Apple overtakes RIM, Microsoft in smartphones

Apple's iPhone 3G passed Research In Motion's (RIM) BlackBerry to take second place in third-quarter global smartphone rankings, according to a report by market researcher Canalys.

Apple also edged out Microsoft in smartphone OSs, the report said.

A record high 39.9 million smartphones were shipped globally in the July through September period, up 28 percent over the same time last year, according to Canalys. Smartphones now represent 13 percent of the total mobile handset market, up from 11 percent in the second quarter.

The devices, which combine computing functions of a personal digital assistant (PDA) with a mobile phone, have gained popularity as companies offer new functions, such as on board cameras, music players, touchscreens and speedier Web browsing.

Nokia retained its lead in smartphones but lost significant market share during the quarter due to heavy competition from Apple and third place RIM. The Finnish company shipped 15.5 million smartphones in that period, down slightly from last year as its market share fell to 38.9 percent from 51.4 percent.

Apple shipped 6.9 million smartphones, up from just 1.1 million the same time last year. That was enough for a market share of 17.3 percent, compared to 3.6 percent last year.

"It was expected that Apple would figure among the smart phone leaders this quarter, with that huge initial new product shipment, it was just a question of how high up it would be -- and this is impressive," said senior Canalys analyst Pete Cunningham, in a statement.

RIM shipped 6.1 million smartphones during the quarter, followed by 2.3 each for Motorola and fifth place High Tech Computer (HTC).

HTC was the only non-Western smartphone vendor among the top five in the third quarter. The Taiwanese company has won acclaim for its Touch Diamond line of touchscreen smartphones, as well as working with Google's Android software to develop the G1 handset now being sold by T-Mobile USA. Sales of G1 handsets were not included in this survey because the devices were not yet on sale in the quarter.

The Canalys report also highlighted Apple's growth in mobile phone OSs.

Although Nokia's Symbian OS retained its market dominance, the Apple OS took a chunk of its market and posted a huge year on year growth rate.

Symbian shipped in 18.6 million smartphones in the third quarter, down 12.4 percent compared to last year. The Apple OS, by contrast, shipped in 6.9 million handsets, growing 523 percent over last year.

RIM came in third to Apple with its OS in 6.1 million smartphones, up 83.5 percent compared to a year ago, Canalys said. Microsoft's Windows Mobile OS grew 42.9 percent year-on-year to 5.4 million and Linux was the OS for 2.0 million smartphones, up 49 percent compared to last year.

Canalys noted that creating new mobile phone technology, such as Maps programs, has become critical due to competition in the smartphone business.

"You also need to be able to integrate them seamlessly into the device to provide a great total user experience," said analyst Tim Shepherd. "And that means having sufficient control of development of the operating system, which Apple and RIM clearly have already. Nokia's acquisition of Symbian should help it in this regard, regardless of what other Symbian Foundation members choose to do."

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