier. Nokia’s total smartphone share, including
Windows Phone and the N9, was 9.2 percent, Gupta said.

European ‘Uncertainty’

“Economic uncertainty has really impacted markets like
western Europe, with smartphone upgrades declining,” Gupta
said. Nokia now has the third-largest share in the region,
behind Samsung and Apple, he said.

The researchers forecast that Windows Phone will be the
second-biggest smartphone system after Android by 2015,
displacing Apple’s iOS, Gupta said, reiterating earlier

Gartner lowered its full-year mobile-phone sales forecast
to 1.9 billion handsets, for growth of approximately 5.5
percent, including sales of 650 million smartphones,
representing a 38 percent jump. The research company earlier
forecast growth of 7 percent overall this year, with a 39
percent gain for smartphones.

To contact the reporter on this story:
Diana ben-Aaron in Helsinki at

To contact the editor responsible for this story:
Kenneth Wong at

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