Nokia Signs Smartphone Deal with Microsoft as Market Share Falls

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Global smartphone sales are expected to hit 468 million units in 2011. (Photo:
Global smartphone sales are expected to hit 468 million units in 2011. (Photo:


  • Nokia signs smartphone partnership deal with Microsoft; plans to scrap Symbian OS platform
  • Nokia Q1 2011 profits fall 1.4% to $503 million – much better than expected; its global market share drops to 29%
  • Apple posts record unit sales of 18.6 million iPhones and $11.9 billion in profit for Q1

Finnish mobile phone company Nokia is connecting with Microsoft in a partnership that is expected to boost its diminishing market share.

The deal between the smartphone and software giants comes as Nokia posted a 1.4% fall in profit to $503 million for the first quarter of 2011. The figures were better than expected though, with initial forecasts predicting much lower earnings, or even a loss in Q1.

Nokia still sells the most mobile handsets in the world, but smartphone rivals and cheaper models are taking large chunks out of its lead. Global market share has fallen to 29% – a 4% decrease and the first time in ten years that it has been below 30%.

Apple Profits Soar 95%

In comparison to Apple, whose quarterly profits leapt 95% year-on-year, the figures reveal the extent of the damage caused by the Finnish company’s sluggish response to smartphone competitors.

Apple has now overtaken Nokia as the world’s biggest seller of mobile phones in terms of revenue, with record unit sales of 18.6 million iPhones and almost $12 billion in profits, according to consultants at Strategy Analytics.

In 2012, Nokia will scrap its Symbian OS platform, on which all its current smartphones are based, and adopt Microsoft’s Windows Phone 7 software. This move will allow Nokia to cut costs by as much as $1.5 billion per year.

Key Players – Smartphone Industry

  • Apple (iPhone – iOS 4)
  • Research in Motion (Blackberry 6 OS)
  • Samsung (Galaxy S – Android OS)
  • HTC (Sensation – Android OS)
  • Microsoft (Windows Phone 7 OS)
  • Sony Ericsson (Xperia X10 – Android OS)
  • Nokia (N8 – Symbian OS)
  • Huawei (IDEOS X6 – Android OS)

Key Statistics - Global Smartphone Industry (source: Gartner)

  • Global smartphone sales will top 468 million units in 2011, up almost 58% on 2010.
  • By 2015, 67% of smartphones will have an average price tag of $300 or less.
  • Android will become most widely used OS in 2011 and will have almost 50% of worldwide market by 2012.
  • Apple iOS will hold on to second spot through 2014.
  • Nokia-Windows Phone partnership will make Microsoft’s Mobile OS third largest by 2013.
  • Research In Motion market share will decrease as the consumer market becomes more competitive.

By James Mulholland for
James Mulholland is a Paris-based internet and broadcast journalist specializing in sports, current affairs and technology news, while also freelancing as a photographer.

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