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iPhone Only Reason Smartphone Segment Is Growing

Sales of the iPhone have been close to meteoric in some markets, a fact that is bolstering overall numbers for the smartphone market in the face of sluggish performances from the iPhone’s competitors. In fact, if the iPhone didn’t exist, the smartphone market would be in decline.

That’s according to a new report from Needham & Co. analyst Charles Wolf.

Worldwide, Apple’s market share saw an uptick while Nokia, RIM and Microsoft Corp. all saw declines. Meanwhile, in the United States the iPhone is eating away at BlackBerry and Palm. In fact, the iPhone tripled its market share in the third quarter to reach 30 percent, erasing most of RIM’s lead in the process.

According to Wolf, the 7 million iPhones Apple shipped in the third quarter made up the total growth for the smartphone segment for that period.

Wolf wrote: “Apple’s iPhone 3G, introduced in July, is the only reason smartphone growth did not slow in September. Apple shipped almost 7 million iPhones in the quarter, accounting for all of the sequential shipment growth in the quarter and then some. However, 2 million iPhone sales represented carrier channel fill (which IDC reports as sales). In its absence, smartphone sales growth would undoubtedly have decelerated in September. We believe growth in the smartphone market will likely slow yet again in the December quarter despite the recent introduction of compelling new smartphones. Research In Motion has led the parade with three new models, along with the T-Mobile G1 running on Google’s Android operating system. However, the industry faces a major headwind in the form of a recession whose depth and duration is unknown.”


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