Final 2009 mobile phone market numbers as all have reported: we have big news

Now as RIM has been the last of the significant mobile phone handset makers to report quarterly sales numbers that relate to the 2009 calendar year, we can close the fourth quarter of 2009. We can also close the year 2009 and we can close the decade. RIM came in as expected in market share, did not cause a major surprise to readers of our blog, but I do have a 'bombshell' in the big picture mobile phone handsets market share picture. We have a new entrant into the Top 5, and obviously one of the global brands that for ages has been thought of as a 'big 5' is no longer a big 5 handset maker. Obviously Nokia, Samsung and LG are too big so they are safe. We have one of SonyEricsson or Motorola dropping out of the Top 5. And who is the newcomer?

Its a decade gone by. Wow. When I joined Nokia in 1998 we were not even the world's biggest handset maker haha. Now the world has seen not only the mobile phone decade, but also the Nokia decade, as today Nokia is the world's most widely spread brand. Not just tech brand, any brand. Has bigger market share of global population than Coca Cola, Levi's or McDonalds haha. (just in case, for those random readers who don't know me, I left Nokia HQ in 2001 to start my own consultancy, so I've been independent since then. This is not a blog of a current Nokia employee haha.) So yes, lets do a bit of a look back. Don't worry, this is not 'another long Tomi blog' haha.

TEN YEARS AGO

Ten years ago as 2000 started, for the year ended, ie the full year 1999, the mobile phone handset industry sold 280 milllion mobile phones. Many so-called 'experts' and analysts suggested mobile phones were at near saturation. The world had half a billion mobile phone subscribers. There was no 3G, there was no mobile internet apart from some ultra-expensive gadgets or Japan. Smartphones sold a couple of million units and most PDA makers felt a smartphone would never pass PDA's in sales. And apart from Scandinavia essentially nobody thought that phones would be used (at least by 'normal people') for anything else except voice calls. And yes, a mobile phone was not seen as a teenager thing (outside of Scandinavia). Ten years ago for the full year 1999 the world's largest handset maker was Nokia with 27% market share, about 50% bigger than its number 2 rival, Motorola at 17%. Ericsson was third biggest at 11%, Panasonic fourth biggest at 7% and Samsung had just become the fifth biggest handset maker at 6% passing Siemens.

Since then in the past ten years, the mobile phone industry grew to five times its size. The global mobile phone subscriber base grew to 9 times its size. Out of the top 5 biggest makers ten years ago, Panasonic fell out of the Top 5 at the start of the decade. Ericsson struggled, joined forces with Sony and the combined SonyEricsson gradually fell towards the bottom. Meanwhile South Korean LG joined the top 5 in 2004. As we went into 2009, for the end of 2008, the top 5 were in order: Nokia, Samsung, Motorola, LG and SonyEricsson. And as we have learned from Nokia earlier this year, the world' sold 120 million 'unlicensed' ie pirated phones. I have adjusted the annual sales figures (for all years in the past decade) to reflect the pirated phones as well.

MOBILE PHONE FINAL MARKET SHARES 2009

So, now we have the final numbers. And it looks like this for the top 10 biggest mobile phone handset makers for 2009. Note that these numbers (including last year's market shares) have been adjusted for the unlicensed ie pirated phones, so note, 'last year' numbers have also been adjusted. So I am not 'fiddling with the numbers' where earlier reports had Nokia 2008 market share at 39%, Samsung at 16%, Motorola at 9% etc. All have been adjusted to include the pirated phones.

Here are the final market share numbers for all top 10 biggest mobile phone manufacturers for 2009 including the 2008 market share in parenthesis:

1.   Nokia .............. Finland............432 million.....34%  (36%)
2.   Samsung..........South Korea.....227 million.....18%  (15%)
3.   LG....................South Korea.....118 million.....  9%  (7%)
4.   ZTE..................China.................60 million.......5%  (4%)
5.   SonyEricsson....Japan/Sweden....57 million......5%  (7%)

6.   Motorola............USA..................55 million.......4%  (8%)
7.   RIM...................Canada..............35 million......3%  (2%)
8.   Huawei..............China.................31 million......3%  (2%)
9 .  Sharp................Japan.................27 million......2%  (3%)
10. Apple.................USA..................25 milllion.......2%  (1%)

