Motorola continues to lose ground in handset market

MUNICH, Germany — In a mobile handset market characterized by strong unit growth and continuing price pressure, Nokia could strengthen its worldwide pole position during the second quarter. According to Gartner figures, Motorola continued its steep decline, but it managed to defend its second position.

Gartner attributes Nokia's aggressive pricing strategy to its success; the Finnish handset manufacturer could improve its market share from 33.7 percent in 2Q06 to 36.9 percent in 2Q07. During the same period, the company raised the number of units shipped from 77.75 millions to 99.96 million.

Motorola's shipments, in contrast declined from 50.53 million to 39.49 million, causing the market share to slip drastically from 21.9 percent in 2Q06 to 14.6 percent in 2Q07.

Samsung rose its market share from 11.2 percent to 13.4 percent, possibly passing Motorola in the quarter ahead. Sony Ericsson, worldwide number four, increased its market share from 6.6 percent to 9.0 percent. LG, similarly improved its share from 6.3 percent to 6.8 percent.

The entire market volume grew 17.4 percent to 270.9 million units. Gartner predicts global phone sales will reach 1.13 billion units in 2007.

Market growth was once again fueled by demand in emerging markets in Africa, Latin America and Asia Pacific, but also the more mature markets in Western Europe and North America picked up, said Gartner mobile devices research director Carolina Milanesi. "Apple stole the limelight in the quarter with the introduction of its iPhone in North America in the last two days of the quarter," she explained. "But we will only be able to assess Apple's impact in the quarters to come."