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Smartphones 'out sell' PCs for first time

The new personal computer

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The smartphone is the new personal computer of choice.

According to the device counters at IDC, makers of smartphones shipped 100.9 million devices in the fourth quarter of 2010, an 87.2 per cent increase from the 53.9 million units that were consumed in the final quarter of 2009. For the first time, smartphones have surpassed PCs in terms of number of units shipped in a quarter. In Q4 2010, with the PC market recovered but losing some steam, PC makers shipped 92.1 million units, a year-on-year increase of only 5.5 per cent.

For the full year, consumers and businesses together bought 302.6 million smartphones, up 74.4 per cent from the 173.5 million units that went out the door in 2009. PC still reigned supreme for the full year, however, with a total of 346.2 million units shipped in 2010, up 13.6 per cent over 2009's levels.

Nokia was still the top maker of smartphones in 2010, but its growth is fading compared to Apple, whose iPhone is growing share like a weed. Nokia, which is apparently in the midst of a massive management shakeup, cranked out 28.3 million smartphones in Q4, rising 36.1 per cent over the prior year. But that was less than half the growth rate of Apple, which shot up by 86.2 per cent to 16.2 million units, bypassing Research in Motion to take the number two spot in smartphones. RIM came in third in Q4, with 36.4 per cent growth, to 14.6 million units sold.

Samsung nearly quadrupled its smartphone sales to 9.7 million units, and HTVC nearly tripled its sales to 8.6 million devices in the quarter to take the number four and five positions in the market. Other smartphone makers pumped out 23.5 million units, rising 147.4 per cent and nearly twice as fast as the overall market, showing that this expanding market has room for new entrants.

The PC business has been contracting for the past decade, but ironically, vendors outside of the top five, in aggregate, have a larger piece of the PC pie (at around 40 per cent of shipments, depending on the quarter) than other smartphone makers outside the top five vendors have of their pie (around a quarter of shipments).

While Linux has not been much of a driver on the desktop and has done well only on the server where Unix laid the foundation of administrators and professionals get paid to manage systems, Linux has taken off like crazy on smartphones in the form of Android. And the reason is simple: the way smartphones work, you have no idea what the operating system is and you don't care. As a user, you think at the app level and rarely go much deeper.

"Android continues to gain by leaps and bounds, helping to drive the smartphone market," explained Ramon Llamas, senior research analyst with IDC's mobile phone technology and trends team, in a statement accompanying the figures. "It has become the cornerstone of multiple vendors' smartphone strategies, and has quickly become a challenger to market leader Symbian. Although Symbian has the backing of market leader Nokia, Android has multiple vendors, including HTC, LG Electronics, Motorola, Samsung and a growing list of companies deploying Android on their devices."

IDC says that the new Windows Phone 7 operating system from Microsoft accounted for 1.5 million units in the fourth quarter, and the new Symbian^3 operating system being championed by Nokia had 5 million shipments. Llamas says that the holidays are over and now Nokia and Microsoft have to sustain their ramps for all of 2011 to keep pace with iOS and Android. ®

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