Global mobile phone sales total 1.75 billion units with a -1.7% Y-o-Y decline in 2012 according to Gartner, the first WW market decline since 2009. 

“Tough economic conditions, shifting consumer preferences and intense market competition weakened the worldwide mobile phone market this year,” the analyst remarks. 

Feature phone demand was weak during both Q4 2012 and 2012, with Q4 sales dropping by 19.3% Y-o-Y to 246.4 million units. Gartner predicts feature phone sales will fall further in 2013, replaced by smartphones as market driver. 

The past year was a healthy one for smartphones-- Q4 2012 smartphones sales reach a record of 207.7m units with 38.3% Y-o-Y growth. Gartner predicts overall 2013 smartphone sales will make "close to" 1bn from overall mobile phone sales of 1.9bn units. 

Unsurprisingly smartphones remains in the firm clutches of the Apple-Samsung duopoly, which holds 52% share of the Q4 2012 market (up from 46.4% in Q3 2012).

“There is no manufacturer that can firmly lay claim to the No. 3 spot in global smartphone sales,” Gartner says. “The success of Apple and Samsung is based on the strength of their brands as much as their actual products. Their direct competitors, including those with comparable products, struggle to achieve the same brand appreciation among consumers, who, in a tough economic environment, go for cheaper products over brand.” 

Samsung is the biggest smartphone and overall mobile phone maker, with Q4 2012 mobile phone sales amounting to 384.6m units (of which 53.5% are smartphones). Gartner attributes such success to the strength of the Galaxy brand, now something of a synonym to Android phones (it commands 42.5% of Android share) for consumers. 

Competition against Samsung should intensify in 2013, with competitors such as Sony and Nokia improving their smartphone offerings. 

Meanwhile Q4 2012 Apple sales total 43.5m with 22.6% Y-o-Y growth (or 130m for 2012), even if customers appear to prefer the less expensive iPhone 4 and 4S models to the iPhone 5. 

Strong international sales propel Huawei to 3rd biggest global smartphone vendor. The company sells 27.2m smartphones in 2012 (up by 73.8% from 2011), and premium models such as the Ascend D2 and Mate should boost Huawei brand perception as a premium smartphone maker in 2013.

Once the biggest mobile maker in the world, Nokia continues to struggle in 2012 with global mobile market share of just 18%, a new low for the company according to Gartner.  Nokia smartphone sales for 2012 total 39.3m units with a -53.6% decline, as Windows Phone devices (Lumia and Asha) fail to fill the gap Symbian left. 

When it comes to operating systems, Android holds 69.7% of the Q4 2012 market with 87.8% Y-o-Y growth, widening the gap with iOS (20.9% Q4 share) further.  BlackBerry share contracts to 3.5% (from 8.8% in Q4 2011), while Windows Phone grows by a slight 1.2% Y-o-Y to 3% as Microsoft-powered smartphone sales grow by 124.2% Y-o-Y. 

“2013 will be the year of the rise of the third ecosystem as the battle between the new BlackBerry10 and Widows Phone intensifies,” Gartner concludes. “As carriers and vendors feel the pressure of the strong Android’s growth, alternative operating systems such as Tizen, Firefox, Ubuntu and Jolla will try and carve out an opportunity by positioning themselves as profitable alternatives.” 

Go Gartner Market Share Analysis: Mobile Phones, WW, Q4 2012 and 2012