Smartphone market feeling economic pinch

The mobile phone industry is not immune to the ill winds of the economy, experiencing its weakest quarter of year-on-year growth in the third quarter of this year.

So says analyst Gartner, whose figures suggest that worldwide smartphone sales for the period stood at just 36.5 million units down 11.5 per cent compared to the same quarter in 2007.

"The current economic climate is negatively impacting sales of higher end devices," said principal analyst Roberta Cozza in a statement. "Going forward, we should expect the smartphone device market to continue to grow but at a slower pace. Although leading mobile operators are subsidising more smartphones, to reach lower prices they tie the device to two year contracts with monthly data plan rates which remain too expensive for the mainstream user."

Despite the bleak figures, Nokia continued to hog the top spot with 42.4 per cent market share during the quarter although it did experience a three per cent decline year-on-year.

"Nokia is feeling the pressure from increased competition in the consumer smartphone market. The company introduced solid Nseries products with top features, but its lack of a commercial touch-screen device in its smartphone portfolio prevented Nokia from capitalising from consumer demand for this feature," added Cozza.

"The recently announced N97 is a much needed evolution for the n9x series of products. It is unfortunate that the device will not be available before the first half of 2009 as this is a competitive product in today's market."

Apple managed to slip back into its number three position by nabbing 12.9 per cent of the market, while boasting channel shipment sales of near to seven million during the quarter.