MOTOROLA Inc may lose its No. 1 spot in US mobile-phone sales this year as consumers abandon its handsets for more advanced models, research firms IDC and Strategy Analytics said.
Motorola's share of the US market fell to 25 percent in the first quarter, according to data from IDC. South Korea's LG Electronics Co and Samsung Electronics Co each expanded their share to 21 percent, while Apple Inc gained on sales of its iPhone, IDC analyst Ramon Llamas said.
At this pace, the company that created the mobile-phone market 25 years ago and maker of the Razr handset will cede the top spot in the US, the only region it leads, before the end of 2008, Llamas said. Buyers in Europe and Asia already have switched to LG touch-screen phones and Nokia Oyj devices offering satellite navigation, leading to a 33-percent slump in Motorola's worldwide phone sales last year.
"The US, their bread and butter, is not immune anymore to their problems," Llamas told Bloomberg News during a phone interview from IDC's headquarters in Massachusetts. "Samsung and LG have come out swinging with great products and received a very good reception from most US carriers."
In the first quarter of last year, Motorola had 37.7 percent of the US market, while Samsung had 16.6 percent and LG had 16.3 percent, Neil Mawston, an analyst at Boston-based researcher Strategy Analytics, said. He said Motorola would probably lose its US lead in the second half of 2008.
Under pressure from billionaire investor Carl Icahn, Motorola Chief Executive Officer Greg Brown said in March that the company would split off the money-losing phone unit to focus on profitable television set-top boxes, two-way radios and wireless-networking equipment. The phone business had lost more than US$1.5 billion since the start of 2007.
Motorola climbed 13 cents to US$9.90 yesterday in New York Stock Exchange composite trading.
The shares had dropped 38 percent this year before today, compared with a 6 percent drop in the Standard & Poor's Information Technology Index.
Motorola plans to introduce more products in the second half, followed by phones with improved features next year, spokeswoman Jennifer Erickson said in an e-mail.