Thu, Nov 23, 2006 - Page 11 News List

Nokia, Motorola widen market lead

BLOOMBERG

Nokia Oyj and Motorola Inc, the world's largest mobile-phone makers, widened their lead in the third quarter over Samsung Electronics Co as demand in Asia helped increase unit sales by 22 percent.

Nokia's market share rose to 35.1 percent from 32.5 percent a year earlier, Stamford, Connecticut-based researcher Gartner Inc said in a release. Motorola rose to 20.6 percent from 18.7 percent, and Samsung fell to 12.2 percent from 12.5 percent.

As a result of increases for Nokia and Motorola and the growth in Asia, Gartner raised its full-year sales forecast to 986 million units from its previous forecast of 960 million units. Lower-priced phones in Asian countries including China, India, Vietnam, Pakistan and Bangladesh helped sales expand from last year's total of 817 million.

"If you look at where you had the biggest growth, you had Asia grow 54 percent," Carolina Milanesi, principal research analyst at Gartner, said in an interview. Companies paid "more attention to the emerging markets and so having more, cheaper phones on the market is obviously driving sales."

Espoo, Finland-based Nokia increased its market share in every region except North America. The company regained the top spot in Latin America after losing it to Motorola a year ago, Gartner said. Nokia sold 88.1 million units in the quarter.

"Although Nokia has been criticized for lacking in the mid-tier, they still have the widest portfolio," Milanesi said. The companies that made large gains were able to "tap into those regions that are not saturated."

Schaumburg, Illinois-based Motorola also lost ground in other markets, including Western and Eastern Europe, the Middle East and Africa, Gartner said. Motorola sold 51.9 million units.

While Seoul-based Samsung lost market share, the company kept its No. 3 position by increasing sales, though at a slower pace than Nokia and Motorola.

"If you look at the vendors in the third quarter, Samsung was back," Milanesi said. She said Samsung struggled in the first half of the year. She said the 30.6 million units sold by Samsung was a "healthy" sales figure.

Sony Ericsson Mobile Communications, in fourth place, increased sales and won market share to 7.7 percent from 6.7 percent. In the No. 5 spot was LG Electronics Inc, with a market share falling to 6 percent from 6.5 percent. LG is suffering because it isn't offering enough different phones, Milanesi said.

BenQ Corp (明基), Taiwan's biggest cellphone maker, also lost market share, falling to 2.4 percent from 4.7 percent after the company stopped funding its German handset business. In September, BenQ's German unit filed for bankruptcy protection.

There are lots of "little things" that will change the mobile industry in the fourth quarter and into next year, Milanesi said. "Definitely there's a change in respect to content playing a bigger role" and the addition of more Internet applications on phones, she said.

In the fourth quarter there will be a "bigger focus" on music, Milanesi said.

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