Motorola Set to Overtake Nokia?

July 27, 2006 - source: BWCS

US mobile phone maker Motorola is rapidly gaining ground on arch-rival Nokia in the handset selling stakes and could overtake it within 24 months, according to a new report by Strategy Analytics. For the time being the Finnish company dominates the global market for mobile terminals with a 33% share of all sales, however, Motorola's sales are said to be growing at a much faster rate than its competitors.

The US-based analyst house said that while Nokia's mobile phone sales grew by an impressive 29% last quarter, Motorola blitzed this with an astonishing 53% growth in its handsets sales. In recent years Nokia has concentrated on low-cost handset sales to developing markets such as China and India. However, its American rival is now beginning to ape this strategy with heavy investments in emerging markets, where, whilst profits are smaller, volumes are much higher. At the other end of the market Motorola is still doing very well with its Razr ultra-thin phones.

Meanwhile, perhaps in a sign that it is feeling the pressure, Nokia, has started legal action against two Chinese manufacturers and several distributors who have been selling replicas of its 7260 handset. The Finns are clearly keen to shore up their share of the world's fastest-growing market for mobiles.