Gartner report also shows Apple and Samsung increased market share to take 52 per cent of global smartphone sales.
Global mobile phone sales reached 1.75 billion units last year, representing a 1.7 per cent dip on 2011 sales, a new Gartner study has revealed.

Smartphones led the way in terms of overall mobile phone sales, with Q4 of 2012 seeing record smartphone sales of 207.7 million units – a 38.3 per cent rise on the same period in 2011.

The study suggests that sales of worldwide smartphones to end users will be close to one billion units in 2013, while overall mobile phone sales to end users are predicted to reach 1.9 billion units.

“The last time the worldwide mobile phone market declined was in 2009,” said Anshul Gupta, principal research analyst at Gartner. “Tough economic conditions, shifting consumer preferences and intense market competition weakened the worldwide mobile phone market this year.”

Q4 2012 saw Apple and Samsung strengthen their domination over the international smartphone market to 52 per cent from 46.4 per cent in Q3.

Samsung saw the year out at the top of the market in both global smartphone and mobile phone sales, notching up 64.5 million smartphone units - up 85.3 per cent from the fourth quarter of 2011.

In 2012, Samsung totalled 384.6 million mobile phones sales, of which 53.5 per cent (up from 28 per cent in 2011) were smartphone sales.
Meanwhile, Apple reached sales of 43.5 million units in the Q4 of 2012, rising 22.6 per cent year-on-year. In 2012, Apple totalled 130 million smartphone sales across the globe.
While the demand for iPhones in the fourth quarter remained strong, consumers’ demand veered toward the less expensive iPhone 4 and 4S models. The launch of the iPad Mini also presented users with a dilemma when deciding whether or not to upgrade an iPhone 4 or iPhone 4S to an iPhone 5, or buy the new tablet.
Elsewhere, Huawei enjoyed a successful fourth quarter as it took third place among smartphone vendors for the first time. In 2012, the manufacturer sold 27.2 million smartphones to end users, representing a leap of 73.8 per cent from 2011. Both the Ascend D2 and Mate, which were announced at this year’s Computer Electronics Show (CES), are aimed at growing the firm’s brand perception as a premium product and increase its mobile phone margins. Gartner analysts said international markets are crucial for Huawei’s growth in 2013, as well as being able to improve its product mix to a higher tier.
“There is no manufacturer that can firmly lay claim to the No. 3 spot in global smartphone sales,” said Mr. Gupta. “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.”
The fourth quarter also saw sales of Nokia handsets begin to rise, following a positive response to its Asha mobile phones and Lumia Windows Phone 8 models. However, this was not enough to prevent the firm from losing ground in the market, plummeting to an all-time low market share of 18 per cent.
Gartner's studyalso found that the dwindling demand for feature phones failed to pick up any momentum last year, with total sales dropping 19.3 per cent year-on-year; a trend that Gartner predicts will continue in 2013.