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Apple: From Zero to 17.1 Percent Smartphone Share in 2.5 Years

by John Paczkowski
Posted on November 13, 2009 at 7:05 AM PT

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steveWiphoneLest there be any doubt that Apple’s iPhone is redefining the smartphone market, consider this: In less than two and a half years, the device has managed to claim nearly a fifth of the worldwide market for smartphones.

According to new data released this week by Gartner, Apple shipped some 7.04 million iPhones in the third quarter–up from just 4.72 million phones in the same period a year ago–for a 17.1 percent share of the market (see table below; click to enlarge).

That’s a 49.2 percent year-over-year increase in sales and it puts Apple (AAPL) in spitting distance of Research in Motion (RIMM), which also posted close to a 50 percent year-over-year gain to claim 21 percent of smartphone sales during the period.

With 39 percent of smartphone sales, Nokia (NOK) was the top seller during the period, and it’s clearly not ceding its spot any time soon. But RIM might, given the small gap between its market share and Apple’s.

In any case, RIM clearly has a fight on its hands as we head in the holidays, especially if Apple brings an 8GB iPhone 3GS to market in the next few weeks.

gartner

UPDATE: According to Apple’s last earnings announcement, the company said it shipped 7.4 million iPhones during the quarter. Why there’s a discrepancy between the company’s numbers and Gartner’s isn’t clear.

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  • joel verreault
    Umm...Did anyone read the article when a title was chosen?

    How is Apple gaining on RIM?

    According to the stats you provided:

    in Q3 08 RIM sold 1 Million more phones than Apple
    in Q3 09 RIM sold 1.5 Million more phones than Apple

    in Q3 08 RIM had 3% more market share than Apple
    in Q4 09 RIM had 3.7% more market share than Apple

    If I remember my lessons from Grover on Sesame Street (gratz on being 40 Sesame Street) then Im pretty sure those stats say Apple is lagging RIM in growth. NOT GAINING.

    I am pretty sure a bigger number means they are further apart, not closer.
  • You're absolutely right. Headline adjusted accordingly.
  • Bill Simpsen
    In Q2 2007, Apple had ZERO market share.

    You can pick a quarter in which it appears RIM is pulling away. I can pick a 2.5 year span which shows that RIM sees a steamroller in its rear view mirror.

    I think the original headline was fine.
  • Bob Borchers
    Also, has anyone checked Gartner's definition of a smartphone? In the Nokia number I am pretty sure they are counting anything running Symbian regardless of how it used/sold. I would guess that many of the "smartphones" counted for Nokia are sold and used as voice terminals only. Perhaps it is time for the analyst world to rethink what constitutes a "smartphone"
  • Actually, if you click through the link above, you'll see that Gartner does distinguish between smartphone and "mobile terminal" sales.
  • Stuart Fan
    I think Google is likely to eventually prevail and vanquish Apple, just as Microsoft did with PC. Open system rules, be it in PC or SmartPhone. The same guy Steve Jobs decided to keep Mac a closed system has decided to keep iPhone a closed system - he just cannot let go of the extra profits on the hardware side and may lose big in the long run. This game is not over yet and iPhone does not have a 90% share of the Smartphone market and probably will never get there.
  • Ken Cheng
    Recently, David Pogue has dubbed phones like Droid, iPhone, etc., as AppPhones, to separate them from Smartphones like all those Symbians etc.
  • Ken Cheng
    @Stuart, do you mean "open" like how Linux prevailed on the desktop? Or are you talking some other kind of "open?" It's not like MS was ever "open." And, with over 100k apps, how is making the iPhone "open" going to make it any better? Does anyone besides true believers make buying decisions based upon openness?

    As for "90% share of the Smartphone market" who ever said that was Apple's goal? Sounds a bit like a strawman argument to me. Apple is already the most profitable cellphone manufacturer, let alone most profitable smartphone manufacturer.
  • Bob Borchers
    John -

    Gartner separates the "feature" phones from "smartphones" but my point was that even within the smartphone category I think Gartner includes many devices that would not meet our modern definition of "smart". Or put another way, these devices do not compete with Blackberry, iPhone, Android, etc.
  • Again, marketshare will matter very little in the overall scheme - Apple is targeting and will get the 70% market share of full price smartphones - with subsidies, Apple is having no trouble selling and making $600-$700 in revenue plus itunes sales. RIM is giving away a phone with everyone you buy in the US - certainly they are not making $600+ PER SALE. Nokia might on certain phones but how many do they sell at that price - literally a handful? And Android will definitely rule the roost of $49 smartphones so like the Ipod market and the Pc market ... Apple will simply rule the best spot - the solid volume-high margin arena ... the BEST place to be. Being number #1 overall with 2% margins is a short term business. Why won't Android be high value? can't - with 50 companies selling "Andreoid," phones, the only competition is price. We are already seeing Andreoid price drops and of course, GOOGLE makes zero for every phone sold. They hoope to sell ads on it down the line but with the iPhone holding 80% mobile web browsing?
  • Bill Simpsen
    Joe has it right. Apple is already the most profitable cell phone company in the world. It would take a tremendous shift in market share or pricing to change that.

    An HP exec recently lamented that they have to ship a pallet of netbooks to match the profit of one MacBook. Nokia is in the same position. Market share of devices or revenues is not the same as market share of profits.
  • Stuart Fan
    Ken,

    Open OS means Apple allows every handset maker that wants to adopt its OS to license its OS. I am much more willing to bet Google on the future since any handset makers that want to adopt Android can become a licensee. Apple's business model failed with the Mac before and there is no indication it will be any different this time and mind you, this is not only my view. More important, IT managers that make decisions at most corporations will likely to stick with RIM since iPhone does not provide the necessary system security for them.
  • Fred Hamranhansenhansen
    > How is Apple gaining on RIM?

    Apple is accelerating faster. The iPhone was at zero a few years ago when RIM was pretty much where they are now.
  • Turley Muller
    John-

    the discrepancy between the 7.4M number and Gartner's 7M is likely due to shipments vs sell-through. Apple said channel inventory increased by about 400k units so I believe Gartner backs that number out and just reports sell-through estimates
  • Apple release just one model. but It's sold more than N97, HTC diamond and more.

    Great Apple. I love iphone
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About John

John Paczkowski has been poking fun at the tech industry and the personalities that drive it since 1997. From 1999 to 2007, he wrote the award-winning tech news Web log Good Morning Silicon Valley for the San Jose Mercury News, Silicon Valley's daily newspaper. Read more »

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