A very accurate predictor of the current Quarter smartphone sales trends is a population-weighted average of the most recent Kantar numbers of the current quarter, compared to the previous quarter. We've now seen the pattern for many quarters and Kantar's numbers foretell very accurately what is the global reality on a very short term view, ie now in late December, with November sales data, we have a good view to Q4 (October-December) quarter sales.
Windows Phone 8 was supposed to excite the world and restore Microsoft and Windows to smartphones (yeah, when have we heard that before, and before, and before, and before). Nokia's brand new Lumia 920 and 820 were supposed to be the best Windows Phones ever made and somehow magical in restoring Nokia's past glories from America to China. With the parallel launch of Windows 8 for the PC environment, the Microsoft powered ecosystem was supposed to be on a big comeback. Well, I don't specialize in the PC world but rumors from that side suggest Windows 8 has been far worse in its early adoption than say Windows 7 was. This does not suggest a glamorous Christmas Quarter for Redmond on its main business. Well, at least we have the new Nokia Lumias and the HTCs and Samsungs and others doing the 'magnificent' new Windows Phone 8 smartphones, right? Enter Kantar.
KANTAR SUGGESTS WINDOWS PHONE SALES ARE DOWN FROM Q3 !!
Kantar always gives us some of its markets it studies, not all. This time from the November 2012 stats they published, we have a good comparison to September Kantar data (both before Windows Phone 8 launched, and data that was reported in Q3). The regions that Kantar reported both in September and November are the European big 5 countries ie EU5 (Germany, France, UK, Italy and Spain), plus the USA, Australia and Brazil. When we take the population-weighted averages of those four regions, and calculate the Windows Phone market share then and now, we get this finding:
Kantar numbers population-weighted average for these 4 regions in Q4 suggested a global average market share for Windows Phone to be 5.3% (don't worry that the reality was only 2%, remember this is not a 'globally representative' sample of Kantar data, this sample strongly over-samples Windows OS's best markets, USA and Europe, and ignores the huge smartphone markets where Windows is negligable, such as China, India and Japan. The point we want, is to compare Kantar last quarter vs Kantar now.
What does Kantar measure for those same four regions now, for November? The weighted average of those same four regions says Windows Phone new sales market share has fallen to 3.8%. Yes, a drop of one third! So what was 1.9% global Windows Phone market share in Q3, these Kantar measurements suggest that after Windows Phone 8 was launched, the global market share for Windows Phone is now crashing to 1.3%. We rounded it to 2% last quarter (was almost 3% in the previous quarter) and Kantar numbers suggest we will round off the Windows Phone market share for Christmas at 1%. That is catastrophic.
Now, remember, the Christmas Quarter, Q4, October to November, does always feature a big jump in smartphone sales. I am modelling a 30% jump from Q3 data. So while the Windows Phone market share is down by a third (according to Kantar measurements) the actual sales are not down by much. If the global smartphone market grew 30% for Christmas, then the total global Windows Phone sales (both platforms, old Windows Phone 7.x and new Windows Phone 8) would be about 2.9 million units.
By The Way.. I did warn you, that the new Lumia 920 and Lumia 820 sales will underperform at Nokia compared to the first Windows Phone launches a year ago. I explained what factors were wrong, mostly in the executive management by Stephen Elop the CEO, who raised prices, not lowered them - raising prices means less sales. Who also limited his carrier relationships, limited distribution means less sales than broad distribution. Etc Etc Etc. I told you so...
ANY OTHER CONTRADICTORY DATA?
But wait, how about China! Yeah, Nokia's Lumia 920T that will launch for China Mobile on the Chinese proprietary 3G standard, TD-SCDMA, will not launch until January. So no help there. What of other Chinese smartphone sales on Windows? Informa has just reported that Windows Phone market share in China is 1%. When Analysys, Gartner and IDC have given China numbers for their latest reports, none mentioned Windows Phone at all, it is that small.
So don't expect miracles out of China. What other news? HTC is so disappointed in Windows Phone 8, it is withdrawing its lowest-price (best-selling) Windows Phone smartphone, the 8C from many markets including the US. And Samsung? Is focusing on its new Tizen devices for next year, don't expect Sammy to waste too much of their marketing efforts on the undesirable Windows platform right now.
