Smartphone Market Shares at Q2 and Report Card for Half-Year Performance

We now have all info from the major smarpthone manufacturers on their Q2 results, and we have the four big analyst houses (Gartner, IDC, Canalys and Strategy Analytics) each giving their final count of Q2 total smartphone market. I am able to do the market shares and with considerable confidence. So what is our big number? Taking the average of the big 4 analyst houses, we get the Q2 number at 108.0 million smartphones sold in the quarter, up 7% from Q1. And obviously if your company grew by about 7% then you were only keeping up with the industry growth. Any faster growth means you are taking market share and slower growth means you are abandoning market share.

MARKET SHARE TABLES

Some who come to this blog will want the analysis, but others only want the big headline numbers, so here is the Top 10 Smartphone Manufacturers (and below it the Top 7 operating systems too)

Rank . . Brand . . . . . . . Millions sold . . . . . . Market Share Q2 . . . . (market share Q1)

1 . . . . . Apple . . . . . . . 20.3 million . . . . . . . 19% . . . . . . . . . . . . . (18%)
2 . . . . . Samsung . . . . 17.8 million . . . . . . . 16% . . . . . . . . . . . . . (13%)
3 . . . . . Nokia . . . . . . . 16.7 million . . . . . . . 15% . . . . . . . . . . . . . (24%)
4 . . . . . RIM  . . . . . . .  13.3 million . . . . . . . 12% . . . . . . . . . . . . . (14%)
5 . . . . . HTC . . . . . . . . 12.2 million . . . . . . . 11% . . . . . . . . . . . . . (10%)
6 . . . . . LG . . . . . . . . . . 5.4 million . . . . . . . . 5% . . . . . . . . . . . . . (  5%)
7 . . . . . SonyEricsson . . 5.3 million . . . . . . . . 5% . . . . . . . . . . . . . (  5%)
8 . . . . . Motorola . . . . . . 4.4 million . . . . . . . . 4% . . . . . . . . . . . . . (  4%)
9 . . . . . Huawei . . . . . . . 4.0 million . . . . . . . . 4% . . . . . . . . . . . . . (  2%)
10 . . . . ZTE . . . . . . . . .  2.7 million . . . . . . . . 3% . . . . . . . . . . . . . (  2%)

Others 5.9 million 5%
TOTAL 108.0 Million

That is by manufacturers (please see below for analysis which also explains how I arrived at some of the numbers like the total for Samsung etc). Here is the operating system market share table:

Rank . . . Operating System . . Market Share Q2 . . . . . (was market share Q1)

1 . . . . . . Android . . . . . . . . . . 45%. . . . . . . . . . . . . . (35%)
2 . . . . . . iOS . . . . . . . . . . . .  19% . . . . . . . . . . . . . . (18%)
3 . . . . . . Symbian . . . . . . . . . 16%. . . . . . . . . . . . . . (25%)
4 . . . . . . Blackberry . . . . . . .  12% . . . . . . . . . . . . . . (14%)
5 . . . . . . bada . . . . . . . . . . . .  5% . . . . . . . . . . . . . . (  3%)
6 . . . . . . Phone 7 . . . . . . . . . . 1% . . . . . . . . . . . . . . (  2%)
7 . . . . . . Windows Mobile . . . . 0.5%  . . . . . . . . . . . . (  2%)
Others . . . . . . . . . . . . . . . . . .  1% . . . . . . . . . . . . . . (  1%)

Feel free to quote the stats, link to this site and use at your convenience in any context. For the above numbers (and all in this blog) please use as your source: TomiAhonen Consulting August 2011. (for those who need more info on the handset industry numbers, please consult my TomiAhonen Phone Book 2010 statistical volume; or for those who want to understand the larger mobile telecoms industry including the carrier business, mobile voice, data, messaging, internet etc, please see TomiAhonen Almanac 2011).

Now lets go to the handset manufacturers, in the order of size, starting with the new number 1:

