Nokia’s market share continues to slide

Nokia lost almost five percentage points of market share in the first quarter, research company Gartner said.

The company today announced the Lumia 925, it’s new flagship handset running Windows Phone 8.

Overall global sales figures for mobile phones rose 0.7% in the first three months of the year, driven by demand for smartphones and strong growth in the Asia-Pacific region, which helped to offset much weaker sales elsewhere.

Of the different vendors, Samsung took much of the gains, remaining in the number one position with a market share of 23.6%, ahead of Nokia on 14.8% and Apple on 9%. Nokia had held a 19.7% share just a year ago.

Those figures followed a 13% rise in sales by Samsung, a 16% increase by Apple, and a 24% fall by Nokia, compared with the same period last year.

“Although Nokia’s Windows Phone sales have sequentially improved, reaching a volume of 5.1 million units, Nokia is yet to see high growth in the smartphone segment,” Gartner said. “Nokia’s position in the smartphone market dropped to No. 10 in the first quarter of 2013, from No. 8 in the fourth quarter of 2012.”

Gartner said smartphones accounted for 49.3% of sales of mobile phones globally, up from 44% in the fourth quarter of 2012.

Feature phone woes

Worryingly for Nokia, however, Gartner said that overall sales of the cheaper feature phones were also slowing, as consumers kept hold of their phones for longer.

“Nokia’s mobile phone share dropped 4.9 percentage points in the first quarter of 2013 mainly due to a steep decline in feature phone sales,” said Gartner.

Feature phones such as Nokia’s Asha range are crucial to the company’s future as it defends its leading market share in emerging economies such as India and Africa, while struggling to keep up in the smartphone race.

“Feature phones users across the world are either finding their existing phones good enough or are waiting for smartphones prices to drop further,” said research analyst Anshul Gupta. “Either way the prospect of longer replacement cycles is certainly not a good news for both vendors and carriers looking to move users forward.”