Kantar numbers suggest Windows Phone, after Windows Phone 8 has launched, will still sell less than Windows Phone did in Q3? That is very bad news for Microsoft and for Nokia. But now lets look at the shocker.
SYMBIAN SALES GROWING SUGGESTS KANTAR
And this second bit of data must be devastating for Espoo and anyone near Nokia strategy. It is now 9 months from the last new Symbian based smartphones released by Nokia. The model range is obsolescent. The customers are being peddled new Windows Phone based smartphones instead. Yet those old pesky Symbian based Nokia smartphones have many of the features and abilities that Nokia owners want - like great cameras, like real physical QWERTY keyboards, etc. And what does Kantar data suggest? Those 4 Kantar-reported regions, weighted average suggested Symbian sales in Q3 of 7.7% in these four regions. And now? They suggest 7.5% market share for the same four regions. After we factor in the growth in sales for the Christmas quarter, the data suggests Nokia Symbian sales have jumped from 3.3 million to 4.3 million !!!
KANTAR NUMBERS SUGGEST 6.8 MILLION TOTAL NOKIA SMARTPHONE SALES
Like I said, the Kantar numbers are very accurate in short-term forecasting smartphone OS platform performance for the current quarter. And these findings suggest total Nokia smartphone sales of 6.8 million units for Q4 which they also suggest, would split 4.3 million on Symbian (and MeeGo), and 2.5 million on all Lumia, old and new, on Windows Phone. So compared to Q3, when Nokia only sold the 'undesirable' and suddenly 'obsolete' early Lumia smartphones, and now when the new Windows Phone 8 has launched, Nokia Windows based smartphone sales would be down by 13% while the industry grew 30% in the same period (real effective loss in unit sales of 43% in a 3 month period, after the new platform had launched). I call this a disaster.
And the customers? They refuse Windows Phone but they still accept Symbian (and MeeGo). So Symbian/MeeGo sales would be up - based on the Kantar numbers - from 3.4 million in the last quarter to 4.3 million now - an increase in absolute terms of 27% in Symbian sales from 3 months ago, but after we factor in the market growth, its slightly less than the 30% growth of the market, so Symbian would only lose 3% of its share in this past 3 months - with utterly obsolete and uncompetitive phones! (and zero management support of any kind). Incidentially, my recent spot-check of Chinese online sales of handsets found two Lumia devices as Nokia's bestselling smartphones in China. And two Symbian devices - the 808 Pureview and ... the N8 !!! (Why does moron-CEO Stephen Elop not give us a Lumia with 12mp camera, if the N8, at two YEARS of age, still is a top 5 bestselling smartphone in the biggest smartphone market on the planet? Hello?)
And do you really want to cry? Nokia' second best-selling smartphone in mid December online sales in China was.. the N9 running MeeGo. A smartphone that is 15 months old, but still outsells all Lumia smartphones except one and outsells all Symbian smartphones by Nokia. Why is idiot Elop not fully supporting the N9, selling this magnificient smartphone in every market, and launching its sister phone the N950 to the world? What is wrong with the brain of the CEO? And why is the Board still allowing the clueless Microsoft Muppet to run Nokia. He should have been fired long ago. The worst CEO of all time! (PS the continued very strong sales of the N9 and MeeGo suggest very promising starts for two new smartphone operating systems that launch next year - Sailfish the MeeGo next version that will power Jolla smartphones from Finland; and the Tizen alliance which will see first smartphones launched by Samsung and Lenovo in 2013. Tizen is what Samsung too of Nokia-discarded MeeGo and its partnership, and transformed now as a Samsung-led Tizen alliance. With such partners - PARTNERS - as NTT DoCoMo, Sprint, Telefonica, SK Telecom etc - some of the biggest mobile operators/carriers in the world)
If Nokia smartphone overall number is 6.8 million for Q4, that would be slightly up, 8% up, from Q3 and no doubt, the snake-oil-salesman ultimate spin-doctor-in-chief Stephen Elop of Nokia would proudly celebrate that his smartphone unit had growth. Don't be fooled, as the market grew 30%, it means effectively Nokia lost more than one fifth (in mathematical terms, the competitive decline is 22% of its market share last quarter) of its feeble remaining market position just over the past 3 months. Not 'grew by 8%' but rather, lost one fifth of what remained. Nokia's market share in smartphones - which was 29% just 24 months ago - would now fall from 3.7% in Q3 to 2.7% now in Q4. This, if Kantar's numbers are accurately indicating the total global market reality. Do remember, that Brazil is included in this data, so its not just the rich world markets we are looking at.
