Motorola Loss of Market Share Not Due to Apple iPhone

RedHerring reports that Motorola sold 39.4 million cell phone handsets in the second quarter of 2007, to hold on to 14.6% of global market share. With that, Motorola holds on to its title as the world’s second largest cell phone manufacturer, though its share dropped significantly from the 21.9% global share it had the previous year. Samsung, the world’s third-largest cell phone brand, came close to overtaking Motorola with 13.4% of the global market.

Unlike Motorola and Samsung, Nokia actually increased its global market share last quarter; the Finnish cell phone maker gained 3% on its existing market dominance by selling nearly 1 billion phones — in emerging markets as well as established markets in Western Europe – to a Q2 total of 36.9% of total worldwide unit sales.

Dropping popularity of the three-year old RAZR cell phone certainly has something to do with Motorola’s drop, but it would be premature also to blame Motorola’s dropping market share on the popularity of Apple’s iPhone — the Apple iPhone did not play a role in Q2 market share shifts since the iPhone only launched two days before the end of the quarter. That means the established cell phone brands aren’t going to feel the effects of the iPhone’s popularity until third quarter’s numbers are released.

Analysts do not expect the upcoming release of the RAZR2 to help Motorola recapture its 20% share of the worldwide market in the third quarter since, initially at least, the RAZR2 will not be free. The $0 (and in some cases cash back deals) on the first-generation Motorola RAZRs helped fuel huge demand for those models.