APPLE - 19% MARKET SHARE - PROFITABLE - GRADE A

Apple took the crown from Nokia and it wasn't even close. In Q1, Apple was 23% smaller than Nokia in smartphone unit sales; just one quarter later Apple is 21% bigger! Now, to be fair, Apple only grew 9% in iPhone sales from Q1 - the huge shift was due to the Nokia collapse (Nokia fell 31% in the same period). While normally for most smartphone makers, I would be saying that 9% growth, when the market itself grew 7% is not particularly strong, its barely faster than the industry - this was a strange Q2 for Apple. Usually Apple releases its new iPhone on the last days of June and gets several million more sales for Q2. This year Apple is waiting (rumors say its because of the redesign after Apple tried to create a SIM-free iPhone but the carriers revolted and said no way - a SIM-free iPhone would in effect bypass the carriers and reduce them to bit-pipe operators). We can be sure that when the so-called iPhone 5 will be launched (rumors say end of September) then we will again see people standing in lines and buying it in huge numbers setting world records for new smarpthone sales. So considering Apple's "obsolescent" product line - only the CDMA variant (so-called Verizon iPhone) and the iPhone White were the recent news - Apple's growth faster than the industry is truly remarkable. The iPhone 4 is literally over a year old now and still growing sales. Astonishing. And yes, Apple has the best loyalty, the biggest desirability, which it intelligently transfers to the highest profits in the industry. Their sales will surge when the iPhone 5 is released, and if the rumors about a lower-cost 'Nano' iPhone are true, it could be a phenomenal Christmas for Cupertino. From Christmas when Apple had only 16% market share, they have picked up 3 points in this very tough year, while having by far the most expensive smarpthones. Excellent. So its a clear Grade of A for Apple for the first half of 2011.

SAMSUNG - 16% MARKET SHARE - PROFITABLE - GRADE A+

If there is perfection in execution in smartphones in this year 2 of the Smartphone Bloodbath, that is Samsung. They grew in this past Quarter by a whopping 41% to 17.8 million units (because Samsung has not provided officially their smartphone shipment number for Q2, I am using the average of the three analyst houses who gave a Samsung number, which gives me the 17.8 million number). This is by far the biggest growth of any smartphone maker in the quarter and a growth rate of almost 70% in the first half of this year. Samsung has a genuine hit phone series in the Galaxy, an Android based premium phone.

Samsung also has a new hit OS platform for low-end phones, in the bada operating system, which sold 5.4 million units in Q2 and for the first half of 2010 has sold 8.9 million smartphones. Since its launch five quarter ago, bada has accumulated 14.2 million smartphones sold - this is by far the best launch of any new smartphone OS, even better than the iPhone or better than Android in the comparative period of their launch. Obviously compared to its famous big brand launch (Microsoft's Windows Phone), bada has now outsold all new Windows Phone smartphones by over 3 to 1. bada grew its sales 54% in just the past quarter. I also calculated the split of Android/bada/Microsoft smartphones for Samsung for those who are interested in such things - and I get 69% Android, 30% bada, and 1% Microsoft out of all Samsung branded smartphones sold in Q1. Samsung as a corporation is suffering from the global economic weakness in some of its other units like plasma screen TVs and microchips, but its mobile phone handset unit is generating healthy profits for Samsung corporation and is a bright light to the company. When you are able to make profits and grow unit sales faster than anyone else - and capture large chunks of market share (Samsung had 11% market share in Q4), this is the best grading for H1, Samsung gets an A+

NOKIA - 15% MARKET SHARE - LOSS-MAKING - GRADE F-

Nokia has collapsed totally. In Q4 of 2010, Nokia's smarpthone unit was as big as all smartphones made by Apple and Samsung combined, today Nokia has fallen behind both. In Q4 Nokia made more than half a billion Euros of profits in its smartphones unit, this Q2 Nokia's total handset unit has become unprofitable and its smartphones unit generated a loss of almost 150 million Euros. The sales of Nokia's Symbian based smarpthones crashed comprehensively after February 11, when Nokia CEO Stephen Elop in what will go down as one of the biggest and costliest management blunders in history, told the world that Nokia will end its Symbian production, and will not pursue the previously-announced MeeGo based smartphone path for migration - but rather will switch to Microsoft based smartphones. And this bizarre statement was done saying Nokia would not use the current Microsoft system(s) but rather will wait for a later Microsoft Windows Phone 7 based OS which means the first Nokia smartphones running Microsoft would not be sold until the end of the year at the earliest. This bizarre announcement in February, with no phones to sell until December, has caused what is commonly known as the 'Osborne Effect' (nobody wanting to buy the current models because the company itself has announced they are obsolete) and unfortunately Nokia had dozens of new Symbian based phones coming out of its pipeline. We heard in July that another 10 more Symbian based phones will be released this year - all to comprehensive market rejection.

So, Nokia was the world's biggest smartphone manufacturer by a huge margin just six months ago, makign healthy profits - in fact, Nokia's newest Symbian S^3 based smartphones were such a hit, that Nokia profits in the smartphone unit surged 68% in Q4. Nokia had seen unit sales grow, average sales prices grow (by a Nokia record!) and profitability grow (massively). Now the CEO has killed all that growth and in turn made Nokia Symbian phones instantly undesirable. The Nokia dominant market share of 29% in Q4 has fallen by half to 15% today (and the trend is unstoppable, because of the Osborne Effect and as Nokia cannot retool its factories, Nokia can not produce any other except Symbian-based smartphones in large volumes this year, so Nokia market share will fall by another half to 7% by Q4 of 2011, before the first Microsoft-based smartphones can even be released).

