Though the announcement that Microsoft will be buying Nokia's devices and services unit was not surprising, the move is now placing pressure on other smartphone manufacturers. It is expected that Windows Phone will become an exclusive Microsoft platform, changing little in the Windows Phone market, but perhaps creating demand for other smartphone operating systems.
While Nokia has taken much criticism for its strategy of being number one in the smaller Windows Phone market while ignoring the crowded Android sector, the strategy seems to have paid off for the company. In addition to its acquisition, Nokia's Lumia smartphones seem to have attracted a growing number of smartphone users.
Kantar Worldpanel this weekend revealed sales numbers showing that Windows Phone sales are actually rising throughout Europe. Numbers for the U.K., Germany, France, Spain, and Italy show that Windows Phone market share has risen to a full 8.2% of the smartphone market. Windows Phone is also making waves in Mexico, where Kantar says it captured 11.6% of smartphone sales during the past three months.
The Kantar report states that most of the growth in Windows Phone sales is coming from first-time smartphone buyers. Also, low-priced handsets from Nokia are predicted to go over well in emerging markets, where other analysts have predicted major smartphone growth in the coming years.
“Windows Phone’s success has been in convincing first time smartphone buyers to choose one of its devices with 42% of sales over the past year coming from existing featurephone owners," said Dominic Sunnebo, a strategic insight director at Kantar. "This is a much higher proportion than Android and iOS. The Lumia 520 is hitting a sweet spot, offering the price and quality that new smartphone buyers are looking for.
“Feature phone owners present a huge opportunity, representing more than half of all mobile users globally and this will be the new battleground over the next year. With the iPhone 4 and lower-end or older Samsung Galaxy models selling well among first time smartphone owners, there is plenty of competition for these customers. The brands that win in this segment will be those that understand and address the needs of consumers in terms of price, content, and quality.”