WINDOWS PHONE EVEN WORSE
And Windows? The Kantar numbers do suggest Windows Phone sales collapsing from Q3 to Q4. Market share falling from 1.9% to 1.3%. Total global Windows Phone sales falling from 3.3 million in Q3 to 2.9 million now in Q4. What collaborative data do we have? We hear that in most markets the Windows Phone based Nokia Lumia smartphones have been selling out. Selling out sounds good. Until we see what trick Nokia CEO has now been playing. The Next Web quotes Elop and runs a story on 20 December explaining that Nokia has deliberately run low initial rates of Lumia 920 and 820 unit production for Christmas, to help create buzz and demand and a feeling of success. Elop admits in his CNet interview on 21 December that "there's frustration due to limited supply. Our focus is on broadening distribution."
Deutche Bank analysts have severely downgraded their Lumia sales numbers saying their market checks reveal far lesser actual sales than initial hype suggested. And remember, if the mix of Windows vs Symbian phones is now reversing to more Symbian, it means Nokia average sales prices would plummet for Christmas, and likely loss-making in the smartphone unit again increase. Last Quarter the Windows Phone unit made a 49% loss per every Lumia smartphone sold. How much worse can it get?
Then the other Windows Phone partners? I mentoined HTC reducing its Windows Phone 8 offering, including pulling the HTC 8C from many markets and not launching its large screen Windows Phone smartphone. HTC is focusing on where the profits and customers are - on Android obviously.
We'll see soon enough in January, but yes, I am now quite confident in my previous early gut-feeling forecast number that 6.8 million is roughly the level of Nokia total smartphone sales for Q4. The mix of Lumia on Windows Phone vs Symbian is very likely to switch to more Symbian!! So I expect Nokia to have about 63% of its smartphones now in Q4 running still on Symbian/MeeGo and only 37% running on all variants of Windows Phone.
Meanwhile, globally, Windows Phone would have something in the order of 1.3% market share for Christmas and sell 2.9 million units. It would still remain smaller than Symbian now 22 months after Elop decided to sacrifice Symbian and MeeGo instead of Windows Phone. When Palm - once the world's second biggest smartphone platform - had fallen to about 1% market share (and very unprofitable), it had its mercy killing, being sold to HP and ended. How long will Ballmer keep the massive-losses-generating Windows Phone platform even alive? It will soon go the way of the Kin and the Zune and Microsoft will shift its focus only on the PC and tablet side of the Windows 8 operating system.
How long does Nokia have as a company? I said a year ago it was a dead-man-walking. I expect Nokia to be sold any day now.. In reality, lets see how the US fiscal cliff is sorted out, some sanity and stability is restored to Wall Street, and perhaps all those giant tech and consumer electronics giants sitting on billions of cash, will finally feel it safe enought to start the bidding war on the corpse that is Nokia, mostly obviously for its rich patents portfolio - did you notice again, Nokia picked RIM's pockets again on a patents fight, like it did with Apple about a year ago, etc. So realistically? Lets say a good time frame for when the Nokia take-over battle will happen could be around February-March'ish of 2013.
For those who took part in our Crowd-sourced forecast, remember, a little over a year ago, I asked my Twitter followers to suggest what market share Microsoft Windows Phone would have now at Q4 of 2012. The forecasts ranged from 0.4% to 43.2% with the average suggested at 10.1%. Haha, if Kantar numbers do foretell a reality near 1.3%, then currently the nearest guesses are with Gibson Tang, Maarten Lens-FitzGerald, Josie Fraser and Ben Fletcher. Good luck to all contestants. See the full contest and all entries here: Crowd-sourcing a forecast for Windows Phone.
Note: an early edition of this blog posting mistakenly identified the HTC handset as 8X when it is the 8C that is being pulled. The blog is now corrected.
One plug - For anyone who needs data and numbers on the handset industry, remember my TomiAhonen Phone Book with all the charts, numbers, data you would ever need to know, in a convenient pdf eBook formated for small screens so you can carry all the data right on your tablet or smartphone.