Nokia was 23% bigger than its nearest rival (Apple) just three months ago. Now all smartphones selling with a Nokia brand, are 21% smaller than the iPhone. And this while Apple delayed its launch of the iPhone 5... Nokia average sales prices are down, its unit sales have collapsed, its market share is in freefall - and for the unit of Nokia that was a lock for generating profits - the handset unit has never reported a loss to Nokia - for the first time now in Q2, Nokia reported a loss in its handsets unit. And the profit engine of handsets, smartphones - are now producing the lion's share of the losses of Nokia. That is execution at the very worst way imaginable. We are witnessing the most rapid destruction of any brand, not just in mobile phone handsets, but in the total tech history. There are absolutely zero positive news from Nokia. What the management now is doing, is not attempting to restore Nokia sales by cancelling the dead-end Microsoft path, rather they now are changing the naming of Nokia phones and changing the advertising agency of Nokia. (this is like rearraning the deck chairs while the Titanic sinks)

In perhaps the most bizarre twist of incompetence in Nokia CEO, it is a very rare occurance that a phone manufacturer faces a true hit phone. Nokia was gifted that in its development of the N9 smartphone powered by Nokia's home-grown MeeGo smartphone OS (the newest, most advanced, most open-source, Linux based OS that had a migration path for Nokia's massive application developer community, from Symbian). The N9 has had almost unprecedented strong response from early reviewers and tech press. The MeeGo OS has been compared favorably even to the iPhone OS and seen as better than Android and anything else on the market. The N9 is in huge demand worldwide and is even seen by some tech analysts as a legitimate 'iPhone killer' superphone for Nokia. It is very rare for any phone maker to have a hit phone - Samsung has one now with the Galaxy from last year. Apple's iPhone was the previous hit phone from 2007, and the previous global hit was Motorola's Razr two years prior to that. It is rare to find a hit phone. And the N9 has every element to be such a superbly desirable premium phone. And best of all, Nokia has even a ready sister phone to the N9, a QWERTY variant called the N950, both ready to manufacture and sell now. So what does CEO Stephen Elop do? He refuses to sell the N9 in most of Nokia's biggest and best markets like Germany, the UK, Italy, India etc. In the USA where Nokia's Symbian had been failing the longest, we just heard that even though USA based pundits and bloggers like the N9, Nokia will not release the N9 there either?

Only 29 countries will get the N9 and those are mostly very marginal tiny countries like the UAE, New Zealand, Norway etc. And the N950 will not even be sold anywhere. And the CEO Stephen Elop went on record with the biggest newspaper of Finland, Helsingin Sanomat - saying that "even if the N9 was a huge hit, there will be no further MeeGo based phones from Nokia." This is the level of incompetence that Nokia is now exhibiting. Even when faced with a genuine - and rare - hit phone - of premium price, premium profit levels - the CEO would rather force Nokia to eat massive losses, than let the N9 be sold in big markets (and refuses to sell the N950 anywhere). And he causes a second 'Osborne Effect' on MeeGo, so instantly stalling any possible excitement for the new phones and their advanced OS. This is sheer incompetence in smartphone management. 

Nokia is a disgrace to the industry, while the industry is in hypegrowth stage. This is far worse mismanagement than Siemens or Motorola or Palm (or Microsoft Kin). Nokia's free-fall means that by the end of Q3 they will have fallen behind HTC and RIM, and by Q4 will be passed by LG and SonyEricsson (maybe even Motorola and Huawei). Going from undisputed number 1 with 29% of the market to number 8 with 7% of the market, in a matter of 12 months, that is self-inflicted corporate suicide. When other manufacturers complain of shortages, Nokia factories are idling and Nokia suppliers cry of lack of demand from their biggest client. (And to add insult to injury, Nokia is not even using its idle smarpthone factories to manufacture their new Microsoft-based smartphones - because of the components etc, the factories are not capable of making the Microsoft-based phones, so the first Nokia branded smartphones are actually made by Compal of Taiwan, can you imagine! That you own the biggest, most efficient mobile phone factories in the world, then you force them to be idle, and you pay third parties to make your phones in sweatshops to far lower levels of quality than expected of Nokia branded phones. What madness is this?). I am not the only tech writer who has now suggested Nokia may disappear as an independent company over the next months to come. That is how badly Nokia is now being mismanaged. Oh, and if you thought a CEO doing an Osborne Effect was a sign of incompetence, have you heard of the Ratner Effect? Thats when you call your own products crap (and then are surprised that consumers stop buying, if the CEO says it of own products, that is instantly believed). Now we have a new standard, called Elop Effect, which is combining the damage of the Osborne Effect with the carnage of the Ratner Effect, and we get the Elop Effect.

