iPhone 4S Vaults Apple Into First Place Globally, As Smartphones Outsell Personal Computers in 2011

Canalys reports in its full, detailed Q4 2011 country-level smart phone shipment estimates to clients, that 488 million smartphones shipped in 2011, easily outpacing 415 million client PC (and that’s including ‘pads) shipments last year in rounded figures.

Vendors shipped 158.5 million smartphones in Q4 2011, up 57% on the 101.2 million units shipped in Q4 2010. This bumper quarter took total global shipments for the whole of 2011 to 487.7 million units, up 63% on the 299.7 million smartphones shipped throughout 2010. By comparison, the global client PC market grew 15% in 2011 to 414.6 million units, with 274% growth in pad shipments. Pads accounted for 15% of all client PC shipments in 2011.

In 2011 we saw a fall in demand for netbooks, and slowing demand for notebooks and desktops as a direct result of rising interest in pads, says Chris Jones, Canalys VP and Principal Analyst. But pads have had negligible impact on smartphone volumes and markets across the globe have seen persistent and substantial growth through 2011. Smartphone shipments overtaking those of client PCs should be seen as a significant milestone. In the space of a few years, smartphones have grown from being a niche product segment at the high-end of the mobile phone market to becoming a truly mass-market proposition. The greater availability of smartphones at lower price points has helped tremendously, but there has been a driving trend of increasing consumer appetite for Internet browsing, content consumption and engaging with apps and services on mobile devices.

Canalys’s market research competitor International Data Corporation (IDC) says the worldwide mobile phone market grew 6.1% year over year in Q4 2011, with the feature phone market declining faster than anticipated, dragging market growth down to its lowest point in over two years. According to the IDC Worldwide Mobile Phone Tracker, vendors shipped 427.4 million units in 4Q11 compared to 402.8 million units in the fourth quarter of 2010. The 6.1% year-over-year growth was higher than IDC’s forecast of 4.4% for the quarter, but weaker than the 9.3% growth in 3Q11.

“The mobile phone market exhibited unusually low growth last quarter, which shows it is not immune to weaker macroeconomic conditions worldwide,” observes Kevin Restivo, senior research analyst with IDC’s Worldwide Mobile Phone Tracker. “The introduction of high-growth products such as the iPhone 4S, which shipped in the fourth quarter, bolstered smartphone growth. Yet overall market growth fell to its lowest point since 3Q09 when the global economic recession was in full bloom.”

For its part, Canalys expects smartphone market growth low in 2012 as vendors exercise greater cost control and discipline, and put more focus on profitability. Notably, even vendors who have focused on conquering the low-end of the market with aggressive pricing, such as Huawei, ZTE and LG, are now turning more attention on the higher end of the market, which is Apple’s market domain. Canalys expects flagship models aimed at raising selling prices and improving margins will feature more heavily this year.

Indeed, Apple’s impressive end to 2011 resulted in it becoming both the leading smartphone vendor as well as client PC vendor (when iPads are included) in Q4 2011, shipping a whopping 37.0 million iPhones plus 15.4 million iPads and 5.2 million Macs. Canalys notes that Apple also smashed the all-time record for the most smartphones shipped globally by any single vendor in one quarter, beating Nokias previous record of 28.3 million shipped in Q4 2010. Moreover, Apples performance meant that it displaced Nokia, for the first time, as the leading smartphone vendor by annual shipments. Apple shipped 93.1 million iPhones in 2011, representing growth of 96% over 2010.

IDC’s metrics show Apple jumping into the third spot globally from fifth spot lin QA3 ’11 thanks to its record-breaking 4th quarter shipments, and scoring the company’s highest-ever ranking on IDC’s Top 5 global mobile phone leaderboard. The launch of the iPhone 4S, available in over 90 countries as of mid-January, was the primary reason the company leapt over LG and ZTE in 4Q11 IDC says. Canalys attributes some of the iPhone 4s’s strong performance to pent-up demand resulting from the launch coming in October rather than June, but Apples overall volume was also boosted by continued shipments of the more aggressively priced iPhone 4 and 3GS models. IDC reports that the iPhone 4S was particularly well-received in Australia, Hong Kong, Korea, and Taiwan.

However, Samsung finished 2011 in a strong second place, shipping 35.3 million smartphones in Q4 2011 under its own brand, and bringing its total to 91.9 million for the year, compared to just 24.9 million in 2010. That metric also excludes shipments of rebranded products, such as the Nexus S and Galaxy Nexus, which Canalys counts under the Google brand.

Nokias smartphone performance in the fourth quarter was less spectacular, the company shipping 19.6 million smartphones, a 31% decline from the record high of a year earlier, but still up 17% on Q3 2011, aided by 1.2 million and 0.6 million shipments of its Windows Phone and MeeGo-based products respectively, Nokia’s total smartphone shipments for the year came in at 77.3 million globally.

Its first Windows Phone products, the Lumia 800 and 710, along with the recently announced Lumia 900 through AT&T in the US, have improved the outlook for Nokia, comments Canalys Senior Analyst, Tim Shepherd. They are well-designed, competitive devices that demonstrate innovation is still alive within Nokia. But the battle is not over and it has huge challenges ahead. Nokia must continue to build out its Lumia portfolio with devices tailored to address all price points and all the markets in which it aims to compete. It must hasten its transition from Symbian to Windows Phone around the world and, with Microsoft, promote and generate excitement for the platform and new products. And it must succeed in attracting more developers to build high quality, locally relevant apps.

Hard-luck BlackBerry-maker RIM ended 2011 as still the fourth largest smartphone vendor with annual unit growth of 5%. At the platform level, Android accounted for 52% of global smartphone shipments in Q4 2011, with iOS runner-up representing 23% and Symbian 12%. Android was also the leading smartphone platform by volume for the whole year, accounting for 49% of all devices shipped in 2011, well ahead of iOS with its 19% share and Symbian with 16%. Collectively, Android smartphone shipments grew 149% year on year in Q4 2011 to 81.9 million units, resulting in a total of 237.8 million for the full year, up 244% on 2010.

comScore’s MobiLens service reported last week that Apple continued to gain ground in the U.S. mobile subscriber market in September with a 12.4 percent share of total U.S. mobile subscribers (up 2.2 percentage points), compared with Samsung at 25.3 percent, LG with a 20 percent share Motorola just slightly ahead of Apple at a 13.3 percent share, and RIM rounding out the top five with a 6.7 percent share.

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