All other branded phones....................74 million.....6%  (6%)
Pirated 'unlicensed' phones..............120 million.....10%  (8%)

Total sales for 2009........................1,260 million (=1.26 Billion) (was 1.31B in 2008)

We knew to expect it, but still this was big. ZTE out of China did surprise us by how quickly they did it, and how they not only passed Motorola for 5th place, which we were expecting about now, but also passing SonyEricsson to become world's fourth biggest handset maker for the full year 2009. They sold a very impressive 60 million handsets and are already bullishly promising 80 million level sales for this year. Congratulations ZTE ! They also become the first handset maker from the Emerging World markets to become a top 5 handset manufacturer. They are also the first newcomer in the Top 5 since LG displaced Siemens seven years ago.

The players moving up in market share, compared with 2008, were Samsung, LG, ZTE, RIM, Apple. The ones going down were Nokia, Motorola, SonyEricsson and Sharp.

Otherwise in the chart, RIM is of course the biggest 'pure smartphone maker' in the world while Nokia of course makes more smartphones as part of its total mobile phone portfolio. Of the others in the top 10, only Apple joins RIM as a 'pure smartphone maker' coming in at tenth.

And very demoralizing news for Motorola, which has now fallen out of the top 5 for the first time in their history. How total has been their recent market failure. Since their brief Razr-powered 'surge' - they hit a peak of 21 percent global market share as recently as 2006 - they now are down to one fifth that peak at 4% and crash-diving (their market share fell by half in just one year, they were third biggest at 8% in 2008).

Hey, while we're on the topic, check out Nokia in 2009 compared to a decade ago. Their rivals have all bounced positions, former number 2 is now number 6, current number 2 was once number 5. Nokia held market share all decade as number one, at every time, every single year, they were at least 50% bigger than number 2 and every year as big as number 2 and 3 put together, often as big as numbers 2, 3 and 4 put together. Thats not bad performance in an industry that was so volatile, that it grew 5 times in size in only ten years.

TOTAL DECADE SALES

I want to mention an interesting view to the decade as well. We now can count the total decade-wide sales, the ten years January 2000 to December 2009. The top 5 are worth menitoning (the others are far smaller)

1. Nokia................................2.8 Billion......34%
2. Motorola............................1.1 Billion.....13%
3. Samsung...........................1.0 Billion......12%
4. SonyEricsson.......................600 million...7%
5. LG.......................................500 million...6%

other branded......................1.8 Billion.....22%
unlicenced..........................   500 million...6%

TOTAL sales 2000-2009........8.3 Billion

Some stunning numbers there..  And there is an interesting pattern. Moto and Samsung running very close to each other. SonyEricsson and LG also running very close. huge jumps between those groupings. oh, and for the full decade? Nokia more than twice as big as number 2, and as big as numbers 2, 3 and 4 put together.. not bad for the little Finnish company that once made rubber and paper as its main products.

SMARTPHONE FINAL MARKET SHARES 2009

I know you want the smartphone picture. Remember, smartphones are only 14% of the total market. The real battle today is on the top of this blog posting, not the bottom. but yes, this is the 'hot' story part. So lets get to final end-of-year 2009 numbers in smartphones.

1. Nokia...........Finland........68 million.....39%  (41%)
2. RIM..............Canada.......37 million.....20%  (16%)
3. Apple............USA...........25 million.....15%   (7%)
4. HTC..............Taiwan......... 9 million......5%   (5%)
5. Samsung......South Korea...7 million......4%   (2%)

For the full year from 2008, RIM, Apple and Samsung grew, Nokia declined and HTC held steady. Motorola's high-stakes gamble into smartphones did not see them climb into the top 5 of smartphones (and did not reverse their catastrophic decline in total handset market). SonyEricsson's long history in smartphones also did not get them back into top 5. Palm keeps losing market share (a decade ago they were second largest smartphone maker). Fujitsu lost its number 5 position to strongly surging Samsung. Nokia has better market share in smartphones than mobile phones overall, and is almost twice as big as number 2, and as big as its two biggest rivals put together.