But the numbers don't lie. If you go from big profits to big losses, if you go from growing unit sales to decline, if you go from being as big as your two biggest rivals combined, to smaller than either of them, if lose half your world-leading market share in a matter of six months - that is the worst performance of any company in the tech space ever. Ever. The worst performance EVER. I am sorry I can only award Nokia a grade of F-. They deserve much worse.

RIM - 12% MARKET SHARE - PROTITABLE - GRADE C-

Poor Blackberry. Two year ago they were happily growing and seemed to have fixed all their worries, the formerly North-America -centric Canadian smartphone maker had managed to find success in the far bigger international markets, and the previously business-phone brand had found a strong youth audience. All seemed peachy. And then it all went wrong. In the summer of 2009 RIM had its peak market share of 21% in smartphones around the world. Since then its been a steady decline, now selling 13.3 million units, a decline of 8% from Q1, RIM's market share is at 12% (and still falling).

As so many other pundits, I have been puzzled by RIM's predicament and have written my latest thoughts about it on this blog last week. I think RIM has two highly loyal and low-churn segments, but in both there is far less growth than in the overall smartphone market. Business users do not grow by the speed of the smarpthone market. Business/corporate/enterprise and government users of mobile phones were among the early ones to get them two decades ago, and were early onto the smartphone. So their growth period is long gone. Now most businesses have clear policies on what level job is entitled to a company-paid mobile phone, and that total pool is not growing significantly, especially not in the volatile economic climate right now (or the past three years). Its steady business for Blackberry but not growth. The youth market is good news, but there, the love is not for specifically the Blackberry phone handsets, its for the Blackberry Messenger service. And for that, any old Blackberry will do. The youth and young adult segment (16-24 year old) are the highest adopter rate of smartphones, so that age group has already mostly smartphones - the market in it is not growing - and worse for RIM, if a young user has a Blackberry in their pocket, they have no real strong need to upgrade it, the old BB works just fine. As this segment does typically have two phones in their pockets, what the youth do - is upgrade their OTHER phone for hte new HTC, Samsung, iPhone etc - so RIM has loyal customers here, who have no real interest in replacing their old Blackberry handset..

But with all that, RIM is selling to its steady loyal customer base, in ever smaller numbers. RIM's total sales per quarter level peaked this year in Q1, and now the overall unit sales are declining, not just market share. So against an industry that grew 7%, RIM sales of Blackberries declined 8% in Q2. That means an effective loss of 15% of where RIM was just three months earlier. That is bad. But, what sets RIM apart from most others who have bad results in Q2, while RIM is losing sales, it is generating profits. And to remain long-term viable as a company, selling whatever, you have to generate profits. So for the first half of this year, I am grading RIM with a C-. 

HTC - 11% MARKET SHARE - PROFITABLE - GRADE B

HTC has been growing nicely, faster than the industry, and making profits. But HTC's performance has fallen into the shadow of Samsung. And deservedly so. Samsung noticed how strong Android was, and prioritized Android over Microsoft Windows Mobile (the old obsolete version) and Microsoft Windows Phone 7 (the new, but incompatible version). When Samsung focused on Android for its top-end phones (and bada for low-end), Samsung was able to drive strong growth. HTC kept trying Microsoft until Q1 of 2011, when it finally threw in the towel. HTC said that of its total smartphone sales in Q1, 95% were on their 'Sense' platform (ie running Android). Thus only 400,000 total HTC smartphones - 5% of all that HTC made - were on the two Microsoft platforms, Windows Mobile and Windows Phone 7. They finally understood that to fight for Microsoft was a wasted effort (something that Android partners Motorola and LG had already, very vocally, said). HTC seems to be the perpetual bride's maid in the smartphone bloodbath, they consistently report good results, but always someone else gets a spectacular result so HTC is always in the next-best category. But they grew unit sales at 26%, grew market share by one point, and did this while making strong profits. A good performance, earns a grade of B

LG - 5% MARKET SHARE - LOSS-MAKING - GRADE C-

South Korean LG, the world's third-biggest mobile phone maker was late to smartphones and had a disasterous adventure into Microsoft-powered smarpthones that turned their profit-making handset unit into a loss-maker (sound familiar?), and LG abandoned that path and now is concentrating on Android. They have seen strong gains in the smartphone market shares as a result, passing Motorola in Q1 and now in Q2 passing SonyEricsson as well, to arrive as the 6th biggest smartphone maker with 5.4 million smartphones sold (growth of 15% from Q1). That would be a good performance except that LG is still making losses in its handset unit, so we cannot grade this as good performance. For all of the first half of 2011 LG's handsets have operated at a loss and LG now needs to get its business back into solid profit-making basis. LG is a giant electronics conglomerate so phones are not its ony business, but still, long-term viability in the smartphones does require a profitable business, and that is not what LG is delivering right now. Their market share gains are coming at the cost of giving away LG branded smartphones at below cost. So I grade LG at a C-.

