Microsoft Windows Phone Shipments Leap In Third Quarter, Phablet Sales On The Rise (MSFT)

Shipments of Microsoft’s (NASDAQ:MSFT) Windows Phone leapt from 3.7 million to 9.5 million in the third quarter, overtaking BlackBerry (NASDAQ:BBRY) for third place in worldwide smartphone shipments, according to analysis from research firm IDC. Sales of larger smartphones, or phablets, also rose to one of every five shipped, up to 21 percent from just 3 percent in the same quarter in 2012, according to the report.

Eighty-one percent of smartphones shipped in the third quarter of 2013 ran the Android operating system from Google (NASDAQ:GOOG), while iPhones running Apple’s (NASDAQ:AAPL) iOS fell from 14.4 percent to 12.9 percent. Apple’s losses in market share do not reflect a fall in sales, however, as overall shipments rose from 26.9 million to 33.8 million. Overall smartphone volumes rose in the third quarter to 261.1 million, up from 186.7 million in 2012.

While Microsoft’s Windows Phone still lags behind operating systems from Apple and Google, its third-place success comes at the expense of BlackBerry, which last week failed to find a buyer willing to take the Canadian handset maker private, and ousted CEO Thorsten Heinz. For the Windows Phone, 93.2 percent of shipments came from Nokia, which Microsoft plans to acquire early in 2014.

"Android and Windows Phone continued to make significant strides in the third quarter. Despite their differences in market share, they both have one important factor behind their success: price," Ramon Llamas, IDC research manager, wrote in the release.

Sales of lower-priced handsets from Android hardware partners, which represent four out of the top five smartphone manufacturers worldwide, plus Windows Phone devices from Nokia, continue to drive the market, according to IDC. Average smartphone prices fell to $317, down from $356 in 2012. While shipments of phablets rose, which tend to cost more than standard smartphone, their average price also fell from $573 to $443 in the third quarter.

Android market share topped 80 percent for the first time in the third quarter, as Apple struggles to gain a foothold in countries like China and India, where low-cost devices make up the majority of sales.