Motorola trails Samsung in global market

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Motorola lost its second spot in the global mobile handset market to Samsung in the third quarter, according to data released on Tuesday, as the US company focused on returning to profit instead of market share.

Motorola’s share of the global mobile phone market fell to 13.1 per cent in the three months to the end of September, compared with 20.7 per cent a year ago and 14.6 per cent in the second quarter of 2007, according to figures from Gartner, the research firm. Meanwhile, Korea’s Samsung edged up to 14.5 per cent from 12.2 per cent last year and 13.4 per cent in the previous quarter.

Finland’s Nokia underlined its global dominance, increasing its share by 3 percentage points to 38.1 per cent year-on-year – its highest quarterly share to date – and up from 36.9 per cent in the second quarter.

“Motorola today is a pale version of the company it was a year ago,” said Carolina Milanesi, research director at Gartner.

Motorola saw strong sales in 2005 and 2006 thanks to its ultra-slim Razr phone, which sold more than 50m units, but has struggled to find new products with the same popularity.

The latest version of Motorola’s best-seller, the Razr2, has been well received and sold 900,000 units in the quarter, but Motorola needs a wider portfolio of products to compete with its rivals, Ms Milanesi said. She added that Motorola was unlikely to regain a 20 per cent market share in the next 12 months.

Ed Zander, chief executive of Motorola, has promised to return the handset business to profitability by next year and is turning down business in emerging markets, where volumes are high but margins are low. Rivals such as Nokia, however, have seen strong growth in these areas.

Nokia’s strong volume growth means it is close to reaching its stated goal of 40 per cent market share. The Finnish handset maker also continues to dominate in the smartphone segment of the market, with 57 per cent market share, compared with less than 10 per cent for its nearest rival, Research in Motion, maker of the Blackberry.

Apple, which entered the smartphone segment with its iPhone in June, sold 1.4m units in the US in the third quarter. Total global smartphone sales reached 27.4m in the same period. Apple has targeted 10m iPhone sales in 2008, which is likely to make a clear number two in the segment behind Nokia.

iPhone sales were not launched in Europe until the fourth quarter.

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