SONYERICSSON - 5% MARKET SHARE - LOSS-MAKING - GRADE C+

Then we have Japanese-Swedish partnership, SonyEricsson, who have struggled to get their act together in smartphones for a long time. They were hit particularly hard by the original iPhone (at the time SE was growing strongly on the back of Walkman branded musicphones, that were mostly featurephones) and plunged into loss-making. They crawled back about a year ago and were making profits for 5 quarters in a row - but now the latest price wars, Nokia dumping prices and the bloodbath nature of the smartphone market has taken its toll on the modest SonyEricsson profits, they went back into loss-making.

In the market share meanwhile, SonyEricsson was growing at almost exactly the rate of the industry at only 8% from Q1, to 5.3 million smartphones and lost their number 6 smartphone manufacturer ranking to LG. This is not good performance but it is passable, for one quarter they managed a profit and they are keeping steady in the market share, so its not disasterous performance like some others, so I grade SonyEricsson for the first half at C+, with a warning, they need to fix the profitability issue now before things get worse in the second half.

MOTOROLA - 4% MARKET SHARE - LOSS-MAKING - GRADE D

Motorola Mobility as its now called since the loss-making former handset number 1 was split up last year, and following its long-held tradition of reporting losses (ever since the good old days of the Razr, long before Apple came onto the scene with an iPhone), Motorola Mobility once again reported losses. Its smartphone sales grew 7% to 4.4 million units which keeps Moto in 8th place among the smartphone makers. However, its slide back is not ending (Motorola was 6th biggest smartphone maker as recently as Q3 of last year). Now the Chinese are chasing Moto, and Huawei may well pass Moto-moto by next quarter. Do we need to say more? Motorola reported losses in both quarters and lost a point of market share in the past half-year with no good news in sight. I grade Motorola at a D.

HUAWEI - 4% MARKET SHARE - PROFITABLE - GRADE B

So in the Top 10 we've always featured some Japanese handset makers. This is the first quarter when the last fully Japanese makers are ousted (SonyEricsson being only half-Japanese and half-Swedish). The last two heroic Samurais of Sharp and Fujitsu were dumped by two hungry new Chinese brands Huawei and ZTE. Huawei is better known as the world's second-largest telecoms infrastructure maker (the big telecoms equipment such as the cell towers and related 'base stations' that cellular networks run on). They also are one of China's largest handset makers and cellular modem makers. They were dabbling in smartphones for a while but got serious about it last year. Huawei has not given a formal number for Q2 but they have said in early July that their full year will hit 20 million smarpthones. I am projecting from that on a strong growth pattern with typical mobile phone quarterly sales seasonality, that they would be doing about 4 million smarpthone sales in Q2. The math works out at a range of 3.8 million to 4.2 million, so there is not chance they'd yet have passed Motorola but they are well clear of Chinese rival ZTE. And we do not have solid numbers for Q1 so I can't give you an exact growth rate but I hope we will get more info from Huawei on a quarterly basis in the quarters to come. Nonetheless, a profit-making strongly growing smartphone maker who picks up market share, is a solid B grade for Huawei for the first half of the year.

ZTE - 3% MARKET SHARE - PROFITABLE - GRADE B

And then we have ZTE also from China. They also make telecoms equipment but are better known for being the world's fourth largest mobile phone handset manufacturer, growing very fast, specializing on low-cost handsets for example for India and Africa. ZTE much like Huawei was doing a bit of smartphones but got serious about it last year and focused like Huawei, on Android. They have also seen strong growth in smarpthones and we did hear ZTE tell us in July that they have sold 5 million smartphones in the first half of this year. I have broken that down as 2.2 million in Q1 and 2.8 million in Q2 so I project 27% growth rate in one quarter, but please note, its my projection, it could be less, we won't know until we see Q3 results how realistic that has been as a growth pattern. But also, like Huawei, ZTE does its growth by being profitable and thus they too earn for the first half of the year, a grade of B.