While looking at the race by operating systems, we get this picture

1. Symbian (mostly Nokia).............80 million.....46%  (54%)
2. RIM (Blackberry).......................37 million.....20%  (16%)
3. Apple (iPhone)..........................25 million.....15%   (7%)
4. Windows Mobile (mostly HTC)... 11 million......6%  (12%)
5. Google Android (mostly HTC).......7 million......4%    (1%)

The big gorilla, inspite of all the Admob stats and US centric tech pundits, is Symbian, bigger than Blackberry, iPhone, and all Windows Mobile and Google Android smartphones put together, in 2009. But which tech analyst even remembers to mention the biggest smartphone operating system on the planet, Symbian? But yes, it took a big hit in 2009 as it moved to Nokia's ownership and many of Nokia's rivals who used to be part-owners of Symbian and had been making Symbian smartphones shifted away to mostly Google Android. The big winners RIM, Apple and Google Android. The big loser is Windows Mobile which lost half its market in 2009.

Note that this picture is changing dramatically in 2010, because during 2009, the main handset maker of Windows Mobile smartphones, HTC, switched to Android. Most of Android sales were in the fourth quarter, so Android is already outselling Windows Mobile now in 2010. Meanwhile Samsung - which offers smartphones on Symbian, Windows Mobile and Android platforms and continues to support all those - has launched its own operating system Bada, and its fair to expect that Samsung will put primary emphasis to Bada. So expect some of Symbian, Windows Mobile and Android market shares that in 2009 were attributed to the fifth biggest smartphone maker Samsung, to shift to their new operating system in 2010.

There you have it, the full year picture in market shares, in mobile phones and smartphones.

Comments

[A. Zammit]

It is unreal how on the ball Tomi is. I don't know how he does to keep up with everything in the ever rapidly growing industry. He always seems to be ahead of the news and where things will end up. It's nice to get a perspective of how these mobile wars are playing out. It makes you wonder if it's a battle of the OSs or battle of Hardware. Who will be the players that last? Who will die off? Will there always be this much competition? One thing is for sure. Tomi is there to cover it all! keep up the good work.

[Bob Holt]

Depending on what you are looking at the operating system numbers for Apple should be doubled since the itouch runs the same operating system and, while no one but Apple knows for sure, seems to be selling at a somewhat faster rate than the iphone.

Speaking of the future, there was an interesting article pointing out that the itouch servers as a "farm system" for the iphone. All of those preteens and teenagers using itouch's getting ready to move to iphones. I certainly see that in my daughters high school.

No one else has such an eco system and I suspect it spells problems for others in the phone industry.

[Dardano]

Look at Apple, they more than doubled their market share from 7% to 15% in just one year, I think they're on a roll and who says they won't double it again in 2010? iPhone 4G anyone? 5 bucks they'll do it and in a year from now you'll be reporting Apple with 30%, RIM with like 22% (i dont think they'll grow much due to competition from others and their phones are ugly and clumsy to use), Nokia will go down to around 35% the way they've been innovating the last few years comes at no surprise and the rest who cares those three alone make up almost 90% of the market, Android will grow and eat all of WinMo's shares and some of Nokias and RIM's.

I obviously think Apple has the platform of the future since almost everyone I know has an iPhone or wants their next phone to be an iPhone (Switzerland here), it's crazy but Apple has brought out a MUST-HAVE product as it appears to be and although I don't own one I also want my next phone to be an iPhone. I like the fact that the iPhone has an integrated iPod, that I think is the biggest selling point and then the ease of use and pleasure to the eye (software and hardware). However, they can only grow with that propensity if they cover all their bases; For one, they need additional form factors because with only One phone it's tough since a lot of people hold back due to lack of a physical keyboard, then there are lack of basic functionality like multi-tasking, they also need to get rid of exclusivity deals with carriers, they need to put iPhones in every shelf of every carrier.

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These data from mobile phone market surprise us. The competition between different brands of the mobile phone becomes tight.

[Polly]

Look at Apple, they more than doubled their market share from 7% to 15% in just one year, I think they're on a roll and who says they won't double it again in 2010? iPhone 4G anyone? 5 bucks they'll do it and in a year from now you'll be reporting Apple with 30%, RIM with like 22% (i dont think they'll grow much due to competition from others and their phones are ugly and clumsy to use), Nokia will go down to around 35% the way they've been innovating the last few years comes at no surprise and the rest who cares those three alone make up almost 90% of the market, Android will grow and eat all of WinMo's shares and some of Nokias and RIM's.

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