Mobile phone maker Sony Ericsson moved closer towards being one of the top three phone providers in the industry, as its revenue edged ahead of rival Samsung.

Revenue for the fourth quarter for joint-venture between Japan's Sony and Sweden’s Ericsson was up 31 percent to $4.98. Rival Samsung Electronics had reported in its most recent quarterly report that its mobile phone unit earned slightly less as it fell to the fourth position on $4.7 billion revenue.

However, South Korea-based Samsung sold 6 million more units than Sony Ericsson, which benefited from higher average prices.

We believe that SE [Sony Ericsson] with its 9.2 percent unit share, and revenues 8% higher and operating profits 89 percent higher than Samsung (32mn units) in Q4 is on the path to becoming the global No. 3 handset company, said Sandeep Malhotra, an analyst at Merrill Lynch.

The venture lost money the first two years following its inception in 2001, but turned around with the introduction of phones with cameras and music players, some of which use Sony’s Walkman brand.

Earlier investments in R&D and marketing have enabled us to expand the portfolio and strengthen the brand to increase consumer and operator appeal, said Miles Flint, President of Sony Ericsson.

Sony-Ericsson sold 75 million phones in 2006. Walkman branded phones represent 17 million, or 23 percent, of all phones sold. Another 60 million phones are music enabled. In comparison, Apple sold 39 million iPod in its 2006 fiscal year.