That was the top 10 handset makers. Note the absence of such 'major' brands as HP (who bought Palm, Palm was a top 10 maker) and such bold rivals who wanted to extend their PC leadership position into smartphones like Dell, Acer and Lenovo. Note that the Japanese traditional big smartphone makers like Sharp, Fujitsu and Kyocera are not in it anymore. And now 5 and a half of the top 10 makers are Asian-based (Samsung, HTC, LG, Sony(Ericsson), Huawei and ZTE). I think thats about right, as half of all the population of the planet, and half of all mobile phone users - are living here in Asia haha.. Now lets look at the smartphone operating systems also by size

ANDROID (SMARTPHONES ONLY) - 45% MARKET SHARE - GROWING - GRADE A

Google's Android is on a powerful roll. Google kindly keeps giving us their activation number update quite regularly and from that its relatively easy to count the total unit sales, project that to three month periods and get their market share. I counted about 49 million total Android sales in Q2 which is up 38% from Q1, an astonishing growth rate that is actually accelerating now (was 35% in Q1) this no doubt fuelled mostly by lower-cost Android smartphones that are eating up the free Nokia customer-give-away that Nokia kindly volunteered to hand over to its rivals this year. I have also done as I like to do, my market share split-up of the top Android manufacturers (see below). Also note, I have removed Android tablet sales from the total, so this is pure smartphones as it should be. I grade Android at an A.

iOS (iPHONE ONLY) - 19% MARKET SHARE - FLAT - GRADE B

Apple's iPhone is now the world's second largest smartphone operating system by new sales. While iPhones sell less than half the total number of Androids at 20.3 million units in Q2, see what I wrote in the above about a surge of iPhone for the second half of 2011 with the new iPhone 5 and quite possibly a cheaper iPhone model as well. Apple's iOS operating system suffers as an ecosystem in that it is exclusive to Apple only and consequently as the iPhone 4 is now a year old, the growth rate of the iOS (in smartphones, excluding the iPad and iPod Touch obviously, as this is a count only of smartphones) platform is slowing from Q1 when it was 18% to only half that, the 9% growth rate it is now. This means Apple is now growing only marginally faster than the market. I therefore give the iOS platform a grade for the first half of the year, of B.

SYMBIAN - 16% MARKET SHARE - DECLINING - GRADE F

In Symbian we are witnessing a spectacle, a death of a platform (and bizarrely, a death caused when it was the world's biggest platform and still growing, a death caused by its owners, Nokia and its new CEO Stephen Elop in probably the costliest management mistake ever made in business). Symbian declined not only Nokia smartphone sales, but after Stephen Elop's February 11 announcement of the end of Symbian, of course the last remaining partners in Symbian (mostly Japanese makers) have abandoned that ship too, most importantly NTT DoCoMo, Japan's biggest mobile operator who had been specifying Symbian for its phones for over a decade but now said it shifts to Android. The Japanese handset makers who supplied NTT DoCoMo obviously immediately followed suit. DoCoMo said a few months ago that half of all phones sold to its network by Christmas will be Android based. So Symbian saw a collapse of 31% of its sales in Q2, and when we add in the fact that the market grew by 7%, the real loss to Symbian was 38%. When you see your last loyal remaining platform partners abandoning the sinking ship, that is when its really all over for a platform. Stephen Elop caused this death, just weeks before his silly February 11 announcement, NTT DoCoMo had renewed its commitment to Symbian. Now Nokia is scuttling all possible parts that could help Symbian, from ending the migration path to MeeGo (via Qt), to terminating the Ovi branded app store to ending all Nokia sales of Symbian in North America etc etc etc. Symbian is a dead man walking now. Whatever Elop 'promised' to sell 150 million more Symbian smartphones back in February might not even reach half that level..  In Q4 of 2010, exactly two quarters ago, Symbian market share was 32%. So Symbian has lost half of its customers in six months. That is a record loss of customers. That is a grade of an F.

BLACKBERRY OS - 12% MARKET SHARE - DECLINING - GRADE D

RIM's Blackberry OS suffers from the same problem as the iPhone, that RIM won't license it to anyone else. The irony is that Nokia had asked to meet with RIM about Nokia licensing the Blackberry OS when Stephen Elop did his dealings with Android, Microsoft, Intel etc - and RIM said flatly no, they were not interested. I think with hindsight that will be seen as a mistake. Certainly Nokia would have been far better off even with poorly-performing RIM than with reseller sales boycott-ridden Microsoft. At least Blackberries even now sell 12x more than all Microsoft Windows Phone based smartphones added together. But even so, it would have been a marriage of two losers. And RIM didn't like the idea of being bossed about by the Finns over at Nokia. In a way RIM even benefitted, as now with the desperation moves by Nokia such as abandoning the alphabet-coded segmentation of Nokia phones - the E-Series was RIM's biggest rival globally - now Nokia's business and youth phones brands are severely weakened by this latest dumb move by Nokia HQ.

But as an operating system platform, RIM's Blackberry is no longer in growth, it saw its first quarter of actual declining sales and its market share has been declining since 2009, from its peak of 21% to the 12% it is now. There are no signs RIM can stop the bleeding either. In the past half year, the Blackberry OS lost two points of market share. I grade this suffering OS platform at a D.  

