Windows Phone Thrives on BlackBerry Crumble

Could Windows Phones take on iPhones as BlackBerry fades?

Microsoft (MSFT) saw a huge jump in third-quarter smartphone shipments, sending out twice as many devices as it did in Q3 2012.

That’s the latest news from IDC, which broke down the numbers on smartphone shipments for Q3. IDC tracked the number of devices on each major operating system — Android, iOS, Windows Phone and BlackBerry — being shipped worldwide.

The report only tracked the number of new devices being shipped —  it doesn’t reflect the overall market share of smartphones — but it still offers insight into where consumer tastes are moving.

Google’s (GOOG) Android devices and Microsoft Windows Phones were the biggest winners in Q3. Android took a staggering 80% market share of new shipments, while MSFT devices jumped from 2% to 3.6%. Apple’s (AAPL) iPhones lost market share, but managed to increase shipments year-over-year. And BlackBerry (BBRY) dropped from 4.1% of overall shipments in Q3 2012 to a mere 1.7% this past quarter.

Mobile Phone Shipments Q313

So, what do these numbers tell us?

Most prominently, MSFT is swallowing BlackBerry’s market share. In Q3 2012, Windows Phones were shipping at half the rate of BlackBerry devices; in Q3 2013, they’re shipping at more than double BlackBerry’s rate. In fact, more Windows Phones shipped in the most recent quarter than BlackBerry devices did in last year’s Q3 (9.5 million vs. 7.7 million).

Microsoft came into this battle looking to knock BlackBerry off the third-place podium. Based on these shipment numbers, they’ve done it — thanks to Nokia (NOK). More than 90% of Windows Phone shipments were Nokia devices.

Meanwhile, Android continues to run away with market share: For every five smartphones shipped last quarter, four were Android devices. However, as IDC points out, low prices are the driving factor behind the growth in Android and Windows Phone devices — that leads to more devices sold (or, in this case, shipped), but could cramp margins.

Apple, on the other hand, seems content to slowly get more phones in the hands of consumers while maintaining higher profit margins. As of July, that model still made Apple the most profitable company in the smartphone industry, despite its declining market share. Unless the total install base of iPhone users starts to plummet, it’s difficult to imagine Apple cutting those prices just to chase market share.

Windows Phones aren’t going to eclipse Android devices any time soon. But as BlackBerry fades out of the picture, MSFT devices could at least start to chase Apple for market share, which could lead to more people taking Windows Phones a heckuva lot more seriously.

Adam Benjamin is an Assistant Editor at InvestorPlace. As of this writing, he did not hold a position in any of the aforementioned securities.

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