1 billion smartphones ... and counting

Worldwide sales of smartphones to end users had a record fourth quarter of 2014 with an increase to 367.5 million units, according to Gartner, Inc, taking the total number of smartphone sales in 2014 to 1.2 billion units.  After three years in the top spot, Samsung was beaten by Apple in the global smartphone market.

"Samsung's performance in the smartphone market deteriorated further in the fourth quarter of 2014, when it lost nearly 10 percentage points in market share," said Anshul Gupta, principal research analyst at Gartner. "Samsung continues to struggle to control its falling smartphone share, which was at its highest in the third quarter of 2013. This downward trend shows that Samsung's share of profitable premium smartphone users has come under significant pressure."

"With Apple dominating the premium phone market and the Chinese vendors increasingly offering quality hardware at lower prices, it is through a solid ecosystem of apps, content and services unique to Samsung devices that Samsung can secure more loyalty and longer-term differentiation at the high end of the market," said Roberta Cozza, research director at Gartner.

Apple's first ever large-screen phones continued to see huge demand with sales in China and US. The new iPhone 6 and iPhone 6 Plus drove strong replacements within the iOS base and also offered new users, who are looking for larger-screen phones, a strong alternative to Android.

Q4 of 2014 saw Lenovo (which includes sales of mobile phones by Lenovo and Motorola) move to the no. 3 spot in the global smartphone market, reaching 6.6% market share. Lenovo enjoyed strong sales in its home market, China, as well as Russia, India, Indonesia and Brazil.

Chinese vendors, such as Huawei and Xiaomi, are continuing to improve their sales in China and other overseas markets, increasing their share in the mid-to-low-end smartphone market. "Chinese vendors are no longer followers," said Cozza. "They are producing higher quality devices with appealing new hardware features that can rival the more established players in the mobile phone market. Brand building and marketing will be key activities in deciding which Chinese vendors can secure a foothold in mature markets."

The availability of smartphones at lower prices accelerated the migration of feature phone users to smartphones pushing the smartphone operating system market to double-digit growth in most emerging countries, including India, Russia and Mexico. This trend continued to benefit Android, which saw its market share grow. Chinese and other smaller players drove Android's performance in 2014, while more established players at the higher end of the market continued to struggle to increase stickiness to their brands and ecosystems. Windows Phone's performance was flat but it recorded strong results in some markets in Europe, and in the business segment.

Worldwide mobile phone sales to end users totalled nearly 1.9 billion units in 2014, with smartphones representing around two-thirds of those sales