BADA - 5% MARKET SHARE - GROWING - GRADE A

So that was the top 4. Remember when Microsoft and Nokia talked of the Windows Phone platform being one of the big 3 platforms. That is obviously not happening. But in its shadow, there is the biggest new platform that is still growing strong. Grew 54% in just one quarter! Yes. Grew faster than Android (but from a smaller base). Who is that? Its Samsung's bada, its low-cost smartphone platform for Samsung's lower cost smartphones, by which it will migrate its featurephone users to Samsung branded basic smartphones. Samsung supports four operating systems, Android, bada, Microsoft's outgoing Windows Mobile and Microsof'ts new and incompatible Windows Phone OS. And Samsung didn't bother to tell us how it is selling in any of those, not even the total unit sales of smartphones for Q2. So its a lot of detective work and heavy math modelling to try to figure out how many Android phones were made by the other Android makers, to find out how many Samsung did. And then do the same for the two Microsoft operating systems. To find out what is the remaining bada number.

But I have done my maths several times over and am very confident that Samsung sold about 5.4 million bada smartphones in Q2. That is up 54% from Q1 when they sold 3.5 million. (Oh, if you felt you had not seen any bada phones, they tend to be marketed as the Samsung Wave lower-priced basic smartphones, that may ring some bells). In total for the first half, thus Samsung has sold 8.9 million bada-based smartphones, which is a little below their announced target of 10 million for the first half of this year. That is probably why we didn't hear the number from Samsung. That means I get a cumulative bada shipments since launch of 14.2 million which makes bada by a wide margin the best new OS launch for smartphones in history - yes faster than the iPhone, faster than Android. That means we cannot give bada anything less than a full A grade.

WINDOWS PHONE 7 - 1% MARKET SHARE - DECLINING - GRADE D-

And then we have the 'best' of Microsoft's two operating systems now, the infamous Microsoft Windows Phone 7, the operating system which Microsoft goofed massively by not providing a migration path to its developers from Windows Mobile. WinMo had at its peak over 12% market share. If Microsoft had done what it did with DOS and Windows - provided a migration path - then it could today easily have a market share close to 12% for the Windows Phone 7 OS. But while WinMo still lingers on, how is Windows Phone 7 doing? It saw its unit sales crash 31% from the 1.6 million smartphones in Q1 to 1.1  million in Q2. The market share of Windows Phone 7 is now globally at 1% (which is after we have removed the market share of Windows Mobile obviously, some analysts now count the two added together but as these are incompatible, I think it is wrong to count WinMo and WP7 in the same classification). When you have a 'hot' new OS that is optimized for touch screen phones and you have managed to anger your developers, and your handset makers all complain they can't do any sales on your OS - and now the resellers are in sales boycott (that is because Microsoft bought Skype and the carriers/operators hate Skype so they refuse to support any Microsoft sales. This story from June was just repeated in a fresh story in the San Francisco Chronicle this past week) - and as the smartphone market globally is in hypergrowth stage - if you cannot grow, something is seriously wrong. And it is. Microsoft is simply failing the smartphone market. If you lose 31% of your market share in one quarter, that is misery indeed. Its no wonder that Steve Ballmer refuses to even give us the count of Windows Phone now..  And yes, Microsoft, do bow your head in shame. This is another disgrace you are involved in with your mobile strategy. Shame on you! I grade Microsoft Windows Phone with a grade of D-.

MICROSOFT WINDOWS MOBILE - 0.5% MARKET SHARE - DECLINING - GRADE D+

And as a thorn in the side of Windows Phone 7, there is the old Windows Mobile that refuses to die. It still sells in modest numbers mostly to some business/enterprise users and while it also saw a big decline in sales - fell 28% from Q1, this is far less rapid a decline as its newer and supposedly better big brother, Windows Phone 7. But Windows Mobile is about to disappear from our radars, its market share is now under half of one percent, so if I round it off to full percentage points, its market share is rounded off to zero. It is nearly as irrelevant as Palm OS or Linux Mobile etc. I believe this is the last quarter we track WinMo but lets see what surprises Q3 brings us. Still, in its swan-song, WinMo still managed a slightly better score than its newer sibling, I grade Windows Mobile at a D+

And what about Palm ie WebOS that is now owned by Hewlett-Packard (a giant tech company as big as Nokia and Microsoft put together)? Or where is Maemo? MeeGo? LiMo etc. They are all so tiny they fall into the well below one half of one percent range, and do not deserve a paragraph and mention.. Sorry.

