"PC guys are not going to just figure this out. They're not going to just walk in." So said former Palm CEO Ed Colligan back in 2006, when asked about Apple's chances in the smartphone market. But four years later, not only has Palm been subsumed into the gaping maw of HP -- with Colligan himself long gone -- but Apple's flying up the charts. On Thursday, market research firm IDC released its latest data on the worldwide phone market for the third quarter of 2010 and Apple now holds fourth place in terms of sales.
That's a big jump for the company, which had previously not broken the top five; IDC attributes the move to the increased popularity of smartphones, bolstered by Apple's release of the iPhone 4 during the quarter. No longer on the list? SonyEricsson, missing for the first time since 2004.
The shift of the mobile phone market towards smartphones has not yet impacted the bottom line of market leader Nokia, which still shipped far and away the most phones during the quarter--110 million to second place Samsung's 71 million--but IDC also notes that the company's average selling price dropped to €136 from €190 in the same quarter last year and that the company's unit shipments grew only 2 percent year over year. While Nokia claims that the lower prices are due to aggressive competition in the market, it also does tend to suggest that much of the company's volume comes from cheaper conventional handsets.
Despite holding the fourth spot, Apple lags fairly far behind the top three in overall units, selling less than half as many phones as third-place LG. However, its jump into the top five did squeeze it past BlackBerry-maker RIM, which it outsold by about 1.7 million units. That jibes with comments made by Apple CEO Steve Jobs during the company's most recent financial results call, in which he said "We've now passed RIM, and I don't see them catching up with us in the foreseeable future." Apple also posted the most significant growth rates of any of the manufacturers in the top five, registering a 90.5 percent increase year over year, bolstering its market share to 4.1 percent from 2.5 percent. In the grand scheme of things, that may still be rather small, but it's impressive nonetheless for a company that makes essentially a single phone.
It's a little harder to see the state of Apple's major competitor in the smartphone platform, Android, due to the fragmented nature of the platform, but both second-place Samsung and third-place LG sell Android handsets in their mix. IDC notes that like the iPhone, Android has seen gains in Asia/Pacific, North America and Western Europe, mostly at the expanse of conventional phones from manufacturers like Nokia, and certain models of Android devices have also gained traction in Latin America.
With the smartphone market clearly being the segment of mobile phones to watch, all eyes will be on IDC's worldwide smartphone market figures, due next week.
Disclaimer: IDC and Macworld are both owned by IDG.