Smartphone Holiday Sales Look Strong

While overall retails sales on “Black Friday,” Nov. 27, were lackluster, and mobile phone sales for 2009 will be down slightly, smartphone providers are looking at a strong holiday season. The winners include Apple Inc., whose iPhone continues to be a popular stocking-stuffer, and the Motorola Inc. Droid, which runs on the open-source Android operating system from Google Inc. and is marketed by Verizon Wireless.

Equity analysts fanned out to Apple retail stores across the country and reported strong, if unspectacular, results not only for the iPhone but for a range of Apple devices.

“Demand for Apple products has started the holiday season well,” wrote Deutsche Bank analyst Chris Whitmore, as reported on Tech Trader Daily (under the smashing headline “Apple Retail Stores Packed...With Analysts”). Macs, iPhones and iPods all sold well, and the Apple stores “enjoyed heavy traffic throughout the holiday weekend,” Whitmore added, with the iPod Touch a particular bright spot.

Apple offered rare discounts for one day on Friday, cutting prices between 5 percent and 11 percent on selected products. Shoppers for the iPod Classic and the iPhone weren’t offered deals.

Also enjoying strong pre-Christmas results was Samsung, which has already exceeded its sales goal for 2009. The smartphone device maker, the world’s No. 2 provider of mobile devices, broke the 200 million mark earlier this month.

Research firm Wireless Expertise said that even with overall sales of mobile handsets sliding because of the recession, smartphone sales will continue to grow, reaching 423 million in 2013, from 165 million this year. That’s a 27 percent annual growth rate.

Apple, Samsung, BlackBerry-maker Research in Motion(RIMM), Sony Ericsson and Nokia(NOK) will continue to see smartphone growth. The real market driver, though, may be Android: Gartner recently forecast the open-source platform to overtake the iPhone by 2012, with almost 500 million phones running on Android by then.

In need of a strong 2009 holiday season is Windows Mobile. Sales of devices running on Windows Mobile declined sharply in the third quarter this year, and Microsoft(MSFT), which recently released WM version 6.5, has spent several years and hundreds of millions of dollars on the mobile version of its dominant desktop OS, only to see it languish in fourth place with around 8 percent market share. Some analysts have predicted that Windows Mobile 7.0, when it comes out, will be the last version of the beleaguered operating system.

By comparison Android, which has begun to appear on a significant number of devices only in the last few months, already has 3.5 percent of the total smartphone market, said Gartner.

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