A recent research report from Gartner claims that sales of mobile phones increased by nearly 20% year-over-year in the second quarter and the leading two makers of handsets increased their market share quite noticeably.

Worldwide mobile phone sales totaled 229 million units in the second quarter of 2006, a 18.3% increase from the same period last year. The research firm believes that mobile phone sales forecast is still on track to reach 960 million units in 2006, with 238 million units in the third quarter of 2006. The analysts believe that sales of cell phones in emerging markets were primary drivers for market growth in the quarter.

“While mobile operators in the mature markets of Western Europe and North America struggled to maintain the customer acquisition growth levels seen in previous quarters, but mobile operators in emerging markets continued to sign new customers driving handsets sales,” said Carolina Milanesi, principal analyst for mobile terminals research at Gartner, based in Egham.

Note: This table includes sales of integrated digital enhanced network (iDEN) terminals.
It excludes shipments from original design manufacturers to original equipment manufacturers.

Leading vendors Nokia and Motorola both grew their market share and accounted for more than half of the worldwide mobile phone sales in the second quarter of 2006. Nokia maintained its No. 1 position with a 33.6% market share, gaining two percentage points compared to the same period last year. Gartner stated that as Nokia starts to ship more feature-rich phones (such as the N72 and N73) in the third quarter of 2006, it needs to ensure that it can also cater for users who put fashion ahead of functionality and are looking for thin products.

Gartner believes that Motorola is a “big winner” in the quarter. The company achieved a market share of 21.9%, growing its market share by 4.2% year on year, the highest growth this quarter. Motorola maintained its lead in North America and Latin America and its No.2 position in other markets, according to Gartner, which expects the company to continue its share gain thanks to new phones, such as Motofone, Krzr and Rizr.

Samsung retained its No. 3 position but lost market share compared to the top two players. Sales reached 25.5 million units in the second quarter, approximately half of Motorola’s total sales this quarter. Lower sales in the home market coupled with weaker than expected demand in some key markets in Asia Pacific explained Samsung’s weaker performance. To grow market share in mature markets such as Western Europe and North America , Gartner said Samsung needs to match its high feature set with a more distinctive design.

Sony Ericsson regained the No.4 position with sales reaching 15.3 million units. “Sony Ericsson’s bet on music and imaging continued to pay back. 25% of their sales came from the Walkman branded devices and the first Cybershot phone K800 was also well received by consumers,” said Ms Milanesi.

LG Electronics lost 0.4 percent market share year on year and slipped into fifth place. “Although The Chocolate phone sold very well and helped to increase LG’s brand awareness globally, ‘one swallow does not make summer’. LG needs to bring to market more products from the Black Label series including a 3G offering, to win back and hold the fourth position,” added Ms Milanesi.