Samsung Taking Smartphone Shares Worldwide

A new analysis of handset trends by Russian mobile service provider MTS shows how fast consumer preferences are changing in the handset area.

In the last year, for example, Nokia’s share among Russian customers fell from 47.5 percent to 27 percent, while Samsung’s share rose from 14.8 percent to 32.3 percent.

As has been seen elsewhere, Samsung is growing fast, while Nokia is sinking just as quickly. Nokia executives believe their new switch to the Microsoft Windows Phone operating system will reverse the slide, but the switch will take time, though time now is running against them.

Even if the Microsoft-powered devices change Nokia’s ability to market a smartphone that people want to buy in significant numbers, the company will be starting out from a low installed base, at a time when competitors such as Samsung are gobbling up share all over the world.

Samsung is the world’s largest smartphone manufacturer and user of Google’s Android operating system, leading in both smartphones and mobile handsets. The gains have been particularly pronounced, globally, since 2010.

Nokia is unfortunately a laggard in smartphones at a time when the devices are becoming the standard for mobile possessions. In the first quarter of 2012, smartphones accounted for 26.7 percent of total handsets sold in the Russian market – an increase of 9.3 percent year-over-year.The share of smartphone revenue for devices sold grew 60.9 percent in the first quarter of 2012 – an increase of 18.2 percent year-over-year.

Some even think that if Nokia survives as an independent company, it may never gain market share against the smartphone leaders, and will have to retrench as a supplier of basic feature phones.

In other words, Nokia might find it can continue only as a specialist supplier of devices with low costs suitable for many developing regions, selling a small number of smartphones, sure, but essentially without any hope of gaining share in the smartphone segment.

But Nokia will have to compete against competitors able to match its low prices, and may also field devices that outperform what Nokia can produce. That will be tough.

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