ANDROID SPLIT BY MANUFACTURERS

That was the operating systems for Q2. Finally, as I have been offering on this blog, I do the split of the major Android makers dividing the total Android pie of 49 million smartphones. This is rough only, but it should be reasonably accurate. I get the top 7 Android makers as follows:

MAKER . . . .
Samsung . . . . 12.2 M . . . 25%
HTC . . . . . . . . 11.7 M . . . 24%
LG . . . . . . . . .  5.3 M . . . 11%
SonyEricsson .  5.2 M . . . 11%
Motorola . . . . . 4.4 M . . . . 9%
Huawei . . . . . . 4.0 M . . . . 8%
ZTE . . . . . . . .  2.7 M . . . . 6%
Others . . . . . .  3.4 M . . . . 7%
TOTAL . . . . . . 49.0 M

Thats it, the smartphone bloodbath year 2, Electric Boogaloo, half-year report cards for all major brands. I will return with more analysis of this story as the second half of the year unfolds. Please note, I am now on my summer vacation so while I invite people to post comments on the blog, please don't worry that it may take a while for me to get back to respond. I will be responding in due time..

Enjoy and feel free to use the info and post links to this blog and send readers who want to know more about mobile phones and smarpthones from their market and platform angles. And if you need more info than this blog can provide, please see my TomiAhonen Phone Book 2010 and the TomiAhonen Almanac 2011 for more facts and data.

Comments

[n900lover]

Can't be that wp7 is at 1 % and losing share! It has tiles and customer satisfaction and xbox and developers and windows and apps and ms and bing and ecosystems and ... in short - it has everything!

[ejvictor]

I watched the Harvard smartphone usability study/shoot out between iOS, WP7, Android and BB (people who never used the UX were asked to do simple tasks) and was shocked as how bad the UX is in the majority of OS's for the "simple" core tasks of a mobile device who's primary function is to "communicate". I'm not a Nokia fanboy, I'm a functionality fanboy and I have to say that the functionality of "my choice OS" keeps confusing my peers in the United States.

Nokia may drive me backwards - becoming one of the tablet/dumb phone adopters (something I was doing back in 2008 with my N810 and 9300). Tabco or a MeeGo will become my primary device and voice calls and pictures will be the domain of my N8 (I believe that the N8 has the N82 effect going for it-such a solid phone that people will hold onto it for years bemoaning the fact than no other device has all its features and functions).

The total abandonment of the North American market to WP7 is pure corporate suicide and represents unimaginable poor judegment on managements part!!!

[Jax667]

Tomi,

Nokia reported 16,7 million sold Symbian units in Q2 2011 and Gartner lists 23,85 million Symbian units in that same quarter. Even Japanese models from NTT DoCoMo added which account usually for 3 million additional sales, this number can not be right. Did Symbian sell in Japan like hotcakes or is that a mistake of Gartner?

It would be very interesting to read your opinion on that matter. Thanks in advance.

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very interesting information! thanks a lot for sharing!

[SoVatar]

Gartner provides weird numbers for Nokia Smartphone sales (sales through to end users) in Q2.

http://www.gartner.com/it/page.jsp?id=1764714

I could not find a Gartner number that shows how many Smart Phones Nokia sold through in Q2, however there is a quote from a Gartner guy posted below.

Combining this info with other info available, it looks like Nokia in Q2 sold about 21.5 Million Smart Phones to consumers, sold about 16.5 Million Smart Phones into the channel. (Unsold) inventory delivered into the channel fell therefore by about 5 Million handsets.

If this is true, it means that reported Q1 sales are higher than reality (devices sold to end users), reported Q2 sales lower than reality. The steep decline of Nokia Smart Phone sales would be a little less steep, albeit still devastating for Nokia.

Here is the Gartner quote:

“The sales efforts of the channel, combined with Nokia’s greater concentration in retail and distributors’ sales, saw Nokia destock more than 9 million units overall and 5 million smartphones, helping it hold on to its position as the leading smartphone manufacturer by volume,” Gartner analyst Roberta Cozza said. “However, we will not see a repeat of this performance in the third quarter of 2011, as Nokia’s channel is pretty lean.”

http://allthingsd.com/20110811/nokia-remains-top-handset-maker-but-for-how-long/?reflink=ATD_yahoo_ticker

[SVE]

No N9 for Germany either. Add them to the UK and US list. http://engt.co/npM8zM

[Boris]

I had a dream two nights ago.

I dreamed that I read news about Nokia Q3 performance. They sold 6 million smartphones less than in Q2, and loss was 1,1 billion EUR.

P. S.
MSFT still hiding WP7 phones sales number. Shocked :-)).

[kevin]

Tomi,

Gartner reported Bada sell-through of just 2.1m units, which is way below your estimate of 5.4m. Any explanation?

[Endymion]

A facebook community seems to have started on the fire elop motto

http://www.facebook.com/pages/Stephen-Elop-GET-OUT-of-Nokia/212104365498135

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