In 2007, over one billion mobile phones were sold worldwide for the first time. With growth expected to grow in Asia and other developing markets, 2008 may surpass last year’s numbers. Industry watchers are asking if Nokia can expand in North America and if Motorola can stop its loss of market share.
According to figures from Gartner, sales of mobile phones surpassed 1.15 billion units in 2007. This number is a 16% increase from 2006’s numbers of 999 million units sold. Much of this growth is due to emerging markets like China and India where many people are buying their first handset.
Nokia is still the world’s alpha male of mobile phone manufacturers. It sold 435 million handsets last year. Throughout 2007, Nokia controlled 37.8% of global market share. For the first time, Nokia accounted for 40% of all sales in the fourth quarter.
Nokia is followed by Motorola, Samsung, Sony Ericsson, and LG. Every company except Motorola increased its market share. In the fourth quarter of 2007 Samsung bumped Motorola out of second place. For the full year Motorola’s market share was 14.3%, down from 21.1%. Samsung increased its market share from 11.8% to 13.4%.
According to Gartner, this year will see even better sales. Nokia is expected to extend its market share by growing in North America.
“In most markets Nokia’s market share is larger than 40 percent, in North America it’s close to 10 percent,” said Carolina Milanesi, research director at Gartner.
Nokia has tried to expand its market share in North America in the past but hasn’t been able to make much progress. According to Carolina Milanesi, this year could be the breakout year for Nokia’s moves into North America.
“Verizon has said it plans to open its network, which might be more on paper than in reality. But North American carriers are starting to realize they need to be more flexible than in the past. For Nokia, and everyone else, it means not having to build Verizon-specific phones, and faster time to market,” she said.
Nokia isn’t the only company that has potential to improve in the North American market. “Sony Ericsson has a very interesting lineup. With the addition of Windows Mobile it has a chance to grow in North America,” said Milanesi.
One of the biggest questions of 2008 is how Motorola will deal with its declining handset sales. There has been speculation that Motorola will sell its mobile phone division. Analysts think if the phone division is sold, it will be bought by a Chinese company like ZTE.