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Welcome to Microsoft Pri0: That's Microspeak for top priority, and that's the news and observations you'll find here from Seattle Times reporter Sharon Chan.

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August 11, 2011 1:39 PM

Sales of Windows Phone drop in second quarter

Posted by Janet I. Tu

Worldwide sales of smartphones running Microsoft Windows Phone have dropped so much that they now lag behind sales of phones running Samsung's Bada, which are sold in the international and emerging markets.

Sales of phones running Microsoft's mobile operating systems (which includes primarily Windows Phone 7 but may include its predecessor, Windows Mobile), captured 1.6 percent of the market in the second quarter of 2011, according to technology company Gartner.

That's down from 4.9 percent of the market a year ago, even amid a 74 percent year-over-year increase in the sales of smartphones overall worldwide.

Google's Android operating system captured 43.4 percent of the market, coming in first and up from 17.2 percent a year ago. Nokia's Symbian was second with 22.1 percent, but it was a sharp drop from its 40.9 percent a year ago. Apple's iOS came in third with 18.2 percent, up from 14.1 percent last year.

Research In Motion (RIM) came in fourth, and Samsung's Bada fifth. Microsoft was sixth.

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"Google and Apple are the obvious winners in the smartphone ecosystem," Gartner said in its news release for its report "Market Share: Mobile Communication Devices by Region and Country, 2Q11." (The report is available for purchase at Gartner's website.)

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"The combined share of iOS and Android in the smartphone operating system (OS) market doubled to nearly 62 percent in the second quarter of 2011, up from just over 31 percent in the corresponding period of 2010," Gartner said.

Microsoft didn't fare much better in the North American market. Its sales declined significantly in the second quarter, falling into the very low single digits, said Gartner analyst Hugues De La Vergne.

That's even as the North American smartphone market experienced a record quarter as sales reached 24.7 million units, exceeding sales of non-smartphones for the first time, De La Vergne said.

Microsoft is expected to launch an updated version of Windows Phone, codenamed "Mango," sometime later this year.

De La Vergne thinks that will help Microsoft but "obviously, competition is extremely fierce. The only real opportunity that Microsoft has right now is through its partnership with Nokia," which will use the Windows Phone platform on its smartphones going forward.

"But we don't really see that paying any significant turnaround until the second half of 2012, when we will see Nokia with a full portfolio of devices addressing all price tiers and all market segments," De La Vergne said.

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